BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON
          ELECTIONS AND CONSTITUTIONAL AMENDMENTS
                              Senator Ben Allen, Chair
                                2015 - 2016  Regular 

          Bill No:             AB 1083        Hearing Date:    6/16/15    
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          |Author:    |Eggman                                               |
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          |Version:   |3/26/15                                              |
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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:  local enforcement

           DIGEST
           
          This bill permits the City Council of the City of Stockton and  
          the Fair Political Practices Commission (FPPC) to enter into an  
          agreement that provides for the FPPC to enforce a local campaign  
          finance ordinance passed by the City Council of the City of  
          Stockton.

           ANALYSIS
           
          Existing Law:

          1)Creates the FPPC, and makes it responsible for the impartial,  
            effective administration and implementation of the Political  
            Reform Act (PRA). 



          2)Requires a local government agency that adopts or amends a  
            local campaign finance ordinance to file a copy of the  
            ordinance with the FPPC. 



          3)Prohibits a local government agency from enacting a campaign  
            finance ordinance that imposes campaign reporting requirements  
            that are additional to or different from those set forth in  
            the PRA for elections held in its jurisdiction unless the  







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            additional or different requirements apply only to the  
            candidates seeking election in that jurisdiction, their  
            controlled committees or committees formed or existing  
            primarily to support or oppose their candidacies, and to  
            committees formed or existing primarily to support or oppose a  
            candidate or to support or oppose the qualification or passage  
            of a local ballot measure which is being voted on only in that  
            jurisdiction, and to city or county general purpose committees  
            active only in that city or county, respectively. 



          4)Authorizes the FPPC, until January 1, 2018, upon mutual  
            agreement between the FPPC and the San Bernardino County Board  
            of Supervisors, to have primary responsibility for the  
            impartial, effective administration, implementation, and  
            enforcement of a local San Bernardino County campaign finance  
            reform ordinance. Requires the San Bernardino County Board of  
            Supervisors to consult with the FPPC prior to adopting and  
            amending any local campaign finance reform ordinance that is  
            subsequently enforced by the FPPC. 



          5)Authorizes the FPPC, pursuant to the aforementioned agreement,  
            to investigate possible violations of the San Bernardino  
            County campaign finance reform ordinance and bring  
            administrative actions against persons who violate the  
            ordinance, as specified. 



          6)Permits the San Bernardino County Board of Supervisors and the  
            FPPC to enter into any agreements necessary and appropriate  
            for the operation of these provisions, including agreements  
            for reimbursement of state costs with county funds, as  
            specified.  Permits the San Bernardino County Board of  
            Supervisors or the FPPC, at any time, by ordinance or  
            resolution, to terminate any agreement for the FPPC to  
            administer, implement, or enforce the local campaign finance  
            reform ordinance or any provision thereof. 











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          7)Requires the FPPC to report to the Legislature with specified  
            information on or before January 1, 2017, if the FPPC enters  
            into such an agreement with the San Bernardino County Board of  
            Supervisors. 

          This bill:

          1)Provides that, upon mutual agreement between the FPPC and the  
            City Council of the City of Stockton, the FPPC is authorized  
            to assume primary responsibility for the impartial, effective  
            administration, implementation, and enforcement of a local  
            campaign finance ordinance passed by the City Council of the  
            City of Stockton. Provides that the FPPC is authorized to be  
            the civil prosecutor responsible for the civil enforcement of  
            such an ordinance. Provides that as the civil prosecutor, the  
            FPPC may do both of the following: 
             a)   Investigate possible violations of the local campaign  
               finance reform ordinance; and,
             b)    Bring administrative actions in accordance with the PRA  
               and the administrative adjudication provisions of the  
               Administrative Procedure Act. 

          2)Requires any local campaign finance reform ordinance of the  
            City of Stockton that is enforced by the FPPC to comply with  
            the PRA. 

          3)Requires the City Council of the City of Stockton to consult  
            with the FPPC prior to adopting and amending any local  
            campaign finance reform ordinance that will be enforced by the  
            FPPC. 

          4)Permits the City Council of the City of Stockton and the FPPC  
            to enter into any agreements necessary and appropriate to  
            carry out the provisions of this bill, including agreements  
            pertaining to any necessary reimbursement of state costs with  
            city funds for costs incurred by the FPPC in administering,  
            implementing, or enforcing a local campaign finance reform  
            ordinance pursuant to the provisions of this bill. 

