BILL NUMBER: AB 2823 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MARCH 15, 2016
INTRODUCED BY Assembly Member Gatto
FEBRUARY 19, 2016
An act to amend Section 87206 of Sections
82033, 82034, 87103, 87206, and 87207 of, and to add Section 87206.5
to, the Government Code, relating to the Political Reform Act
of 1974.
LEGISLATIVE COUNSEL'S DIGEST
AB 2823, as amended, Gatto. Political Reform Act of 1974: economic
interest disclosure.
The Political Reform Act of 1974 prohibits a public official at
any level of state or local government from making, participating in
making, or in any way attempting to use his or her official position
to influence a governmental decision in which the public official
knows or has reason to know that he or she has a financial interest.
A public official has a financial interest in a governmental decision
if it is reasonably foreseeable that the decision will have a
material financial effect, distinguishable from its effect on the
public generally, on a business entity in which the public official
has a direct or indirect investment worth $2,000 or more, real
property in which the public official has a direct or indirect
interest worth $2,000 or more, or a source of income aggregating $500
or more in value within 12 months before the time when the decision
is made.
The Political Reform Act of 1974 requires persons holding
specified public offices to file disclosures of investments, real
property interests, and income within specified periods of assuming
or leaving office, and annually while holding the office. The act
requires the disclosures to include a statement indicating, within a
specified value range, the fair market value of investments or
interests in real property and the aggregate value of income received
from a source.
This bill would increase the thresholds at which a public official
has a disqualifying financial interest in a source of income from
$500 to $1,000, in investments in business entities from $2,000 to
$5,000, and in interests in real property from $2,000 to $10,000.
This bill would make conforming adjustments to the thresholds at
which income, investments, and interests in real property must be
disclosed on a public official's statement of economic interests. The
bill would also revise the dollar amounts associated with the value
ranges for reporting the value of economic interests.
Existing law makes a knowing or willful violation of the act a
misdemeanor and subjects offenders to criminal penalties.
By creating additional crimes, this bill would impose a
state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
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 make a technical, nonsubstantive change to that
provision.
Vote: majority 2/3 . Appropriation:
no. Fiscal committee: no yes .
State-mandated local program: no yes .
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 82033 of the
Government Code is amended to read:
82033. "Interest in real property" includes any leasehold,
beneficial or ownership interest interest,
or an option to acquire such an interest in real property
located in the jurisdiction owned directly, indirectly
indirectly, or beneficially by the public
official, or other filer, or his or her immediate family if the fair
market value of the interest is two ten
thousand dollars ($2,000) ($10,000) or
more. Interests in real property of an individual includes a pro rata
share of interests in real property of any business entity or trust
in which the individual or immediate family owns, directly,
indirectly indirectly, or beneficially, a
10-percent interest or greater.
SEC. 2. Section 82034 of the Government
Code is amended to read:
82034. "Investment" means any financial interest in
in, or security issued by
by, a business entity, including, but not limited to,
common stock, preferred stock, rights, warrants, options, debt
instruments, and any partnership or other ownership interest owned
directly, indirectly, or beneficially by the public official, or
other filer, or his or her immediate family, if the business entity
or any parent, subsidiary, or otherwise related business entity has
an interest in real property in the jurisdiction, or does business or
plans to do business in the jurisdiction, or has done business
within the jurisdiction at any time during the two years
prior to before the time any statement or other
action is required under this title. An asset shall not be deemed an
investment unless its fair market value equals or exceeds
two five thousand dollars ($2,000).
($5,000). The term "investment" does not include
a time or demand deposit in a financial institution, shares in a
credit union, any an insurance policy,
interest in a diversified mutual fund registered with the Securities
and Exchange Commission under the Investment Company Act of 1940
(15 U.S.C. Sec. 80a-1 et seq.) or in a common trust fund
created pursuant to Section 1564 1585
of the Financial Code, interest in a government defined-benefit
pension plan, or any a bond or other
debt instrument issued by any government or government agency.
