Bill Text: CA AB2318 | 2015-2016 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Nonprofit organizations: use of public resources.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2016-09-29 - Chaptered by Secretary of State - Chapter 825, Statutes of 2016. [AB2318 Detail]

Download: California-2015-AB2318-Amended.html

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BILL NUMBER: AB 2318	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 28, 2016

INTRODUCED BY   Assembly Member Low

                        FEBRUARY 18, 2016

   An act to  amend Sections 54964.5 and 54964.6 of 
 add Sections 84311 and 84312 to, and to repeal Section 54964.6
of,  the Government Code, relating to  campaign
activity.   the Political Reform Act of 1974. 



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2318, as amended, Low.  Political Reform Act of 1974: 
Fair Political Practices Commission: enforcement: use of public
resources.
   (1)  Existing law prohibits the use of public funds for
campaign activities.  Existing law prohibits a nonprofit
organization or an officer, employee, or agent of a nonprofit
organization from using, or permitting another to  use
  use,  public resources received from a local
agency for  any  campaign  activity, as defined, and
  activity  not authorized by law. 
Existing law defines, among other terms, "public resources" to mean
any property or asset owned by a local agency and funds received by a
nonprofit organization which have been generated from any activities
related to conduit bond financing by those entities subject to
specified conduit financing and transparency and accountability
provisions, and "nonprofit organization" to mean an entity
incorporated under the Nonprofit Corporation Law or a nonprofit
organization that qualifies for exempt status under the federal
Internal Revenue Code of 1986, except as specified. Existing law
authorizes a civil cause of action for a violation of these
prohibitions and damages that include, but are not limited to, 3
times the value of the unlawful use of the public resources. Existing
law authorizes the Attorney General, a district attorney, and a city
attorney of a city having a population in excess of 750,000 to seek
these civil remedies.   Existing law authorizes the
Attorney General, any district attorney, or any city attorney of a
city with a population over 750,000 to bring a civil action to
recover a civil penalty against any person who intentionally or
negligently violates that prohibition. 
   The Political Reform Act of 1974 regulates contributions to public
officials and also regulates conflicts of interests on the part of
public officials while carrying out their respective duties. The act
establishes the Fair Political Practices Commission as the agency
responsible for administering and enforcing the act. The act
authorizes the Commission to seek and impose administrative and civil
penalties against persons who violate the act, as prescribed. The
act makes a willful violation of its provisions a misdemeanor subject
to specified penalties. 
   This bill  additionally  would  restate the
prohibition on the use of public resources described above within the
Political Reform Act of 1974 and would also  authorize the Fair
Political Practices Commission to bring a civil action  or
to commence an administrative action for violation of these
provisions.   to recover the civil penalty, as described
above. The bill would authorize the Commission to investigate, hold
an administrative hearing on, and issue an order against a violator
of the prohibition on the use of public resources for campaign
activity, instead of commencing a civil action. 
   (2) Existing law requires qualifying individuals and political
organizations to report specified information, including, but not
limited to, political contributions, in statements filed with the
Fair Political Practices Commission. Existing law requires a
reporting nonprofit organization that engages in campaign activity to
deposit into a separate bank account all  "specific
  specific  source or sources of  funds"
  funds  it receives and to pay for all campaign
activity from that separate bank account. Existing law 
defines, among other terms,   defines  "reporting
nonprofit organization"  to mean   as  a
nonprofit organization for which public resources from one or more
local agencies account for more than 20% of the nonprofit
organization's annual gross revenue, as specified, and  defines
 "specific source or sources of funds"  to mean
  as  any funds received by the reporting nonprofit
organization that have been designated for campaign activity use or
any other funds received by the nonprofit  organization.
  organization that are used for campaign activity.

