SB 831, as amended, Hill. Political Reform Act of 1974.
(1) The Political Reform Act of 1974 provides for the comprehensive regulation of campaign financing and related matters, including the reporting of campaign contributions, as defined. Under existing law, a payment made at the behest of a candidate for elective office is considered a contribution unless the payment is made for purposes unrelated to the candidate’s candidacy, and a payment is presumed to be unrelated to a candidate’s candidacy if it is made principally for legislative, governmental, or charitable purposes.
The bill would prohibit an elected officer from requesting that a payment be made, or a person from making a payment, at the behest of the elected officer to a nonprofit organization that is exempt from taxation under Section 501(c)(4) of the Internal Revenue Code and that the elected officer knows or has reason to know is owned or controlled by that officer or specified family members of the officer, except as specified. The bill would provide that an elected officer is deemed to have complied with that requirement if the Commission determines that the elected officer has made a reasonable effort to ascertain whether a nonprofit organization is owned or controlled by any of the specified persons.
(2) The act prohibits specified officers from receiving gifts, as defined, in excess of $440 in value from a single source in a calendar year. The act exempts gift payments for the actual costs of specified types of travel that are reasonably related to a legislative or governmental purpose, or to an issue of state, national, or international public policy, from the annual limit on the value of gifts from a single source.
This bill would require a nonprofit organization that pays for these types of travel for an elected state officer or local elected officeholder to disclose the names of donors responsible for funding the payments, as specified. The bill would require a person who receives a gift of a travel payment to report the travel destination on his or her statement of economic interests.
(3) The act requires that contributions deposited into a campaign account be held in trust for expenses associated with the election of the candidate or for expenses associated with holding office. The act provides that an expenditure to seek office is within the lawful execution of this trust if it is reasonably related to a political purpose and an expenditure associated with holding office is within the lawful execution of this trust if it is reasonably related to a legislative or governmental purpose. Expenditures that confer a substantial personal benefit must be directly related to a political, legislative, or governmental purpose. The act authorizes the use of campaign funds to make donations or loans to bona fide charitable, educational, civic, religious, or similar tax-exempt nonprofit organizations. The act imposes additional limitations on certain expenditures, including those relating to automotive expenses, travel expenses, tickets for entertainment or sporting events, personal gifts, and real property expenses.
The bill would prohibit an elected officer or a committee controlled by the elected officer from making an expenditure of campaign funds to a nonprofit organization that is exempt from taxation under Section 501(c)(4) of the Internal Revenue Code and that is owned or controlled by the officer or specified family members of the officer, as specified.
This bill would also limit the expenditure of campaign funds for other purposes, as specified, including personal vacations, payments for membership dues for a country club, health club, or other recreational facility, specified tuition payments, utility payments, vehicle use that is not directly related to an election campaign, and certain gifts for specified family members of a candidate, elected officer, or other individuals with the authority to approve the expenditure of campaign funds held by a committee.
begin insert(4) This bill would incorporate additional changes to Section 89513 of the Government Code, proposed by AB 1666 and AB 1692, that would become operative only if this bill and either or both of those bills are chaptered and become effective on or before January 1, 2015, and this bill is chaptered last.
end insert(4)
end deletebegin insert(5)end insert A violation of the act’s provisions is punishable as a misdemeanor. By expanding the scope of an existing crime, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
(5)
end deletebegin insert(6)end insert The Political Reform Act of 1974, an initiative measure, provides that the Legislature may amend the act to further the act’s purposes upon a 2⁄3 vote of each house and compliance with specified procedural requirements.
This bill would declare that it furthers the purposes of the act.
Vote: 2⁄3. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Section 87106 is added to the Government Code,
2to read:
(a) An elected officer shall not request that a payment
4be made, and a person shall not make a payment at the behest of
5the elected officer, as described in Section 82015, to a nonprofit
6organization that the elected officer knows or has reason to know
7is owned or controlled by that officer or a family member of the
8elected officer.
9(b) An elected officer is deemed to have complied with the
10requirements of subdivision (a) if the Commission determines that
11the elected officer has made a reasonable effort to ascertain whether
12a nonprofit organization is owned or controlled by any individual
13described in subdivision (a).
14(c) For purposes of this section, a nonprofit organization is
15owned or controlled by an elected officer or family member of the
16elected officer if the elected officer or family member of the elected
17officer, or a member of that person’s immediate family, is a
18director, officer, partner, or trustee of, or holds any position of
19management with, the nonprofit organization, and is paid for his
20or her services.
21(d) For purposes of this section, the following terms have the
22following meanings:
23(1) “Family member of the elected officer” means the spouse,
24child, sibling, or parent of an elected officer.
25(2) “Nonprofit organization” means an organization that is
26exempt
from taxation under Section 501(c)(4) of the Internal
27Revenue Code.
28(e) This section shall not apply to behested payments made to
29a nonprofit organization that is formed for the purpose of
30coordinating or performing disaster relief services.
Section 87207 of the Government Code is amended
32to read:
(a) If income is required to be reported under this
34article, the statement shall contain, except as provided in
35subdivision (b):
36(1) The name and address of each source of income aggregating
37five hundred dollars ($500) or more in value, or fifty dollars ($50)
P5 1or more in value if the income was a gift, and a general description
2of the business activity, if any, of each source.
3(2) A statement whether the aggregate value of income from
4each source, or in the case of a loan, the highest amount owed to
5each source, was at least five hundred dollars ($500) but did not
6exceed one thousand
dollars ($1,000), whether it was in excess of
7one thousand dollars ($1,000) but was not greater than ten thousand
8dollars ($10,000), whether it was greater than ten thousand dollars
9($10,000) but not greater than one hundred thousand dollars
10($100,000), or whether it was greater than one hundred thousand
11dollars ($100,000).
12(3) A description of the consideration, if any, for which the
13income was received.
