BILL ANALYSIS Ó
SENATE COMMITTEE ON
ELECTIONS AND CONSTITUTIONAL AMENDMENTS
Senator Ben Allen, Chair
2015 - 2016 Regular
Bill No: SB 1467 Hearing Date: 4/19/16
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|Author: |Bates |
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|Version: |4/13/16 |
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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: campaign prohibitions
DIGEST
Prohibits a candidate-controlled ballot measure committee from
expending campaign funds on an advertisement featuring the
controlling candidate or another officeholder or candidate.
ANALYSIS
Existing law:
1)Defines "controlled committee" as a committee that's
controlled directly or indirectly by a candidate or state
measure proponent or that acts jointly with a candidate,
controlled committee, or state measure proponent in connection
with the making of expenditures. A candidate or state measure
proponent controls a committee if he or she, his or her agent,
or any other committee he or she controls has a significant
influence on the actions or decisions of the committee.
2)Provides, pursuant to regulations promulgated by the Fair
Political Practices Commission (FPPC), that
candidate-controlled ballot measure committee funds shall be
used only to make expenditures related to a state or local
measure or potential measure anticipated by the committee, or
to qualification or pre-qualification activities relating to
such measures.
3)Defines "advertisement," for purposes of the Political Reform
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Act (PRA), as any general or public advertisement which is
authorized and paid for by a person or committee for the
purpose of supporting or opposing a candidate for elective
office or a ballot measure or ballot measures.
"Advertisement" does not include a communication from an
organization other than a political party to its members, a
campaign button smaller than 10 inches in diameter, a bumper
sticker smaller than 60 square inches, or other advertisement
as determined by regulations of the FPPC.
This bill:
1)Prohibits a committee controlled by a candidate for elective
office that is primarily formed to support or oppose one or
more ballot measures from expending campaign funds on an
advertisement featuring the controlling candidate or another
officeholder or candidate, as specified.
Provides, for purposes of this bill, that "featuring a candidate
or officeholder" means using any of the following belonging to
the candidate or otherwise singling out the candidate or
officeholder: name, signature, title, voice, or image.
BACKGROUND
Was the Prior Version of this Bill Constitutional ? The prior
amended version of this bill sought to extend existing campaign
contribution limits that are applicable to state officeholders
and candidates for state office to ballot measure committees
controlled by state officeholders and candidates for state
office. However, given questions related to the
constitutionality of that approach, the author amended the bill
to instead prohibit a candidate-controlled ballot measure
committee from expending campaign funds on an advertisement
featuring the controlling candidate or another officeholder or
candidate.
The U.S. Supreme Court has made a distinction between limits on
campaign contributions made to candidates and limits on campaign
contributions made to ballot measure committees. In Buckley v.
Valeo (1976), the Supreme Court upheld contribution limits
placed upon candidates, acknowledging the state interest of
preventing corruption or its appearance. However, in Citizens
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Against Rent Control v. City of Berkeley (1981), the Court found
no such risk of corruption exists when contributions are given
to ballot measure committees. Accordingly, the Court struck
down a City of Berkeley ordinance that placed a $250
contribution limit on ballot measures committees.
The ballot measure committee at issue in Citizens Against Rent
Control wasn't candidate-controlled, however. The prior version
of this bill sought to regulate contributions made to
candidate-controlled ballot measure committees, and didn't
restrict contributions made to non-candidate controlled
committees similar to the one in Citizens Against Rent Control.
On June 25, 2004, the FPPC adopted regulations governing
contributions to ballot measure committees controlled by elected
state officers and candidates for state elective office. Under
those regulations, contributions to a ballot measure committee
that is controlled by a candidate for elective state office were
to be limited to the contribution limits that applied to the
individual's candidate committee at the time the candidate took
control of the ballot measure committee.
On February 8, 2005, a suit was filed against the FPPC
challenging those regulations. The plaintiffs claimed the
regulation adopted by the FPPC was illegal for several reasons,
including that the FPPC lacked the statutory authority to adopt
the regulation and that the regulation violated the First
Amendment to the United States Constitution per Citizens Against
Rent Control.
In Citizens to Save California v. California Fair Political
Practices Commission (2006) the regulation was invalidated by
the Court of Appeal, Third Appellate District, which, without
reaching the constitutional issue, held that the Commission
lacked the statutory authority to impose contribution limits on
candidate-controlled ballot measure committees.
