BILL ANALYSIS �
SENATE COMMITTEE ON ELECTIONS
AND CONSTITUTIONAL AMENDMENTS
Senator Norma J. Torres, Chair
BILL NO: AB 409 HEARING DATE: 8/20/13
AUTHOR: QUIRK-SILVA ANALYSIS BY: Darren Chesin
AMENDED: 8/13/13
FISCAL: YES
SUBJECT
Statements of Economic Interest: online filing
DESCRIPTION
Existing law requires that candidates for, and current holders
of, specified elected or appointed state and local offices and
designated employees of state and local agencies file Statements
of Economic Interests (SEIs) disclosing their financial
interests, including investments, real property interests, and
income.
Existing law authorizes an agency to permit the electronic
filing of a SEI, including amendments, in accordance with
regulations adopted by the Fair Political Practices Commission
(FPPC).
Existing law permits the FPPC to adopt regulations to require an
agency to redact information on a SEI prior to posting it on the
Internet.
This bill would permit the FPPC to develop and operate its own
online system for filing SEIs which must enable a filer to
comply with all relevant requirements and must include, but not
be limited to, both of the following:
A means or method whereby a filer may electronically file,
free of charge, a SEI submitted under penalty of perjury in
conformity with existing law.
Security safeguards that include firewalls, data encryption,
secure authentication, and all necessary hardware and software
and industry best practices to ensure that the security and
integrity of the data and information contained in each SEI
are not jeopardized or compromised.
This bill provides that such a system must issue to a person who
electronically files his or her SEI, or an amendment thereto, an
electronic confirmation that notifies the filer that his or her
SEI or amendment was received. The confirmation must include
the date and the time that the SEI or amendment was received and
the method by which the filer may view and print the data
received. A paper copy retained by the filer of a SEI or
amendment that was electronically filed and the confirmation
issued shall create a rebuttable presumption that the filer
filed his or her SEI or amendment on time.
This bill provides that if the FPPC develops an online SEI
filing system it must provide for all of the following:
Conduct public hearings to receive input on the implementation
of that system, maintain ongoing coordination among affected
state and local agencies as necessary, and develop training
and assistance programs for state and local filing officers
and filers regarding use of the online system for filing.
Make all the data filed on the system available on the FPPC's
Internet Web site in an easily understood format that provides
the greatest public access, and provide assistance to those
seeking public access to the information.
Redact private information, including, but not limited to, the
signatures of filers, from the data that is made available on
the Internet.
Develop and implement a policy regarding redaction of private
information for the purposes of this paragraph and conduct one
or more public hearings to receive input on the development of
that policy.
Specify which categories filers may file SEIs electronically
through the online system.
This bill provides that if the FPPC specifies that designated
persons may file their SEIs electronically through their online
system, the FPPC must assume specified duties of those filers'
filing officer.
This bill would take effect immediately as an urgency statute.
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BACKGROUND
Statements of Economic Interests . As part of the PRA's
comprehensive scheme to prevent conflicts of interest by state
and local public officials, existing law identifies certain
elected and other high-level state and local officials who must
file SEIs. Similarly, candidates for those positions must also
file SEIs. Other state and local public officials and employees
are required to file SEIs if the position they hold is
designated in an agency's conflict of interest code. A position
is designated in an agency's conflict of interest code when the
position entails the making or participation in the making of
governmental decisions that may foreseeably have a material
financial effect on the decision maker's financial interests.
The information that must be disclosed on an SEI, and the
location at which an SEI is filed, varies depending on the
position held by the individual who is required to file an SEI.
Although there are some exceptions, individuals who are required
to file an SEI typically must file that document with the agency
of which they are an elected official or by which they are
employed. In some cases, original SEIs or copies thereof are
filed with the FPPC.
The purpose of the SEI is two-fold:
It provides necessary information to the public about a public
official's personal financial interests so there is assurance
that officials are making decisions that do not enhance their
personal finances; and,
It serves as a reminder to the public official of potential
conflicts of interests so the official can recuse him or
herself from making or participating in governmental decisions
that are deemed conflicts. In short, the Form 700 provides
transparency and ensures accountability.