14(4) In the case of a gift, the amount and the date on which the
15gift was received, and the travel destination for purposes of a gift
16that is a travel payment, advance, or reimbursement.
17(5) In the case of a loan, the annual interest rate, the security,
18if any, given for the loan, and the term of the loan.
19(b) If the filer’s pro rata share of income to a business entity,
20including income to a sole proprietorship, is required to be reported
21under this article, the statement shall contain:
22(1) The name, address, and a general description of the business
23activity of the business entity.
24(2) The name of every person from whom the business entity
25received payments if the filer’s pro rata share of gross receipts
26from that person was equal to or greater than ten thousand dollars
27($10,000) during a calendar year.
28(c) If a payment, including an advance or reimbursement, for
29travel is required to be reported pursuant to this section, it may be
30reported on a separate travel
reimbursement schedule which shall
31be included in the filer’s statement of economic interest. A filer
32who chooses not to use the travel schedule shall disclose payments
33for travel as a gift, unless it is clear from all surrounding
34circumstances that the services provided were equal to or greater
35in value than the payments for the travel, in which case the travel
36may be reported as income.
Section 89506 of the Government Code is amended
38to read:
(a) Payments, advances, or reimbursements for travel,
40including actual transportation and related lodging and subsistence
P6 1that is reasonably related to a legislative or governmental purpose,
2or to an issue of state, national, or international public policy, are
3not prohibited or limited by this chapter if either of the following
4applies:
5(1) The travel is in connection with a speech given by the elected
6state officer, local elected officeholder, candidate for elective state
7office or local elective office, an individual specified in Section
887200, member of a state board or commission, or designated
9employee of a state or local government agency,
the lodging and
10subsistence expenses are limited to the day immediately preceding,
11the day of, and the day immediately following the speech, and the
12travel is within the United States.
13(2) The travel is provided by a government, a governmental
14agency, a foreign government, a governmental authority, a bona
15fide public or private educational institution, as defined in Section
16203 of the Revenue and Taxation Code, a nonprofit organization
17that is exempt from taxation under Section 501(c)(3) of the Internal
18Revenue Code, or by a person domiciled outside the United States
19who substantially satisfies the requirements for tax-exempt status
20under Section 501(c)(3) of the Internal Revenue Code.
21(b) Gifts of travel not described in subdivision (a) are subject
22to the limits in Section
89503.
23(c) Subdivision (a) applies only to travel that is reported on the
24recipient’s statement of economic interests.
25(d) For purposes of this section, a gift of travel does not include
26any of the following:
27(1) Travel that is paid for from campaign funds, as permitted
28by Article 4 (commencing with Section 89510), or that is a
29contribution.
30(2) Travel that is provided by the agency of a local elected
31officeholder, an elected state officer, member of a state board or
32commission, an individual specified in Section 87200, or a
33designated employee.
34(3) Travel that is reasonably necessary in
connection with a
35bona fide business, trade, or profession and that satisfies the criteria
36for federal income tax deduction for business expenses in Sections
37162 and 274 of the Internal Revenue Code, unless the sole or
38predominant activity of the business, trade, or profession is making
39
speeches.
P7 1(4) Travel that is excluded from the definition of a gift by any
2other provision of this title.
3(e) This section does not apply to payments, advances, or
4reimbursements for travel and related lodging and subsistence
5permitted or limited by Section 170.9 of the Code of Civil
6Procedure.
7(f) (1) A nonprofit organization that makes payments, advances,
8or reimbursements that total more than ten thousand dollars
9($10,000) in a calendar year, or that total more than five thousand
10dollars ($5,000) in a calendar year for a single person, for travel
11by an elected state officer or local elected officeholder as described
12in subdivision (a) shall disclose to the Commission the
names of
13the donors responsible for funding those payments, advances, or
14reimbursements. The disclosure of donor names shall be limited
15to donors who donated one thousand dollars ($1,000) or more to
16the nonprofit organization in a calendar year and who knew or had
17reason to know that the donation would be used for a payment,
18advance, or reimbursement for travel by an elected state officer or
19local elected officeholder as described in subdivision (a).
20(2) A donor knows or has reason to know that his or her donation
21will be used in the manner described in paragraph (1) under any
22of the following conditions:
23(A) The donor directed the nonprofit organization to use the
24donation to make a payment, advance, or reimbursement for travel
25by an elected state officer or local elected officeholder
as described
26in subdivision (a).
27(B) The donor made the donation in response to a message or
28solicitation for donations for the stated purpose of making a
29payment, advance, or reimbursement for travel by an elected state
30officer or local elected officeholder as described in subdivision
31(a).
32(C) The donor, or an agent, employee, or representative of the
33donor, accompanied an elected state officer or local elected
34officeholder for any portion of travel as described in subdivision
35(a).
36(3) For purposes of Sections 87103, 87207, and 89503, a
37nonprofit organization that makes payments, advances, or
38reimbursements for travel by an elected state officer or local elected
39officeholder as described in subdivision
(a) is the source of the
40gift unless the nonprofit organization is acting as an intermediary
P8 1or agent of the donor. If the nonprofit organization is acting as an
2intermediary or agent of the donor, all of the following apply:
3(A) The donor to the nonprofit organization is the source of the
4gift.
5(B) The donor shall be identified as a financial interest under
6Section 87103.
7(C) The gift shall be reported as required by Section 87207.
8(D) The gift shall be subject to the limitations on gifts specified
9in Section 89503.
Section 89513 of the Government Code is amended
11to read:
This section governs the use of campaign funds for the
13specific expenditures set forth in this section. It is the intent of the
14Legislature that this section guide the interpretation of the standard
15imposed by Section 89512 as applied to other expenditures not
16specifically set forth in this section.