   Existing law requires a reporting nonprofit organization that
engages in campaign activity of specified amounts or more to
periodically disclose to the Franchise Tax Board, and post on its
Internet Web site in a certain manner, the identity and amount of
each specific source or sources of funds it receives for campaign
activity, a description of the campaign activity, and the identity
and amount of payments the organization makes from the required
separate bank account. Existing law  authorizes 
 authorizes, and in some instances requires,  the Franchise
Tax Board to  conduct an audit of any   audit a
 reporting nonprofit  organization and requires the
board to conduct an audit of any reporting nonprofit organization
that engages in campaign activity in excess of $500,000 in a calendar
year. Existing law   organization,  requires the
board to issue a written audit  report   report,
 and  requires the board  to transmit the  audit
 report to the Attorney General and the district attorney for
the county in which the reporting nonprofit organization is
domiciled. Existing law authorizes the Attorney General or the
district attorney for the county in which the reporting nonprofit
organization is domiciled to  assess   impose
 a monetary civil penalty of up to $10,000 against a reporting
nonprofit organization for  each violation of these
disclosure requirements.   misusing public resources
received from a local   agency, as described in (1), for
failing to maintain the separate bank account, or for not complying
with the disclosure requirements described above. 
   This bill would  recast and relocate those provisions within
the Political Reform Act of 1974, thereby making the Fair Political
Practices Commission responsible for their administration and
enforcement, except as specified. The bill would  change the
term "reporting nonprofit organization" to "publicly funded
multipurpose organization,"  described   defined
 as a multipurpose organization  as defined in the
Political Reform Act  for which public resources from one or
more local agencies account for more than 20% of the multipurpose
organization's annual gross revenue, as specified.  This
  The  bill would redefine "specific source or
sources of funds"  to mean   as  payments
or funds that meet specified criteria received by the publicly funded
multipurpose organization from donors that are for, or may be used
for, contributions or expenditures, as specified, or any other funds
received by the publicly funded multipurpose organization within a
 two-year   2-year  period that are used
for campaign activity. This bill would shift the Franchise Tax Board'
s  authority and  duties under these provisions to the Fair
Political Practices Commission and would authorize the  Fair
Political Practices Commission,   Co  
mmission,  in addition to the Attorney General or the district
attorney, to impose the  monetary  civil penalty of up to
$10,000 against a publicly funded multipurpose  organization
for each violation.   organization.  
   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. 
   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:  no   yes  .


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 54964.6 of the  
Government Code   is repealed.  
   54964.6.  (a) A reporting nonprofit organization that engages in
campaign activity, either directly or through the control of another
entity, shall deposit into a separate bank account all specific
source or sources of funds received and shall pay for all campaign
activity from that separate bank account.
   (b) As used in this section, the following terms shall have the
following meanings:
   (1) "Reporting nonprofit organization" means a nonprofit
organization for which public resources from one or more local
agencies account for more than 20 percent of the nonprofit
organization's annual gross revenue in the current fiscal year or
either of the previous two fiscal years. A reporting nonprofit
organization shall not include a nonprofit organization that sponsors
a committee, as defined in Section 82048.7 of the Government Code,
if the nonprofit organization reports all contributions it received
and all expenditures it made on campaign disclosure statements filed
by the sponsored committee and the nonprofit organization makes no
payments from its general treasury to the sponsored committee other
than payments for contributions by donors earmarked for the sponsored
committee. For purposes of this subdivision, "earmarked" means a
payment by a donor to a nonprofit organization subject to a
condition, agreement, or understanding that the payment will be used
for making contributions or independent expenditures by the sponsored
committee of the sponsoring nonprofit organization.
   (2) "Specific source or sources of funds" shall mean any funds
received by the reporting nonprofit organization that have been
designated for campaign activity use or any other funds received by
the nonprofit organization that are used, in whole or in part, within
a two-year period from receipt for campaign activity.
   (3) Unless otherwise defined herein, the definitions found in
subdivision (b) of Section 54964.5 shall apply to this section.
   (c) Thirty days after the end of each quarter, a reporting
nonprofit organization that engages in campaign activity of fifty
thousand dollars ($50,000) or more related to statewide candidates or
ballot measures or engages in campaign activity of two thousand five
hundred dollars ($2,500) or more related to local candidates or
ballot measures, either directly or through the control of another
entity, at any point during that quarter shall disclose the following
information for that quarter:
   (1) The name and amount of each specific source or sources of
funds used for campaign activity, provided that the aggregate amount
of funds received since January 1 of the most recent odd year by a
reporting nonprofit organization from that specific source or sources
of funds is at least two hundred fifty dollars ($250).
   (2) The name of the payee and amount of all payments aggregating
two hundred fifty dollars ($250) or more made from the single bank
account required under subdivision (a).
   (3) A description of each campaign activity.