Investments of an individual includes a pro rata share of investments
of any business entity, mutual fund, or trust in which the
individual or immediate family owns, directly, indirectly, or
beneficially, a 10-percent interest or greater. The term "parent,
subsidiary subsidiary, or otherwise
related business entity" shall be specifically defined by regulations
of the commission.
SEC. 3. Section 87103 of the Government
Code is amended to read:
87103. A public official has a financial interest in a decision
within the meaning of Section 87100 if it is reasonably foreseeable
that the decision will have a material financial effect,
distinguishable from its effect on the public generally, on the
official, a member of his or her immediate family, or on any of the
following:
(a) Any business entity in which the public official has a direct
or indirect investment worth two five
thousand dollars ($2,000) ($5,000) or
more.
(b) Any real property in which the public official has a direct or
indirect interest worth two ten
thousand dollars ($2,000) ($10,000) or
more.
(c) Any source of income, except gifts or loans by a commercial
lending institution made in the regular course of business on terms
available to the public without regard to official status,
aggregating five hundred one thousand
dollars ($500) ($1,000) or more in
value provided or to, promised to,
or received by, by the public
official within 12 months prior to before
the time when the decision is made.
(d) Any business entity in which the public official is a
director, officer, partner, trustee, employee, or holds any
a position of management.
(e) Any donor of, or any intermediary or agent for a donor of, a
gift or gifts aggregating two hundred fifty dollars ($250) or more in
value provided to, received by, or promised to the public official
within 12 months prior to before the
time when the decision is made. The amount of the value of gifts
specified by this subdivision shall be adjusted biennially by the
commission to equal the same amount determined by the commission
pursuant to subdivision (f) of Section 89503.
For purposes of this section, indirect investment or interest
means any investment or interest owned by the spouse or dependent
child of a public official, by an agent on behalf of a public
official, or by a business entity or trust in which the official, the
official's agents, spouse, and dependent children own directly,
indirectly, or beneficially a 10-percent interest or greater.
SECTION 1. SEC. 4. Section 87206 of
the Government Code is amended to read:
87206. If an investment or an interest in real property
is required to be disclosed under this article, the
statement shall contain: contain all of the
following:
(a) A statement of the nature of the investment or
interest. investment.
(b) (1) The name of the business entity in
which each investment is held, and a general description of the
business activity in which the business entity is engaged.
(c)
(2) The address or other precise location of the real
property.
(d)
(c) A statement whether
indicating which of the following represents the fair market
value of the investment or interest in real property equals
or exceeds two thousand dollars ($2,000) but does not exceed ten
thousand dollars ($10,000), whether it exceeds ten thousand dollars
($10,000) but does not exceed one hundred thousand dollars
($100,000), whether it exceeds one hundred thousand dollars
($100,000) but does not exceed one million dollars ($1,000,000), or
whether it exceeds one million dollars ($1,000,000).
investment:
(1) At least five thousand dollars ($5,000) but not greater than
ten thousand dollars ($10,000).
(2) Greater than ten thousand dollars ($10,000) but not greater
than fifty thousand dollars ($50,000).
(3) Greater than fifty thousand dollars ($50,000) but not greater
than one hundred thousand dollars ($100,000).
(4) Greater than one hundred thousand dollars ($100,000) but not
greater than two hundred fifty thousand dollars ($250,000).
(5) Greater than two hundred fifty thousand dollars ($250,000) but
not greater than five hundred thousand dollars ($500,000).
(6) Greater than five hundred thousand dollars ($500,000) but not
greater than one million dollars ($1,000,000).
(7) Greater than one million dollars ($1,000,000) but not greater
than two million dollars ($2,000,000).
(8) Greater than two million dollars ($2,000,000).
(e)
(d) In the case of a statement filed under
Sections Section 87203 or 87204, if the
investment or interest in real property was
partially or wholly acquired or disposed of during the period covered
by the statement, the date of acquisition or disposal.
(f) For purposes of disclosure under this article, "interest in
real property" does not include the principal residence of the filer
or any other property that the filer utilizes exclusively as the
personal residence of the filer.
