BILL ANALYSIS �
AB 447
Page 1
Date of Hearing: May 3, 2011
ASSEMBLY COMMITTEE ON ELECTIONS AND REDISTRICTING
Paul Fong, Chair
AB 447 (Huffman and Fletcher) - As Amended: April 25, 2011
AS PROPOSED TO BE AMENDED
SUBJECT : Political Reform Act of 1974.
SUMMARY : Makes numerous significant changes to the Political
Reform Act of 1974 (PRA). Specifically, this bill :
1)Establishes a framework for the development of a statewide
electronic campaign disclosure filing system, pursuant to the
following:
a) Permits the Secretary of State (SOS) to charge a fee on
the filing of any campaign disclosure report that is
required to be filed pursuant to the PRA. Requires the fee
revenues to be used only for the development and
maintenance of a system for online or electronic filing of
reports and statements required by the PRA.
b) Declares the intent of the Legislature to develop a
statewide electronic filing system that consolidates the
filing of state and local campaign statements and reports
required by the PRA into a searchable database that
provides for all of the following:
i) Electronic filing of committee organization
statements;
ii) Electronic filing of campaign statements by all
state committees, without regard to the amounts of
contributions and expenditures;
iii) Electronic filing of all reports by all major donors
at the state and local levels when specified thresholds
are met;
iv) A consolidated statewide network that includes a
process to import into the statewide database
state-required committee disclosures from each local
jurisdiction that has its own electronic filing system;
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and,
v) A statewide, Internet Web-based database with
expanded filing and public search capabilities that are
data-driven and user-friendly.
c) Requires the SOS and the Fair Political Practices
Commission (FPPC) to work towards development of the
electronic filing system described above, pursuant to the
following:
i) Requires the SOS and FPPC to develop a feasibility
study report outlining the technology requirements and
costs of the system by December 31, 2013;
ii) Requires the SOS and the FPPC to develop a funding
plan that includes a project budget for the duration of
the project. Requires the funding plan to describe
proposals for raising funds for development of the
electronic filing system, including grants from private
and public sources, federal funds, state appropriations,
and fees charged to filers of committee organization
statements and campaign statements;
iii) Requires the SOS and the FPPC to engage in
fundraising pursuant to the funding plan detailed above,
and pursuant to the FPPC's authority to accept funding;
and,
iv) Requires the SOS and the FPPC to complete work on
the development, construction, and launch of the
electronic filing system by December 31, 2017.
2)Makes the following changes to the schedule for filing of
campaign disclosure reports:
a) Requires elected officers, candidates, or committees
that are required to file campaign statements with the SOS
or with a county elections official to file a copy of each
campaign statement with the elections official of any
jurisdiction in which the filer made expenditures of
$25,000 or more during the reporting period, with limited
exceptions.
b) Permits a local government agency to enact an ordinance
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imposing additional or different filing requirements than
those set forth in the PRA if the additional or different
filing requirements apply only to a general purpose
committee that spends $25,000 or more in the jurisdiction
of that local government agency. States the intent of the
Legislature that the SOS and the FPPC make efforts to
coordinate with each local government agency that proposes
to enact, or has enacted, an ordinance described above to
harmonize, to the extent possible, the provisions of the
proposed or enacted ordinance with the PRA.
c) Requires regular campaign reports to be filed quarterly
in odd-numbered years, and monthly in even-numbered years,
instead of semi-annually in all years, for all candidates
for elective state office, all other candidates and
recipient committees for which the total cumulative
reportable amount of contributions made or received,
expenditures made, or loans made or received is $50,000 or
more, and all slate mailer organizations that have received
payments or made expenditures of $50,000 or more.