   (d) Thirty days after the end of each even year, a reporting
nonprofit organization that engages in campaign activity of one
hundred thousand ($100,000) or more related to statewide candidates
or ballot measures or engages in campaign activity of ten thousand
dollars ($10,000) or more related to local candidates or ballot
measures, either directly or through the control of another entity,
at any point during that even year or the prior odd year shall
disclose all the following information for those two calendar years:
   (1) The name and amount of any specific source or sources of funds
used for campaign activity, provided that the aggregate amount of
funds received since January 1 of the most recent odd year by a
reporting nonprofit organization from that specific source or sources
of funds is at least two hundred fifty dollars ($250).
   (2) The name of the payee and amount of all payments made from the
single bank account required under subdivision (a).
   (3) A description of each campaign activity.
   (e) Each reporting nonprofit organization that engages in campaign
activity, either directly or through the control of another entity,
shall provide to the Franchise Tax Board and display on its Internet
Web site the information it is required to disclose under this
section. The information shall be clearly described and identified on
a separate Internet Web page, which shall be linked from the
homepage of the organization's Internet Web site. The link to this
Internet Web page from the homepage shall be as visible as all
similar links.
   (f) The Franchise Tax Board may conduct an audit of any reporting
nonprofit organization that is required to provide records to the
board pursuant to this section. The Franchise Tax Board shall conduct
an audit of any reporting nonprofit organization that engages in
campaign activity in excess of five hundred thousand dollars
($500,000) in a calendar year. The reporting nonprofit organization
shall provide records to the Franchise Tax Board that substantiate
the information required to be disclosed by this section. The
Franchise Tax Board shall determine whether the organization complied
with the requirements of Section 54964.5 and this section, issue a
written audit report, and transmit the written audit report to the
Attorney General and the district attorney for the county in which
the reporting nonprofit organization is domiciled.
   (g) If the Franchise Tax Board determines at the conclusion of an
audit that a reporting nonprofit organization has violated Section
54964.5 or this section, the Attorney General or the district
attorney for the county in which the reporting nonprofit organization
is domiciled may impose a civil fine upon the reporting nonprofit
organization in an amount up to ten thousand dollars ($10,000) for
each violation. 
   SEC. 2.    Section 84311 is added to the  
Government Code   , to read:  
   84311.  (a) A nonprofit organization or an officer, employee, or
agent of a nonprofit organization shall not use, or permit another to
use, public resources, received from any local agency for any
campaign activity not authorized by law.
   (b) As used in this section and Section 84312, the following terms
shall have the following meanings:
   (1) "Ballot measure" means a state or local initiative,
referendum, or recall measure certified to appear on a regular or
special election ballot or other measure submitted to the voters by
the Legislature or the governing body at a regular or special
election.
   (2) (A) "Campaign activity" means a payment that is used for
communications that expressly advocate for or against the
qualification of a clearly identified ballot measure, the approval or
rejection of a clearly identified ballot measure, or the election or
defeat of a clearly identified candidate by the voters, or that
constitutes a campaign contribution.
   (B) "Campaign activity" does not include any of the following:
   (i) The costs of adopting a position or resolution supporting or
opposing a clearly identified ballot measure or candidate, including,
but not limited to, posting the position or resolution on the
nonprofit organizations' Internet Web site, communicating the
position or resolution to members of the nonprofit organization, or
issuing a press statement.
   (ii) Incidental or minimal use of public resources.
   (iii) Incidental costs related to the establishment or
administration of a sponsored committee, as defined in Section
82048.7. A reasonable accounting method may be used to determine the
use of nonpublic resources to pay for that cost. For purposes of this
subparagraph, "establishment and administration" means the cost of
office space, telephones, salaries, utilities, supplies, legal and
accounting fees, and other expenses incurred in establishing and
operating a sponsored committee.
   (3) "Candidate" means an individual who has qualified to have his
or her name listed on the ballot, or who has qualified to have
write-in votes on his or her behalf counted by elections officials,
for nomination or election to an elective office at any regular or
special primary or general election, and includes any officeholder
who is the subject of a recall election.
   (4) "Expenditure" means a payment used for communications that
expressly advocate the approval or rejection of a clearly identified
ballot measure, or the election or defeat of a clearly identified
candidate, by the voters, or that constitutes a campaign
contribution.
