BILL ANALYSIS �
AB 2146
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Date of Hearing: April 25, 2012
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Cameron Smyth, Chair
AB 2146 (Cook) - As Amended: April 16, 2012
SUBJECT : Political Reform Act of 1974: County of San
Bernardino.
SUMMARY : Authorizes the state's Fair Political Practices
Commission (Commission) and the County of San Bernardino to
mutually enter into an agreement to grant the Commission primary
responsibility for administering and enforcing that county's
local campaign finance reform ordinance. Specifically, this
bill :
1)Provides that, upon mutual agreement between the Commission
and the Board of Supervisors of the County of San Bernardino,
the Commission is authorized to assume primary responsibility
for the impartial, effective administration, implementation,
and enforcement of a local campaign finance reform ordinance
passed by the Board of Supervisors of the County of San
Bernardino.
2)Authorizes the Commission to be the civil prosecutor
responsible for the civil enforcement of that local campaign
finance reform ordinance in accordance with the Political
Reform Act of 1974 (PRA). As the civil prosecutor of the
County of San Bernardino's local campaign finance reform
ordinance, the Commission may do both of the following:
a) Investigate possible violations of the local campaign
finance reform ordinance; and,
b) Bring administrative actions in accordance with the PRA
and Chapter 5 (commencing with Section 11500) of Part 1 of
Division 3 of Title 2 of the Government Code.
1)Requires any local campaign finance reform ordinance of the
County of San Bernardino enforced by the Commission pursuant
to this bill to comply with the PRA.
2)Requires the Board of Supervisors of the County of San
Bernardino to consult with the Commission prior to adopting
and amending any local campaign finance reform ordinance that
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is subsequently enforced by the Commission pursuant to this
bill.
3)Authorizes the Board of Supervisors of the County of San
Bernardino and the Commission to enter into any agreements
necessary and appropriate to carry out the provisions of this
bill, including agreements pertaining to any necessary
reimbursement of state costs with county funds for costs
incurred by the Commission in administering, implementing, or
enforcing a local campaign finance reform ordinance pursuant
to this bill.
4)Authorizes the Board of Supervisors of the County of San
Bernardino or the Commission to, by ordinance or resolution at
any time, terminate an agreement made pursuant to this bill
for the Commission to administer, implement, or enforce a
local campaign finance reform ordinance or any provision
thereof.
5)Makes findings and declarations that a special law is
necessary and that a general law cannot be made applicable
because of the necessity to avoid an appearance of corruption
in the County of San Bernardino's electoral process.
6)Makes findings and declarations that this bill furthers the
purposes of the PRA.
EXISTING LAW :
1)Creates the Commission, and makes it responsible for the
impartial, effective administration and implementation of the
PRA.
2)Requires local government agencies that adopt or amend local
campaign finance ordinances to file a copy of the ordinance
with the Commission.
3)Prohibits a local government agency from enacting a campaign
finance ordinance that imposes campaign reporting requirements
that are additional to or different from those set forth in
the PRA for elections held in its jurisdiction unless the
additional or different requirements apply only to the
candidates seeking election in that jurisdiction, their
controlled committees or committees formed or existing
primarily to support or oppose their candidacies, and to
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committees formed or existing primarily to support or oppose a
candidate or to support or oppose the qualification or passage
of a local ballot measure which is being voted on only in that
jurisdiction, and to city or county general purpose committees
active only in that city or county, respectively.
4)Provides that nothing in the PRA shall nullify contribution
limitations or prohibitions of any local jurisdiction that
apply to elections for local elective office, except that
these limitations and prohibitions may not conflict with a
specified provision of the PRA dealing with "member
communications."
5)Provides that payments made for communications to members,
employees, shareholders, or families of members, employees, or
shareholders of an organization for the purpose of supporting
or opposing a candidate or a ballot measure, which are
referred to as "member communications," are not contributions
or expenditures, if those payments are not made for general
public advertising such as broadcasting, billboards, and
newspaper advertisements.
6)Makes violations of the PRA subject to administrative, civil,
and criminal penalties.
FISCAL EFFECT : Unknown. This bill is keyed fiscal.
COMMENTS :
1)This bill intends to allow the County of San Bernardino and
the Commission to mutually negotiate and execute a contract
for implementation and enforcement of local campaign finance
ordinances. By doing so, the County hopes to secure those
services with less expense than if they had to create and
operate a local ethics commission, while also ensuring that
enforcement is insulated from undue local influence. This
measure is sponsored by the County of San Bernardino.
2)According to the author, "�m]any counties and cities across
California have enacted campaign finance rules to create a
level playing field for candidates and to stem the influence
of 'big money' in local politics. As a result, locally
appointed ethics commissions often enforce campaign finance
rules adopted by local governments. The County of San
Bernardino, which has been the subject of several high-profile
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corruption cases, is in the process of developing a campaign
finance ordinance that would establish contribution limits
that mirror those applied to State Senate and Assembly
candidates. Rather than appointing an ethics commission,
which could present financial as well as conflict-of-interest
challenges, the County proposes to contract with the Fair
Political Practices Commission (FPPC) to enforce the rules.