Maintains semi-annual filings for candidates for non-state
office, committees, and slate mailer organizations that do
not hit the $50,000 threshold, and for committees that are
not recipient committees. Permits a statement of
inactivity to be filed, in lieu of a campaign report, for
any quarterly or monthly reporting period during which the
candidate, committee, or slate mailer organization has
reportable contributions, expenditures, loans, and payments
of $500 or less. Provides that the requirements for the
statement of inactivity shall be proscribed by the FPPC.
d) Reduces the amount of time, from one month to 15 days,
that a candidate or committee has to prepare and file a
campaign report after the end of a regular reporting
period.
e) Reduces the number of pre-election campaign statements
that must be filed from two to one. Renames "pre-election
statements" as "16-day reports," and requires the 16-day
reports to be filed not later than the 16th day before the
election for the period ending 21 days before the election.
f) Extends the period that late contribution reports must
be filed from the last 16 days before an election to the
last 90 days before the election. Renames "late
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contribution reports" as "90-day contribution reports."
g) Extends the period that late independent expenditure
(IE) reports must be filed from the last 16 days before an
election to the last 90 days before the election. Renames
"late IE reports" as "90-day IE reports."
h) Eliminates the following special and supplemental
reporting requirements:
i) A requirement for recipient committees that are
primarily formed to support or oppose one or more state
ballot measures to file quarterly campaign reports,
instead of semi-annual campaign reports, for any
semi-annual period in which the committee was not
required to file a pre-election report.
ii) A requirement for a candidate or recipient committee
to file a supplemental pre-election report when the
candidate or committee makes contributions totaling
$10,000 or more in connection with an election if the
candidate or committee would not otherwise be required to
file a pre-election report during that semi-annual
reporting period, and if those contributions were not
already disclosed on another statement.
iii) A requirement for a recipient committee that makes
contributions totaling $10,000 or more to elected state
officers, their committees, or committees primarily
formed to support or oppose those officers, if those
contributions are made during the first half of a
semi-annual campaign reporting period in an odd-numbered
year, to file a supplemental report, unless all the
contributions were disclosed on a supplemental
pre-election report.
iv) A requirement for a candidate or recipient committee
to file a supplemental IE report when the candidate or
committee makes IEs totaling $1,000 or more in a calendar
year to support or oppose a candidate or measure.
i) Raises the threshold, from $5,000 to $25,000, at which
recipient committees that are required to file campaign
reports online or electronically are required to file a
report with the SOS when the committee makes contributions
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or IEs to support or oppose the qualification or passage of
a single state ballot measure. Requires the report to be
filed within 24 hours, instead of 10 business days, from
the time the contributions or IEs are made.
3)Establishes the following requirements governing the
designation of a treasurer for a committee:
a) Requires a person to complete an online certification
course prior to, or not later than 15 business days after,
being designated as a campaign treasurer. Provides that
this certification is valid for two years.
b) Requires the FPPC to design and administer the course to
address the statutes and regulations governing the
financing of campaigns, and the duties and responsibilities
of a treasurer under the PRA. Permits the FPPC to charge
up to $50 for the course, and permits this fee to be paid
or reimbursed with campaign funds.
c) Requires each application for certification as a
treasurer to verify, under penalty of perjury, the identity
of the person by means of an identifier determined by the
FPPC.
d) Requires each treasurer to verify, under penalty of
perjury, on a statement of organization or an amendment to
a statement of organization, that he or she has been
certified.
e) Provides that a campaign statement or report submitted
on behalf of a committee is not deemed filed if the
treasurer of the committee is not currently certified.
f) Requires the SOS's Web site to include a list of
treasurers who are certified.
4)Requires a campaign statement, when an expenditure must be
itemized on the statement, to include the date that the
expenditure was made.
5)Requires campaign statements to include details about
contributions received by the filer that were made at the
behest of a third party if the filer has reason to know that
those contributions were made at the behest of that third
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party, and if the cumulative amount of those contributions
plus the amounts the third party has contributed to the filer
equals or exceeds any relevant contribution limit for the
race.
6)Permits the FPPC, by regulation, to impose requirements
regarding the content of slate mailers in addition to those in
existing law.
7)Permits the FPPC to regulate the content of a prerecorded
telephonic message that is disseminated by means of an
automatic dialing-announcing device and that advocates the
support of, or opposition to, a candidate or ballot measure.