17(a) (1) Campaign funds shall not be used to pay or reimburse
18a candidate, elected officer, or any individual or individuals with
19authority to approve the expenditure of campaign funds held by a
20committee, or employees or staff of the committee or the elected
21officer’s governmental agency, for travel expenses and necessary
22accommodations, except when
these expenditures are directly
23related to a political, legislative, or governmental purpose.
24(2) For purposes of this section, payments or reimbursements
25for travel and necessary accommodations shall be considered
26directly related to a political, legislative, or governmental purpose
27if the payments would meet standards similar to the standards of
28the Internal Revenue Service pursuant to Sections 162 and 274 of
29the Internal Revenue Code for deductions of travel expenses under
30the federal income tax law.
31(3) For purposes of this section, payments or reimbursement
32for travel by the household of a candidate or elected officer when
33traveling to the same destination in order to accompany the
34candidate or elected officer shall be considered for the same
35purpose as the candidate’s
or elected officer’s travel.
36(4) If campaign funds are used to pay or reimburse a candidate,
37elected officer, his or her representative, or a member of the
38candidate’s household for travel expenses and necessary
39accommodations, the expenditure shall be reported as required by
40Section 84211.
P9 1(5) If campaign funds are used to pay or reimburse for travel
2expenses and necessary accommodations, any mileage credit that
3is earned or awarded pursuant to an airline bonus mileage program
4shall be deemed personally earned by or awarded to the individual
5traveler. Neither the earning or awarding of mileage credit, nor
6the redeeming of credit for actual travel, shall be subject to
7reporting pursuant to Section 84211.
8(6) Campaign
funds shall not be used to make a payment for a
9
personal vacation for a candidate; elected officer; immediate family
10member of a candidate or elected officer; or an officer, director,
11employee, or member of the staff of a candidate, elected officer,
12or committee.
13(b) (1) Campaign funds shall not be used to pay for or reimburse
14the cost of professional services unless the services are directly
15related to a political, legislative, or governmental purpose.
16(2) Expenditures by a committee to pay for professional services
17reasonably required by the committee to assist it in the performance
18of its administrative functions are directly related to a political,
19legislative, or governmental purpose.
20(3) Campaign funds shall not be used to pay
health-related
21expenses for a candidate, elected officer, or any individual or
22
individuals with authority to approve the expenditure of campaign
23funds held by a committee, or members of his or her household.
24“Health-related expenses” includes, but is not limited to,
25examinations by physicians, dentists, psychiatrists, psychologists,
26or counselors; expenses for medications, treatments, or medical
27equipment; and expenses for hospitalization and special dietary
28foods. However, campaign funds may be used to pay employer
29costs of health care benefits of a bona fide employee or independent
30contractor of the committee.
31(4) Campaign funds shall not be used to make a payment for
32membership dues for a country club, health club, or other
33recreational facility.
34(5) Campaign funds shall not be used to make tuition payments,
35
unless the payments are directly related to a political, legislative,
36or governmental purpose.
37(c) Campaign funds shall not be used to pay or reimburse fines,
38penalties, judgments, or settlements, except those resulting from
39either of the following:
P10 1(1) Parking citations incurred in the performance of an activity
2that was directly related to a political, legislative, or governmental
3purpose.
4(2) Any other action for which payment of attorney’s fees from
5contributions would be permitted pursuant to this title.
6(d) Campaign funds shall not be used to purchase clothing to
7be worn by a candidate or elected officer.
8(e) (1) Except where otherwise prohibited by law, campaign
9funds may be used to purchase or reimburse for the costs of
10purchase of tickets to political fundraising events for the attendance
11of a candidate, elected officer, or his or her immediate family, or
12an officer, director, employee, or staff of the committee or the
13elected officer’s governmental agency.
14(2) Campaign funds shall not be used to pay for or reimburse
15for the costs of tickets for entertainment or sporting events for the
16candidate, elected officer, or members of his or her immediate
17family, or an officer, director, employee, or staff of the committee,
18unless their attendance at the event is directly related to a political,
19legislative, or governmental purpose.
20(3) The
purchase of tickets for entertainment or sporting events
21for the benefit of persons other than the candidate, elected officer,
22or his or her immediate family are governed by subdivision (f).
23(f) (1) Campaign funds shall not be used to make a gift to a
24spouse, child, sibling, or parent of a candidate, elected officer, or
25other individual with authority to approve the expenditure of
26campaign funds held by a committee, except for a gift of nominal
27value that is substantially similar to a gift made to other persons
28and that is directly related to a political, legislative, or
29governmental purpose. Campaign funds shall not be used to make
30personal gifts to any other person not described in this paragraph
31unless the gift is directly related to a political, legislative, or
32governmental purpose. The refund of a campaign
contribution
33does not constitute the making of a gift.
34(2) This section does not prohibit the use of campaign funds to
35reimburse or otherwise compensate a public employee for services
36rendered to a candidate or committee while on vacation, leave, or
37otherwise outside of compensated public time.
38(3) An election victory celebration or similar campaign event,
39or gifts with a total cumulative value of less than two hundred fifty
40dollars ($250) in a single year made to an individual employee, a
P11 1committee worker, or an employee of the elected officer’s agency,
2are considered to be directly related to a political, legislative, or
3governmental purpose. For purposes of this paragraph, a gift to a
4member of a person’s immediate family shall be deemed to be a
5gift to that person.
6(g) Campaign funds shall not be used to make loans other than
7to organizations pursuant to Section 89515, or, unless otherwise
8prohibited, to a candidate for elective office, political party, or
9committee.
begin insertSection 89513 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
11to read:end insert
This section governs the use of campaign funds for the
13specific expenditures set forth in this section. It is the intent of the
14Legislature that this sectionbegin delete shallend delete guide the interpretation of the
15standard imposed by Section 89512 as applied to other expenditures
16not specifically set forth in this section.
