BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1083


                                                                    Page  1





          Date of Hearing:  April 15, 2015


                  ASSEMBLY COMMITTEE ON ELECTIONS AND REDISTRICTING


                           Sebastian Ridley-Thomas, Chair


          AB 1083  
          (Eggman) - As Amended March 26, 2015


          SUBJECT:  Political Reform Act of 1974:  local enforcement.


          SUMMARY:  Permits the City Council of the City of Stockton and  
          the Fair Political Practices Commission (FPPC) to enter into an  
          agreement that provides for the FPPC to enforce a local campaign  
          finance ordinance passed by the City Council of the City of  
          Stockton.  Specifically, this bill:  


          1)Provides that, upon mutual agreement between the FPPC and the  
            City Council of the City of Stockton, the FPPC is authorized  
            to assume primary responsibility for the impartial, effective  
            administration, implementation, and enforcement of a local  
            campaign finance ordinance passed by the City Council of the  
            City of Stockton.  Provides that the FPPC is authorized to be  
            the civil prosecutor responsible for the civil enforcement of  
            such an ordinance.  Provides that as the civil prosecutor, the  
            FPPC 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  
               Political Reform Act (PRA) and the administrative  
               adjudication provisions of the Administrative Procedure  








                                                                    AB 1083


                                                                    Page  2





               Act.

          2)Requires any local campaign finance reform ordinance of the  
            City of Stockton that is enforced by the FPPC to comply with  
            the PRA.

          3)Requires the City Council of the City of Stockton to consult  
            with the FPPC prior to adopting and amending any local  
            campaign finance reform ordinance that will be enforced by the  
            FPPC.

          4)Permits the City Council of the City of Stockton and the FPPC  
            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  
            city funds for costs incurred by the FPPC in administering,  
            implementing, or enforcing a local campaign finance reform  
            ordinance pursuant to this bill.

          5)Prohibits an agreement entered into pursuant to the provisions  
            of this bill from containing any form of a cancellation fee,  
            liquidated damages provision, or other financial disincentive  
            to the exercise of the right to terminate the agreement,  
            except that the FPPC may require the City Council of the City  
            of Stockton to pay the FPPC for services rendered and any  
            other expenditures reasonably made by the FPPC in anticipation  
            of services to be rendered pursuant to the agreement if the  
            City Council of the City of Stockton terminates the agreement.

          6)Permits the City Council of the City of Stockton or the FPPC  
            to terminate, at any time, by ordinance or resolution, any  
            agreement made pursuant to this bill for the FPPC to  
            administer, implement, or enforce a local campaign finance  
            reform ordinance or any other provisions thereof.

          7)Requires the FPPC, if an agreement is entered into pursuant to  
            the provisions of this bill, to report to the Legislature on  
            or before January 1, 2019, and submit that report in  
            compliance with current law.  Requires the FPPC to develop the  








                                                                    AB 1083


                                                                    Page  3





            report in consultation with the City Council of the City of  
            Stockton.  

          8)Requires the report to include, but not be limited to, all of  
            the following:

             a)   The status of the agreement;

             b)   The estimated annual cost savings, if any, for the City  
               of Stockton;

             c)   A summary of relevant annual performance metrics,  
               including measures of utilization, enforcement, and  
               customer satisfaction;

             d)   Public comments submitted to the FPPC or the City of  
               Stockton relative to the operation of the agreement; and,
              
             e)   Legislative recommendations.

          9)Contains a January 1, 2020 sunset date.

          10)Makes legislative findings and declarations as to the  
            necessity of a special statute for City of Stockton due to the  
            need to avoid an appearance of corruption in the city's  
            electoral process.

          EXISTING LAW:  


          1)Creates the FPPC, and makes it responsible for the impartial,  
            effective administration and implementation of the PRA.

          2)Requires a local government agency that adopts or amends a  
            local campaign finance ordinance to file a copy of the  
            ordinance with the FPPC.