8)Increases the fine that may be assessed, from $10 to $25, for
each day that a statement or report is filed after the
deadline. Increases the maximum liability under this
provision from the greater of 100 percent of the cumulative
amount stated in the last statement or report or $100, to the
greater of 150 percent of the cumulative amount stated in the
last statement or report or $750.
9)Prohibits a candidate or elected officer from using campaign
funds to pay a fine imposed on him or her for failure to file
a statement of economic interests by the deadline.
10)Makes various corresponding and technical changes.
EXISTING LAW :
1)Prohibits any fee from being collected by any officer for the
filing of any report or statement, including campaign
disclosure reports, required to be filed pursuant to the PRA.
2)Requires every committee to have a treasurer. Prohibits an
expenditure from being made by or on behalf of a committee
without the authorization of the treasurer or that of his or
her designated agents. Prohibits a contribution or expenditure
from being accepted or made by or on behalf of a committee at
a time when there is a vacancy in the office of treasurer.
3)Requires the statement of organization for a campaign
committee to include the full name, street address, and
telephone number (if any), of the campaign's treasurer.
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4)Prohibits a local government agency from enacting an ordinance
imposing filing requirements additional to or different from
those set forth in the PRA unless the additional requirements
apply only to the candidates seeking election in that
jurisdiction, their controlled committees or committees formed
primarily to support or oppose their candidacies, to
committees formed or existing primarily to support or oppose a
local ballot measure that is being voted on only in that
jurisdiction, and to a city or county general purpose
committee active only in that city or county, respectively.
5)Requires elected officers, candidates, committees, and slate
mailer organizations to file semiannual campaign statements,
with certain exceptions.
6)Requires all candidates and committees that are required to
file campaign reports in connection with a state elective
office or state measure to file those reports online or
electronically if the cumulative amount of contributions
received, expenditures made, loans made, or loans received is
$25,000 or more.
7)Requires general purpose committees, including political party
committees and small contributor committees, that cumulatively
receive contributions or make expenditures of $25,000 or more
to support or oppose candidates for any elective state office
or state measure, to file campaign reports online or
electronically.
8)Requires slate mailer organizations to file campaign reports
online or electronically if the cumulative reportable payments
received or made for the purposes of producing slate mailers
is $25,000 or more.
9)Requires each slate mailer organization to include the name,
street address, and city of the slate mailer organization on
the outside of each piece of slate mail. Requires a specified
disclosure notice to be included on every slate mailer.
10)Requires campaign phone calls to include a disclosure of the
name of the organization that paid for or authorized the
calls, except in certain circumstances.
11)Requires a live person to announce any telephone call that is
placed through the use of an automatic dialing-announcing
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device, with certain exceptions.
12)Permits the use of campaign funds to pay fines if those fines
resulted from an action for which payment of attorney's fees
from contributions is permitted. Permits the expenditure of
campaign funds for attorney's fees where those fees are for
defense of an action brought for a violation of state or local
campaign or disclosure laws.
FISCAL EFFECT : Unknown. State-mandated local program; contains
a crimes and infractions disclaimer.
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COMMENTS :
1)Author's Amendments : After the committee's deadline for
accepting pre-committee amendments to this bill, the author
indicated his desire to make a number of substantive
amendments to this bill. Those amendments primarily remove
provisions of the bill as currently in print, thereby
narrowing the scope of this bill. Additionally, those
proposed author's amendments would make the quarterly/monthly
reporting schedule created by this bill applicable only to
candidates for state office and other candidates and
committees that spend or receive contributions of $50,000 or
more.
The provisions that are being removed are as follows:
a) Section 6 of the bill, which would have repealed Section
83124 of the Government Code. That provision would have
eliminated the requirement for the FPPC to adjust
contribution limits and voluntary expenditure limits every
two years to reflect changes in the consumer price index
(CPI). Additionally, Sections 34, 35, 36, and 38 of the
bill, which would have established contribution limits and
voluntary expenditure limits for state office at their
current levels.
b) Section 37 of the bill, which would have established
limits on contributions to, and on aggregate contributions
received by, officeholder accounts, at their existing
levels, and would have ended the requirement for the FPPC
to adjust these limits every two years to reflect changes
in the CPI.
c) Sections 39 and 41 of the bill, which would have lowered
the gift limit to $250 and ended the requirement for the
FPPC to adjust these limits every two years to reflect
changes in the CPI.
d) Section 40 of the bill, which would have made the
one-year revolving door ban, which currently applies to
members of the Legislature, applicable to Legislative staff
as well.