AB 2146 would authorize the County of San Bernardino to
contract with the Commission to enforce San Bernardino
County's local campaign finance ordinance. This would only
occur after a mutual agreement between the Commission and the
San Bernardino County Board of Supervisors has been reached."
3)According to the author, the need for outsourcing local ethics
enforcement stands on both efficiency and effectiveness
grounds: "�c]ontracting with the Commission is an ideal
solution for several reasons. Counties that have ethics
commissions or other formal entities spend as much as $3.5
million annually to police ethical behavior. Contracting with
the Commission is a cost effective alternative to an ethics
commission and a prudent use of taxpayer resources.
Additionally, contracting with the Commission provides
oversight by an impartial and independent third party and
eliminates potential conflicts of interest that could arise
from the creation of an internal agency by the Board of
Supervisors."
4)The Commission was created by the Act, a ballot initiative
passed by California voters in 1974 as Proposition 9. To meet
its responsibilities under the Act, the Commission adopts and
amends regulations. The Commission regulates campaign
financing and spending, financial conflicts of interest,
lobbyist registration and reporting, post-governmental
employment, mass mailings at public expense, and gifts and
honoraria given to public officials and candidates.
The Commission investigates alleged violations of the
Political Reform Act, imposes penalties when appropriate, and
assists state and local agencies in the development and
enforcement of conflict-of-interest codes. In an effort to
reduce these violations, the Commission educates the public
and public officials on the requirements of the Act and
provides written and oral advice to public agencies and
officials and conducts seminars and training sessions.
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The Commission also develops required forms, prepares manuals
and instructions, aids agencies and public officials with
record keeping and reporting, and maintains a central file of
statements of economic interests (SEI) for certain state and
local officials. It has roughly 80 employees.
5)Violations of the PRA are subject to administrative, civil,
and criminal penalties. Generally, the Attorney General (AG)
and district attorneys have responsibility for enforcing the
criminal provisions of the PRA, though any elected city
attorney of a charter city also has the authority to act as
the criminal prosecutor for violations of the PRA that occur
within the city. The Commission, the AG, district attorneys,
and elected city attorneys of charter cities all have
responsibility for enforcement of the civil penalties and
remedies provided under the
PRA, depending on the nature and location of the violation,
while any member of the public also has the ability to file a
civil action to enforce the civil provisions of the PRA,
subject to certain restrictions. The Commission has the sole
authority to bring administrative proceedings for enforcement
of the PRA. When the Commission determines on the basis of
such a proceeding that a violation of the PRA has occurred, it
has the authority to impose monetary penalties of up to $5,000
per violation, in addition to ordering the violator to cease
and desist violation of the PRA and to file any reports,
statements, or other documents or information required by the
PRA.
In the case of local campaign ordinances, there is no single
approach as to the types of penalties that are available for
the violations of those ordinances. Many local ordinances
provide for misdemeanor or civil penalties for violations,
while some ordinances (including the current ordinance for San
Bernardino County) do not establish any penalties for
violations. In some local jurisdictions that have independent
boards or commissions to enforce the local campaign finance
ordinances, those boards or commissions have the authority to
bring administrative enforcement proceedings, similar to the
authority the Commission has under the PRA.
6)Under existing law, local government agencies have the ability
to adopt campaign ordinances that apply to elections within
their jurisdictions, though the PRA imposes certain limited
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restrictions on those local ordinances. For instance, 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. Similarly, AB 1430 (Garrick), Chapter 708,
Statutes of 2007, prohibits local governments from adopting
rules governing member communications that are different than
the rules that govern member communications at the state
level.
Aside from these restrictions, however, local government
agencies generally have a significant amount of latitude when
developing local campaign finance ordinances that apply to
elections in those agencies' jurisdiction. Any jurisdiction
that adopts or amends a local campaign finance ordinance is
required to file a copy of that ordinance with the Commission,
and the Commission has begun posting those ordinances on its
website. The Commission's website currently includes campaign
finance ordinances from 17 different counties and from 130
different cities.
San Bernardino County currently has a local campaign finance
ordinance, though that ordinance is very limited in scope.
Specifically, the ordinance merely establishes a voluntary
campaign expenditure limit for candidates for local office.
It does not provide any incentive for candidates to adopt or
reject that voluntary limit, nor does it establish penalties
for candidates who agree to abide by the voluntary limits but
then subsequently make campaign expenditures in excess of
those limits.
Other cities and counties have adopted campaign finance
ordinances that are much more extensive. In some cases, those
ordinances include campaign contribution limits, reporting and
disclosure requirements that supplement the requirements of
the PRA, temporal
restrictions on when campaign funds may be raised, and voluntary
public financing of local campaigns, among other provisions.
