BILL ANALYSIS
SENATE COMMITTEE ON ELECTIONS, REAPPORTIONMENT AND
CONSTITUTIONAL AMENDMENTS
Senator Loni Hancock, Chair
BILL NO: AB 7 HEARING DATE:
7/7/09
AUTHOR: KREKORIAN ANALYSIS BY:
Darren Chesin
AMENDED: 5/14/09
FISCAL: YES
SUBJECT
Independent expenditures: advertisements: disclosure
DESCRIPTION
Existing law requires the legal name of a committee that
supports or opposes one or more ballot measures to include
a name or phrase that identifies the economic or other
special interest of its major donors of $50,000 or more.
If the major donors of $50,000 or more share a common
employer, the identity of the employer must also be
disclosed.
Existing law defines "independent expenditure" (IE) as an
expenditure made by any person in connection with a
communication which expressly advocates the election or
defeat of a clearly identified candidate or the
qualification, passage or defeat of a clearly identified
measure, or taken as a whole and in context, unambiguously
urges a particular result in an election but which is not
made to or at the behest of the affected candidate or
committee.
Existing law 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.
This bill requires every broadcast or mass mailing
advertisement supporting or opposing a candidate or ballot
measure that is paid for by an IE to include both of the
following:
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; and,
The Uniform Resource Locator (URL) address for an
Internet web site established by the committee that lists
the committee's principal officer and all donors who made
contributions of $100 or more to the committee.
This bill also 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. The economic or other special interest of the
major donors of $50,000 or more must be listed in
descending order based on the amount of the contributions
made by the respective donor to the committee.
BACKGROUND
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
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
AB 7 (KREKORIAN) Page
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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.
COMMENTS
1.According to the author : In recent years, California has
seen an astounding increase in the amount of money spent
to influence elections, particularly by independent
expenditure committees. Since 2000, $88 million has been
spent on independent expenditures to support or oppose
candidates, with $42 million originating from just 10
groups.
These expenses are made to influence California's political
process, to shape our laws and, ultimately, to affect the
future of all Californians. IE 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
expenditures" for legislative and statewide candidates
from 2001 through 2006 came from just 25 "independent
expenditure" groups.
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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 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 influence their
votes.
AB 7 seeks to ensure that voters have the most useful
information about the political groups formed to sway
their decisions in the voting booth. AB 7 also helps to
resolve the current disparity between disclosure
statements for ballot measure committees and those of IE
committees by making the disclosures uniform while also
providing for several key disclosures so that the
information is formatted in a way to provide voters with
a better understanding of what interests are behind the
political advertisements (without substantially
increasing the length of the disclosure statement).
2.On the Other Hand . The California Broadcasters
Association, which opposes this bill, maintains that
"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
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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."
3.Related Legislation . AB 1322 (Huffman), which is also
being heard in this committee today, specifies the text
and format in which a disclosure must appear when such
disclosures are required on certain IEs. AB 1322
contains a similar requirement regarding disclosure of an
Internet website address where contributor information
can be accessed.
PRIOR ACTION
Assembly Elections and Redistricting Committee:6-0
Assembly Appropriations Committee: 12-2
Assembly Floor: 61-15
POSITIONS
Sponsor: Author
Support: New America Foundation
California Common Cause
Oppose: California Broadcasters Association
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