This analysis reflects these proposed author's amendments.
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2)Purpose of the Bill : According to the author:
Changes to the Political Reform Act of 1974 are crucial to
promote greater transparency and help restore public
confidence in the political process here in California.
Many of these changes are less than glamorous, for example
reorganizing sections related to campaign reporting to make
them clearer and easier to use. Some of these changes
likely will meet resistance, such as?requiring campaign
treasurers to undergo training, but these provisions are
important in ensuring greater access to, participation in
and confidence with the political process in California.
And finally, some of the changes are forward thinking,
namely the planning and implementation of a statewide
online reporting web portal, which, realistically, will
take several years to develop and complete, the strong will
of our colleagues in the legislature now and in the future
as well as with those in the offices of the Secretary of
State and the Fair Political Practices Commission, and
funding (private as well as public) to put California back
at the fore of progressive, open and fair political
activities.
3)Does This Bill Further the Purposes of the Political Reform
Act ? California voters passed an initiative, Proposition 9,
in 1974 that created the FPPC and codified significant
restrictions and prohibitions on candidates, officeholders and
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.
It could be argued that the provision of this bill that permits
the SOS to charge a fee for the filing of campaign reports
does not further the purposes of the PRA, and therefore cannot
be adopted by the Legislature without approval by the voters.
Among the provisions of Proposition 9 in 1974 was a
prohibition against any fee or charge being collected by any
officer for the filing of any report or for the forms upon
which reports are to be prepared. Because the fee on campaign
reports that is authorized by this bill would directly
conflict with a provision of the original PRA, it could be
argued that this change does not "further the purposes" of the
PRA.
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4)PRA Task Force : In August of last year, then-chairman of the
FPPC, Dan Schnur, established a 25-member Advisory Task Force
charged with proposing regulatory and statutory changes to the
PRA. The task force held four meetings between August and
December of last year, and its recommendations were presented
to the full FPPC in January of this year. The FPPC has
already adopted some regulatory changes that were proposed by
the task force.
This bill seeks to implement some of the statutory changes that
were proposed by the task force. It is not, however, a
comprehensive proposal to implement all of the task force's
recommendations. Rather, this bill reflects some of the
recommendations of the task force, but it omits other
recommendations that the task force made, and includes
proposals that the task force did not discuss.
Provisions of this bill that provide for the development of a
new electronic campaign filing system, change reporting
schedules, and require campaign treasurers to take an online
training course are all similar to recommendations made by the
task force. Provisions of this bill that would permit the SOS
to charge a fee on campaign filings, give local jurisdictions
the authority to impose filing requirements on general purpose
committees, raise the fee for late filing of reports, and
prohibit candidates or officeholders from paying certain fines
from campaign funds were not discussed by the task force.
5)Arguments in Support : According to Charles H. Bell, Jr., the
Co-Chair of the Advisory Task Force referenced above:
AB 447 contains major elements of the recommendations of
the �FPPC] Chairman's Task Force on Reform of the �PRA], on
which I served as Co-Chairman?
The FPPC Task Force?proposed a number of changes to the
nearly 36 year old �PRA]. These recommendations would
update the �PRA] and clear out accumulated underbrush,
primarily in the campaign finance portions of the law, to
make campaign reports (1) more accessible to the public
through a modernized, state-level electronic filing system,
and (2) less complicated and burdensome for volunteer
campaign treasurers as well as professionals to prepare.
This bill updates and simplifies campaign report filing
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schedules, delegates authority to the FPPC to make
additional regulatory updates in accordance with the
statutory changes, and consolidates in one chapter and
standardizes the naming of committees and "disclaimers"
used in campaign communications in all forms (mail,
telephone bank, slate mail, broadcast and Internet).