17(a) (1) Campaign funds shall not be used to pay or reimburse
18begin delete theend deletebegin insert aend insert candidate,begin delete theend delete
elected officer, or any individual or individuals
19with authority to approve the expenditure of campaign funds held
20by a committee, or employees or staff of the committee or the
21elected officer’s governmentalbegin delete agencyend deletebegin insert agency,end insert for travel expenses
22and necessarybegin delete accommodationsend deletebegin insert accommodations,end insert except when
23these expenditures are directly related to a political, legislative, or
24governmental purpose.
25(2) Forbegin delete theend delete
purposes of this section, payments or reimbursements
26for travel and necessary accommodations shall be considered as
27directly related to a political, legislative, or governmental purpose
28if the payments would meet standards similar to the standards of
29the Internal Revenue Service pursuant to Sections 162 and 274 of
30the Internal Revenue Code for deductions of travel expenses under
31the federal income tax law.
32(3) Forbegin delete theend delete purposes of this section, payments or reimbursement
33for travel by the household of a candidate or elected officer when
34traveling to the same destination in order to accompany the
35candidate or elected officer shall be considered for the same
36purpose as the candidate’s or elected officer’s travel.
37(4) begin deleteWhenever end deletebegin insertIfend insert
campaign funds are used to pay or reimburse
38a candidate, elected officer, his or her representative, or a member
39of the candidate’s household for travel expenses and necessary
P12 1accommodations, the expenditure shall be reported as required by
2Section 84211.
3(5) begin deleteWhenever end deletebegin insertIfend insert campaign funds are used to pay or reimburse
4for travel expenses and necessary accommodations, any mileage
5credit that is earned or awarded pursuant to an airline bonus
6mileage program shall be deemed personally earned by or awarded
7to the individual traveler. Neither the earning or awarding of
8mileage credit, nor the redeeming of credit for actual travel, shall
9be subject to reporting pursuant to Section 84211.
10(6) Campaign funds shall not be used to make a payment for a
11personal vacation for a candidate; elected officer; immediate
12family member of a candidate or elected officer; or an officer,
13director, employee, or member of the staff of a candidate, elected
14officer, or committee.
15(b) (1) Campaign funds shall not be used to pay for or reimburse
16the cost of professional services unless the services are directly
17related to a political, legislative, or governmental purpose.
18(2) Expenditures by a committee to pay for professional services
19reasonably required by the committee to assist it in the performance
20of its administrative functions are directly related to a political,
21legislative, or governmental purpose.
22(3) Campaign funds shall not be used to pay health-related
23expenses for a candidate, elected officer, or any individual or
24individuals with authority to approve the expenditure of campaign
25funds held by a committee, or members of his or her household.
26“Health-related expenses” includes, but is not limited to,
27examinations by physicians, dentists, psychiatrists, psychologists,
28orbegin delete counselors,end deletebegin insert counselors;end insert expenses for medications,begin delete treatmentsend delete
29begin insert treatments,end insert or medicalbegin delete equipment,end deletebegin insert
equipment;end insert and expenses for
30begin delete hospitalization, health club dues,end deletebegin insert
hospitalizationend insert and special dietary
31foods. However, campaign funds may be used to pay employer
32costs of health care benefits of a bona fide employee or independent
33contractor of the committee.
34(4) Campaign funds shall not be used to make a payment for
35membership dues for a country club, health club, or other
36recreational facility.
37(5) Campaign funds shall not be used to make tuition payments,
38unless the payments are directly related to a political, legislative,
39or governmental purpose.
P13 1(c) begin insert(1)end insertbegin insert end insert Campaign funds shall not be used to pay or reimburse
2fines, penalties, judgments, or settlements, except those resulting
3from either of the following:
4(1)
end delete
5begin insert(A)end insert Parking citations incurred in the performance of an activity
6that was directly related to a political, legislative, or governmental
7purpose.
8(2)
end delete
9begin insert(B)end insert Any other action for which payment of attorney’s fees from
10contributions would be permitted pursuant to this title.
11(2) Campaign funds shall not be used to pay a restitution fine
12imposed under Section 86 of the Penal Code.
13(d) Campaign funds shall not be usedbegin delete for campaign, business, begin insert to purchase clothingend insert to be worn by
14or casual clothing except specialty clothing that is not suitable for
15everyday use, including, but not limited to, formal wear, if this
16attire isend deletebegin delete theend deletebegin insert
aend insert candidate or
17electedbegin delete officer and is directly related to a political, legislative, or begin insert
officerend insert.
18governmental purposeend delete
19(e) (1) Except where otherwise prohibited by law, campaign
20funds may be used to purchase or reimburse for the costs of
21purchase of tickets to political fundraising events for the attendance
22of a candidate, elected officer, or his or her immediate family, or
23an officer, director, employee, or staff of the committee or the
24elected officer’s governmental agency.
25(2) Campaign funds shall not be used to pay for or reimburse
26for the costs of tickets for entertainment or sporting events for the
27candidate, elected officer, or members of his or her immediate
28family, or an officer, director, employee, or staff of the committee,
29unless their attendance at the event is directly related to a political,
30legislative, or governmental purpose.
31(3) The purchase
of tickets for entertainment or sporting events
32for the benefit of persons other than the candidate, elected officer,
33or his or her immediate family are governed by subdivision (f).
34(f) (1) Campaign funds shall not be used to makebegin delete personal giftsend deletebegin insert end insert
35begin inserta gift to a spouse, child, sibling, or parent of a candidate, elected
36officer, or other individual with authority to approve the
37expenditure of campaign funds held by a committee, except for a
38gift of nominal value that is substantially similar to a gift made to
39other persons and that is directly related to a political, legislative,
40or governmental purpose. Campaign funds shall not be used to
P14 1make personal gifts
to any other person not described in this
2paragraphend insert unless the gift is directly related to a political,
3legislative, or governmental purpose. The refund of a campaign
4contribution does not constitute the making of a gift.
