Amended in Assembly August 20, 2015

Amended in Assembly August 17, 2015

California Legislature—2015–16 Regular Session

Assembly BillNo. 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 amended, 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 provide that the provision relating to payments made by a government agency exclusively governs a payment by a governmental agency that is made principally for legislative or governmental purposes at the behest of a candidate who is an elected officer, and consequently the payment would not be subject to the reporting requirement that applies generally to payments made for legislative, governmental, or charitable purposes.

begin insert

This bill would incorporate changes to Section 82015 of the Government Code proposed by both this bill and AB 10, which would become operative only if both bills are enacted and become effective on or before January 1, 2016, and this bill is chaptered last.

end insert

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 23 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: 23. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

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

P2    1

SECTION 1.  

Section 82015 of the Government Code is
2amended to read:

3

82015.  

(a) “Contribution” means a payment, a forgiveness of
4a loan, a payment of a loan by a third party, or an enforceable
5promise to make a payment except to the extent that full and
6adequate consideration is received, unless it is clear from the
7surrounding circumstances that it is not made for political purposes.

8(b) (1) A payment made at the behest of a committee, as defined
9in subdivision (a) of Section 82013, is a contribution to the
10committee unless full and adequate consideration is received from
11the committee for making the payment.

12(2) A payment made at the behest of a candidate is a contribution
13to the candidate unless the criteria in either subparagraph (A) or
14(B) are satisfied:

15(A) Full and adequate consideration is received from the
16candidate.

P3    1(B) It is clear from the surrounding circumstances that the
2payment was made for purposes unrelated to his or her candidacy
3for elective office. The following types of payments are presumed
4to be for purposes unrelated to a candidate’s candidacy for elective
5office:

6(i) A payment made principally for personal purposes, in which
7case it may be considered a gift under the provisions of Section
882028. Payments that are otherwise subject to the limits of Section
986203 are presumed to be principally for personal purposes.

10(ii) A payment made by a state, local, or federal governmental
11agency or by a nonprofit organization that is exempt from taxation
12under Section 501(c)(3) of the Internal Revenue Code. A payment
13by a state, local, or federal governmental agency that is made
14principally for legislative or governmental purposes is governed
15exclusively by this clause and, therefore, is not subject to the
16reporting requirement described in clause (iii).

17(iii) A payment not covered by clause (i), made principally for
18legislative, governmental, or charitable purposes, in which case it
19is neither a gift nor a contribution. However, payments of this type
20that are made at the behest of a candidate who is an elected officer
21shall be reported within 30 days following the date on which the
22payment or payments equal or exceed five thousand dollars
23($5,000) in the aggregate from the same source in the same
24calendar year in which they are made. The report shall be filed by
25the elected officer with the elected officer’s agency and shall be
26a public record subject to inspection and copying pursuant to
27subdivision (a) of Section 81008. The report shall contain the
28following information: name of payor, address of payor, amount
29of the payment, date or dates the payment or payments were made,
30the name and address of the payee, a brief description of the goods
31or services provided or purchased, if any, and a description of the
32specific purpose or event for which the payment or payments were
33made. Once the five-thousand-dollar ($5,000) aggregate threshold
34from a single source has been reached for a calendar year, all
35payments for the calendar year made by that source shall be
36disclosed within 30 days after the date the threshold was reached
37or the payment was made, whichever occurs later. Within 30 days
38after receipt of the report, state agencies shall forward a copy of
39these reports to the Commission, and local agencies shall forward
P4    1a copy of these reports to the officer with whom elected officers
2of that agency file their campaign statements.

3(C) For purposes of subparagraph (B), a payment is made for
4purposes related to a candidate’s candidacy for elective office if
5all or a portion of the payment is used for election-related activities.
6For purposes of this subparagraph, “election-related activities”
7shall include, but are not limited to, the following:

8(i) Communications that contain express advocacy of the
9nomination or election of the candidate or the defeat of his or her
10opponent.