In many cases, local campaign finance ordinances are enforced
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by the district attorney of the county or by the city
attorney. In at least a few cases, however, local
jurisdictions have set up independent boards or commissions to
enforce the local campaign finance laws.
The Commission does not currently enforce any local campaign
finance ordinances as it would for San Bernardino if this bill
were adopted. The Commission can and does, however, bring
enforcement actions in response to violations of the PRA that
occur in campaigns for local office, even in cases where the
local jurisdiction brings separate enforcement actions for
violations of a local campaign finance ordinance.
7)According to an April 17, 2012 article in the
Press-Enterprise, a small number of California cities and
counties have their own ethics commissions, such as Los
Angeles, San Diego and San Francisco, although San Bernardino
does not.
The same article notes that in San Bernardino County, a current
Supervisor and the District Attorney were among those fined by
the Commission in recent years for violations of the PRA.
8)The prospect of outsourcing administration and enforcement of
local campaign finance rules to the state Commission is both
novel and intriguing. The Commission does not currently
provide such a service to any local jurisdiction. As such,
there are a number of questions that the Committee may wish to
consider:
a) Given the importance of the right of the public to have
access to the workings of their own government, could the
outsourcing of the administration and enforcement of San
Bernardino County campaign finance regulations to a
state-run agency in Sacramento create problems of access
for locals? How often might residents want or need to
visit a physical office, rather than corresponding by
email, telephone or regular mail? Are the Commission's
telephone advice lines well-staffed, or are there long wait
times?
b) Given the importance of local control and autonomy, is
there any danger that a state agency would be less
responsive to the needs of the local community than a local
one? For example, does the Commission have the language
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competence to adequately serve the residents of the county
who do not speak English as a first language? To what
extent does the Commission have discretion in its
enforcement? What might be the result if that discretion
were not grounded in the mores of the local community, in
the way a district attorney's discretion to charge would
be?
Furthermore, while the statute gives both parties the power
to terminate the contract at will, it does not speak to the
possibility of cancellation fees or liquidated damages
clauses that could apply to cancellation. Such provisions,
if included in the agreement, could become a major
disincentive to ending the contract if the County found
that its residents would be better served by having their
own local ethics commission.
The Committee may wish to consider placing certain
restrictions on any contract between the County and the
Commission to prohibit cancellation fees, liquidated
damages, or
other such disincentives to cancellation, while recognizing
that the County should still be obligated to pay for
services rendered or other expenditures reasonably made by
the Commission in anticipation of services to be rendered.
c) Given the untested nature of the proposal, should the
authorization include a sunset provision in order to give
the County and the Commission time to figure out how best
to administer the program before it is extended or
expanded? How will the County or the Commission know if
the program was successful? Will there be estimated cost
savings? How much? How will the Legislature know? If the
program works, should it be expanded to other counties?
The Committee may wish to consider adding a sunset clause to
the bill - perhaps expiring after five years, on January 1,
2018 - in order to allow the parties to negotiate an
agreement and implement it over a couple of election cycles
to see how it works.
The Committee may also wish to consider requiring a report on
the operation of the program, including its performance on
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measures of economic efficiency, enforcement, and customer
satisfaction, to be delivered to the relevant legislative
committees in time to inform any discussion over extension
or expansion of the program. Any such report should be due
one year prior to the sunset date, so if the sunset date
were January 2018, then the report should be due by January
2017.
9)The California State Association of Counties and Urban
Counties Caucus write in support of the bill, and even
advocate for its expansion: "While our organizations support
the bill, we would be interested in seeing the bill expanded
to allow other counties to contract with the Commission, if
agreed upon by their County Board of Supervisors."
10)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.
11)Support arguments : According to the author, "�t]he proposed
local campaign finance reform ordinance is intended to make it
more difficult for candidates and influential individuals and
entities to engage in quid pro quo corruption, make the
financing of campaigns for elective county offices more
transparent, and to make more information, especially
financial information, regarding candidates and their
supporters available to voters. Enforcement of the local
campaign finance reform ordinance by the Commission is needed
to ensure the integrity of the ordinance."
Opposition arguments : This bill could theoretically take away
local autonomy by outsourcing local campaign finance
administration and enforcement to individuals hundreds of
miles away, making it harder to physically access the
bureaucracy, while taking local mores out of the equation. It
also exports public sector clerical jobs out of the County.
12)This bill is double-referred to the Committee on Elections
and Redistricting, where it will be heard on April 26, 2012.
REGISTERED SUPPORT / OPPOSITION :
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Support
County of San Bernardino �SPONSOR]
California State Association of Counties
Fair Political Practices Commission
Urban Counties Caucus
Opposition
None on file
Analysis Prepared by : Hank Dempsey / L. GOV. / (916) 319-3958