          5)Prohibits an agreement entered into pursuant to the provisions  
            of this bill from containing any form of a cancellation fee,  
            liquidated damages provision, or other financial disincentive  
            to the exercise of the right to terminate the agreement,  
            except that the FPPC may require the City Council of the City  








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            of Stockton to pay the FPPC for services rendered and any  
            other expenditures reasonably made by the FPPC in anticipation  
            of services to be rendered pursuant to the agreement if the  
            City Council of the City of Stockton terminates the agreement.  


          6)Permits the City Council of the City of Stockton or the FPPC  
            to terminate, at any time, by ordinance or resolution, any  
            agreement made pursuant to this bill for the FPPC to  
            administer, implement, or enforce a local campaign finance  
            reform ordinance or any other provisions thereof.

          7)Requires the FPPC, if an agreement is entered into pursuant to  
            the provisions of this bill, to report to the Legislature on  
            or before January 1, 2019, and submit that report in  
            compliance with current law.  Requires the FPPC to develop the  
            report in consultation with the City Council of the City of  
            Stockton. 

          8)Requires the report to include, but not be limited to, all of  
            the following: 


             a)   The status of the agreement; 


             b)   The estimated annual cost savings, if any, for the City  
               of Stockton;


             c)    A summary of relevant annual performance metrics,  
               including measures of utilization, enforcement, and  
               customer satisfaction; 


             d)   Public comments submitted to the FPPC or the City of  
               Stockton relative to the operation of the agreement; and, 


             e)   Legislative recommendations. 

          9)Contains a January 1, 2020 sunset date. 

          10) Makes legislative findings and declarations as to the  








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            necessity of a special statute    for City of Stockton due to  
            the need to avoid an appearance of corruption in the city's  
            electoral process. 

           BACKGROUND
           
           San Bernardino County Contract with the FPPC  .  In 2012, the  
          Legislature enacted AB 2146 (Cook, Chapter 169, Statutes of  
          2012), which permitted San Bernardino County and the FPPC to  
          enter into an agreement that provides for the FPPC to enforce  
          the County's local campaign finance reform ordinance.  Prior to  
          this, the FPPC did not enforce any local campaign finance  
          ordinances.  According to previous analyses, the County of San  
          Bernardino, which had been the subject of several high-profile  
          corruption cases, was in the process of developing a campaign  
          finance ordinance.  Rather than appoint an ethics commission,  
          which could present financial as well as conflict of interest  
          challenges, the County proposed to contract with the FPPC to  
          enforce their local campaign finance ordinance.  Moreover, the  
          County determined that it was in the best interest of the County  
          to retain the services of the FPPC to provide for the  
          enforcement and interpretation of San Bernardino County's local  
          campaign finance ordinance as the FPPC has special skills,  
          knowledge, experience, and expertise in the area of enforcement  
          and interpretation of campaign laws necessary to effectively  
          advise, assist, litigate, and otherwise represent the County on  
          such matters. 
          As a result, the FPPC and San Bernardino County entered into a  
          mutual agreement, from January 1, 2013 through December 31,  
          2014, for the FPPC to provide the County campaign enforcement  
          and interpretation services for the impartial, effective  
          administration, implementation, and enforcement of San  
          Bernardino's campaign finance reform ordinance.  According to  
          the FPPC, San Bernardino County and the FPPC have entered into a  
          new two-year mutual agreement. 

           Local Campaign Ordinances and the PRA  .  Under existing law,  
          local government agencies have the ability to adopt campaign  
          ordinances that apply to elections within their jurisdictions,  
          though the PRA imposes certain limited restrictions on those  
          local ordinances.  For instance, SB 726 (McCorquodale, Chapter  
          1456, Statutes of 1985) limited the ability of local  
          jurisdictions to impose campaign filing requirements that  
          differed from those in the PRA, permitting such requirements  








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          only when they applied solely to candidates and committees whose  
          activity is restricted primarily to the jurisdiction in  
          question.  This provision sought to avoid the necessity of a  
          candidate or committee active over a wider area being required  
          to adhere to several different campaign filing schedules.   
          Similarly, AB 1430 (Garrick, Chapter 708, Statutes of 2007),  
          prohibited local governments from adopting rules governing  
          member communications that are different than the rules that  
          govern member communications at the state level. 

          Aside from these restrictions, however, local government  
          agencies generally have a significant amount of latitude when  
          developing local campaign finance ordinances that apply to  
          elections in those agencies' jurisdictions.  Any jurisdiction  
          that adopts or amends a local campaign finance ordinance is  
          required to file a copy of that ordinance with the FPPC, and the  
          FPPC posts those ordinances on its website.  Several cities and  
          counties have adopted campaign finance ordinances, some of which  
          are very extensive. 