5(2) begin deleteNothing in this section shall end deletebegin insertThis section does notend insert prohibit
6the use of campaign funds to reimburse or otherwise compensate
7a public employee for services rendered to a candidate or
8committee while on vacation, leave, or otherwise outside of
9compensated public time.
10(3) An election victory celebration or similar campaign event,
11or gifts with a total cumulative value of less than two hundred fifty
12dollars ($250) in a single year made to an
individual employee, a
13committee worker, or an employee of the elected officer’s agency,
14are considered to be directly related to a political, legislative, or
15governmental purpose. For purposes of this paragraph, a gift to a
16member of a person’s immediate family shall be deemed to be a
17gift to that person.
18(g) Campaign funds shall not be used to make loans other than
19to organizations pursuant to Section 89515, or, unless otherwise
20prohibited, to a candidate for elective office, political party, or
21committee.
begin insertSection 89513 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
23to read:end insert
This section governs the use of campaign funds for the
25specific expenditures set forth in this section. It is the intent of the
26Legislature that this sectionbegin delete shallend delete guide the interpretation of the
27standard imposed by Section 89512 as applied to other expenditures
28not specifically set forth in this section.
29(a) (1) Campaign funds shall not be used to pay or reimburse
30begin delete theend deletebegin insert aend insert candidate,begin delete theend delete
elected officer, or any individual or individuals
31with authority to approve the expenditure of campaign funds held
32by a committee, or employees or staff of the committee or the
33elected officer’s governmentalbegin delete agencyend deletebegin insert agency,end insert for travel expenses
34and necessarybegin delete accommodationsend deletebegin insert accommodations,end insert except when
35these expenditures are directly related to a political, legislative, or
36governmental purpose.
37(2) Forbegin delete theend delete purposes of this section, payments or reimbursements
38for travel
and necessary accommodations shall be considered as
39directly related to a political, legislative, or governmental purpose
40if the payments would meet standards similar to the standards of
P15 1the Internal Revenue Service pursuant to Sections 162 and 274 of
2the Internal Revenue Code for deductions of travel expenses under
3the federal income tax law.
4(3) Forbegin delete theend delete purposes of this section, payments or reimbursement
5for travel by the household of a candidate or elected officer when
6traveling to the same destination in order to accompany the
7candidate or elected officer shall be considered for the same
8purpose as the candidate’s or elected officer’s travel.
9(4) begin deleteWhenever end deletebegin insertIfend insert
campaign funds are used to pay or reimburse
10a candidate, elected officer, his or her representative, or a member
11of the candidate’s household for travel expenses and necessary
12accommodations, the expenditure shall be reported as required by
13Section 84211.
14(5) begin deleteWhenever end deletebegin insertIfend insert campaign funds are used to pay or reimburse
15for travel expenses and necessary accommodations, any mileage
16credit that is earned or awarded pursuant to an airline bonus
17mileage program shall be deemed personally earned by or awarded
18to the individual traveler. Neither the earning or awarding of
19mileage credit, nor the redeeming of credit for actual travel, shall
20be subject to reporting pursuant to Section 84211.
21(6) Campaign funds shall not be used to make a payment for a
22personal vacation for a candidate; elected officer; immediate
23family member of a candidate or elected officer; or an officer,
24director, employee, or member of the staff of a candidate, elected
25officer, or committee.
26(b) (1) Campaign funds shall not be used to pay for or reimburse
27the cost of professional services unless the services are directly
28related to a political, legislative, or governmental purpose.
29(2) Expenditures by a committee to pay for professional services
30reasonably required by the committee to assist it in the performance
31of its administrative functions are directly related to a political,
32legislative, or governmental purpose.
33(3) Campaign funds shall not be used to pay health-related
34expenses for a candidate, elected officer, or any individual or
35individuals with authority to approve the expenditure of campaign
36funds held by a committee, or members of his or her household.
37“Health-related expenses” includes, but is not limited to,
38examinations by physicians, dentists, psychiatrists, psychologists,
39orbegin delete counselors,end deletebegin insert counselors;end insert expenses for medications,begin delete treatmentsend delete
40begin insert treatments,end insert or medicalbegin delete equipment,end deletebegin insert
equipment;end insert and expenses for
P16 1begin delete hospitalization, health club dues,end deletebegin insert
hospitalizationend insert and special dietary
2foods. However, campaign funds may be used to pay employer
3costs of health care benefits of a bona fide employee or independent
4contractor of the committee.
5(4) Campaign funds shall not be used to make a payment for
6membership dues for a country club, health club, or other
7recreational facility.
8(5) Campaign funds shall not be used to make tuition payments,
9unless the payments are directly related to a political, legislative,
10or governmental purpose.
11(c) Campaign funds shall not be used to pay or reimburse fines,
12penalties,
judgments, or settlements, except those resulting from
13either of the following:
14(1) Parking citations incurred in the performance of an activity
15that was directly related to a political, legislative, or governmental
16purpose.
17(2) Any other action for which payment of attorney’s fees from
18contributions would be permitted pursuant to this title.begin insert However, end insert
19begin insertcampaign funds shall not be used to pay a fine, penalty, judgment,
20or settlement relating to an expenditure of campaign funds that
21resulted in either of the following:end insert
22(A) A
personal benefit to the candidate or officer if it is
23determined that the expenditure was not reasonably related to a
24political, legislative, or governmental purpose.
25(B) A substantial personal benefit to the candidate or officer if
26it is determined that the expenditure was not directly related to a
27political, legislative, or governmental purpose.
