BILL ANALYSIS Ó
SENATE COMMITTEE ON
ELECTIONS AND CONSTITUTIONAL AMENDMENTS
Senator Ben Allen, Chair
2015 - 2016 Regular
Bill No: AB 594 Hearing Date: 7/7/15
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|Author: |Gordon |
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|Version: |6/29/15 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Darren Chesin |
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Subject: Political Reform Act of 1974: campaign statements
DIGEST
This bill eliminates certain campaign reporting requirements and
makes other changes to thresholds and reporting requirements
pursuant to the Political Reform Act of 1974 (PRA).
ANALYSIS
Existing law :
1)Provides that any person or combination of persons who
directly or indirectly does any of the following is considered
a "committee" for the purposes of the PRA:
a) Receives contributions of $1,000 or more in a calendar
year (these committees are commonly known as "recipient
committees");
b) Makes independent expenditures of $1,000 or more in a
calendar year (these committees are commonly known as
"independent expenditure committees"); or,
c) Makes contributions totaling $10,000 or more per year
to, or at the behest of, candidates or committees (these
committees are commonly known as "major donor committees").
1)Requires candidates, political committees, and slate mail
organizations to file specified periodic and activity-based
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campaign finance reports, including semiannual statements,
pre-election statements, supplemental pre-election statements,
and late contribution/independent expenditure reports that
include specified campaign finance information.
2)Defines "late contribution" as either of the following:
a) A contribution, including a loan, that totals $1,000 or
more in the aggregate and that is made to or received by a
candidate, controlled committee, or committee primarily
formed or existing primarily to support or oppose a
candidate or measure within 90 days before the date of the
election at which candidate or measure is to be voted on;
or,
b) A contribution, including a loan, that totals $1,000 or
more in the aggregate and that is made to or received by a
political party committee within 90 days before a state
election.
1)Defines "late independent expenditure" as an independent
expenditure that totals $1,000 or more in the aggregate and
that is made for or against a specific candidate or measure
involved in an election within 90 days before the date of the
election.
2)Requires a "late contribution" or a "late independent
expenditure," as defined, to be publicly reported within 24
hours of the time that it is made or received, as specified.
This bill :
1)Revises the definition of recipient committee by increasing
the qualifying monetary threshold from $1,000 to $2,000 for
contributions received by a person or combination of persons.
2)Clarifies that a contribution or an independent expenditure of
$1,000 or more that is received or made on Election Day is a
"late contribution" or a "late independent expenditure" that
is required to be reported within 24 hours of having been
received or made.
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3)Eliminates supplemental pre-election and supplemental
independent expenditure reporting requirements.
4)Requires all pre-election reports to be filed pursuant to the
same schedule, instead of having a slightly different schedule
for pre-election reports that are filed in connection with
statewide elections held in June and November of even-numbered
years.
5)Eliminates the requirement for city general purpose committees
to file pre-election reports if they do not receive
contributions of $1,000 or more.
6)Makes corresponding and technical changes.
BACKGROUND
Periodic and Activity Based Reports . Under the PRA, there are
two general types of reporting requirements. The first type of
report is commonly referred to as a periodic report. Periodic
reports must be filed according to a specified time schedule for
all similarly-situated candidates and committees, regardless of
the amount of campaign activity during the period of time
covered by the report. These reports generally include all
campaign activity (contributions, loans, expenditures, etc.)
that occurred over a specified period of time. Semi-annual
reports and pre-election reports are two examples of periodic
reports that are required under the PRA.
The second type of report that the PRA requires is an
activity-based report. An activity-based report is triggered
when a candidate or committee has campaign activity that meets
or exceeds a specific dollar threshold. Late contribution
reports and late independent expenditure reports are examples of
activity-based reports.
This bill seeks to eliminate two types of special activity-based
reports in an effort to streamline the campaign reporting
process. The reports that would be eliminated are supplemental
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pre-election statements and supplemental independent expenditure
reports. Due to modifications made to campaign limits and
disclosure requirements after these reporting requirements were
established, these special activity-based reporting requirements
no longer serve their original purposes.
Supplemental Pre-election Statements . Existing law requires a
recipient committee to file a supplemental pre-election
statement if it makes contributions of $10,000 or more in
connection with an election for which the committee otherwise
would not be required to file pre-election statements. This
reporting requirement, which was created in 1985, was designed
to ensure that a committee that is making significant
contributions in an election is required to disclose its donors
prior to the election.
For example, if an individual made a $50,000 contribution to a
state general purpose committee a month before a legislative
special election, and the state general purpose committee then
used those funds to make a $50,000 contribution to a candidate
who was running in that special election, the supplemental
pre-election statement ensured that the state general purpose
committee was required to disclose the $50,000 contribution it
received from the individual prior to the special election.
At the time the supplemental pre-election statement requirements
were put into law, there were no contribution limits for
elections for state office. As a result, the requirement to
file supplemental pre-election statements was an important tool
to ensure that the true source of significant campaign
contributions to candidates was disclosed prior to the election.
Since that time, however, Proposition 34 of 2000 imposed
contribution limits for elections for state office, and many
local jurisdictions have enacted local contribution limits. As
a result, it has become relatively uncommon for committees to
meet the $10,000 threshold that requires filing a supplemental
pre-election statement.
Supplemental Independent Expenditure Reports . Existing law
requires a candidate or committee that makes independent
expenditures of $1,000 or more in a calendar year in connection
with an election to file a supplemental independent expenditure
report at the same times and in the same places as the committee
would be required to file campaign statements if it were
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primarily formed to support or oppose the candidate or measure
that it supported or opposed with the independent expenditure.
