HomeMy WebLinkAbout13 - Modifying the City's Regulation of Municipal Campaign Contribution and Expenditure Limits and Establishing Lobbyist Registration, Reporting and Disclosure Requirements - CorrespondenceNovember 5, 2019
Item No. 13
From:
jenmcdl0@aol.com
Sent:
Sunday, November 03, 2019 2:49 PM
To:
O'Neill, William; Brenner, Joy; Avery, Brad
Cc:
Dept - City Council
Subject:
Comments on proposed election reform amendments
Dear election reform committee members O'Neill, Brenner and Avery,
First I'd like to thank you for tackling the issue of election reform and attempting to address some of
the community's concerns about the forces, seen and unseen, that shape our local elections.
As I recall, the original plan was for your committee to do some preliminary work before either forming
a citizen taskforce or at least making a robust effort to gather public input. It seems to me that
following through with that plan would go a long way toward restoring the community's faith in the
council and our elections.
In particular, many of us are not convinced by the committee's arguments against limiting fundraising
to one year before a candidate's race. And there has been no acknowledgement of the reasons why
we wanted reforms in this area in the first place, chief among them:
- Some council members have received tens of thousands of dollars in contributions to their
reelection campaigns in the year following their election, i.e. three years before the next race,
including from special interests and those with business before the council.
- Some council members go into their reelection year with hefty and even six -figure bank accounts
they've had three years to build up. Nothing could do more to "entrench" incumbents and discourage
challengers than this.
Nor has the issue of candidates accepting and keeping excess contributions been addressed. One
easy fix would be to require that candidates review contributions and return any overages before filing
their campaign statements, or face real consequences. As it stands, there are no penalties at
all for exceeding contribution limits, even if candidates are repeat offenders.
As for the lobbyist registration ordinance, why not use this opportunity to introduce
meaningful requirements and real penalties for failing to comply? We are notably likely to have
major development projects come before the council over the coming years. The council and the
community have the right to know who is promoting projects and how they are going about it. Why not
require, among other things, that lobbyists file quarterly activity reports stating who they are working
for, who they are lobbying, and how much money they are making or stand to make for these
activities?
This seems to me an excellent opportunity for the council to deliver on a promise it made to
constituents in a way that introduces meaningful reforms and also involves the citizens in the process,
which is the only way to guarantee community buy -in. I hope that you will consider
either holding more public meetings or getting input from a citizen taskforce before moving ahead with
any amendments.
Respectfully,
Jennifer McDonald
Received After Agenda Printed
November 5, 2019
Item No. 13
November 5, 2019, Council Item 13 Comments
The following comments on an item on the Newport Beach City Council agenda are submitted by:
Jim Mosher ( jimmosher(c)yahoo.com ), 2210 Private Road, Newport Beach 92660 (949-548-6229)
Item 13. Introduction of Ordinances Modifying the City's Regulation of
Municipal Campaign Contribution and Expenditure Limits and
Establishing Lobbyist Registration, Reporting and Disclosure
Requirements
This item proposes the first reading of two ordinances. I believe they could both use further
work.
The Campaign Contribution Ordinance
Even setting aside free speech issues (now that money is speech in this country), I am
ambivalent about attempts, such as this, to impose limits on campaign contributions. While well
intentioned, the amounts spent by the "controlled committees" they regulate can easily by
drowned out, with no regulation at all, by self-funded campaigns or by the unlimited amounts
that can be channeled into the same races by "independent" committees. To me, it would be
better to limit the total amount that can be spent on a race by all parties with respect to
influencing the election of each candidate, but I can think of no practical way to enforce that (a
large independent expenditure would, for example, eliminate the candidate's own committee's
right to add more).
Given that limited scope of the existing rules, the present proposal seems intended to reduce or
eliminate the penalties for violation, but does so to make it more likely violations will be
detected.
A major failing of the revisions as currently drafted is they rely primarily on written notice from
the City to alert candidates and contributors to "alleged violations" without clear rules as to how
the notices are generated.
Proposed Section 1.24.030.1 describes in detail the method of notice (by certified mail), but
nowhere (that I can find) does the ordinance specify the process that triggers the notices or who
mails them.
Since responses to the notices are directed to the City Clerk, one might guess the notices are
mailed by the City Clerk. But it doesn't say so. And since the FPPC filings in which possible
violations might be seen are posted directly to the web through third -party vendor (NetFile), it is
unlikely the Clerk currently reviews them. Plus, even in the days of paper filings, I believe most
publicized allegations of violations have been detected by private citizens examining the filings,
rather than by the Clerk on her own initiative — and have sometimes may not have been obvious
from a casual review of the filings because of the FPPC's arcane rules for aggregating (or not
aggregating) contributions from related parties.
Nov. 5, 2019, City Council Item 13 Comments - Jim Mosher Page 2 of 7
I would suggest the ordinance be referred back to the Committee, with instructions to add
sections:
1. Requiring the City Clerk (or the third party contractor?) to review filings as they are
posted (or at some specified interval) for obvious violations, and send notices as
appropriate.
2. Requiring the City Clerk to investigate complaints received from any person, and send
notices as appropriate.
In that connection, I would also suggest that something be added to ensure the City's notices
and the responses to them are public records, which, ideally, would be posted to the web. The
threat of such minor public embarrassment would encourage self -correction of errors before
formal City action is necessary.
