California Legislature—2015–16 Regular Session

Assembly Bill No. 1544

Introduced by Assembly Members Cooley and Jones

July 15, 2015

An act to amend Section 82015 of the Government Code, relating to the Political Reform Act of 1974, and declaring the urgency thereof, to take effect immediately.

LEGISLATIVE COUNSEL’S DIGEST

AB 1544, as introduced, Cooley. Political Reform Act of 1974: behested payments.

The Political Reform Act of 1974 provides for the comprehensive regulation of campaign financing and related matters, including campaign contributions, as defined. Under existing law, a payment made at the behest of a candidate for elective office is considered a contribution unless the payment is made for purposes unrelated to the candidate’s candidacy. Under the act, a payment made by a government agency or an exempt nonprofit organization is presumed to be unrelated to a candidate’s candidacy. Likewise, a payment made principally for legislative, governmental, or charitable purposes is presumed to be unrelated to a candidate’s candidacy, and such payments are required to be reported by a candidate who is an elected officer if they total $5,000 or more in the aggregate from a single source in a calendar year. For purposes of the act, an elected officer retains his or her status as a candidate for that office until the officer has terminated all of his or her committees and no longer holds the office, as specified.

This bill would create a conclusive presumption that a payment made at the behest of a candidate who is an elected officer by a state, local, or federal governmental agency that is made principally for legislative or governmental purposes is unrelated to the elected officer’s candidacy and would exempt the payment from the reporting requirement for behested payments.

The Political Reform Act of 1974, an initiative measure, provides that the Legislature may amend the act to further the act’s purposes upon a 2⁄3 vote of each house and compliance with specified procedural requirements.

This bill would declare that it furthers the purposes of the act.

The Political Reform Act of 1974, an initiative measure, provides that the Legislature may amend the act to further the act’s purposes upon a 2⁄3 vote of each house and compliance with specified procedural requirements.

This bill would declare that it furthers the purposes of the act.

This bill would declare that it is to take effect immediately as an urgency statute.

Vote: ²⁄₃. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 82015 of the Government Code is
amended to read:

82015.  

(a) “Contribution” means a payment, a forgiveness of
a loan, a payment of a loan by a third party, or an enforceable
promise to make a payment except to the extent that full and
adequate consideration is received, unless it is clear from the
surrounding circumstances that it is not made for political purposes.

(b) (1) A payment made at the behest of a committee, as defined
in subdivision (a) of Section 82013, is a contribution to the
committee unless full and adequate consideration is received from
the committee for making the payment.

(2) A payment made at the behest of a candidate is a contribution
to the candidate unless the criteria in either subparagraph (A) or
(B) are satisfied:

(A) Full and adequate consideration is received from the
candidate.

(B) It is clear from the surrounding circumstances that the
payment was made for purposes unrelated to his or her candidacy
for elective office. The following types of payments are presumed
to be for purposes unrelated to a candidate’s candidacy for elective
office:

(i) A payment made principally for personal purposes, in which
case it may be considered a gift under the provisions of Section
82028. Payments that are otherwise subject to the limits of Section
86203 are presumed to be principally for personal purposes.

(ii) A payment made by a state, local, or federal governmental
agency or by a nonprofit organization that is exempt from taxation
under Section 501(c)(3) of the Internal Revenue Code. begin insert The
presumption is conclusive for, and the reporting requirement
described in clause (iii) does not apply to, a payment by a state,
local, or federal governmental agency that is made principally for
legislative or governmental purposes at the behest of a candidate
who is an elected officer. end insert

(iii) A payment not covered by clause (i), made principally for
legislative, governmental, or charitable purposes, in which case it
is neither a gift nor a contribution. However, payments of this type
that are made at the behest of a candidate who is an elected officer
shall be reported within 30 days following the date on which the
payment or payments equal or exceed five thousand dollars
($5,000) in the aggregate from the same source in the same
calendar year in which they are made. The report shall be filed by
the elected officer with the elected officer’s agency and shall be
a public record subject to inspection and copying pursuant to
subdivision (a) of Section 81008. The report shall contain the
following information: name of payor, address of payor, amount
of the payment, date or dates the payment or payments were made,
the name and address of the payee, a brief description of the goods
or services provided or purchased, if any, and a description of the
specific purpose or event for which the payment or payments were
made. Once the five-thousand-dollar ($5,000) aggregate threshold
from a single source has been reached for a calendar year, all
payments for the calendar year made by that source shall be
disclosed within 30 days after the date the threshold was reached
or the payment was made, whichever occurs later. Within 30 days
after receipt of the report, state agencies shall forward a copy of
these reports to the Commission, and local agencies shall forward
a copy of these reports to the officer with whom elected officers
of that agency file their campaign statements.

(C) For purposes of subparagraph (B), a payment is made for
purposes related to a candidate’s candidacy for elective office if
all or a portion of the payment is used for election-related activities.
For purposes of this subparagraph, “election-related activities”
shall include, but are not limited to, the following:

(i) Communications that contain express advocacy of the
nomination or election of the candidate or the defeat of his or her
opponent.

(ii) Communications that contain reference to the candidate’s
candidacy for elective office, the candidate’s election campaign,
or the candidate’s or his or her opponent’s qualifications for
elective office.