11(ii) Communications that contain reference to the candidate’s
12candidacy for elective office, the candidate’s election campaign,
13or the candidate’s or his or her opponent’s qualifications for
14elective office.

15(iii) Solicitation of contributions to the candidate or to third
16persons for use in support of the candidate or in opposition to his
17or her opponent.

18(iv) Arranging, coordinating, developing, writing, distributing,
19preparing, or planning of any communication or activity described
20in clause (i), (ii), or (iii).

21(v) Recruiting or coordinating campaign activities of campaign
22volunteers on behalf of the candidate.

23(vi) Preparing campaign budgets.

24(vii) Preparing campaign finance disclosure statements.

25(viii) Communications directed to voters or potential voters as
26part of activities encouraging or assisting persons to vote if the
27communication contains express advocacy of the nomination or
28election of the candidate or the defeat of his or her opponent.

29(D) A contribution made at the behest of a candidate for a
30different candidate or to a committee not controlled by the
31behesting candidate is not a contribution to the behesting candidate.

32(3) A payment made at the behest of a member of the Public
33Utilities Commission, made principally for legislative,
34governmental, or charitable purposes, is not a contribution.
35However, payments of this type shall be reported within 30 days
36following the date on which the payment or payments equal or
37exceed five thousand dollars ($5,000) in the aggregate from the
38same source in the same calendar year in which they are made.
39The report shall be filed by the member with the Public Utilities
40Commission and shall be a public record subject to inspection and
P5    1copying pursuant to subdivision (a) of Section 81008. The report
2shall contain the following information: name of payor, address
3 of payor, amount of the payment, date or dates the payment or
4payments were made, the name and address of the payee, a brief
5description of the goods or services provided or purchased, if any,
6and a description of the specific purpose or event for which the
7payment or payments were made. Once the five-thousand-dollar
8($5,000) aggregate threshold from a single source has been reached
9for a calendar year, all payments for the calendar year made by
10that source shall be disclosed within 30 days after the date the
11threshold was reached or the payment was made, whichever occurs
12later. Within 30 days after receipt of the report, the Public Utilities
13Commission shall forward a copy of these reports to the Fair
14Political Practices Commission.

15(c) “Contribution” includes the purchase of tickets for events
16such as dinners, luncheons, rallies, and similar fundraising events;
17the candidate’s own money or property used on behalf of his or
18her candidacy, other than personal funds of the candidate used to
19pay either a filing fee for a declaration of candidacy or a candidate
20statement prepared pursuant to Section 13307 of the Elections
21Code; the granting of discounts or rebates not extended to the
22public generally or the granting of discounts or rebates by television
23and radio stations and newspapers not extended on an equal basis
24to all candidates for the same office; the payment of compensation
25by any person for the personal services or expenses of any other
26person if the services are rendered or expenses incurred on behalf
27of a candidate or committee without payment of full and adequate
28consideration.

29(d) “Contribution” further includes any transfer of anything of
30value received by a committee from another committee, unless
31full and adequate consideration is received.

32(e) “Contribution” does not include amounts received pursuant
33 to an enforceable promise to the extent those amounts have been
34previously reported as a contribution. However, the fact that those
35amounts have been received shall be indicated in the appropriate
36campaign statement.

37(f) (1) Except as provided in paragraph (2) or (3), “contribution”
38does not include a payment made by an occupant of a home or
39office for costs related to any meeting or fundraising event held
P6    1in the occupant’s home or office if the costs for the meeting or
2fundraising event are five hundred dollars ($500) or less.

3(2) “Contribution” includes a payment made by a lobbyist or a
4cohabitant of a lobbyist for costs related to a fundraising event
5held at the home of the lobbyist, including the value of the use of
6the home as a fundraising event venue. A payment described in
7this paragraph shall be attributable to the lobbyist for purposes of
8Section 85702.

9(3) “Contribution” includes a payment made by a lobbying firm
10for costs related to a fundraising event held at the office of the
11lobbying firm, including the value of the use of the office as a
12fundraising event venue.

