BILL ANALYSIS
AB 7
Page 1
Date of Hearing: April 30, 2009
ASSEMBLY COMMITTEE ON ELECTIONS AND REDISTRICTING
Paul Fong, Chair
AB 7 (Krekorian) - As Amended: April 27, 2009
SUBJECT : Political Reform Act of 1974.
SUMMARY : Requires an independent expenditure (IE) ad that
supports or opposes a candidate or ballot measure to contain a
statement identifying the economic or other special interests of
the major donors to the committee, and requires the committee to
provide an address for a Web site that lists the donors to the
committee. Specifically, this bill :
1)Requires every broadcast or mass mailing advertisement
supporting or opposing a candidate or ballot measure that is
paid for by an IE to include a statement or phrase that
clearly identifies the economic or other special interest of
the major donors of $50,000 or more to the committee.
2)Provides that if any of the major donors of $50,000 or more to
the committee is another committee, that major donor shall be
identified by the names of the economic or other special
interest that made the highest cumulative contributions of
$50,000 or more to that committee.
3)Requires the economic or other special interest of the major
donors of $50,000 or more to be listed in descending order
based on the amount of the contributions made by the
respective donor to the committee.
4)Requires every broadcast or mass mailing advertisement
supporting or opposing a candidate or ballot measure that is
paid for by an IE to include the Uniform Resource Locator
(URL) for an Internet Web site established by the committee
that lists the committee's responsible officer and all donors
to the committee.
5)Makes technical changes.
EXISTING LAW :
1)Requires a committee that supports or opposes one or more
ballot measures to name itself using a name or phrase that
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identifies the economic or other special interest of its major
donors of $50,000 or more. Provides that if the major donors
of $50,000 or more share a common employer, the identity of
the employer must also be disclosed.
2)Requires a broadcast or mass mailing advertisement supporting
or opposing a candidate or ballot measure that is paid for by
an IE to include a disclosure statement identifying the name
of the committee making the expenditure and the names of the
persons from whom the committee making the IE received its two
highest cumulative contributions of $50,000 or more during the
12-month period prior to the expenditure.
FISCAL EFFECT : Unknown. State-mandated local program; contains
a crimes and infractions disclaimer.
COMMENTS :
1)Purpose of the Bill : According to the author:
Independent expenditure committees and ballot measure
committees both seek the same result by their actions:
influence over the political process and California
law. Ballot measure committees directly amend laws or
introduce new statutes and are often driven by
interests whose intents or interests may or may not be
truthfully stated over the course of their advocacy.
Similarly, Independent Expenditure committees can
introduce into California's political process vitriol
and hate or high-minded debate and informative
activism, depending on the nature of the interests
running the committee. What cannot be disputed is
that IE committees expend a great deal of money to
accomplish their goals. A report issued last year by
the Fair Political Practices Commission (Independent
Expenditures: The Giant Gorilla in Campaign Finance)
highlighted the issue. From the Report:
Since Proposition 34 took effect on January 1, 2001,
through the 2006 election cycle, more than $88 million
was spent on "independent expenditures" benefiting
candidates for state office.
$63 million of the $88 million spent on "independent
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expenditures" for legislative and statewide candidates
from 2001 through 2006 came from just 25 "independent
expenditure" groups.
There was a 6,144% increase in "independent
expenditure" spending in legislative elections between
2000 and 2006.
There was a 5,502% increase in "independent
expenditure" spending for statewide candidates between
2002 and 2006. . .
"Independent expenditure" committees often make it
more difficult to track the true source of spending on
behalf of candidates. That's because "independent
expenditure" committees frequently make contributions
to other such committees, thus adding an additional
layer that obscures the identities of the original
donors. Facilitating full disclosure is crucial to
ensuring the public's right to know which interests
are funding political campaigns.
Given the volume of cash contributed to ballot measure
committees and IE committees with the goal of
influencing California's political process, AB 7 has a
simple premise: the voters, and those affected by the
political influence of such committees, have a right
to know who is trying to move their votes.
AB 7 approaches this problem by expanding the
disclosures required on broadcasts and mailers by . .
. independent expenditure campaigns.
2)On-Ad Disclosures : Existing law generally requires IEs and
ads supporting or opposing ballot measures to include a
disclosure statement identifying the top two donors of $50,000
or more to the committee paying for the ad. Additionally,
existing law requires any committee that supports or opposes
one or more ballot measures to name itself using a name or
phrase that clearly identifies the economic or other special
interest of its major donors of $50,000 or more, and since the
name of the committee paying for an advertisement is required
to be included in the advertisement, any ad in support of or
in opposition to a ballot measure will include an
identification of the economic or other special interest of
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the major donors to the committee funding the ad.
This bill places a similar requirement on ads that are paid for
by IEs. However, rather than requiring the committee name to
include the economic or other special interest of the major
donors of $50,000 or more to the committee, this bill instead
requires that the economic or other special interest of the
donors of $50,000 or more to the committee funding the ad be
included in the ad. Additionally, to ensure that IEs contain
a full disclosure of the interests that are funding an ad,
this bill provides that if one of the major donors of $50,000
or more to the committee funding the ad is another committee,
the ad must also include the economic or special interest of
the major donors to the committee that made the donation.
3)Arguments in Opposition : The California Broadcasters
Association, which opposes this bill, writes:
This bill will increase campaign costs. Unlike the
requirements for all other media, disclosures in radio
advertisements must be vocalized - which in the case of
ballot propositions can currently require over 50% of a 30
second ad. By adding a potentially lengthy web locator
address, the time required for disclosures would consume
over 20 seconds in a 30 second spot. This URL would
contain the same financial disclosures currently stated
within the advertisement.
Radio is one of the least expensive ways to advertise, but
is already being underutilized by political consultants
because the current disclosures dramatically reduce the
time available for an educational message. Lengthening
these disclosures will eliminate radio as a source of low
cost campaign advertising.
4)Related Legislation : AB 1322 (Huffman), which is pending in
the Assembly Appropriations Committee, specifies the text and
format in which a disclosure must appear when such disclosures
are required on certain IEs. AB 1322 was approved by this
committee on April 21, 2009 on a 7-0 vote.
5)Political Reform Act of 1974 (PRA) : California voters passed
an initiative, Proposition 9, in 1974 that created the Fair
Political Practices Commission and codified significant
restrictions and prohibitions on candidates, officeholders and
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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 initiative and require a two-thirds vote of
both houses of the Legislature.
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REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
California Broadcasters Association
Analysis Prepared by : Ethan Jones / E. & R. / (916) 319-2094