   (5) "Local agency" has the same meaning as that term is defined in
paragraph (4) of subdivision (b) of Section 54964 and shall also
include a public entity created pursuant to the Joint Exercise of
Powers Act (Chapter 5 (commencing with Section 6500) of Division 7 of
Title 1) by one or more entities described in Section 54964.
   (6) "Nonprofit organization" means an entity incorporated under
the Nonprofit Corporation Law (Division 2 (commencing with Section
5000) of Title 1 of the Corporations Code) or a nonprofit
organization that qualifies for exempt status under Section 115 of
501(c) of the federal Internal Revenue Code. "Nonprofit organization"
does not include a nonprofit organization that qualifies for
tax-exempt status under Section 501(c)(3) of the federal Internal
Revenue Code.
   (7) "Public resources" means either of the following:
   (A) Any property or asset owned by a local agency, including, but
not limited to, cash, land, buildings, facilities, funds, equipment,
supplies, telephones, computers, vehicles, travel, and local
government compensated work time that is provided to a nonprofit
organization, except funds received in exchange for consideration for
goods or services.
   (B) Funds received by a nonprofit organization that have been
generated from any activities related to conduit bond financing by
those entities subject to the conduit financing and transparency and
accountability provision of Chapter 10.7 (commencing with Section
5870) of Division 6 of Title 1, whether or not those funds are
received by the nonprofit organization in exchange for consideration
for goods or services.
   (8) "Use" means a use of public resources from one or more local
agencies that is substantial enough to result in a gain or advantage
to the user or a loss to a local agency from which a monetary value
may be estimated.
   (c) This section does not prohibit the use of public resources for
providing information to the public about the possible effects of a
ballot measure on the activities, operations, or policies of the
state or a local agency if the informational activities meet both of
the following conditions:
   (1) The informational activities are not otherwise prohibited by
the California Constitution or the laws of this state.
   (2) The information provided constitutes an accurate, fair, and
impartial presentation of relevant facts to aid the electorate in
reaching an informed judgment regarding the ballot measure.
   (d) (1) A person who intentionally or negligently violates this
section is liable for a civil penalty not to exceed one thousand
dollars ($1,000) for each day on which a violation occurs, plus three
times the value of the unlawful use of public resources. The penalty
shall be assessed and recovered in a civil action brought in the
name of the people by the Commission. If two or more persons are
responsible for a violation, they shall be jointly and severally
liable for the penalty. Any moneys recovered by the Commission shall
be paid into the General Fund. Only one judgment on the merits with
respect to a violation may be obtained under this paragraph or
paragraph (1) of subdivision (d) of Section 54964.5.
   (2) A civil action alleging a violation of this section shall not
be commenced more than four years after the date of the alleged
violation.
   (3) The Commission has jurisdiction to commence an investigation
for a violation of this section in the manner described in Section
83115. A civil action shall not be filed or prosecuted under
paragraph (1) with regard to a person for a violation of this section
after the Commission has issued an order in the manner described in
Section 83116 against that person for the same violation. 
   SEC. 3.    Section 84312 is added to the 
Government Code   , to read:  
   84312.  (a) A publicly funded multipurpose organization that
engages in campaign activity, either directly or through the control
of another entity, shall deposit into a separate bank account all
specific source or sources of funds received and shall pay for all
campaign activity from that separate bank account.
   (b) (1) As used in this section, the following terms have the
following meanings:
   (A) "Publicly funded multipurpose organization" means a
multipurpose organization, as defined in subdivision (a) of Section
84222, for which public resources, as defined in paragraph (7) of
subdivision (b) of Section 84311, from one or more local agencies
account for more than 20 percent of the multipurpose organization's
annual gross revenue in the current fiscal year or either of the
previous two fiscal years. "Publicly funded multipurpose organization"
does not include a multipurpose organization that sponsors a
committee, as defined in Section 82048.7, if the multipurpose
organization reports all specific sources of funds received and all
campaign activities on campaign disclosure statements filed by the
sponsored committee, and the multipurpose organization makes no
payments from its general treasury to the sponsored committee other
than payments for contributions by donors earmarked for the sponsored
committee. For purposes of this subparagraph, "earmarked" means a
payment by a donor to a multipurpose organization subject to a
condition, agreement, or understanding that the payment will be used
for making contributions or independent expenditures by the sponsored
committee of the sponsoring multipurpose organization.