13(g) Notwithstanding the foregoing definition of “contribution,”
14the term does not include volunteer personal services or payments
15made by any individual for his or her own travel expenses if the
16payments are made voluntarily without any understanding or
17agreement that they shall be, directly or indirectly, repaid to him
18or her.

19(h) “Contribution” further includes the payment of public
20moneys by a state or local governmental agency for a
21communication to the public that satisfies both of the following:

22(1) The communication expressly advocates the election or
23defeat of a clearly identified candidate or the qualification, passage,
24or defeat of a clearly identified measure, or, taken as a whole and
25in context, unambiguously urges a particular result in an election.

26(2) The communication is made at the behest of the affected
27candidate or committee.

28(i) “Contribution” further includes a payment made by a person
29to a multipurpose organization as defined and described in Section
3084222.

31begin insert

begin insertSEC. 1.5.end insert  

end insert

begin insertSection 82015 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
32to read:end insert

33

82015.  

(a) “Contribution” means a payment, a forgiveness of
34a loan, a payment of a loan by a third party, or an enforceable
35promise to make a payment except to the extent that full and
36adequate consideration is received, unless it is clear from the
37surrounding circumstances that it is not made for political purposes.

38(b) (1) A payment made at the behest of a committee, as defined
39in subdivision (a) of Section 82013, is a contribution to the
P7    1committee unless full and adequate consideration is received from
2the committee for making the payment.

3(2) A payment made at the behest of a candidate is a contribution
4to the candidate unless the criteria in either subparagraph (A) or
5(B) are satisfied:

6(A) Full and adequate consideration is received from the
7candidate.

8(B) It is clear from the surrounding circumstances that the
9payment was made for purposes unrelated to his or her candidacy
10for elective office. The following types of payments are presumed
11to be for purposes unrelated to a candidate’s candidacy for elective
12office:

13(i) A payment made principally for personal purposes, in which
14case it may be considered a gift underbegin delete the provisions ofend delete Section
1582028. Payments that are otherwise subject to the limits of Section
1686203 are presumed to be principally for personal purposes.

17(ii) A payment made by a state, local, or federal governmental
18agency or by a nonprofit organization that is exempt from taxation
19under Section 501(c)(3) of the Internal Revenue Code.begin insert end insertbegin insertA payment
20by a state, local, or federal governmental agency that is made
21principally for legislative or governmental purposes is governed
22exclusively by this clause and, therefore, is not subject to the
23reporting requirement described in clause (iii).end insert

24(iii) begin insert(I)end insertbegin insertend insert A payment not covered by clause (i), made principally
25for legislative, governmental, or charitable purposes, in which case
26it is neither a gift nor a contribution. However, payments of this
27type that are made at the behest of a candidate who is an elected
28officer shall be reported within 30 days following the date on which
29the payment or payments equal or exceed five thousand dollars
30($5,000) in the aggregate from the same source in the same
31calendar year in which they are made. The report shall be filedbegin delete by
32the elected officerend delete
with the elected officer’sbegin delete agency andend deletebegin insert agency.
33The reportend insert
shall be a public record subject to inspection and
34copying pursuant tobegin delete subdivision (a) ofend delete Section 81008. The report
35shall contain the following information: name of payor, address
36of payor, amount of the payment, date or dates the payment or
37payments were made, the name and address of the payee, a brief
38description of the goods or services provided or purchased, if any,
39and a description of the specific purpose or event for which the
40payment or payments were made. Once the five-thousand-dollar
P8    1($5,000) aggregate threshold from a single source has been reached
2for a calendar year, all payments for the calendar year made by
3that source shall be disclosed within 30 days after the date the
4threshold was reached or the payment was made, whichever occurs
5later. Within 30 days after receipt of the report, state agencies shall
6forward a copy of these reports to thebegin delete Commission,end deletebegin insert commission,end insert
7 and local agencies shall forward a copy of these reports to the
8officer with whom elected officers of that agency file their
9campaign statements.