Because the legislation is comprehensive, some of the
authors' amendments have not yet made it in to print. I
understand they will be offered in the course of the
process going forward.
AB 447 also contains some provisions that differ from the
FPPC Task Force's recommendations. I support many of these
additional recommendations as well.
Enactment of this legislation will help bring the �PRA] up
to date in the campaign law area and establish a new era of
public access to campaign reports at the state and local
levels.
6)New Filing Schedule : Under existing law, candidates and
committees generally are required to file regular campaign
disclosure reports semi-annually. Candidates generally are
required to file two pre-election campaign statements for any
election where they will appear on the ballot, and certain
non-candidate committees similarly must file pre-election
reports. When candidates and committees are required to file
these pre-election reports, they generally must also file late
contribution reports, and late IE reports, disclosing within
24-hours any contributions made or received and IEs made of
$1,000 or more in the last 16 days before the election.
Candidates and committees can also be required to file
additional special campaign reports at other times of year,
based on the particular campaign finance activity of the
candidate or committee.
This bill seeks to eliminate many of the special activity-based
reports in favor of requiring more frequent regular reports,
particularly from candidates for state office and from other
candidates, committees, and slate mailer organizations with
activity totaling $50,000 or more. These changes may help
simplify campaign reporting, but may also significantly
increase the number of reports that a candidate or committee
has to file. The impacts on any particular candidate or
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committee will vary significantly depending on the level and
timing of activity by that committee. The following is a
brief overview of how certain types of committees might be
impacted if this bill is approved:
a) State and County General Purpose Committees (But Not
Political Party Committees) with Activity of $50,000 or
More :
i) Regular Reports : Under existing law, state and
county general purpose committees that are not political
party committees typically must file semi-annual
statements, for a total of 4 reports in a 2-year period.
Under this bill, a state or county general purpose
committee with activity of $50,000 or more would file
quarterly reports in odd-numbered years and monthly
reports in even-numbered years, for a total of 16 reports
in a 2-year period.
ii) Pre-Election Reports : Under existing law, state and
general purpose committees file two pre-election
statements in connection with each regularly scheduled
statewide election if the committee makes contributions
or IEs of $500 or more during the pre-election reporting
period. Under this bill, the committee would file only
one pre-election statement (known as a 16-day statement)
for each election in the same circumstances.
For other elections in which the committee is involved,
under existing law, the committee would file a
supplemental pre-election report if it made contributions
of $10,000 or more or IEs of $1,000 or more in connection
with the election. Under this bill, it would file a
pre-election statement for any state or county election
in which it made contributions or IEs of $500 or more
during the pre-election reporting period.
iii) Special Reports : Under existing law, a state or
general purpose committee could be required to file
odd-year reports if it made contributions to candidates
for state office in odd-numbered years and special state
ballot measure reports if it made contributions or IEs in
support of or opposition to a state ballot measure.
Under this bill, the odd-year reports would be eliminated.
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The committee could still be required to file special
state ballot measure reports, but the threshold for
filing such reports would be raised from $5,000 to
$25,000.
iv) 24-Hour Reports / Election Cycle Reporting : Under
existing law, a state or general purpose committee could
be required to file two types of 24-hour reports: a late
IE report if the committee made an IE of $1,000 or more
during the last 16 days before an election, and an
election cycle IE report if the committee is required to
file campaign reports electronically and made an IE of
$1,000 or more related to a candidate for state office or
a state measure in the last 90 days before an election.
Under this bill, the committee would be required to file a
90-day IE report within 24-hours every time it made an IE
of $1,000 or more in the last 90 days before an election.
This report would replace the late IE report. Although
a committee that is required to file campaign reports
electronically would still technically be subject to the
election cycle IE reporting requirement, the 90-day IE
report would satisfy this requirement, and the committee
would not be required to file a second duplicative
report.
b) Candidates for State Office :
i) Regular Reports : Under existing law, a candidate
for elective state office typically must file semi-annual
statements, for a total of 4 reports in a 2-year period.