SEC. 5. Section 87206.5 is added to the
Government Code , to read:
87206.5. (a) If an interest in real property is required to be
disclosed under this article, the statement shall contain all of the
following:
(1) A statement of the nature of the interest.
(2) The address or other precise location of the real property.
(3) A statement indicating which of the following represents the
fair market value of the interest in real property:
(A) At least ten thousand dollars ($10,000) but not greater than
one hundred thousand dollars ($100,000).
(B) Greater than one hundred thousand dollars ($100,000) but not
greater than two hundred fifty thousand dollars ($250,000).
(C) Greater than two hundred fifty thousand dollars ($250,000) but
not greater than five hundred thousand dollars ($500,000).
(D) Greater than five hundred thousand dollars ($500,000) but not
greater than seven hundred fifty thousand dollars ($750,000).
(E) Greater than seven hundred fifty thousand dollars ($750,000)
but not greater than one million dollars ($1,000,000).
(F) Greater than one million dollars ($1,000,000) but not greater
than two million dollars ($2,000,000).
(G) Greater than two million dollars ($2,000,000).
(4) In the case of a statement filed under Section 87203 or 87204,
if the interest in real property was partially or wholly acquired or
disposed of during the period covered by the statement, the date of
acquisition or disposal.
(b) For purposes of disclosure under this article, "interest in
real property" does not include the principal residence of the filer
or any other property that the filer uses exclusively as the personal
residence of the filer.
SEC. 6. Section 87207 of the Government
Code is amended to read:
87207. (a) If Except as provided in
subdivision (b), if income is required to be reported under
this article, the statement shall contain, except as
provided in subdivision (b): contain all of the
following:
(1) The name and address of each source of income aggregating
five hundred one thousand dollars
($500) ($1,000) or more in value, or
fifty dollars ($50) or more in value if the income was a gift, and a
general description of the business activity, if any, of each source.
(2) A statement whether indicating which
of the following represents the aggregate value of income from
each source, or in the case of a loan, the highest amount owed to
each source, was at least five hundred dollars ($500) but
did not exceed one thousand dollars ($1,000), whether it was in
excess of one thousand dollars ($1,000) but was not greater than ten
thousand dollars ($10,000), whether it was greater than ten thousand
dollars ($10,000) but not greater than one hundred thousand dollars
($100,000), or whether it was greater than one hundred thousand
dollars ($100,000). source:
(A) At least one thousand dollars ($1,000) but not greater than
ten thousand dollars ($10,000).
(B) Greater than ten thousand dollars ($10,000) but not greater
than fifty thousand dollars ($50,000).
(C) Greater than fifty thousand dollars ($50,000) but not greater
than one hundred thousand dollars ($100,000).
(D) Greater than one hundred thousand dollars ($100,000) but not
greater than two hundred fifty thousand dollars ($250,000).
(E) Greater than two hundred fifty thousand dollars ($250,000) but
not greater than five hundred thousand dollars ($500,000).
(F) Greater than five hundred thousand dollars ($500,000).
(3) A description of the consideration, if any, for which the
income was received.
(4) In the case of a gift, the amount and the date on which the
gift was received, and the travel destination for purposes of a gift
that is a travel payment, advance, or reimbursement.
(5) In the case of a loan, the annual interest rate, the security,
if any, given for the loan, and the term of the loan.
(b) If When the filer's pro rata
share of income to a business entity, including income to a sole
proprietorship, is required to be reported under this article, the
statement shall contain:
(1) The name, address, and a general description of the business
activity of the business entity.
(2) The name of every person from whom the business entity
received payments if the filer's pro rata share of gross receipts
from that person was equal to or greater than ten thousand dollars
($10,000) during a calendar year.
(c) If When a payment, including an
advance or reimbursement, for travel is required to be reported
pursuant to this section, it may be reported on a separate travel
reimbursement schedule schedule, which
shall be included in the filer's statement of economic
interest. interests. A filer who chooses not to
use the travel schedule shall disclose payments for travel as a gift,
unless it is clear from all surrounding circumstances that the
services provided were equal to or greater in value than the payments
for the travel, in which case the travel may be reported as income.
SEC. 7. No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.
SEC. 8. 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.