begin insert

10(II) A Member of the Legislature or a person elected to a
11statewide elective office, as defined in Section 82053, shall report
12behested payments of the type described in subclause (I) for one
13year after he or she leaves the Legislature or the statewide elective
14office. The report shall be made in accordance with the
15requirements of subclause (I). A Member of the Legislature or a
16person elected to a statewide elective office shall only report a
17payment pursuant to this subclause if the payment would financially
18benefit the former officeholder or a member of his or her immediate
19family, the former officeholder’s employer or the employer of a
20member of his or her immediate family, or an entity with whom
21the former officeholder or a member of his or her immediate family
22is negotiating employment.

end insert

23(C) For purposes of subparagraph (B), a payment is made for
24purposes related to a candidate’s candidacy for elective office if
25all or a portion of the payment is used for election-related activities.
26For purposes of this subparagraph, “election-related activities”
27shall include, but are not limited to, the following:

28(i) Communications that contain express advocacy of the
29nomination or election of the candidate or the defeat of his or her
30opponent.

31(ii) Communications that contain reference to the candidate’s
32candidacy for elective office, the candidate’s election campaign,
33or the candidate’s or his or her opponent’s qualifications for
34elective office.

35(iii) Solicitation of contributions to the candidate or to third
36persons for use in support of the candidate or in opposition to his
37or her opponent.

38(iv) Arranging, coordinating, developing, writing, distributing,
39preparing, or planning of any communication or activity described
40in clause (i), (ii), or (iii).

P9    1(v) Recruiting or coordinating campaign activities of campaign
2volunteers on behalf of the candidate.

3(vi) Preparing campaign budgets.

4(vii) Preparing campaign finance disclosure statements.

5(viii) Communications directed to voters or potential voters as
6part of activities encouraging or assisting persons to vote if the
7communication contains express advocacy of the nomination or
8election of the candidate or the defeat of his or her opponent.

9(D) A contribution made at the behest of a candidate for a
10different candidate or to a committee not controlled by the
11behesting candidate is not a contribution to the behesting candidate.

12(3) A payment made at the behest of a member of the Public
13Utilities Commission, made principally for legislative,
14governmental, or charitable purposes, is not a contribution.
15However, payments of this type shall be reported within 30 days
16following the date on which the payment or payments equal or
17exceed five thousand dollars ($5,000) in the aggregate from the
18same source in the same calendar year in which they are made.
19The report shall be filed by the member with the Public Utilities
20Commission and shall be a public record subject to inspection and
21copying pursuant tobegin delete subdivision (a) ofend delete Section 81008. The report
22 shall contain the following information: name of payor, address
23of payor, amount of the payment, date or dates the payment or
24payments were made, the name and address of the payee, a brief
25description of the goods or services provided or purchased, if any,
26and a description of the specific purpose or event for which the
27payment or payments were made. Once the five-thousand-dollar
28($5,000) aggregate threshold from a single source has been reached
29for a calendar year, all payments for the calendar year made by
30that source shall be disclosed within 30 days after the date the
31threshold was reached or the payment was made, whichever occurs
32later. Within 30 days after receipt of the report, the Public Utilities
33Commission shall forward a copy of these reports to the Fair
34Political Practices Commission.

35(c) “Contribution” includes the purchase of tickets for events
36such as dinners, luncheons, rallies, and similar fundraising events;
37the candidate’s own money or property used on behalf of his or
38her candidacy, other than personal funds of the candidate used to
39pay either a filing fee for a declaration of candidacy or a candidate
40statement prepared pursuant to Section 13307 of the Elections
P10   1Code; the granting of discounts or rebates not extended to the
2public generally or the granting of discounts or rebates by television
3and radio stations and newspapers not extended on an equal basis
4to all candidates for the same office; the payment of compensation
5by any person for the personal services or expenses of any other
6person if the services are rendered or expenses incurred on behalf
7of a candidate or committee without payment of full and adequate
8consideration.