   (B) "Specific source or sources of funds" means any of the
following:
   (i) Payments the publicly funded multipurpose organization
solicits and receives from donors in an amount equal to or greater
than the amount identified in subdivision (a) of Section 82013 for
purposes of making contributions or expenditures.
   (ii) Payments the publicly funded multipurpose organization
receives from donors in an amount equal to or greater than the amount
identified in subdivision (a) of Section 82013 subject to a
condition, agreement, or understanding with the donor that all or a
portion of the payments may be used for making contributions or
expenditures.
   (iii) Existing funds of the publicly funded multipurpose
organization from a donor and a subsequent agreement or understanding
is reached with the donor that all or a portion of the funds may be
used for making contributions or expenditures in an amount equal to
or greater than the amount identified in subdivision (a) of Section
82013. The date of the subsequent agreement or understanding is
deemed to be the date of receipt of the payment.
   (iv) Any other funds received by a publicly funded multipurpose
organization within a two-year period that are used for campaign
activity.
   (2) Except as otherwise defined in this section, the definitions
in subdivision (b) of Section 84311 apply to this section.
   (c) Thirty days after the end of each quarter, a publicly funded
multipurpose organization that engages in campaign activity of fifty
thousand dollars ($50,000) or more related to statewide candidates or
ballot measures or engages in campaign activity of two thousand five
hundred dollars ($2,500) or more related to local candidates or
ballot measures, either directly or through the control of another
entity, at any point during that quarter shall disclose the following
information for that quarter:
   (1) The name and amount of each specific source or sources of
funds used for campaign activity if the aggregate amount of funds
received since January 1 of the most recent odd year by the publicly
funded multipurpose organization from that specific source or sources
of funds is at least one thousand dollars ($1,000). The publicly
funded multipurpose organization shall report all sources of funds
that satisfy the definition of subparagraph (B) of paragraph (1) of
subdivision (b) and for the balance of its campaign activities paid
from the separate bank account. The publicly funded multipurpose
organization shall report sources of funds based on a last in, first
out accounting method. For purposes of this section, "last in, first
out accounting method" means an accounting method by which
contributions and expenditures are attributed to the multipurpose
organization's contributors in reverse chronological order beginning
with the most recent of its contributors or, if there are any prior
contributions or expenditures, beginning with the most recent
contributor for which unattributed contributions remain.
   (2) The name of the payee and amount of all payments aggregating
two hundred fifty dollars ($250) or more made from the separate bank
account required by subdivision (a).
   (3) A description of each campaign activity.
   (d) By January 31 following the end of each even-numbered year, a
publicly funded multipurpose organization that engages in campaign
activity of one hundred thousand dollars ($100,000) or more related
to statewide candidates or ballot measures or engages in campaign
activity of ten thousand dollars ($10,000) or more related to local
candidates or ballot measures, either directly or through the control
or another entity, at any point during that even year or the prior
odd year, shall disclose the following information for those two
calendar years:
   (1) The name and amount of any specific source or sources of funds
used for campaign activity if the aggregate amount of funds received
since January 1 of the most recent odd year by the publicly funded
multipurpose organization from that specific source or sources of
funds is at least one thousand dollars ($1,000). The publicly funded
multipurpose organization shall report all sources of funds that
satisfy the definition of subparagraph (B) of paragraph (1) of
subdivision (b) and for the balance of its campaign activities paid
from the separate bank account. The publicly funded multipurpose
organization shall report sources of funds based on a last in, first
out accounting method.
   (2) The name of the payee and amount of all payments aggregating
two hundred fifty dollars ($250) or more made from the separate bank
account required by subdivision (a).
   (3) A description of each campaign activity.
   (e) Each publicly funded multipurpose organization that engages in
campaign activity, either directly or through the control of another
entity, shall provide to the Commission, and display on the
organization's Internet Web site, the information it is required to
disclose under this section. The information shall be clearly
described and identified on a separate Internet Web page that is
linked from the homepage of the organization's Internet Web site. The
link to this Internet Web page from the homepage shall be as visible
as all similar links.