(iii) Solicitation of contributions to the candidate or to third
persons for use in support of the candidate or in opposition to his
or her opponent.

(iv) Arranging, coordinating, developing, writing, distributing,
preparing, or planning of any communication or activity described
in clause (i), (ii), or (iii).

(v) Recruiting or coordinating campaign activities of campaign
volunteers on behalf of the candidate.

(vi) Preparing campaign budgets.

(vii) Preparing campaign finance disclosure statements.

(viii) Communications directed to voters or potential voters as
part of activities encouraging or assisting persons to vote if the
communication contains express advocacy of the nomination or
election of the candidate or the defeat of his or her opponent.

(D) A contribution made at the behest of a candidate for a
different candidate or to a committee not controlled by the
behesting candidate is not a contribution to the behesting candidate.

(3) A payment made at the behest of a member of the Public
Utilities Commission, made principally for legislative,
governmental, or charitable purposes, is not a contribution.
However, payments of this type shall be reported within 30 days
following the date on which the payment or payments equal or
exceed five thousand dollars ($5,000) in the aggregate from the
same source in the same calendar year in which they are made.
The report shall be filed by the member with the Public Utilities
Commission and shall be a public record subject to inspection and
copying pursuant to subdivision (a) of Section 81008. The report
shall contain the following information: name of payor, address
of payor, amount of the payment, date or dates the payment or
payments were made, the name and address of the payee, a brief
description of the goods or services provided or purchased, if any,
and a description of the specific purpose or event for which the
payment or payments were made. Once the five-thousand-dollar
($5,000) aggregate threshold from a single source has been reached
for a calendar year, all payments for the calendar year made by
that source shall be disclosed within 30 days after the date the
threshold was reached or the payment was made, whichever occurs
later. Within 30 days after receipt of the report, the Public Utilities
Commission shall forward a copy of these reports to the Fair
Political Practices Commission.

(c) “Contribution” includes the purchase of tickets for events
such as dinners, luncheons, rallies, and similar fundraising events;
the candidate’s own money or property used on behalf of his or
her candidacy, other than personal funds of the candidate used to
pay either a filing fee for a declaration of candidacy or a candidate
statement prepared pursuant to Section 13307 of the Elections
Code; the granting of discounts or rebates not extended to the
public generally or the granting of discounts or rebates by television
and radio stations and newspapers not extended on an equal basis
to all candidates for the same office; the payment of compensation
by any person for the personal services or expenses of any other
person if the services are rendered or expenses incurred on behalf
of a candidate or committee without payment of full and adequate
consideration.

(d) “Contribution” further includes any transfer of anything of
value received by a committee from another committee, unless
full and adequate consideration is received.

(e) “Contribution” does not include amounts received pursuant
to an enforceable promise to the extent those amounts have been
previously reported as a contribution. However, the fact that those
amounts have been received shall be indicated in the appropriate
campaign statement.

(f) (1) Except as provided in paragraph (2) or (3), “contribution”
does not include a payment made by an occupant of a home or
office for costs related to any meeting or fundraising event held
in the occupant’s home or office if the costs for the meeting or
fundraising event are five hundred dollars ($500) or less.

(2) “Contribution” includes a payment made by a lobbyist or a
cohabitant of a lobbyist for costs related to a fundraising event
held at the home of the lobbyist, including the value of the use of
the home as a fundraising event venue. A payment described in
this paragraph shall be attributable to the lobbyist for purposes of
Section 85702.

(3) “Contribution” includes a payment made by a lobbying firm
for costs related to a fundraising event held at the office of the
lobbying firm, including the value of the use of the office as a
fundraising event venue.

(g) Notwithstanding the foregoing definition of “contribution,”
the term does not include volunteer personal services or payments
made by any individual for his or her own travel expenses if the
payments are made voluntarily without any understanding or
agreement that they shall be, directly or indirectly, repaid to him
or her.

(h) “Contribution” further includes the payment of public
moneys by a state or local governmental agency for a
communication to the public that satisfies both of the following:

(1) The communication expressly advocates the election or
defeat of a clearly identified candidate or the qualification, passage,
or defeat of a clearly identified measure, or, taken as a whole and
in context, unambiguously urges a particular result in an election.

(2) The communication is made at the behest of the affected
candidate or committee.

(i) “Contribution” further includes a payment made by a person
to a multipurpose organization as defined and described in Section
84222.

SEC. 2.  

The Legislature finds and declares that this bill furthers
the purposes of the Political Reform Act of 1974 within the
meaning of subdivision (a) of Section 81012 of the Government
Code.

SEC. 3.  

This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:

It is a core principle of representative government that an elected
official’s duties include advocacy of government agencies in favor
of expenditures that benefit constituents or public purposes
generally. It is also well-established that a government agency
may not expend public funds for purposes unrelated to the business
of that agency. To that end, government expenditures are subject
to a myriad of laws designed to protect the public interest and
promote transparency, including laws relating to open meetings,
the appropriate use of public resources, conflicts of interests, and
disbursement practices. Therefore, it is necessary that this act take
effect immediately in order to provide clarity for elected officials,
in conformity with the Legislature’s intent when it enacted Chapter
450 of the Statutes of 1997 that reporting requirements for behested
payments not apply with respect to the payments made by a
government agency at the behest of an elected official for a
legislative or governmental purpose.