9(d) “Contribution” further includes any transfer of anything of
10value received by a committee from another committee, unless
11full and adequate consideration is received.

12(e) “Contribution” does not include amounts received pursuant
13to an enforceable promise to the extent those amounts have been
14previously reported as a contribution. However, the fact that those
15amounts have been received shall be indicated in the appropriate
16campaign statement.

17(f) (1) Except as provided in paragraph (2) or (3), “contribution”
18does not include a payment made by an occupant of a home or
19office for costs related to any meeting or fundraising event held
20in the occupant’s home or office if the costs for the meeting or
21fundraising event are five hundred dollars ($500) or less.

22(2) “Contribution” includes a payment made by a lobbyist or a
23cohabitant of a lobbyist for costs related to a fundraising event
24held at the home of the lobbyist, including the value of the use of
25the home as a fundraising event venue. A payment described in
26this paragraph shall be attributable to the lobbyist for purposes of
27Section 85702.

28(3) “Contribution” includes a payment made by a lobbying firm
29for costs related to a fundraising event held at the office of the
30lobbying firm, including the value of the use of the office as a
31fundraising event venue.

32(g) Notwithstanding the foregoing definition of “contribution,”
33the term does not include volunteer personal services or payments
34made by any individual for his or her own travel expenses if the
35payments are made voluntarily without any understanding or
36agreement that they shall be, directly or indirectly, repaid to him
37or her.

38(h) “Contribution” further includes the payment of public
39moneys by a state or local governmental agency for a
40communication to the public that satisfies both of the following:

P11   1(1) The communication expressly advocates the election or
2defeat of a clearly identified candidate or the qualification, passage,
3or defeat of a clearly identified measure, or, taken as a whole and
4in context, unambiguously urges a particular result in an election.

5(2) The communication is made at the behest of the affected
6candidate or committee.

7(i) “Contribution” further includes a payment made by a person
8to a multipurpose organization as defined and described in Section
984222.

10begin insert

begin insertSEC. end insertbegin insert2.end insert  

end insert
begin insert

Section 1.5 of this bill incorporates amendments to
11Section 82015 of the Government Code proposed by both this bill
12and Assembly Bill 10. It shall only become operative if (1) both
13bills are enacted and become effective on or before January 1,
142016, but this bill becomes operative first, (2) each bill amends
15Section 82015 of the Government Code, and (3) this bill is enacted
16after Assembly Bill 10, in which case Section 82015 of the
17Government Code, as amended by Section 1 of this bill, shall
18remain operative only until the operative date of Assembly Bill
1910, at which time Section 1.5 of this bill shall become operative.

end insert
20

begin deleteSEC. 2.end delete
21begin insertSEC. 3.end insert  

The Legislature finds and declares that this bill furthers
22the purposes of the Political Reform Act of 1974 within the
23meaning of subdivision (a) of Section 81012 of the Government
24Code.

25

begin deleteSEC. 3.end delete
26begin insertSEC. 4.end insert  

This act is an urgency statute necessary for the
27immediate preservation of the public peace, health, or safety within
28the meaning of Article IV of the Constitution and shall go into
29immediate effect. The facts constituting the necessity are:

30It is a core principle of representative government that an elected
31official’s duties include advocacy of government agencies in favor
32of expenditures that benefit constituents or public purposes
33generally. It is also well-established that a government agency
34may not expend public funds for purposes unrelated to the business
35of that agency. To that end, government expenditures are subject
36to a myriad of laws designed to protect the public interest and
37promote transparency, including laws relating to open meetings,
38the appropriate use of public resources, conflicts of interests, and
39disbursement practices. Therefore, it is necessary that this act take
40effect immediately in order to provide clarity for elected officials,
P12   1in conformity with the Legislature’s intent when it enacted Chapter
2450 of the Statutes of 1997 that reporting requirements for behested
3payments not apply with respect to the payments made by a
4government agency at the behest of an elected official for a
5legislative or governmental purpose.



O

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