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Governor Signs Bill Banning Lobbyist Home Fundraisers, Vetoes Other Political Reform Measures

Governor Signs Bill Banning Lobbyist Home Fundraisers, Vetoes Other Political Reform Measures

Governor Brown signed and vetoed a flurry of political reform bills on September 30, the last day he could act on measures sent to the his desk during the 2014 regular legislative session. Below we summarize highlights and provide context.

Lobbyist Home Fundraisers Banned, Gift Limits Remain the Same

The Governor signed SB 1441 (Lara, Ch. 930), prohibiting lobbyists from hosting fundraisers in their homes and lobby firms from hosting fundraisers in their offices. Gift limits, however, will remain the same as the Governor vetoed SB 1443, which would have abolished lobbyists’ gifts altogether and reduced the gift limit from other sources to $200 per year.

In vetoing SB 1443, Governor Brown noted that “[p]roper disclosure, as already provided by law, should be sufficient to guard against undue influence” and that the bill added further complexity to the law without commensurate benefit. He also directed Members of the California Senate to an article authored by Bayless Manning, the Governor’s former law professor, entitled  The Purity Potlach: An Essay on Conflicts of Interest, American Government, and Moral Escalation, Federal Bar Journal (1964), pp. 239-256, for a discussion of balance and common sense in establishing constraints on politicians.

New Nonprofit and Contribution Restrictions Vetoed

Governor Brown also vetoed a pair of measures related to nonprofit restrictions and contributions to members of water boards.

SB 831 (Hill) would have required nonprofits that make travel payments to public officials for legislative or governmental purposes (and thus exempting the travel from gift limits) to disclose the donors responsible for funding the travel. The bill would also have prohibited elected officials from using campaign funds to contribute to a nonprofit 501(c)(4) organization that is owned or controlled by the official or a member of the official’s family.

The Governor stated in his veto message that the activities addressed by SB 831 were already subject to extensive regulation and the restrictions proposed would add more complexity without reducing undue influence.

AB 1728 (Garcia) would have prohibited members of water boards in California from accepting contributions in excess of $250 from entities involved in proceedings before a water board. The bill was inspired by the controversy surrounding contributions made by Tom Calderon and his brother, indicted Senator Ronald Calderon, to members of a water board in southern California that went on to award a consulting contract to Tom. Governor Brown vetoed the measure, stating that expanding the contribution restrictions and conflict of interest provisions to one subset of special districts added complexity without advancing the goals of the Political Reform Act.

Vetoes Taken in Context

Media coverage of the Governor’s vetoes stressed a short-term view that the actions meant less-than-expected change in the Political Reform Act at the end of this legislative session. The new chair of the Fair Political Practices Commission (FPPC) echoed the sentiment that rather than adding complexity, emphasis should be placed on common sense interpretation and enforcement of current laws. However, these most recent actions and statements must be taken in the context of the Governor’s actions and FPPC activism during the entire legislative cycle.

Earlier this session, the Governor signed AB 800, which resulted in the most expansive change in enforcement powers of the FPPC in the history of the Political Reform Act. With pre-election enforcement powers, and no commensurate due process rights, the FPPC has the ability to become involved in election contests in an unprecedented manner.

The Governor also signed SB 27 in May, which imposed dramatic new disclosure requirements on nonprofit and out-of-state organizations active in state and local elections as of July 1.

We have previously updated you on the FPPC’s aggressive investigation of lobby, government ethics, and gift disclosure matters in the past year. Never in the forty-year history of the Political Reform Act has the FPPC played such an activist role in California’s political process.   The Governor’s vetoes may mean fewer new rules, but they do not by any means suggest diminishing regulation of political activity in the state.

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As always, do not hesitate to contact the political law attorneys at Nielsen Merksamer if you have any questions.