          3)Prohibits a local government agency from enacting a campaign  
            finance ordinance that imposes campaign reporting requirements  








                                                                    AB 1083


                                                                    Page  4





            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  
            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)Authorizes the FPPC, until January 1, 2018, upon mutual  
            agreement between the FPPC and the San Bernardino County Board  
            of Supervisors, to have primary responsibility for the  
            impartial, effective administration, implementation, and  
            enforcement of a local San Bernardino County campaign finance  
            reform ordinance.  Requires the San Bernardino County Board of  
            Supervisors to consult with the FPPC prior to adopting and  
            amending any local campaign finance reform ordinance that is  
            subsequently enforced by the FPPC.

          5)Authorizes the FPPC, pursuant to the aforementioned agreement,  
            to investigate possible violations of the San Bernardino  
            County campaign finance reform ordinance and bring  
            administrative actions against persons who violate the  
            ordinance, as specified.  

          6)Permits the San Bernardino County Board of Supervisors and the  
            FPPC to enter into any agreements necessary and appropriate  
            for the operation of these provisions, including agreements  
            for reimbursement of state costs with county funds, as  
            specified.  Permits the San Bernardino County Board of  
            Supervisors or the FPPC, at any time, by ordinance or  
            resolution, to terminate any agreement for the FPPC to  
            administer, implement, or enforce the local campaign finance  
            reform ordinance or any provision thereof.

          7)Requires the FPPC to report to the Legislature with specified  








                                                                    AB 1083


                                                                    Page  5





            information on or before January 1, 2017, if the FPPC enters  
            into such an agreement with the San Bernardino County Board of  
            Supervisors.

          FISCAL EFFECT:  Unknown


          COMMENTS:  


          1)Purpose of the Bill:  According to the author:


               This bill seeks to amend the Political Reform Act of 1974  
               in order to authorize the Fair Political Practices  
               Commission (FPPC) to enter into an agreement with the City  
               of Stockton to enforce campaign contribution limits. There  
               is an ongoing, national debate about the role money plays  
               in campaigns, and particularly the effect that large  
               contributions have on candidates once they are elected.  
               Candidates for elected office typically rely on money to  
               fund effective campaigns; the amount and source of those  
               donations can vary greatly. The City of Stockton currently  
               imposes no limits on donations by individuals to campaigns  
               for city offices, so the City Council is considering the  
               adoption of a municipal ordinance setting individual  
               campaign donation limits. The city does not have the  
               resources to oversee and enforce such [an] ordinance, but  
               the FPPC has, through past legislation, arranged with the  
               County of San Bernardino to do just that. This bill would  
               simply allow the City of Stockton to make the same mutual  
               arrangement with the FPPC.


          2)San Bernardino County:  In 2012, the Legislature passed and  
            the Governor signed AB 2146 (Cook), Chapter 169, Statutes of  
            2012, which permitted San Bernardino County and the FPPC to  
            enter into an agreement that provides for the FPPC to enforce  
            the County's local campaign finance reform ordinance.  Prior  








                                                                    AB 1083


                                                                    Page  6





            to this, the FPPC did not enforce any local campaign finance  
            ordinances.  According to previous analyses, the County of San  
            Bernardino, which had been the subject of several high-profile  
            corruption cases, was in the process of developing a campaign  
            finance ordinance.  Rather than appoint an ethics commission,  
            which could present financial as well as conflict of interest  
            challenges, the County proposed to contract with the FPPC to  
            enforce their local campaign finance ordinance.  Moreover, the  
            County determined that it was in the best interest of the  
            County to retain the services of the FPPC to provide for the  
            enforcement and interpretation of San Bernardino County's  
            local campaign finance ordinance as the FPPC has special  
            skills, knowledge, experience, and expertise in the area of  
            enforcement and interpretation of campaign laws necessary to  
            effectively advise, assist, litigate, and otherwise represent  
            the County on such matters.  As a result, the FPPC and San  
            Bernardino County entered into a mutual agreement, from  
            January 1, 2013 through December 31, 2014, for the FPPC to  
            provide the County campaign enforcement and interpretation  
            services for the impartial, effective administration,  
            implementation, and enforcement of the San Bernardino's  
            campaign finance reform ordinance.  According to the FPPC, San  
            Bernardino County and the FPPC have entered into a new two  
            year mutual agreement.


          3)Local Campaign Ordinances and the PRA:  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 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 solely 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.   