It is unclear whether a court would have upheld the prior
provisions of this bill given that a similar regulation was
struck down in court. In the Citizens to Save California
decision, the court indicated its ruling was based on the
determination that the FPPC didn't have the statutory authority
to adopt a regulation limiting contributions to ballot measure
committees that are controlled by candidates for elective state
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office. However, the trial court judge also expressed concerns
about the constitutionality of the regulation, concerns that
presumably would be equally applicable to a statutory limit on
contributions to ballot measure committees that are controlled
by candidates for elective state office.
Is the Current Version of this Bill Constitutional ? According
to an April 12, 2016 letter to Senator Bates from the
Legislative Counsel, "The proposed measure, if enacted, would
prohibit a committee controlled by a candidate for elective
office that is primarily formed to support or oppose one or more
ballot measures from expending campaign funds on an
advertisement featuring the controlling candidate or another
officeholder or candidate. By restricting the manner in which a
committee may engage in political discourse regarding support
for or opposition to a ballot measure, this prohibition may be
subject to constitutional challenge as an unconstitutional
restraint on political speech protected by the First Amendment
to the United States Constitution (see Mclntyre v. Ohio
Elections Commission (1995) 514 U,S. 334)."
While Mclntyre centered on the ability of certain political
speech to remain anonymous, and other sender identification
requirements have been upheld, it nevertheless served to confirm
the Court's decisions in prior cases that a limitation on
political expression is subject to "exacting scrutiny." In the
majority opinion in Mclntyre, the Court stated: "Indeed, as we
have explained on many prior occasions, the category of speech
regulated by the Ohio statute occupies the core of the
protection afforded by the First Amendment: When a law burdens
core political speech, we apply "exacting scrutiny," and we
uphold the restriction only if it is narrowly tailored to serve
an overriding state interest."
While it is difficult to predict whether or not the federal
courts would deem this bill as narrowly tailored enough to serve
an overriding state interest, it is probably safe to assume that
if the bill only prohibited advertisements that "feature" the
controlling candidate, rather than other candidates and
officeholders as well, there is a higher likelihood that it
would withstand a potential challenge on First Amendment
grounds.
COMMENTS
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1) According to the author : SB 1467 would close the campaign
finance loophole that allows candidates and elected officials
to promote themselves and their campaigns with money from
candidate-controlled ballot measure committees.
Unlike typical campaign contributions, current law allows
unlimited contributions to candidate-controlled ballot
measure committees. Money donated to candidate-controlled
ballot measure committees can be used for advertisements
featuring candidates in a positive light, with the intent to
promote the candidate. This practice creates complex
questions as to which funds should be allocated for which
expenditures and whether it is acceptable for a candidate's
campaign to derive benefits from expenditures from the
candidate's controlled committee.
During the investigation that led to former-Senator Leland
Yee's federal indictment for corruption, arms trafficking,
and racketeering, Yee told an undercover FBI agent he could
avoid the restrictions of contribution limits by giving money
to a ballot measure committee that would run ads featuring
him in a positive light. This description shows just how
easily candidates can dip into candidate-controlled ballot
measure committees to promote themselves.
Today, it is much too easy for politicians to gain an unfair
advantage by using ballot measure committee funds to advance
their own campaigns. SB 1467 would put an end to the practice
of candidates and elected officials using
candidate-controlled ballot measure committees to advance
their own candidacies.
In 2000, California voters overwhelmingly enacted Proposition
34, which created contribution limits for state legislature
elections and statewide elections. Proponents of Proposition
34 recognized that elections must be held on an even playing
field to ensure the integrity of our democratic system.
Unfortunately, candidates and elected officials with
candidate-controlled ballot measure committees are now able
to skirt the intentions of California's voters. By opening up
a candidate-controlled ballot measure committee, politicians
can now spend vast sums of money promoting themselves,
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outside of the boundaries of campaign finance laws.
This law would apply to all California legislators and
statewide office holders, as well as those seeking those
offices.
Amendment to Consider . Given the constitutional issues raised
in the "Background" section, above, the committee and the author
may wish to consider amending this bill so that it only
prohibits advertisements that "feature" the controlling
candidate, rather than other candidates and officeholders as
well.
RELATED/PRIOR LEGISLATION
AB 709 (Wolk, of 2006) and AB 1980 (Wolk, of 2004) would have
applied existing contribution limits to candidate-controlled
ballot measure committees. AB 709 failed passage in this
committee while the Conference Committee Report for AB 1980 was
adopted in the Senate but failed in the Assembly. The version
of AB 1980 that was heard in this committee was substantially
different than the version contained in the Conference Committee
report.
POSITIONS
Sponsor: Author
Support: Daniel Schnur, Former Chairman, California Fair
Political Practices Commission
California Voices for Progress
Oppose: None received
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