This reporting requirement, which was created in 1985, was
designed to ensure that a committee that is making significant
independent expenditures in an election is required to disclose
its donors prior to the election. Since the requirement for
supplemental independent expenditure reports was enacted into
law, however, disclosure laws have been amended to require
similar information to be reported within 24 hours whenever a
committee makes independent expenditures of $1,000 or more in
the last 90 days before an election. Since it is rare for
independent expenditures to be made more than 90 days before the
election, supplemental independent expenditure reports largely
have become duplicative of other reports that are filed in a
timelier manner.
Date Changes . Under existing law, pre-election reports are
filed on a slightly different timeline for elections held on the
first Tuesday after the first Monday in June or November of
even-numbered years than for elections held at other times. The
deadline for the first pre-election report for an election held
on the first Tuesday after the first Monday in June is always
March 22, and the report is required to cover campaign activity
through March 17.
For elections held on the first Tuesday after the first Monday
in November, the deadline for the first pre-election report is
always October 5, covering all activity through September 30.
For elections held at other times, the deadline for the first
pre-election report is the 40th day before the election,
covering all activity through the 45th day before the election.
The second pre-election report is always due on the 12th day
before the election, covering all activity through the 17th day
before the election, regardless of when the election is held.
This bill standardizes the schedule for filing pre-election
reports so that the first pre-election report is always due by
the 40th day before the election, covering all activity through
the 45th day before the election, regardless of when the
election is held. As a result, the first pre-election report
for elections on the first Tuesday after the first Monday in
June of even-numbered years will be due between April 23-29
(depending on the exact date of the election) instead of on
March 22, and the first pre-election report for elections on the
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first Tuesday after the first Monday in November of
even-numbered years will be due between September 23-29
(depending on the exact date of the election), instead of on
September 30.
City General Purpose Committees . This bill eliminates the
requirement for city general purpose committees to file
pre-election reports in connection with an election if the
committees are not recipient committees (that is, if they do not
receive contributions of $1,000 or more). Generally, state and
county general purpose committees are required to file
pre-election reports only if they are recipient committees. The
pre-election report is intended to ensure that a committee must
report the donations that it receives prior to an election, if
the committee is making contributions or independent
expenditures in connection with that election. State and county
general purpose committees that are not recipient committees --
that is, committees that make independent expenditures or
contributions, but that do not receive contributions -- are not
required to file pre-election reports. Those committees'
pre-election activities typically will be disclosed on other
reports (including through late independent expenditure reports
and late contribution reports). This bill extends the same
policy to city general purpose committees.
COMMENTS
1)According to the author : I have long believed in the purposes
of California's Political Reform Act and its goal of enabling
a knowledgeable electorate. This includes helping voters
become fully informed as they make decisions that will impact
the governance of this state. For this reason, it is
essential that there is a fair, efficient, and effective means
of holding entities involved with campaigns accountable for
violations of the law. AB 594 would streamline some
provisions of the Political Reform Act to reduce redundancy
and improve accountability. It would also modernize a
reporting threshold in line with the original thresholds.
Overall, the bill would make small, but meaningful reforms to
the Political Reform Act, while maintaining the highest
ethical standards.
This bill would adjust some of the thresholds to file and remove
redundant filings. Specifically, AB 594 would:
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a) Eliminate duplicative reports.
This bill would repeal provisions that currently require
"supplemental pre-election statements" and "supplemental
independent expenditure reports." These statements were
intended to disclose contributions received and independent
expenditures made shortly before the election. However,
when AB 481 (Ch. 496, Stats. 2012) extended the 24-hour
reporting period from 16 days to 90 days, supplemental
pre-election statements and supplemental independent
expenditure reports became duplicative and can be
eliminated without sacrificing disclosure or transparency.
b) Provide updated and relevant monetary threshold for
triggering as a "committee" subject to registration and
reporting.
This bill would increase the recipient committee
qualification threshold from $1,000 to $2,000. This
threshold has not been updated since 1987. Adjusting for
inflation, the threshold change proposed in the bill is in
line with what the original qualification thresholds. This
change will update the outdated threshold in a manner that
balances the ability of a candidate to run a grassroots
campaign with the burdens imposed once he or she qualifies
as a committee. Moreover, should a local government
believe that the new qualification thresholds are higher
than they wish; nothing in the bill would impact the
ability of a local government to apply a lower threshold.
c) Clarify and simplify reporting requirements for 24-hour
reports filed 90 days before the election.
This bill would clarify that reports required to be filed
within 24-hours during the 90- day period prior to the
election includes the election date itself.
d) Clarify and simplify requirements for reports filed
before the election, while still maintaining relevant and
timely disclosure.
This bill would make the law easier to understand and comply
with, and tie reporting requirements to the relevant
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upcoming election.
RELATED/PRIOR LEGISLATION
SB 1442 (Lara) of 2014 would have required most state candidates
and campaign committees to file quarterly campaign reports,
instead of semi-annual campaign reports, would have eliminated
requirements for committees to file certain activity-based
reports (including supplemental pre-election statements and
supplemental independent expenditure reports), and would have
required the development of a new Internet-based campaign
finance reporting and disclosure system.
SB 1442 was vetoed by Governor Brown, who stated in his veto
message that it would be premature to adjust the campaign
reporting schedules until a new campaign finance disclosure
system was in place, and who argued that the Secretary of
State's office should complete two existing information
technology projects before beginning to replace the existing
campaign finance disclosure system.
PRIOR ACTION
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|Assembly Floor: |77 - 0 |
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|Assembly Appropriations Committee: |17 - 0 |
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|Assembly Elections and Redistricting | 5 - 0 |
|Committee: | |
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POSITIONS
Sponsor: Author
Support: California Forward Action Fund
California Special Districts Association
Fair Political Practices Commission
Santa Clara Valley Water District
Oppose: None received
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