28(d) Campaign funds shall not be usedbegin delete for campaign, business, begin insert to purchase clothingend insert
to be worn by
29or casual clothing except specialty clothing that is not suitable for
30everyday use, including, but not limited to, formal wear, if this
31attire isend deletebegin delete theend deletebegin insert aend insert candidate or
32electedbegin delete officer and is directly related to a political, legislative, or begin insert
officer.end insert
33governmental purpose.end delete
34(e) (1) Except where otherwise prohibited by law, campaign
35funds may be used to purchase or reimburse for the costs of
36purchase of tickets to political fundraising events for the attendance
37of a candidate, elected officer, or his or her immediate family, or
38an officer, director, employee, or staff of the committee or the
39elected officer’s governmental agency.
P17 1(2) Campaign funds shall not be used to pay for or reimburse
2for the costs of tickets for entertainment or sporting events for the
3candidate, elected officer, or members of his or her immediate
4family, or an officer, director, employee, or staff of the committee,
5unless their attendance at the event is directly related to a political,
6legislative, or governmental purpose.
7(3) The purchase
of tickets for entertainment or sporting events
8for the benefit of persons other than the candidate, elected officer,
9or his or her immediate family are governed by subdivision (f).
10(f) (1) Campaign funds shall not be used to makebegin delete personal giftsend deletebegin insert end insert
11begin inserta gift to a spouse, child, sibling, or parent of a candidate, elected
12officer, or other individual with authority to approve the
13expenditure of campaign funds held by a committee, except for a
14gift of nominal value that is substantially similar to a gift made to
15other persons and that is directly related to a political, legislative,
16or governmental purpose. Campaign funds shall not be used to
17make personal gifts
to any other person not described in this
18paragraphend insert unless the gift is directly related to a political,
19legislative, or governmental purpose. The refund of a campaign
20contribution does not constitute the making of a gift.
21(2) begin deleteNothing in this section shall end deletebegin insertThis section does notend insert prohibit
22the use of campaign funds to reimburse or otherwise compensate
23a public employee for services rendered to a candidate or
24committee while on vacation, leave, or otherwise outside of
25compensated public time.
26(3) An election victory celebration or similar campaign event,
27or gifts with a total cumulative value of less than two hundred fifty
28dollars ($250) in a single year made to an
individual employee, a
29committee worker, or an employee of the elected officer’s agency,
30are considered to be directly related to a political, legislative, or
31governmental purpose. For purposes of this paragraph, a gift to a
32member of a person’s immediate family shall be deemed to be a
33gift to that person.
34(g) Campaign funds shall not be used to make loans other than
35to organizations pursuant to Section 89515, or, unless otherwise
36prohibited, to a candidate for elective office, political party, or
37committee.
begin insertSection 89513 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
39to read:end insert
This section governs the use of campaign funds for the
2specific expenditures set forth in this section. It is the intent of the
3Legislature that this sectionbegin delete shallend delete guide the interpretation of the
4standard imposed by Section 89512 as applied to other expenditures
5not specifically set forth in this section.
6(a) (1) Campaign funds shall not be used to pay or reimburse
7begin delete theend deletebegin insert aend insert candidate,begin delete theend delete
elected officer, or any individual or individuals
8with authority to approve the expenditure of campaign funds held
9by a committee, or employees or staff of the committee or the
10elected officer’s governmentalbegin delete agencyend deletebegin insert agency,end insert for travel expenses
11and necessarybegin delete accommodationsend deletebegin insert accommodations,end insert except when
12these expenditures are directly related to a political, legislative, or
13governmental purpose.
14(2) Forbegin delete theend delete
purposes of this section, payments or reimbursements
15for travel and necessary accommodations shall be considered as
16directly related to a political, legislative, or governmental purpose
17if the payments would meet standards similar to the standards of
18the Internal Revenue Service pursuant to Sections 162 and 274 of
19the Internal Revenue Code for deductions of travel expenses under
20the federal income tax law.
21(3) Forbegin delete theend delete purposes of this section, payments or reimbursement
22for travel by the household of a candidate or elected officer when
23traveling to the same destination in order to accompany the
24candidate or elected officer shall be considered for the same
25purpose as the candidate’s or elected officer’s travel.
26(4) begin deleteWhenever end deletebegin insertIfend insert
campaign funds are used to pay or reimburse
27a candidate, elected officer, his or her representative, or a member
28of the candidate’s household for travel expenses and necessary
29accommodations, the expenditure shall be reported as required by
30Section 84211.
31(5) begin deleteWhenever end deletebegin insertIfend insert campaign funds are used to pay or reimburse
32for travel expenses and necessary accommodations, any mileage
33credit that is earned or awarded pursuant to an airline bonus
34mileage program shall be deemed personally earned by or awarded
35to the individual traveler. Neither the earning or awarding of
36mileage credit, nor the redeeming of credit for actual travel, shall
37be subject to reporting pursuant to Section 84211.
38(6) Campaign funds shall not be used to make a payment for a
39personal vacation for a candidate; elected officer; immediate
40family member of a candidate or elected officer; or an officer,
P19 1director, employee, or member of the staff of a candidate, elected
2officer, or committee.
3(b) (1) Campaign funds shall not be used to pay for or reimburse
4the cost of professional services unless the services are directly
5related to a political, legislative, or governmental purpose.
6(2) Expenditures by a committee to pay for professional services
7reasonably required by the committee to assist it in the performance
8of its administrative functions are directly related to a political,
9legislative, or governmental purpose.
10(3) Campaign funds shall not be used to pay health-related
11expenses for a candidate, elected officer, or any individual or
12individuals with authority to approve the expenditure of campaign
13funds held by a committee, or members of his or her household.
14“Health-related expenses” includes, but is not limited to,
15examinations by physicians, dentists, psychiatrists, psychologists,
16orbegin delete counselors,end deletebegin insert counselors;end insert expenses for medications,begin delete treatmentsend delete
17begin insert treatments,end insert or medicalbegin delete equipment,end deletebegin insert
equipment;end insert and expenses for
18begin delete hospitalization, health club dues,end deletebegin insert hospitalizationend insert and special dietary
19foods. However, campaign funds may be used to pay employer
20costs of health care benefits of a bona fide employee or independent
21contractor of the committee.
