BILL NUMBER: AB 2842	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Leno

                        FEBRUARY 20, 2004

   An act to amend Section 85307 of, and to add Sections 85303.3,
85303.4, and 85303.5 to, 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 2842, as introduced, Leno.  Political Reform Act of 1974.
   (1) The Political Reform Act of 1974 limits the total amount per
election that may be contributed by a person to a candidate for
elective state office, and to committees who make contributions and
expenditures in support of the candidate.  Under existing law, Member
of the Legislature is an elective state office.  Under existing law,
contributions of personal funds by a candidate to his or her own
campaign are excepted from the contribution limits.
   This bill would authorize a legislative candidate to accept
contributions at twice the limit if the total amount of personal
funds contributed by an opposing candidate to his or her own campaign
exceeds the total amount of campaign contributions raised by the
candidate, not including amounts contributed from the candidate's
personal funds, by more than $300,000, but less than $600,000.  The
bill would allow contributions to be accepted at 3 times the limit if
the total amount of personal funds contributed by an opposing
candidate to his or her own campaign exceeds the total amount of
campaign contributions raised by the candidate, not including amounts
contributed from the candidate's personal funds, $600,000 or more,
but less than $900,000, and would remove the limits if the total
amount of personal funds contributed by an opposing candidate to his
or her own campaign exceeds the total amount of campaign
contributions raised by the candidate, not including amounts
contributed from the candidate's personal funds, by $900,000 or more.
  The bill would prohibit the amount raised by the candidate under
the increased levels from exceeding the amount of personal funds
contributed by the opposing candidate to his or her own campaign.
The bill would require a legislative candidate that intends to use
personal funds for his or her campaign to file a statement that
includes the amount the candidate intends to spend at the time the
candidate files his or her statement of intention to be a candidate,
as specified.
   (2) Existing law prohibits a candidate for elective state office
from personally loaning to his or her campaign an amount that would
have an outstanding balance in excess of $100,000.
   This bill would state that included in this amount are the
proceeds of a loan obtained by the candidate from a commercial
lending institution.  The bill would also prohibit a candidate for
elective state office from contributing personal funds to his or her
controlled committee 30 days prior to an election.
   (3) Under existing law, a violation of the Political Reform Act of
1974 is subject to administrative, civil, and criminal penalties.
This bill would impose a state-mandated local program by imposing
these penalties on persons who violate the provisions of the bill.
  (4) 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.
   (5) The Political Reform Act of 1974, an initiative measure,
provides that the Legislature may amend the act to further the act's
purposes with a 2/3 vote of each house and compliance with specified
procedural requirements.  This bill, which would declare that it
furthers the purposes of the act, would therefore require a 2/3 vote.