FPPC Role . The FPPC is the agency charged with administration
and enforcement of the SEI reporting requirements for all state
and local agencies and filers. Currently, filers at various
levels of state and local government submit an estimated 500,000
forms annually, which are funneled through an array of local
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agencies and certified private filers. No central repository of
SEI filings currently exists, and with just a fraction of the
forms filed electronically, a searchable tool to illuminate
activities on a statewide level is nearly impossible.
The FPPC is required to accept electronic copies of SEIs
forwarded by agencies that are operating FPPC approved
electronic filing systems. Because the FPPC has no system in
place to receive the statements, the electronically filed SEIs
have to be manually processed under their current paper filing
system.
Additionally, SEIs are posted on the FPPC's website for all
legislators, judges, FPPC Commissioners, county boards of
supervisors, mayors and city councilmembers. Prior to posting
on the FPPC website, the forms have to be manually scanned, and
certain information (such as addresses and signatures) has to be
manually redacted from the forms. According to the FPPC, this is
a very labor intensive and costly program.
With interest in government transparency increasing rapidly, the
number of requests by the public to view SEI filings continues
to escalate each year. The FPPC is mandated to provide access
to SEIs no later than the second business day after receiving
the forms. When the FPPC receives a request for SEIs, staff
must manually retrieve the forms from their file room, make
copies and either provide hard copies or email the copies to the
requestor.
COMMENTS
1.According to the Author : Currently state law requires all
state legislators, judges, Fair Political Practices
Commissioners, county boards of supervisors, mayors, and city
councilmembers to file a SEI which is filed with the FPPC by
filling out Form 700. The intent for this filing is to create
transparency of economic interest that public officials and
other filers may have to ensure decision making is not made to
enhance their own personal finances.
On May 30th, 2013 the FPPC released a Request for Information
(RFI) in regards to Form 700s electronic filing. The document
gives explicit details to the needs for the FPPC to advance
with current technology and how it would create effective and
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sufficient transparency to the general public. According to
the document the FPPC manually processes all Form 700s that
requires an approximately 8 steps depending on the form that
the documents are received. In today's society many of these
steps are outdated and very time consuming.
In recent years the FPPC has moved towards an online approach of
the availability of Form 700s. One proactive approach that
they have taken is scanning Form 700s and placing the forms on
the Internet for the public to access. In 2011 the FPPC
changed its policy for California judges to have the ability
to file electronically which now provides Form 700 information
in a digitized electronic user friendly form for this
demographic of filers. Another approach that they have taken
is through the pilot program which allows election filings for
state legislators to be done electronically which allow
filings to be submitted and certified. Such proactive steps
to move to electronic filing aligns with a goal of the FPPC to
lessen the amount of paper that is used for filings. Lastly,
the FPPC has stated on several occasions that electronic
filing would increase the amount of transparency available to
the public as it is the duty of the FPPC to provide
transparency to the general public.
It is suggested in the RFI report that moving from paper filing
to electronic filing will be cost saving to the FPPC and other
local agencies that file and store Form 700s. It is stated
that agencies will save on personnel cost due to an expected
decrease in Form 700 requests, manual processing, and paper
cost. Other potential cost savings may occur through tracking
fines and e-commerce.
The FPPC receives approximately 500,000 statements that are
filed throughout the year during filing periods that are
manually processed by staff. According to the recent FPPC RFI
there are multiple processing steps that are timely which
result in extra personnel cost. Moreover, extra steps in
manual processing are at times escalated due to filing
deadlines that are required by law.
Additionally, it is the obligation of the FPPC to provide all
requested reports within two business days of its requested
date by law which has a timely process as well due to filing
and storage of documents. Recently the amount of Form 700s
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has increased over the years with 2012 having over 5,500
requests. It has been found to be common that requesters will
ask for several copies of forms at a time including copies of
several years back. In 2013 request from state and local
filing officials increased as well from agencies that had
forgotten to retain Form 700s for the public to view which is
current law.
2.Permissiveness . This bill permits the FPPC to develop an
online system for filing SEIs. Individual SEI filers would be
permitted, not required, to use this online system. Filers
would continue to have the option of filing a hard copy SEI.
3.Prior Related Legislation . AB 2062 (Davis), Chapter 500 of
2012 established the process whereby local agencies may
establish systems for the electronic filing of SEIs.
PRIOR ACTION
This bill was completely rewritten in the Senate therefore the
Assembly votes are irrelevant to the current amended version.
POSITIONS
Sponsor: Fair Political Practices Commission
Support: None received
Oppose: None received
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