Under this bill, a candidate for elective state office
would file quarterly reports in odd-numbered years and
monthly reports in even-numbered years, for a total of 16
reports in a 2-year period. Candidates would file
monthly reports in all even-numbered years, so a Senator
or statewide elected official who was in the middle of a
4-year term and was not on the ballot in a particular
even-numbered year would nonetheless be required to file
monthly reports in that year.
ii) Pre-Election Reports : Under existing law, a
candidate for elective state office files two
pre-election statements in connection with an election
where the candidate will appear on the ballot. Under
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this bill, the candidate would file only one pre-election
statement (known as a 16-day statement) for an election
where the candidate will appear on the ballot.
iii) Special Reports : Although some of the special
reporting requirements in the PRA are applicable to
candidates, it is uncommon for candidates to engage in
campaign activities that would trigger a requirement to
file one of those reports. Nonetheless, under existing
law, a candidate for state office could be required to
file a supplemental pre-election report for an election
where the candidate did not appear on the ballot if the
candidate made contributions or IEs above a certain
amount in connection with that election or odd-year
reports if the candidate made contributions above
specified levels to candidates for state office in
odd-numbered years.
Under this bill, these special reports would be eliminated.
iv) 24-Hour Reports / Election Cycle Reporting : Under
existing law, there are two types of 24-hour reports that
a candidate for elective state office could be required
to file: a late contribution report if the candidate made
or received a contribution of $1,000 or more during the
last 16 days before an election, or an election cycle
contribution report if the candidate is required to file
campaign reports electronically and received a
contribution of $1,000 or more in the last 90 days before
an election. Additionally, a candidate for elective
state office who is required to file campaign reports
electronically is required to file a report within 10
business days if the candidate receives a contribution of
$5,000 or more at any time other than during an election
cycle (the last 90 days before the election).
Under this bill, the candidate would be required to file a
90-day contribution report within 24-hours every time the
candidate made or received a contribution of $1,000 or
more in the last 90 days before an election. This report
would replace the late contribution report. Although a
candidate that is required to file campaign reports
electronically would still technically be subject to the
election cycle contribution reporting requirement, the
90-day contribution report would satisfy this
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requirement, and the committee would not be required to
file a second duplicative report. The candidate would
still be required to file a report within 10 business
days if the candidate receives a contribution of $5,000
or more at any time other than during an election cycle.
c) Candidates for Local Office with Activity Below $50,000 :
i) Regular Reports : Under existing law, a candidate
for elective local office typically must file semi-annual
statements, for a total of 4 reports in a 2-year period.
Under this bill, a candidate for elective local office
that raised and spent less than $50,000 would continue to
file semi-annual statements.
ii) Pre-Election Reports : Under existing law, a
candidate for elective local office files two
pre-election statements in connection with an election
where the candidate will appear on the ballot. Under
this bill, the candidate would file only one pre-election
statement (known as a 16-day statement) for an election
where the candidate will appear on the ballot.
iii) Special Reports : Generally the same as for state
candidates, as described above.
iv) 24-Hour Reports / Election Cycle Reporting : Under
existing law, a candidate for elective local office would
be required to file a late contribution report within
24-hours if the candidate made or received a contribution
of $1,000 or more in the last 16 days before an election.
Under this bill, the candidate would be required to file a
90-day contribution report within 24-hours every time the
candidate made or received a contribution of $1,000 or
more in the last 90 days before an election. This report
would replace the late contribution report.
7)90-Day Reports vs. Late Contribution and Late IE Reports : As
noted above, this bill would replace late contribution reports
and late IE reports with 90-day contribution reports and
90-day IE reports. Late contribution and late IE reports
generally require a candidate or committee to file a report
within 24-hours of making or receiving a contribution of
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$1,000 or more, or making an IEs of $1,000 or more, if the
contribution or IE is received or made in the last 16 days
before an election.
Under this bill, contributions made and received and IEs made of
$1,000 or more would have to be reported within 24 hours for
the last 90 days before the election-a significant increase
over the current 16-day period. That could impose a
significant new burden on local candidates and certain
committees.