                                                                    AB 1083


                                                                    Page  7





            Similarly, AB 1430 (Garrick), Chapter 708, Statutes of 2007,  
            prohibited 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' jurisdictions.  Any jurisdiction  
            that adopts or amends a local campaign finance ordinance is  
            required to file a copy of that ordinance with the FPPC, and  
            the FPPC posts those ordinances on its website.  



            Several cities and counties have adopted campaign finance  
            ordinances, some of which are very 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 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 FPPC does not currently enforce any local campaign finance  
            ordinances other than San Bernardino County's.  The FPPC 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.
          4)Criminal, Civil, and Administrative Enforcement of the PRA and  
            Local Campaign Ordinances:  Violations of the PRA are subject  
            to administrative, civil, and criminal penalties.  Generally,  








                                                                    AB 1083


                                                                    Page  8





            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 FPPC,  
            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 FPPC has the sole authority to bring  
            administrative proceedings for enforcement of the PRA.  When  
            the FPPC determines on the basis of such a proceeding that a  
            violation of the PRA has occurred, it can 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 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 FPPC has under the PRA.

          5)Is Expansion of the Law to Soon?  As mentioned above, in 2012,  
            AB 2146 (Cook) became law to permit San Bernardino County and  
            the FPPC to enter into an agreement for the FPPC to enforce  
            the County's local campaign finance reform ordinance.  Among  
            other provisions, AB 2146 also required the FPPC, if it  
            entered into an agreement with the San Bernardino County Board  
            of Supervisors, to report to the Legislature with specified  
            information on or before January 1, 2017.  Current law  








                                                                    AB 1083


                                                                    Page  9





            requires the report to include, but not be limited to, the  
            status of the agreement, the estimated annual cost savings, if  
            any, for the County of San Bernardino, a summary of relevant  
            annual performance metrics, as specified, any public comments  
            submitted relative to the operation of the agreement, and any  
            legislative recommendations.  According to the FPPC, a report  
            has not been submitted to the Legislature yet.  Would it be  
            premature to expand current law when the Legislature has not  
            received a report detailing the effectiveness of the current  
            agreement between the FPPC and San Bernardino County?



          Furthermore, the committee may wish to consider whether such an  
            expansion of the FPPC's workload could negatively impact the  
            ongoing enforcement of the PRA.  Because there is no guarantee  
            that the City of Stockton's local campaign finance ordinance  
            will be consistent with the general framework of the PRA, this  
            additional local ordinance that the FPPC is asked to enforce  
            could add complexity to the FPPC's work.  Conversely, this  
            bill only expands current law to add the City of Stockton's  
            local campaign finance ordinance and gives the FPPC discretion  
            on whether or not they will choose to enter into an agreement  
            with the City Council of the City of Stockton to enforce its  
            local campaign finance ordinance.

          6)Political Reform Act of 1974:  California voters passed an  
            initiative, Proposition 9, in 1974 


          that created the FPPC and codified significant restrictions and  
            prohibitions on candidates, officeholders, and lobbyists. That  
            initiative is commonly known as the PRA.  Amendments to the  
            PRA that are not submitted to the voters, such as those  
            contained in this bill, must further the purposes of the  
            proposition and require a two-thirds vote of each house of the  
            Legislature. 

          7)Related Legislation:  AB 910 (Harper), which is also being  








                                                                    AB 1083


                                                                    Page  10





            heard in this committee today,  authorizes the FPPC to  
            administer and enforce a local campaign finance ordinance for  
            any city or county, upon mutual agreement between the FPPC and  
            the local agency, as specified.





          8)Previous Legislation:  AB 2146 (Cook), Chapter 169 of 2012,  
            permitted San Bernardino County and the FPPC to enter into an  
            agreement that provides for the FPPC to enforce the County's  
            local campaign finance ordinance.



            SB 1226 (Correa) of 2014, would have authorized any city or  
            county to enter into an agreement with the FPPC to administer  
            and enforce a local campaign finance ordinance.  The bill was  
            gutted and amended in the Assembly Appropriations Committee.





          9)Double-Referral:  This bill is double referred to the Assembly  
            Local Government Committee.  
          REGISTERED SUPPORT / OPPOSITION:




          Support


          None on file.











                                                                    AB 1083


                                                                    Page  11






          Opposition


          None on file.




          Analysis Prepared by:Nichole Becker / E. & R. / (916) 319-2094