22(4) Campaign funds shall not be used to make a payment for
23membership dues for a country club, health club, or other
24recreational facility.
25(5) Campaign funds shall not be used to make tuition payments,
26unless
the payments are directly related to a political, legislative,
27or governmental purpose.
28(c) begin insert(1)end insertbegin insert end insert Campaign funds shall not be used to pay or reimburse
29fines, penalties, judgments, or settlements, except those resulting
30from either of the following:
31(1)
end delete
32begin insert(A)end insert Parking citations incurred in the performance of an activity
33that was directly related to a
political, legislative, or governmental
34purpose.
35(2)
end delete
36begin insert(B)end insert Any other action for which payment of attorney’s fees from
37contributions would be permitted pursuant to this title.begin insert However,
38campaign funds shall not be used to pay a fine, penalty, judgment,
39or settlement relating to an expenditure of campaign funds that
40resulted in either of the following:end insert
P20 1(i) A personal benefit to the candidate or officer if it is
2determined that
the expenditure was not reasonably related to a
3political, legislative, or governmental purpose.
4(ii) A substantial personal benefit to the candidate or officer if
5it is determined that the expenditure was not directly related to a
6political, legislative, or governmental purpose.
7(2) Campaign funds shall not be used to pay a restitution fine
8imposed under Section 86 of the Penal Code.
9(d) Campaign funds shall not be usedbegin delete for campaign, business, begin insert
to purchase clothingend insert to be worn by the candidate or elected
10or casual clothing except specialty clothing that is not suitable for
11everyday use, including, but not limited to, formal wear, if this
12attire isend delete
13begin delete officer and is directly related to a political, legislative, or begin insert officer.end insert
14governmental purpose.end delete
15(e) (1) Except where otherwise prohibited by law, campaign
16funds may be used to purchase or reimburse for the costs of
17purchase of tickets to political fundraising events for the attendance
18of a candidate, elected officer, or his or her immediate family, or
19an officer, director, employee, or staff of the committee or the
20elected officer’s governmental agency.
21(2) Campaign funds shall not be used to pay for or reimburse
22for the costs of tickets for entertainment or sporting events for the
23
candidate, elected officer, or members of his or her immediate
24family, or an officer, director, employee, or staff of the committee,
25unless their attendance at the event is directly related to a political,
26legislative, or governmental purpose.
27(3) The purchase of tickets for entertainment or sporting events
28for the benefit of persons other than the candidate, elected officer,
29or his or her immediate family are governed by subdivision (f).
30(f) (1) Campaign funds shall not be used to makebegin delete personal giftsend delete
31begin insert a gift to a spouse, child, sibling, or parent of a candidate, elected
32officer, or other individual with authority to approve the
33expenditure of campaign funds held by a committee, except for a
34gift
of nominal value that is substantially similar to a gift made to
35other persons and that is directly related to a political, legislative,
36or governmental purpose. Campaign funds shall not be used to
37make personal gifts to any other person not described in this
38paragraphend insert unless the gift is directly related to a political,
39legislative, or governmental purpose. The refund of a campaign
40contribution does not constitute the making of a gift.
P21 1(2) begin deleteNothing in this section shallend deletebegin insertThis section does notend insert
prohibit
2the use of campaign funds to reimburse or otherwise compensate
3a public employee for services rendered to a candidate or
4committee while on vacation, leave, or otherwise outside of
5compensated public time.
6(3) An election victory celebration or similar campaign event,
7or gifts with a total cumulative value of less than two hundred fifty
8dollars ($250) in a single year made to an individual employee, a
9committee worker, or an employee of the elected officer’s agency,
10are considered to be directly related to a political, legislative, or
11governmental purpose. For purposes of this paragraph, a gift to a
12member of a person’s immediate family shall be deemed to be a
13gift to that person.
14(g) Campaign funds shall not be used to make loans other than
15to organizations pursuant to Section 89515, or, unless otherwise
16prohibited, to a candidate for elective office,
political party, or
17committee.
Section 89515 of the Government Code is amended
19to read:
Campaign funds may be used to make donations or
21loans to bona fide charitable, educational, civic, religious, or similar
22tax-exempt, nonprofit organizations, if no substantial part of the
23proceeds will have a material financial effect on the candidate,
24campaign treasurer, or any individual or individuals with authority
25to approve the expenditure of campaign funds held by a committee,
26or member of his or her immediate family, and if the donation or
27loan bears a reasonable relation to a political, legislative, or
28governmental purpose, except as prohibited by Section 89515.5.
Section 89515.5 is added to the Government Code, to
30read:
(a) An expenditure of campaign funds by an elected
32officer or committee controlled by the elected officer to a nonprofit
33organization that the elected officer knows or has reason to know
34is owned or controlled by the elected officer or a family member
35of the elected officer is deemed to serve the primary purpose of
36conferring a personal financial benefit on the recipient and is
37prohibited as being unrelated to a political, legislative, or
38governmental purpose and inconsistent with the trust imposed by
39Section 89510.
P22 1(b) An elected officer is deemed to have complied with the
2requirements of subdivision (a) if the
Commission determines that
3the elected officer has made a reasonable effort to ascertain whether
4a nonprofit organization is owned or controlled by any individual
5described in subdivision (a).
6(c) For purposes of this section, a nonprofit organization is
7owned or controlled by an elected officer or family member of the
8elected officer if the elected officer or family member of the elected
9officer, or a member of that person’s immediate family, is a
10director, officer, partner, or trustee of, or holds any position of
11management with, the nonprofit organization and is paid for his
12or her services.