For many state candidates and certain other committees, however,
the impact likely would be less significant. That's because
candidates and committees that are required to file reports
electronically must comply with certain "election cycle"
reporting requirements. Typically, candidates and committees
that are required to file campaign statements in connection
with a state elective office or state measure are required to
file those statements electronically if they have received
contributions or made expenditures of $25,000 or more.
The "election cycle" reporting requirements require candidates
and committees formed primarily to support or oppose state
ballot measures to report all contributions of $1,000 or more
that are received during the election cycle within 24 hours.
The "election cycle" is defined to mean the last 90 days
before an election. Similarly, IEs of $1,000 or more made in
connection with a candidate for elective state office or a
state ballot measure must be reported within 24 hours if such
IEs are made during the election cycle by a committee that
must file reports electronically. As a result, many
candidates and committees already must report contributions or
IEs of $1,000 or more within 24 hours for the last 90 days
before an election.
8)Local Jurisdiction Reporting Rules : Among other provisions,
SB 726 (McCorquodale), Chapter 1456, Statutes of 1985, limited
the ability of local jurisdictions to impose campaign filing
requirements that differed from those in the PRA, permitting
such requirements only when they applied only to candidates
and committees whose activity is restricted primarily to the
jurisdiction in question. This provision sought to avoid the
necessity of a candidate or committee active over a wider area
being required to adhere to several different campaign filing
schedules. To ensure that significant contributions and
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expenditures made for local campaigns were disclosed in a
timely manner in local jurisdictions, SB 726 also provided
that if an "outside" candidate or committee contributed $5,000
or more in a local jurisdiction, or made IEs of $500 or more
in a local jurisdiction, a supplemental pre-election statement
would be required. This supplemental pre-election statement
was required to be filed in accordance with the filing
schedule for the local jurisdiction. The thresholds at which
such reports are required subsequently have been raised to
$10,000 and $1,000, respectively.
This bill would eliminate the supplemental pre-election reports
that were created by SB 726, but would also allow local
jurisdictions to impose filing requirements that add to or
differ from those in the PRA on general purpose committees
that spend $25,000 or more in the jurisdiction of the local
government agency. This bill also encourages coordination
between the SOS, the FPPC, and local governments to attempt to
harmonize local disclosure rules.
Notwithstanding the fact that this bill encourages such
coordination, nothing in this bill gives the SOS or the FPPC
the authority to prohibit local government entities from
adopting campaign disclosure ordinances that are inconsistent
with, or considerably more burdensome than, the PRA or other
local campaign disclosure ordinances. As a result, this bill
could result in a patchwork of inconsistent local ordinances
that make compliance with state and local campaign reporting
requirements burdensome and confusing for certain
entities-exactly the problem that SB 726 sought to rectify.
9)Electronic Campaign Disclosure and Previous Legislation : SB
49 (Karnette), Chapter 866, Statutes of 1997, the Online
Disclosure Act of 1997, required the SOS to develop a process
whereby reports and statements required under the PRA could be
filed online and viewed by the public. SB 49 also required
certain candidates, committees, slate mailer organizations,
lobbyists, lobbyist employers, and lobbying firms to file
campaign reports online.
AB 696 (Longville), Chapter 917, Statutes of 2001, required the
SOS to provide a means or method whereby individuals subject
to mandatory electronic or online filing may submit required
filings free of charge. AB 696 additionally contained a
$600,000 appropriation to the SOS to cover the costs of
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developing a system for free electronic filing. AB 696
required the free filing option to be developed by December
31, 2002; however, the SOS did not report completing that free
filing option until February 1, 2007. Additionally, many
candidates and committees and the current SOS have reported
that the free filing option is not user friendly, which has
resulted in limited use of this option. Finally, one of the
provisions of SB 49 required the SOS to determine and publicly
disclose when the online and electronic campaign disclosure
systems were operating effectively. Once that determination
was made, filers who submitted reports electronically would be
relieved of the requirement to file paper copies of campaign
filings, and the electronic filing would be considered the
official filing for audit and other legal purposes. Despite
the fact that legislation requiring the development of the
online campaign disclosure system was enacted in 1997, the SOS
has never made a public determination that the online campaign
disclosure system is operating effectively. The SOS held a
joint public hearing with the FPPC to determine whether the
online disclosure system was operating effectively in
September 2007, but that hearing was not followed by any
public determination on the system's effectiveness by the SOS.