   (f) The Commission may require an audit of a publicly funded
multipurpose organization that is required to provide records to the
Commission pursuant to this section. The Commission shall require an
audit of any publicly funded multipurpose organization that engages
in campaign activity in excess of five hundred thousand dollars
($500,000) in a calendar year. The publicly funded multipurpose
organization shall provide records to the Commission to substantiate
the information required to by disclosed by this section. The
Commission shall determine if the organization complied with the
requirements of Section 84311 and this section, issue a written audit
report, and transmit the written audit report to the Attorney
General and the district attorney for the county in which the
organization is domiciled.
   (g) If the Commission determines at the conclusion of an audit
that a publicly funded multipurpose organization has violated Section
84311 or this section, the Commission, the Attorney General, or the
district attorney for the county in which the organization is
domiciled may impose a civil fine upon the organization in an amount
up to ten thousand dollars ($10,000) for each violation. 
   SEC. 4.    No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution. 
   SEC. 5.    The Legislature finds and declares that
this bill furthers the purposes of the Political Reform Act of 1974
within the meaning of subdivision (a) of Section 81012 of the
Government Code.  
  SECTION 1.    Section 54964.5 of the Government
Code is amended to read:
   54964.5.  (a) A nonprofit organization or an officer, employee, or
agent of a nonprofit organization shall not use, or permit another
to use, public resources, received from any local agency for any
campaign activity not authorized by law.
   (b) As used in this section and Section 54964.6, the following
terms shall have the following meanings:
   (1) "Ballot measure" means a state or local initiative,
referendum, or recall measure certified to appear on a regular or
special election ballot or other measure submitted to the voters by
the Legislature or the governing body of a local agency at a regular
or special election.
   (2) "Campaign activity" means a payment that is used for
communications that expressly advocate for or against the
qualification of a clearly identified ballot measure, the approval or
rejection of a clearly identified ballot measure, or the election or
defeat of a clearly identified candidate by the voters, or that
constitutes a campaign contribution.
   (A) "Campaign activity" does not include the costs of adopting a
position or a resolution supporting or opposing a clearly identified
ballot measure or candidate, including, but not limited to, posting
the position or resolution on the nonprofit organization's Internet
Web site, communicating the position or resolution to members of the
nonprofit organization, or issuing a press statement.
   (B) "Campaign activity" does not include incidental or minimal use
of public resources.
   (C) "Campaign activity" does not include incidental costs related
to the establishment or administration of a sponsored committee as
defined in Section 82048.7. A reasonable accounting method may be
used to determine the use of nonpublic resources to pay for that
cost. "Establishment and administration" means the cost of office
space, telephones, salaries, utilities, supplies, legal and
accounting fees, and other expenses incurred in establishing and
operating a sponsored committee.
         (3) "Candidate" means an individual who has qualified to
have his or her name listed on the ballot, or who has qualified to
have write-in votes on his or her behalf counted by elections
officials, for nomination or election to an elective office at any
regular or special primary or general election, and includes any
officeholder who is the subject of a recall election.
   (4) "Expenditure" means a payment used for communications that
expressly advocate the approval or rejection of a clearly identified
ballot measure, or the election or defeat of a clearly identified
candidate, by the voters or that constitutes a campaign contribution.

   (5) "Local agency" shall have the same meaning as that term is
defined in paragraph (4) of subdivision (b) of Section 54964 and
shall also include a public entity created pursuant to the Joint
Exercise of Powers Act (Chapter 5 (commencing with Section 6500) of
Division 7 of Title 1) by one or more entities described in Section
54964.
   (6) "Nonprofit organization" means any entity incorporated under
the Nonprofit Corporation Law (Division 2 (commencing with Section
5000) of Title 1 of the Corporations Code) or a nonprofit
organization that qualifies for exempt status under Section 115 or
501(c) of the Internal Revenue Code, provided, however, that
"nonprofit organization" does not include any nonprofit organization
that qualifies for tax-exempt status under Section 501(c)(3) of the
Internal Revenue Code.
   (7) "Public resources" means the following:
   (A) Any property or asset owned by a local agency, including, but
not limited to, cash, land, buildings, facilities, funds, equipment,
supplies, telephones, computers, vehicles, travel, and local
government compensated work time that is provided to a nonprofit
organization, except funds received in exchange for consideration for
goods or services.
   (B) Funds received by a nonprofit organization which have been
generated from any activities related to conduit bond financing by
those entities subject to the conduit financing and transparency and
accountability provisions of Chapter 10.7 (commencing with Section
5870) of Division 6 of Title 1, whether or not those funds are
received by the nonprofit in exchange for consideration for goods or
services.
