BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 1135
                                                                  Page  1

          Date of Hearing:   April 24, 2007

                   ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
                                   Mike Eng, Chair
                  AB 1135 (Strickland) - As Amended:  April 17, 2007
           
          SUBJECT  :   State government: reports: declarations.

           SUMMARY  :   Requires state agency reports to the Legislature to  
          include a signed statement under penalty of perjury by the head  
          of the agency that the contents of the report are true,  
          accurate, and complete, to the best of his or her knowledge.   
          Specifically,  this bill  :  

          1)Requires state agency reports to the Legislature to include a  
            statement signed under penalty of perjury by the head of the  
            agency that the contents of the report are true, accurate, and  
            complete, to the best of his or her knowledge.

          2)States that the provisions of this bill apply to the head of  
            every state agency, elected state officials, and any official  
            whose duties are prescribed by the California Constitution,  
            and the executive officers of the Franchise Tax Board and  
            Board of Equalization.

          3)Subjects any person who knowingly declares a false statement  
            to be true to a civil penalty of up to $20,000.  Requires an  
            action to assess civil penalties to be brought by the Attorney  
            General.

           EXISTING LAW  establishes numerous requirements for state and  
          local government agencies to prepare and submit to the  
          Legislature, the Governor, and other governmental entities,  
          written reports on various subject matters of interest to  
          policymakers and regulatory entities.

           FISCAL EFFECT  :   Unknown

           COMMENTS  :   According to the author's office:  "This bill would  
          ensure that all agencies, cities, counties, and the officials in  
          charge of them are held accountable to the same standards.  In  
          addition, the bill would bring state agency certification in  
          line with what public companies are already required to do by  
          federal law - remain accountable to their shareholders in  
          providing accurate financial information.  California taxpayers  








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          are the shareholders in state and local entities.  They deserve  
          the same accountability from the officials appointed to manage  
          public funds."

          This bill contains provisions similar to AB 1625 (Klehs) of  
          2005, and AB 2404 (Klehs) of 2006, both of which were vetoed by  
          the Governor.  In his veto message of AB 1625, the Governor  
          stated:

          "I absolutely believe that the Legislature, indeed all elected  
          officials, must base their decisions on information that is  
          true, accurate, and complete.  This bill, requiring legislative  
          reports to be submitted under penalty of perjury, only applies  
          to individuals appointed by the Governor and confirmed by the  
          Senate, and to the executive officer of the Franchise Tax Board  
          and the executive director of the Board of Equalization.

          "The law already protects against falsified reports to the  
          Legislature.  Department heads must take oaths of office, and  
          various Government and Penal Code provisions set forth duties,  
          obligations, and penalties for the accurate and truthful  
          execution of the operation of state government.  Further, the  
          Legislature may already require individuals appearing before it  
          to testify under oath, and false testimony is a felony.

          "I will consider similar legislation that applies to all written  
          materials used in the course of legislative deliberations that  
          applies to any official of the State, elected or appointed by  
          the Governor, the Legislature or any other constitutional  
          officer."

          In his veto message of AB 2404, the Governor stated:

          "Although I agree that the Legislature should base their  
          decisions on sound information that is true, accurate and  
          complete, I believe that this bill is the wrong approach.  By  
          requiring that only mandatory reports submitted to the  
          Legislature and State Controller contain signed statements  
          attesting to their accuracy, this bill would create an  
          inconsistent system in which some of the information considered  
          in the legislative process is subject to declarations of truth,  
          while the majority of the written material used in the  
          legislative process is accepted as truth without such  
          verification.









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          "The Legislature already has the authority to question the  
          accuracy of a report by requiring those responsible for  
          submitting the report to attest to the accuracy of the report  
          under oath.   Given this legislative oversight and the fact that  
          state law already makes it a misdemeanor for a state or local  
          official to submit a written report containing false information  
          to the State Controller, this measure is unnecessary."

          AB 1135 appears to partially address the Governor's veto message  
          by making this bill applicable to elected officials at the state  
          government level.  However, it is unclear what the Governor is  
          referring to in his veto statements that he would consider  
          signing legislation that applies the provisions of the two  
          previous bills to "written materials used in the course of  
          legislative deliberations that applies to any official of the  
          State, elected or appointed by the Governor, the Legislature or  
          any other constitutional officer."  The provisions of these  
          bills (AB1625 (Klehs), AB 2404 (Klehs), and this current bill)  
          are related to formal reports submitted by the Executive branch  
          of government and local governments to the legislative branch,  
          not the internal deliberations of either.  Accordingly, it is  
          unclear how the provisions of this bill requiring accuracy in  
          state agency reports to the Legislature can be applied to the  
          Legislature itself. 

           REGISTERED SUPPORT / OPPOSITION  :   

           Support 
           
          None on file.

           Opposition 
           
          None on file.
           
          Analysis Prepared by  :    Ross Warren / B. & P. / (916) 319-3301