   (6) The bill would declare that it is to take effect immediately
as an urgency statute.
   Vote:  2/3.  Appropriation:  no.  Fiscal committee:  yes.
State-mandated local program:  yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 85303.3 is added to the Government Code, to
read:
   85303.3.  (a) For each election, if the total amount of personal
funds contributed by an opposing candidate to his or her own campaign
exceeds the total amount of campaign contributions raised by a
candidate, not including amounts contributed from the candidate's
personal funds, by more than three hundred thousand dollars
($300,000), but less than six hundred thousand dollars ($600,000),
the contribution limitations set forth in Section 85301 shall be
doubled for the candidate.
   (b) For each election, if the total amount of personal funds
contributed by the opposing candidate to his or her own campaign
exceeds the total amount of campaign contributions raised by a
candidate, not including amounts contributed from the candidate's
personal funds, by six hundred thousand dollars ($600,000), but less
than nine hundred thousand dollars ($900,000), the contribution
limitations set forth in Section 85301 shall be tripled for the
candidate.
   (c) For each election, if the total amount of personal funds
contributed by the opposing candidate to his or her own campaign
exceeds the total amount of campaign contributions raised by a
candidate, not including amounts contributed from the candidate's
personal funds, by nine hundred thousand dollars ($900,000) or more,
the contribution limitations set forth in Section 85301 shall not
apply to the candidate.
   (d) For each election, the amount raised by the candidate under
the increased levels may not exceed the amount of personal funds
contributed by the opposing candidate to his or her own campaign.
   (e) A candidate shall provide an initial notification to all other
candidates by guaranteed overnight mail or personal delivery within
24 hours of the time that the candidate has contributed personal
funds to his or her campaign that, in the aggregate, exceed three
hundred thousand dollars ($300,000).  Thereafter, the candidate shall
provide notification in this manner when he or she continues
personal funds to his or her campaign that, in the aggregate, exceed
six hundred thousand dollars ($600,000) and nine hundred thousand
dollars ($900,000).  Upon notification, any candidate who is entitled
to accept contributions under the increased contribution limits may
begin accepting contributions at the increased limits.  The candidate
shall also file the notification within the 24-hour timeframe with
the Secretary of State by facsimile transmission, guaranteed
overnight mail, or personal delivery.
   (f) For the purposes of this section, "personal funds" includes
any amount derived from any of the following:
   (1) Any asset that a candidate has legal right of access to or
control over, and with respect to which the candidate has either of
the following:
   (A) Legal and rightful title.
   (B) An equitable interest.
   (2) Any payment to the candidate, including, but not limited to,
all of the following:
   (A) Salary, commission, or income derived by the candidate through
contract from any source.
   (B) Dividends and proceeds from the sale of the candidate's stocks
or investments.
   (C) Bequests to the candidate.
   (D) Income from trusts established before the beginning of the
election cycle.
   (E) Income from trusts established by bequest after the beginning
of the election cycle of which the candidate is a beneficiary.
   (F) Gifts to the candidate.
   (G) Proceeds from lotteries and similar games of chance.
   (H) The candidate's share of community property.
   (I) Any loan made to the candidate, including, notwithstanding
subdivision (a) of Section 85307, the proceeds of a loan made to a
candidate by a commercial lending institution for which the candidate
is personally liable.
   (g) This section applies only to legislative candidates.
  SEC. 2.  Section 85303.4 is added to the Government Code, to read:

   85303.4.  Every legislative candidate that intends to use personal
funds for his or her campaign shall file a statement of this intent
at the time he or she files the statement of intention specified in
Section 85200. The candidate shall indicate in the statement which of
the following amounts he or she intends to spend:
   (a) Less than three hundred thousand dollars ($300,000).
   (b) Three hundred thousand dollars ($300,000) or more, but less
than six hundred thousand dollars ($600,000).
   (c) Six hundred thousand dollars ($600,000) or more, but less than
nine hundred thousand dollars ($900,000).
   (d) Nine hundred thousand dollars ($900,000) or more.
  SEC. 3.  Section 85303.5 is added to the Government Code, to read:

   85303.5.  No candidate for elective state office may contribute
personal funds to his or her controlled committee 30 days prior to an
election.
  SEC. 4.  Section 85307 of the Government Code is amended to read:
   85307.   (a) The provisions of this article regarding
loans apply to extensions of credit, but do not apply to loans made
to a candidate by a commercial lending institution in the lender's
regular course of business on terms available to members of the
general public for which the candidate is personally liable.
   (b)  A candidate for elective state office may not
personally loan to his or her campaign an amount,  including the
proceeds of a loan obtained by the candidate from a commercial
lending institution,  the outstanding balance of which exceeds
one hundred thousand dollars ($100,000).  A candidate may not charge
interest on any loan he or she made to his or her campaign.
  SEC. 5.  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. 6.  The Legislature finds and declares that the provisions of
this act further the purposes of the Political Reform Act of 1974
within the meaning of subdivision (a) of Section 81012 of the
Government Code.
  SEC. 7.  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:
   In order to ensure that the November 2, 2004 statewide general
election is conducted in a fair and impartial manner, and to clarify
the law regarding candidate loans to the candidate's committee in
light of the ruling in Camp v.  Schwarzenegger (Super. Ct. Sacramento
County, 2004, No. 03AS05478), it is necessary that this bill go into
immediate effect.