BILL ANALYSIS Ó
AB 2070
Page 1
Date of Hearing: April 13, 2016
ASSEMBLY COMMITTEE ON ELECTIONS AND REDISTRICTING
Shirley Weber, Chair
AB 2070
(Harper) - As Introduced February 17, 2016
SUBJECT: Political Reform Act of 1974: local enforcement.
Urgency.
SUMMARY: Authorizes the Board of Supervisors of Orange County
and the Fair Political Practices Commission (FPPC) to enter into
an agreement that provides for the FPPC to administer and
enforce a local campaign finance ordinance passed by the Board
of Supervisors of Orange County, as specified. Specifically,
this bill:
1)Provides that, upon mutual agreement between the FPPC and the
Board of Supervisors of Orange County, 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 Board of Supervisors
of Orange County. Provides that the FPPC, upon agreement, 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 all of the following with
respect to the local campaign finance ordinance:
a) Provide advice;
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b) Investigate possible violations;
c) Bring administrative actions in accordance with the
Political Reform Act (PRA) and the administrative
adjudication provisions of the Administrative Procedure
Act; and,
d) Bring civil actions.
2)Provides that the FPPC shall not be required to obtain
authorization from the district attorney of the County of
Orange to bring an administrative or civil action pursuant to
the provisions of this bill.
3)Requires a local campaign finance ordinance of Orange County
that is enforced by the FPPC to comply with the provisions of
this bill.
4)Requires the Board of Supervisors of Orange County to consult
with the FPPC prior to adopting and amending any local
campaign finance ordinance that is subsequently enforced by
the FPPC pursuant to this bill.
5)Permits the Board of Supervisors of Orange County 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
county funds for costs incurred by the FPPC in administering,
implementing, or enforcing a local campaign finance ordinance
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pursuant to the provisions of this bill.
6)Prohibits an agreement entered into pursuant to the provisions
of this bill from containing any form of a cancellation fee, a
liquidated damages provision, or other financial disincentive
to the exercise of the right to terminate the agreement,
except that the FPPC may require Orange County 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 in the event that the Board of
Supervisors of Orange County terminates the agreement.
7)Permits the Board of Supervisors of Orange County or the FPPC,
at any time, by ordinance or resolution, to terminate any
agreement made pursuant to this bill for the FPPC to
administer, implement, or enforce a local campaign finance
ordinance or any provision thereof.
8)Requires the FPPC, if an agreement is entered into pursuant to
this bill, to report to the Legislature regarding the
performance of that agreement on or before January 1, 2019,
and submit that report in compliance with existing law.
Requires the FPPC to develop the report in consultation with
the Board of Supervisors of Orange County. 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 Orange
County;
c) A summary of relevant annual performance metrics,
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including measures of utilization, enforcement, and
customer satisfaction;
d) Any public comments submitted to the FPPC or Orange
County relative to the operation of the agreement; and,
e) Any legislative recommendations.
9)Contains an urgency clause, allowing this bill to take effect
immediately upon enactment.
10)Makes legislative findings and declarations as to the
necessity of a special statute for Orange County to ensure the
integrity of the electoral process while reducing corruption,
and the appearance of corruption, in the County of Orange.
EXISTING LAW:
1)Creates the FPPC, and makes it responsible for the impartial,
effective administration and implementation of the 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
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
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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, as specified.
5)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.
6)Authorizes the FPPC, until January 1, 2020 and upon mutual
agreement between the FPPC and the City Council of the City of
Stockton, 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, as specified.
FISCAL EFFECT: Unknown
COMMENTS:
1)Purpose of the Bill: According to the author:
AB 2070 will enable Orange [County], upon approval by
voters within the affected jurisdiction to contract
with the [FPPC] for the administration and enforcement
of local campaign finance laws.
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The [PRA] allows local governments to adopt more
stringent campaign finance laws for elections within
their jurisdiction.
The FPPC has broad authority across the state to
enforce the [PRA], but it does not assume primary
responsibility for a local government's additional
campaign finance laws.
Instead, the county board of supervisors or the city
council must monitor local ordinances or create an
Ethics Commission with this authority.
Implementing either of these options can be cost
prohibitive for local governments.
This bill is modeled after legislation from 2012,
which authorized the FPPC to contract with the County
of San Bernardino to assume primary responsibility for
the County's campaign finance laws.
AB 2070 extends these provisions to Orange County upon
voter approval and authorizes the FPPC to become the
civil prosecutor responsible for the civil enforcement
of local campaign finance violations.
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Contracting with the FPPC gives local governments the
ability to bring in an experienced, independent, and
impartial entity to investigate possible violations
and bring administrative or civil action against
violators.
2)San Bernardino County: In 2012, the Legislature passed and
the Governor signed 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 the 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 from January 1, 2015 through December
31, 2016.
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This bill is similar to the provisions of AB 2146 (Cook),
however, there are a few differences. First, this bill
expands the duties of the FPPC, as the civil prosecutor of
Orange County's campaign finance ordinance, to provide advice
and bring civil actions. Additionally, this bill provides
that the FPPC shall not be required to obtain authorization
from the district attorney of Orange County to bring an
administrative or civil action. Finally, this bill does not
contain a sunset and has an urgency clause that would make the
bill go into effect immediately.