   (8) "Use" means a use of public resources from one or more local
agencies that is substantial enough to result in a gain or advantage
to the user or a loss to any local agency for which any monetary
value may be estimated.
   (c) This section does not prohibit the use of public resources for
providing information to the public about the possible effects of
any ballot measure on the activities, operations, or policies of the
state or a local agency, provided that the informational activities
meet both of the following conditions:
   (1) The informational activities are not otherwise prohibited by
the California Constitution or the laws of this state.
   (2) The information provided constitutes an accurate, fair, and
impartial presentation of relevant facts to aid the electorate in
reaching an informed judgment regarding the ballot measure.
   (d) (1) Any person who intentionally or negligently violates this
section is liable for a civil penalty not to exceed one thousand
dollars ($1,000) for each day on which a violation occurs, plus three
times the value of the unlawful use of public resources. The penalty
shall be assessed and recovered in a civil action brought in the
name of the people of the State of California by the Fair Political
Practices Commission, the Attorney General, or by any district
attorney or any city attorney of a city having a population in excess
of 750,000. If two or more persons are responsible for any
violation, they shall be jointly and severally liable for the
penalty. If the action is brought by the Fair Political Practices
Commission or the Attorney General, the moneys recovered shall be
paid into the General Fund. If the action is brought by a district
attorney, the moneys recovered shall be paid to the treasurer of the
county in which the judgment was entered. If the action is brought by
a city attorney, the moneys recovered shall be paid to the treasury
of that city. No more than one judgment on the merits with respect to
any violation may be obtained under this paragraph.
   (2) A civil action alleging a violation of this section shall not
be commenced more than four years after the date of the alleged
violation.
   (3) The Fair Political Practices Commission shall have the
jurisdiction to commence an investigation for a violation of this
section in the manner described in Section 83115. No civil action may
be filed or prosecuted under paragraph (1) with regard to any person
for any violation of this section after the Fair Political Practices
Commission has issued an order in the manner described in Section
83116 against that person for the same violation.  
  SEC. 2.    Section 54964.6 of the Government Code
is amended to read:
   54964.6.  (a) A publicly funded multipurpose organization that
engages in campaign activity, either directly or through the control
of another entity, shall deposit into a separate bank account all
specific source or sources of funds received and shall pay for all
campaign activity from that separate bank account.
   (b) As used in this section, the following terms shall have the
following meanings:
   (1) "Publicly funded multipurpose organization" means a
multipurpose organization, as defined in subdivision (a) of Section
84222, for which public resources, as defined in paragraph (7) or
subdivision (b) of Section 54964.5, from one or more local agencies
account for more than 20 percent of the multipurpose organization's
annual gross revenue in the current fiscal year or either of the
previous two fiscal years. A publicly funded multipurpose
organization shall not include a multipurpose organization that
sponsors a committee, as defined in Section 82048.7, if the
multipurpose organization reports all specific sources of funds
received and all campaign activities on campaign disclosure
statements filed by the sponsored committee and the multipurpose
organization makes no payments from its general treasury to the
sponsored committee other than payments for contributions by donors
earmarked for the sponsored committee. For purposes of this
subdivision, "earmarked" means a payment by a donor to a multipurpose
organization subject to a condition, agreement, or understanding
that the payment will be used for making contributions or independent
expenditures by the sponsored committee of the sponsoring
multipurpose organization.
   (2) "Specific source or sources of funds" shall mean any of the
following:
   (A) Payments the publicly funded multipurpose organization
solicits and receives from donors in an amount equal to or greater
than the amount identified in subdivision (a) of Section 82013 for
the purpose of making contributions or expenditures.
   (B) Payments the publicly funded multipurpose organization
receives from donors in an amount equal to or greater than the amount
identified in subdivision (a) of Section 82013 subject to a
condition, agreement, or understanding with the donor that all or a
portion of the payments may be used for making contributions or
expenditures.
   (C) Existing funds of the publicly funded multipurpose
organization from a donor and a subsequent agreement or understanding
is reached with the donor that all or a portion of the funds may be
used for making contributions or expenditures in an amount equal to
or greater than the amount identified in subdivision (a) of Section
82013. The date of the subsequent agreement or understanding is
deemed to be the date of receipt of the payment.
