BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
SB 1001 (Yee) - Lobbyists Fees.
Amended: May 8, 2012 Policy Vote: E&CA 3-2
Urgency: No Mandate: No
Hearing Date: May 14, 2012 Consultant: Maureen Ortiz
This bill meets the criteria for referral to the Suspense File.
Bill Summary: SB 1001 increases the filing fee for lobbyists
from the existing fee of up to $25 per year to a fee of no more
than $50 per year, and also requires political committees
(recipient candidate, general purpose, ballot measure
committees, etc.) that receive contributions totaling $1,000 or
more in a calendar year to pay a similar fee of up to $50 per
year. Additionally the bill establishes a late filing penalty
for committees equal to three times the amount of the fee.
SB 1001 provides that the lobbyist filing fees, the new
committee filing fee, and any late filing penalties imposed on
committees will all be deposited into the Political Disclosure,
Access, and Transparency Account (PDAT Account) which the bill
creates. The money will be used for the maintenance, repair,
and improvement of the lobbyists' online disclosure system at
the Secretary of State's Office.
Fiscal Impact: Total costs of approximately $590,000 (General
Fund) annually of which approximately $490,000 is new fee
revenue.
The Secretary of State indicates the need for one
additional PY to administer the new filing fee imposed on
political committees at an estimated cost of approximately
$80,000 annually (General Fund).
A redirection of approximately $200,000 in lobbyist filing
fee revenue from the General Fund to the newly created PDAT
Account.
Approximately $390,000 in revenue from the new fee imposed
on committees to the Political Disclosure, Access, and
Transparency Account.
Unknown revenue from late filing penalties collected from
committees that do not meet the filing deadlines, deposited
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into the PDAT Account.
There are approximately 7,800 recipient committees that would be
required to pay a new $50 annual fee to the Secretary of State
resulting in potential new revenue of up to $390,000 each year.
Ordinarily, this revenue would be deposited into the General
Fund, however, SB 1001 directs the money to the Political
Disclosure, Access, and Transparency Account.
Background: Current law requires lobbying firms and lobbyist
employers to register with the Secretary of State (SOS) and
authorizes the SOS to charge a fee of up to $25 per year for
each lobbyist listed on its registration statement. Existing
law also provides that any person, candidate or committee that
files a statement of economic interest, campaign statement or
report after the deadline imposed by the PRA will be subject to
a late filing penalty of $10 per day.
Existing law, pursuant to the Political Reform Act of 1974
(PRA), requires the Secretary of State, in consultation with the
Fair Political Practices Commission, to provide online and
electronic filing processes for use by specified political
committees, lobbyists, lobbying firms, and lobbyist employers.
Those processes must enable a user to comply with all relevant
disclosure requirements. The SOS must also make all data filed
available on the Internet for public viewing.
Created in 1999, Cal-Access is the database and filing system
used by the Secretary of State to make much of the lobbying and
campaign finance information available online at no cost to
users. Cal-Access consists of a suite of applications developed
in 13 different programming languages which, until recently, ran
the system on a server cluster and associated components that
are more than 12 years old, using an uncommon version of the
Unix operating system. While the SOS has the funding to
maintain the existing hardware and software, finding parts and
qualified people to do the maintenance on such outdated
equipment has been increasingly difficult.
The Cal-Access system has been riddled with problems recently
when the entire program went down November 30, 2011, was
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restored December 7, 2011, went down again on December 9, 2011,
and was restored again on December 30, 2011. The causes of the
outages were layered and complex and no quick fix was available.
While the recovery efforts pursued in December should stabilize
Cal-Access and enable it to continue running, the system can
never be made stronger or patched with new features. Any
attempt to upgrade or modernize Cal-Access could be as risky,
time-consuming, and expensive as developing and deploying a new
system. Even the December work to restore Internet availability
of Cal-Access is probably a temporary fix. It is highly likely
that Cal-Access will require more robust servers in the next
three to four years simply to continue providing access to the
ever-growing volume of information.
Proposed Law: SB 1001 does the following:
a) Increases the filing fee for lobbyists from the existing
fee of up to $25 per year to a fee of no more than $50 per
year;
b) Requires political committees (recipient candidate,
general purpose, ballot measure committees, etc.) that
receive contributions totaling $1,000 or more in a calendar
year to pay a similar fee of up to $50 per year within 15
days of filing its statement of organization;
c) Provides that a committee which is created and pays the
initial $50 fee in the final three months of a calendar
year is not subject to the fee the following year;
d) Provides that a committee that existed prior to January
1, 2013 shall pay the $50 fee no later than February 15,
2013, but by January 15 each year thereafter;
e) Subjects a committee that fails to pay its annual
registration fee on time to a penalty equal to three times
the amount of the fee;
f) Requires the FPPC to enforce the fee provisions;
g) Creates The Political Disclosure, Access, and
Transparency Account, and specifies that the filing fee
revenue from lobbyists and committees, as well as fees
collected for late filing of reports from committees, will
be deposited in that account, and provides that the money
will be used for the maintenance, repair, and improvement
of the online or electronic disclosure program implemented
by the Secretary of State.
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SB 1001 requires the Fair Political Practices Commission to
adjust the filing and registration fees on December 1 of each
even-numbered year to reflect any increase in the Consumer Price
Index, and to round each adjustment to the nearest $5.
Staff Comments: SB 1001 contains provides that the filing fees
and late filing penalties be deposited in the Political
Disclosure, Access, and Transparency Account to be used to
upgrade and maintain the Secretary of State's Cal-Access
database. However, the money will not be appropriated by the
Legislature until the Secretary of State has completed and
submitted a feasibility study regarding a new online or
electronic disclosure program to the Joint Legislative Budget
Committee and the Department of Finance.
Staff Recommended Amendments: Staff recommends the following
amendments:
1) On page 3, delete lines 38 and 39 which require fees
collected prior to January 1, 2013 to be deposited into the
General Fund. This language is unnecessary since
SB 1001 does not take effect until January 1, 2013, any fees
collected in the current year will already be deposited into the
General Fund pursuant to existing law.
2) Clarify that the Secretary of State will NOT have to
complete a feasibility study report every time money in the fund
will be used to improve the electronic disclosure system once a
new system is established. The Secretary of State has existing
authority to perform Information Technology projects that cost
up to $1 million annually which means small updates and changes
can be completed quickly and efficiently. The language in
Section 84613(c) appears to restrict the current authority of
the Secretary of State to make future updates when necessary.