13(d) For purposes of this section, the following terms have the
14following meanings:
15(1) “Family member of the elected officer”
means the spouse,
16child, sibling, or parent of an elected officer.
17(2) “Nonprofit organization” means an organization that is
18exempt from taxation under Section 501(c)(4) of the Internal
19Revenue Code.
Section 89516 of the Government Code is amended
21to read:
Notwithstanding Sections 89512 and 89513, this section
23governs the use of campaign funds for vehicle expenses.
24(a) Campaign funds shall not be used to purchase a vehicle
25unless both of the following apply:
26(1) Title to the vehicle is held by the committee and not the
27candidate, elected officer, campaign treasurer, or any other
28individual or individuals with authority to approve the expenditure
29of campaign funds held by a committee, or a member of his or her
30immediate family.
31(2) The use of the vehicle is directly related to an election
32campaign.
33(b) Campaign funds shall not be used to lease a vehicle unless
34both of the following apply:
35(1) The lessee is the committee, or a state or local government
36agency, and not the candidate, elected officer, or a member of his
37or her immediate family; or the lessor is a state or local government
38agency.
39(2) The use of the vehicle is directly related to an election
40campaign.
P23 1(c) Campaign funds may be used to pay for or reimburse the
2operating costs, including, but not limited to, insurance,
3maintenance, and repairs, for any vehicle for which campaign
4funds may be spent pursuant to this section.
5(d) Campaign funds may be used to reimburse a candidate,
6elected officer, his or her immediate family, or any individual or
7individuals with authority to approve the expenditure of campaign
8funds held by a committee, or an employee or member of the staff
9of the committee or of the elected officer’s governmental agency,
10for the use of his or her vehicle at the rate approved by the Internal
11Revenue Service pursuant to Section 162 of the Internal Revenue
12Code in connection with deductible mileage expenses under the
13federal income tax law, if both of the following requirements are
14met:
15(1) The vehicle use for which reimbursement is sought is directly
16related to an election campaign.
17(2) The specific purpose and mileage in connection with each
18expenditure is documented in a
manner approved by the Internal
19Revenue Service in connection with deductible mileage expenses.
20(e) For purposes of this section, use of a vehicle is considered
21to be directly related to an election campaign as long as its use for
22other purposes is only incidental to its use for an election campaign.
Section 89517 of the Government Code is amended
24to read:
(a) Campaign funds shall not be used for payment or
26reimbursement for the lease of real property, for a utility bill for
27real property, or for the purchase, lease, or refurbishment of any
28appliance or equipment, where the lessee or sublessor is, or the
29legal title resides in, in whole or in part, a candidate, elected officer,
30campaign treasurer, or any individual or individuals with authority
31to approve the expenditure of campaign funds, or member of his
32or her immediate family.
33(b) Campaign funds shall not be used to purchase real property.
34Except as prohibited by subdivision (a), campaign funds may be
35used to lease real property for up to one year
at a time if the use
36of that property is directly related to political, legislative, or
37governmental purposes and the lessee or sublessor is not, or the
38legal title does not reside in, in whole or in part, a candidate, elected
39officer, campaign treasurer, or any individual or individuals with
P24 1authority to approve the expenditure of campaign funds, or a
2member of his or her immediate family.
3(c) For purposes of this section, real property, appliance, or
4equipment is considered to be directly related to a political,
5legislative, or governmental purpose if its use for other purposes
6is only incidental to its use for political, legislative, or
7governmental purposes and the lessee or sublessor of the real
8property is not, or the legal title for the real property does not reside
9in, in whole or in part, a candidate, elected officer, campaign
10
treasurer, or any individual or individuals with authority to approve
11the expenditure of campaign funds, or a member of his or her
12immediate family.
(a) Section 4.1 of this bill incorporates amendments
14to Section 89513 of the Government Code proposed by both this
15bill and Assembly Bill 1666. It shall only become operative if (1)
16both bills are enacted and become effective on or before January
171, 2015, (2) each bill amends Section 89513 of the Government
18Code, (3) Assembly Bill 1692 is not enacted or as enacted does
19not amend Section 89513 of the Government Code, and (4) this
20bill is enacted after Assembly Bill 1666, in which case Sections 4,
214.2, and 4.3 of this bill shall not become operative.
22(b) Section 4.2 of this bill incorporates amendments to Section
2389513 of the Government Code proposed by both this bill and
24Assembly Bill 1692. It shall only become operative if (1) both bills
25are enacted and become effective on or before January 1, 2015,
26(2) each bill amends Section 89513 of the Government Code, (3)
27Assembly Bill 1666 is not enacted or as enacted does not amend
28Section 89513 of the Government Code, and (4) this bill is enacted
29after Assembly Bill 1692, in which case Sections 4, 4.1, and 4.3
30of this bill shall not become operative.
31(c) Section 4.3 of this bill incorporates amendments to Section
3289513 of the Government Code proposed by this bill, Assembly
33Bill 1666, and Assembly Bill 1692. It shall only become operative
34if (1) all three bills are enacted and become effective on or before
35January 1, 2015, (2) all three bills amend Section 89513 of the
36Government Code,
and (3) this bill is enacted after Assembly Bill
371666 and Assembly Bill 1692, in which case Sections 4, 4.1, and
384.2 of this bill shall not become operative.
No reimbursement is required by this act pursuant to
3Section 6 of Article XIII B of the California Constitution because
4the only costs that may be incurred by a local agency or school
5district will be incurred because this act creates a new crime or
6infraction, eliminates a crime or infraction, or changes the penalty
7for a crime or infraction, within the meaning of Section 17556 of
8the Government Code, or changes the definition of a crime within
9the meaning of Section 6 of Article XIII B of the California
10Constitution.
The Legislature finds and declares that this bill
13furthers the purposes of the Political Reform Act of 1974 within
14the meaning of subdivision (a) of Section 81012 of the Government
15Code.
O
91