   (D) Any other funds received by the publicly funded multipurpose
organization within a two-year period that are used for campaign
activity.
   (3) Unless otherwise defined herein, the definitions found in
subdivision (b) of Section 54964.5 shall apply to this section.
   (c) Thirty days after the end of each quarter, a publicly funded
multipurpose organization that engages in campaign activity of fifty
thousand dollars ($50,000) or more related to statewide candidates or
ballot measures or engages in campaign activity of two thousand five
hundred dollars ($2,500) or more related to local candidates or
ballot measures, either directly or through the control of another
entity, at any point during that quarter shall disclose the following
information for that quarter:
   (1) The name and amount of each specific source or sources of
funds used for campaign activity, provided that the aggregate amount
of funds received since January 1 of the most recent odd year by a
publicly funded multipurpose organization from that specific source
or sources of funds is at least one thousand dollars ($1,000). The
publicly funded multipurpose organization shall report all sources of
funds that satisfy the criteria of paragraph (2) of subdivision (b)
and for the balance of its campaign activities paid from the separate
bank account. The publicly funded multipurpose organization shall
report sources of funds based on a last in, first out accounting
method. For purposes of this section, "last in, first out accounting
method" means an accounting method by which contributions and
expenditures are attributed to the multipurpose organization's
contributors in reverse chronological order beginning with the most
recent of its contributors or, if there are any prior contributions
or expenditures, beginning with the most recent contributor for which
unattributed contributions remain.
   (2) The name of the payee and amount of all payments aggregating
two hundred fifty dollars ($250) or more made from the single bank
account required under subdivision (a).
   (3) A description of each campaign activity.
   (d) By January 31 following the end of each even year, a publicly
funded multipurpose organization that engages in campaign activity of
one hundred thousand ($100,000) or more related to statewide
candidates or ballot measures or engages in campaign activity of ten
thousand dollars ($10,000) or more related to local candidates or
ballot measures, either directly or through the control of another
entity, at any point during that even year or the prior odd year
shall disclose all the following information for those two calendar
years:
   (1) The name and amount of any specific source or sources of funds
used for campaign activity, provided that the aggregate amount of
funds received since January 1 of the most recent odd year by a
publicly funded multipurpose organization from that specific source
or sources of funds is at least one thousand dollars ($1,000).
   (2) The name of the payee and amount of all payments aggregating
two hundred fifty dollars ($250) or more made from the single bank
account required under subdivision (a).
   (3) A description of each campaign activity.
   (e) Each publicly funded multipurpose organization that engages in
campaign activity, either directly or through the control of another
entity, shall provide to the Fair Political Practices Commission and
display on its Internet Web site the information it is required to
disclose under this section. The information shall be clearly
described and identified on a separate Internet Web page, which shall
be linked from the homepage of the organization's Internet Web site.
The link to this Internet Web page from the homepage shall be as
visible as all similar links.
   (f) The Fair Political Practices Commission may require an audit
of any publicly funded multipurpose organization that is required to
provide records to the Fair Political Practices Commission pursuant
to this section. The Fair Political Practices Commission shall
require an audit of any publicly funded multipurpose organization
that engages in campaign activity in excess of five hundred thousand
dollars ($500,000) in a calendar year. The publicly funded
multipurpose organization shall provide records to the Fair Political
Practices Commission that substantiate the information required to
be disclosed by this section. The Fair Political Practices Commission
shall determine whether the organization complied with the
requirements of Section 54964.5 and this section, issue a written
audit report, and transmit the written audit report to the Attorney
General and the district attorney for the county in which the
publicly funded multipurpose organization is domiciled.
   (g) If the Fair Political Practices Commission determines at the
conclusion of an audit that a publicly funded multipurpose
organization has violated Section 54964.5 or this section, the Fair
Political Practices Commission, the Attorney General, or the district
attorney for the county in which the publicly funded multipurpose
organization is domiciled may impose a civil fine upon the publicly
funded multipurpose organization in an amount up to ten thousand
dollars ($10,000) for each violation.  
  SEC. 3.    The Legislature finds and declares that
this bill furthers the purposes of the Political Reform Act of 1974
within the meaning of subdivision (a) of Section 81012 of the
Government Code.