According to previous analyses, in November 2014, Orange County
voters approved Measure E, which authorized the County to
contract with the FPPC for the administration and enforcement
of its local campaign finance ordinance, commonly referred to
as TINCUP. Consequently, this bill is an attempt to fulfill
the will of Orange County voters.
3)FPPC and San Bernardino County Report: As mentioned above, in
2012, AB 2146 (Cook) became law to permit San Bernardino
County and the FPPC to enter into an agreement for the FPPC to
enforce the County's local campaign finance reform ordinance.
Among other provisions, AB 2146 also required the FPPC, if it
entered into an agreement with the San Bernardino County Board
of Supervisors, to report to the Legislature with specified
information on or before January 1, 2017. Current law
requires the report to include, but not be limited to, the
status of the agreement, the estimated annual cost savings, if
any, for the County of San Bernardino, a summary of relevant
annual performance metrics, as specified, any public comments
submitted relative to the operation of the agreement, and any
legislative recommendations.
The FPPC submitted the report to the committee on March 24,
2016. According to the report, the FPPC served to
administer, interpret and enforce the County's ordinance,
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focusing on four key areas - advising, informing, auditing,
and enforcing. Key points detailing the FPPC's
responsibilities include, but is not limited to, the
following:
Advising candidates for elected county offices and
potential contributors in county elections regarding the
county's local campaign finance reform ordinance;
Proposing revisions to the original ordinance to
help the ordinance more closely align with the PRA;
Providing training and developing educational
materials to assist candidates and campaign treasurers in
the county;
Conducting audits of 22 candidates and campaign
committees;
Resolving 23 cases involving committees, candidates,
and donors involved in San Bernardino County elections
(of those 23 cases, the FPPC prosecuted 9 cases resulting
in fines, issued warning letters in 4 cases, and closed
10 cases with no violation found).
Additionally, County staff stated that the agreement between
the FPPC and the San Bernardino County resulted in substantial
savings when compared to the cost of other public ethics
commissions and aided in enforcement proceedings by removing
any semblance of conflict of interest. The report concluded
by stating that the partnership between the FPPC and the San
Bernardino County has been successful and both the FPPC and
San Bernardino County support removing the sunset date from
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the statute.
1)The City of Stockton: Last year, the Legislature passed and
the Governor signed AB 1083 (Eggman), Chapter 186, Statutes of
2015, which 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, as specified. According to the FPPC, no
contract has been entered into with the City Council of the
City of Stockton to enforce a local campaign finance
ordinance.
2)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
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
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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.
3)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 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
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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.
4)Arguments in Opposition: In opposition, the Orange County
Employees Association (OCEA), writes:
OCEA takes issue with the county potentially contracting
with the FPPC because they are concerned the county's
finance law, known as TINCUP, would be invalidated because
it's stricter than the state law.
We are unsure why this bill was introduced; we have been
told that the Orange County [Board of Supervisors (BOS)] is
not pushing for this legislation allowing the [FPPC] to
investigate and enforce campaign finance laws in the
region. In fact, they have placed Measure A on the June
2016 ballot asking for the establishment of an ethics
commission as recommended by the Orange County Grand Jury.
Establishing a local County commission would require
changing a law approved by voters last year permitting the
County to contract with the state [FPPC] for civil
enforcement of county campaign laws with legislative
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approval. The ballot measure also would ask voters to
approve a charter amendment giving the executive director
of the proposed Orange County Campaign Finance and Ethics
Commission the legal authority to subpoena the bank records
of candidates for county offices?
While it may be true that the Orange County BOS approved
moving forward with this issue in their 2015-16 legislative
platform, the county's platform also called for them to
"continue the discussion locally about ethics, including,
but not limited to, local ethics oversight." The county did
just that and agreed to place Measure A on the June 2016
ballot establishing an ethics commission - a decision OCEA
whole-heartedly supports.
It seems to us that the Orange County Board of Supervisors
has had a change of heart and agreed to pursue a different
path then what was approved in the county platform over a
year ago.
5)Political Reform Act of 1974: California voters passed an
initiative, Proposition 9, in 1974
that created the FPPC and codified significant restrictions and
prohibitions on candidates, officeholders, and lobbyists. That
initiative is commonly known as the PRA. Amendments to the
PRA that are not submitted to the voters, such as those
contained in this bill, must further the purposes of the
proposition and require a two-thirds vote of each house of the
Legislature.
6)Related Legislation: AB 2558 (Steinorth), removes the January
1, 2018 sunset date from a provisions of law that authorizes
the FPPC to permanently enforce San Bernardino County's local
campaign finance reform ordinance. AB 2558 was approved by
this committee on a 7-0 vote, and is pending in the Assembly
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Appropriations Committee
7)Previous Legislation: 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.
AB 910 (Harper) of 2015, would have authorized 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 910 was never heard in
this committee.
AB 1083 (Eggman), Chapter 186, Statutes of 2015, permits the
City Council of the City of Stockton and the 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.
8)Double Referral: After this bill was referred to this
committee, the Assembly Rules Committee instructed that it
should be referred to the Assembly Local Government Committee
upon approval by this committee. Accordingly, any motion to
approve this bill should provide for the bill to be
re-referred to the Assembly Local Government Committee.
REGISTERED SUPPORT / OPPOSITION:
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Support
None on file.
Opposition
Orange County Employees Association
Analysis Prepared by:Nichole Becker / E. & R. / (916) 319-2094