          In some cases, those ordinances include campaign contribution  
          limits, reporting and disclosure requirements that supplement  
          the requirements of the PRA, temporal restrictions on when  
          campaign funds may be raised, and voluntary public financing of  
          local campaigns, among other provisions.  In many cases, local  
          campaign finance ordinances are enforced by the district  
          attorney of the county or by the city attorney.  In at least a  
          few cases, however, local jurisdictions have set up independent  
          boards or commissions to enforce the local campaign finance  
          laws. 

          The FPPC does not currently enforce any local campaign finance  
          ordinances other than San Bernardino County's.  The FPPC can and  
          does, however, bring enforcement actions in response to  
          violations of the PRA that occur in campaigns for local office,  
          even in cases where the local jurisdiction brings separate  
          enforcement actions for violations of a local campaign finance  
          ordinance. 

           Criminal, Civil, and Administrative Enforcement of the PRA and  
          Local Campaign Ordinances  .  Violations of the PRA are subject to  
          administrative, civil, and criminal penalties.  Generally, the  
          Attorney General (AG) and district attorneys have responsibility  
          for enforcing the criminal provisions of the PRA, though any  








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          elected city attorney of a charter city also has the authority  
          to act as the criminal prosecutor for violations of the PRA that  
          occur within the city.  The FPPC, the AG, district attorneys,  
          and elected city attorneys of charter cities all have  
          responsibility for enforcement of the civil penalties and  
          remedies provided under the PRA, depending on the nature and  
          location of the violation, while any member of the public also  
          has the ability to file a civil action to enforce the civil  
          provisions of the PRA, subject to certain restrictions. 

          The FPPC has the sole authority to bring administrative  
          proceedings for enforcement of the PRA.  When the FPPC  
          determines on the basis of such a proceeding that a violation of  
          the PRA has occurred, it can impose monetary penalties of up to  
          $5,000 per violation, in addition to ordering the violator to  
          cease and desist violation of the PRA and to file any reports,  
          statements, or other documents or information required by the  
          PRA.  In the case of local campaign ordinances, there is no  
          single approach as to the types of penalties that are available  
          for the violations of those ordinances.  Many local ordinances  
          provide for misdemeanor or civil penalties for violations, while  
          some ordinances do not establish any penalties for violations.   
          In some local jurisdictions that have independent boards or  
          commissions to enforce the local campaign finance ordinances,  
          those boards or commissions have the authority to bring  
          administrative enforcement proceedings, similar to the authority  
          the FPPC has under the PRA. 

           COMMENTS
           
           1)According to the Author  :  This bill seeks to amend the  
            Political Reform Act of 1974 in order to authorize the FPPC to  
            enter into an agreement with the City of Stockton to enforce  
            campaign contribution limits. 

          There is an ongoing, national debate about the role money plays  
            in campaigns, and particularly the effect that large  
            contributions have on candidates once they are elected.   
            Candidates for elected office typically rely on money to fund  
            effective campaigns; the amount and source of those donations  
            can vary greatly.  The City of Stockton currently imposes no  
            limits on donations by individuals to campaigns for city  
            offices, so the City Council is considering the adoption of a  
            municipal ordinance setting individual campaign donation  








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            limits. 

          The city does not have the resources to oversee and enforce such  
            an ordinance, but the FPPC has, through past legislation,  
            arranged with the County of San Bernardino to do just that.   
            This bill would simply allow the City of Stockton to make the  
            same mutual arrangement with the FPPC.

                               RELATED/PRIOR LEGISLATION
           
          AB 910 (Harper), which is still pending in the Assembly as a  
          two-year bill, authorizes the FPPC to administer and enforce a  
          local campaign finance ordinance for any city or county, upon  
          mutual agreement between the FPPC and the local agency, as  
          specified. 

          AB 2146 (Cook, Chapter 169, Statutes of 2012), permitted San  
          Bernardino County and the FPPC to enter into an agreement that  
          provides for the FPPC to enforce the County's local campaign  
          finance ordinance.

          SB 1226 (Correa of 2014), would have authorized any city or  
          county to enter into an agreement with the FPPC to administer  
          and enforce a local campaign finance ordinance. The bill was  
          gutted and amended in the Assembly Appropriations Committee. 

           PRIOR ACTION
           
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          |Assembly Floor:                       |74 - 1                     |
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          |Assembly Appropriations Committee:    |17 - 0                     |
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          |Assembly Local Government Committee   |  9 - 0                    |
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          |Assembly Elections and Redistricting  |  5 - 1                    |
          |Committee:                            |                           |
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          POSITIONS
           
          Sponsor: Author     

           Support: None received   








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           Oppose:  None received   
                                          
                                      -- END --