In light of the problems that were encountered with the
development of the existing electronic campaign finance
disclosure system, any effort to develop a new system should
be subject to strict oversight and accountability
requirements.
10)Duplicative Filings : One of the provisions of this bill
requires certain elected officers, candidates, and committees
to file a copy of a campaign statement with the elections
official of any jurisdiction in which the filer made
expenditures of $25,000 or more during the reporting period.
Given that the state has gradually moved towards encouraging
online campaign filings and away from requiring duplicative
paper copies of filings, the desirability of this requirement
is unclear.
In fact, enacting this requirement for copies of campaign
filings to be filed in multiple locations seems inconsistent
with recent legislative efforts. Last year, the Legislature
approved and Governor Schwarzenegger signed AB 1181 (Huber),
Chapter 18, Statutes of 2010, a bill that provided greater
access to campaign filings online by lowering the threshold at
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which candidates and committees were required to file such
reports online or electronically. In addition to lowering
those thresholds, AB 1181 eliminated the requirement for paper
copies of certain reports to be filed with local filing
officers when those reports were filed electronically, in
recognition of the fact that making these reports available
online would provide much greater access to the information in
those reports.
11)Odd-Year Local and Special Elections : The reporting schedule
proposed by this bill appears to be designed for the regular
state election cycle, where elections are held in
even-numbered years. For special elections or local elections
that are held in odd-numbered years, however, the reporting
schedule in this bill would result in more frequent monthly
reports in non-election years, and quarterly reports in the
election years. Although many local candidates would continue
to file semi-annual reports under this bill (because those
candidates raise or spend less than $50,000), some candidates
for local office likely will raise or spend more than $50,000,
and thus could be required to file monthly reports in
non-election years.
12)Technical Issues : This bill contains a number of technical
issues that should be considered and addressed as this bill
moves through the Legislative process. Among the technical
issues identified by committee staff are the following:
This bill replaces pre-election reports with 16-day
reports, for which the filing deadline would be the 16th
day before the election. Because elections in this state
are always held on Tuesdays, the 16th day before the
election will always fall on a Sunday. Pursuant to
regulations adopted by the FPPC, whenever the deadline for
a report to be filed falls on a Saturday, Sunday, or
official state holiday, the report can be filed on the next
day that is not a Saturday, Sunday, or official state
holiday unless the report is a contribution report due on a
Saturday, Sunday, or official state holiday immediately
prior to an election or unless the report is a specified IE
report. In light of this fact, it may be worth changing
the 16-day reports to 15-day reports.
Under this bill, Section 84218 of the Government Code
would provide that 16-day reports for slate mailer
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organizations would be filed pursuant to Section 84200.5 of
the Government Code. But Section 84200.5 of the Government
Code does not specify requirements for a 16-day report for
slate mailer organizations.
This bill allows a person to be designated as a
treasurer for a committee even if that person is not yet
certified as a treasurer, provided that the person becomes
certified within 15 business days of being named the
treasurer. However, this bill also provides that a
campaign statement submitted on behalf of a committee is
not deemed filed if the treasurer of the committee is not
currently certified. This would appear to prohibit a
person from being designated as a treasurer for a committee
if that person had not yet been certified as a treasurer,
because any statement of organization submitted by the
committee with that person designated as the treasurer
would not be deemed to have been filed.
REGISTERED SUPPORT / OPPOSITION :
Support
California Common Cause
Charles H. Bell, Jr., Co-Chair, FPPC Task Force on Reform of the
Political Reform Act
Robert M. Stern, Co-Chair, FPPC Task Force on Reform of the
Political Reform Act
Opposition
None on file.
Analysis Prepared by : Ethan Jones / E. & R. / (916) 319-2094