BILL ANALYSIS
SENATE COMMITTEE ON ELECTIONS, REAPPORTIONMENT AND
CONSTITUTIONAL AMENDMENTS
Senator Loni Hancock, Chair
BILL NO: AB 2007 HEARING DATE:
6/15/10
AUTHOR: ADAMS ANALYSIS BY:
Darren Chesin
AMENDED: 4/5/10
FISCAL: YES
SUBJECT
Gifts: posting on FPPC website
DESCRIPTION
Existing law requires any entity that is required to file a
lobbying disclosure report to include on that report a list
of activity expenses made by the filer. "Activity expense"
means any expense (including gifts) incurred or payment
made by a filer, or arranged by a lobbyist or lobbying
firm, which benefits any elective state official,
legislative official, agency official, state candidate, or
member of the immediate family of one of those individuals.
Existing law requires any entity that is required to file a
lobbying disclosure report to provide each beneficiary of a
gift listed within the report information about the date
and amount of each gift reportable by the beneficiary and a
description of the goods or services provided to the
beneficiary.
Existing law requires candidates for and specified elected
or appointed state and local officers and designated
employees of state and local agencies to file a Statement
of Economic Interests (SEI) disclosing their financial
interests, including investments, real property interests,
and income. For the purposes of disclosing income on an
SEI, "income" includes gifts valued at $50 or more in a
calendar year from a single source.
This bill would require the Fair Political Practices
Commission (FPPC), on or before February 1 of each year, to
post on its Internet Web site information describing all
gifts donated to Members of the Legislature and designated
employees of the Legislature in the previous calendar year
and reported by the donors.
BACKGROUND
Recent Fines Imposed for Failure to Report Gifts . This bill
appears to be motivated, at least in part, by a number of
fines recently imposed by the FPPC on several members of
the Legislature and legislative employees for failure to
disclose the receipt of gifts that lobbyist employers
reported making to those members and employees. Because
the Political Reform Act (PRA) requires lobbyist employers
to disclose any activity expenses (which includes gifts to
members of the Legislature and legislative employees) that
they incur on their lobbying disclosure reports, the FPPC
was able to compare the gifts reported as having been made
by lobbyist employers with the gifts reported as having
been received by members of the Legislature and legislative
employees on their SEIs. In cases where a lobbyist
employer reported making a gift to a member of the
Legislature or a legislative employee that was valued at
$50 or more, and the member or employee did not report that
gift on his or her SEI, the FPPC initiated an investigation
and pursued enforcement actions.
This bill would require the FPPC to post information on its
Internet Web site about gifts that lobbyist employers (and
other entities that are required to file lobbying
disclosure reports) disclosed making to members of the
Legislature and to legislative employees.
COMMENTS
1.According to the author , members of the Legislature or
designated employees often attend an event while not
partaking in food or drink. As well it is a common
occurrence to have RSVP'd to an event and to not attend.
Should the donor of the gift report the individual as
participating, but does not send a letter to the
individual as a courtesy, the Member or employee might
not know to report that gift or to correct it with the
donor due to a lack of knowledge. The individual only
becomes aware of the reported gift once a FPPC violation
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notice has been issued without an adequate opportunity to
correct a misunderstanding.
AB 2007 would require the FPPC to post all gifts reported
by donors on their website to encourage transparency and
to allow Members of the Legislature and designated
employees to see what has been reported on their behalf
so that they may more accurately complete their reports.
2.Reportable Gifts Must Still Be Reported . While the
posting of this information on the Internet may make it
easier for legislators and legislative employees to
ensure that they are disclosing gifts that were given to
them, it would not relieve legislators and legislative
employees of the obligation under the PRA to report
having received gifts of $50 or more in a calendar year
from a single source if that source did not report having
made a gift to that legislator or employee.
3.Accuracy of Lobbying Reports . The information that would
be posted on the Internet by the FPPC pursuant to the
provisions of this bill would be based entirely on
reports filed by entities that are required to file
lobbying disclosure reports. In some cases, those
reports may be inaccurate, and may result in an Internet
posting that misrepresents the gifts actually received by
a member of the Legislature or by a legislative employee.
For instance, in the cases discussed above, the FPPC
dropped investigations against a number of members of the
Legislature and legislative employees who stated that a
lobbying disclosure report that indicated that a gift had
been made to that member or employee was in error. Such
erroneous reports can occur when a member or employee
RSVPs to attend a reception, for instance, but then fails
to attend, or when a member or employee attends a
reception but does not consume and food or beverages, but
fails to notify the entity filing the lobbying disclosure
report of that fact.
Having the FPPC post information about gifts reported as
having been made by entities filing lobbying disclosure
reports to members of the Legislature and legislative
employees could give the public an inaccurate impression
that the state agency responsible for the enforcement of
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the PRA had made a determination that those gifts
actually were received.
4.FPPC Workload and Costs . Approximately 4,500 entities
have filed lobbyist disclosure reports with the Secretary
of State (SOS) during the 2009-2010 Legislative Session.
Under the provisions of this bill, the FPPC would be
required to examine the reports filed by each of those
entities to determine if they reported making gifts to a
member of the Legislature or a designated legislative
employee and if so, to post that information on the
Internet.
5.Reports Already Available Online . Almost all of the
information that the FPPC would be required to post
online under the provisions of this bill is already
available online. Because most lobbyist disclosure
reports are required to be filed electronically with the
SOS, the only information that would be posted online
under this bill that is not already available through the
Web site of the SOS is information from lobbying
disclosure reports of entities that did not reach the
threshold at which they are required to file reports
electronically.
Under existing law, any person who is required to file
lobbying disclosure reports must file those reports
electronically if the total amount of reportable
payments, expenses, contributions, gifts, or other items
was $5,000 or more in any calendar quarter. Any entity
that reached that $5,000 threshold in any calendar
quarter since July 1, 2000 is required to file all
subsequent lobbying disclosure reports electronically,
even if they do not reach that $5,000 threshold in
subsequent quarters. These $5,000 thresholds will be
lowered to $2,500 on January 1, 2011 per AB 1181 (Huber)
Chapter 18 of 2010.
As such, it is likely that the vast majority of gifts
reported as having been given to members of the
Legislature and legislative employees are already
reported electronically and immediately posted to the Web
site of the SOS. Given this fact, the desirability for
having the FPPC post this information as well is unclear.
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6.User Friendliness . This bill does not explicitly require
the FPPC to post this information in any specific format.
Given that fact, it would appear that the FPPC could
comply with the provisions of this bill simply by
re-posting the lobbying disclosure reports that appear on
the SOS's Web site on its own Web site, though it would
also have to review any lobbying disclosure filings that
were not filed electronically to determine if those would
need to be made available online. If it is the author's
intent that the FPPC be required to provide this
information in a specific format, such as in a listing by
member of the Legislature or by employee, that should be
specified in this bill to ensure that the author's intent
is realized.
PRIOR ACTION
Assembly Elections and Redistricting Committee: 7-0
Assembly Appropriations Committee: 14-1
Assembly Floor: 74-0
POSITIONS
Sponsor: Author
Support: None received
Oppose: Fair Political Practices Commission
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