And I would suggest the Committee revisit the proposed CPI adjustment language in Section
1.25.030.C. I now (somewhat) regret having submitted a suggestion about this to the
Committee's October 14 meeting. I am not sure how the Clerk currently makes the adjustment,
but my concern was that the adjustment be made to the limit set in the ordinance based on the
total change in CPI from the date of the ordinance (rather than in two-year steps, with each limit
based on the previous rounded limit and the change in CPI over the last two years — which, due
to rounding errors, could get progressively out of step with the original intent).
My suggestion would be to say:
"C. Adjustment for Cost of Living Changes. The campaign contribution and contribution
acceptance and solicitation limit set forth in subsections (A) and (B) will be adjusted to reflect
changes in the annual Los Angeles -Long Beach -Anaheim Consumer Price Index for All
Urban Consumers (CPI -U) published by the U.S. Bureau of Labor Statistics. In June of each
odd -numbered year, the City Clerk shall determine and announce a new limit, effective July
1, obtained by multiplying $1,200 by the ratio of the annual CPI -U for the previous year to the
CPI -U for 2018 of 267.730, with the result rounded to the nearest $100."
That uses the "annual CPI -U," which is a distinct statistic published by the BLS after the end of
each year, and less volatile the monthly CPI -U.
Instead, the proposed language instructs the Clerk to use an uncertain monthly number for the
current year, comparing it to the comparable number in 2019 in the following very baroque way,
to which, if used, I would offer these minimal corrections:
"C. Adjustment for Cost of Living Changes. The campaign contribution limits and contribution
acceptance and solicitation limits set forth in subsections (A) and (B) shall be adjusted in
two-year intervals, beginning in 2021, by the City Clerk to reflect changes in the Consumer
Price Index for All Urban Consumers (CPI -U) in the selected local area of Los Angeles -Long
Beach -Anaheim, California. In June of each year there is to be an adjustment, the City Clerk
shall determine the new limit by comparing the last published index number that is Gies Ct
in time to the date the adjustment in limits is to he made, and the corresponding index
number for 2019. ((A)-B)/B*100=i, where A=Most recent index, B=Corresponding index for
2019, i=Adjustment in percent]. Adjustments made pursuant to this subsection shall be
Nov. 5, 2019, City Council Item 13 Comments - Jim Mosher Page 3 of 7
rounded to the nearest one hundred dollars ($100.00), shall be announced by the City Clerk
in June of the year an adjustment is to be made, and shall be effective July 1."
It might be noted the existing language said the adjustment was made in February (which is
likely when the December and annual CPI -U for the previous year is available), but is not clear
as to when it is posted or becomes effective. Choosing June as the month to announce the new
limit is quite arbitrary — as is instructing the Clerk to calculate a percent change, then apply that
percentage to the original limit, as opposed to correcting the original limit directly by multiplying
it by A/B.
An additional problem, noted at the October 14 public meeting, is that in those instances where
the City Clerk is unable to achieve compliance through notice and response, the knowing and
willful non-compliance becomes a violation. But the sanctions for the violation (including
termination of a candidacy and removal from office) are left entirely to the discretion of the
County's District Attorney. And there is no assurance the DA will be inclined to pursue such
matters of primarily local political interest.
Possible alternatives might be:
1. Keep prosecution with the City Attorney.
2. Authorize the City Council to appoint a Special Prosecutor if the City Attorney or DA
declines.
3. Give citizens a right of private action to ask a court to compel compliance, with costs to
be awarded to the prevailing party.
Finally, in the event of conviction, the ordinance, as proposed, leaves unexplained the fate of
the illegal contribution. Should it be turned over to the City?
Regarding the other matters rejected by Committee, I have no strong opinion about restricting
contributions to a specific time period. But it certainly erodes public confidence to see people
wait to see who wins an election, then make contributions to the winners' campaigns after the
election and before the person has established any record in office (or to an incumbent who
cannot run for the same office again) -- especially when there is no campaign debt to pay off
(and even when there is). To many it gives the appearance of influence peddling on the part of
the elected and bribery on the part of their contributors.
As to matters not considered by the Committee, a major problem with campaign financing, not
addressed in the proposed revisions, is timely disclosure of the contributions as they may affect
decision making. Although the contributions are disclosed in internet postings, the postings may
occur months after the contribution. This situation might be improved with enhanced
requirements for disclosure on the part of the elected before votes on matters affecting
campaign contributors and more rigorous enforcement of whatever FPPC requirements there
are in this respect.
The Lobbying Disclosure Ordinance
While ordinances limiting campaign contributions seem common, local registration of lobbyists
in California remains relatively rare. The Alliance for Justice/Bolder Advocacy posts a list of
Nov. 5, 2019, City Council Item 13 Comments - Jim Mosher Page 4 of 7
about three dozen California City, County, School and Special District Local Lobbyinq
Ordinances with links to the individual codes, to which could be added Anaheim, Palm Springs
and probably more.
Given the many agencies with no lobbyist disclosure at all (and setting aside my free speech
concerns), the Council is to be applauded for considering this baby step.
The most obvious shortcoming of the proposed measure is that although it identifies who must
register, it does not specify what information is disclosed as part of the registration. That is left
entirely up to the Orange County Campaign Finance and Ethics Commission, whose interest in
County lobbyists is quite minimal: they ask only for contact information for the lobbyist and their
clients. Moreover, all the staff report (page 13-3) assures that "If the Board of Supervisors does
not take action to allow the City to utilize the existing system, the ordinance can be modified to
require registration with the City Clerk," that is not what the ordinance says. Proposed Section 7
on page 13-21 says the ordinance will not take effect at all unless the County agrees to perform
the registration for the City.
Why we would be doing this is unclear to me.
For the County's "existing system" is rudimentary, at best. It consists of a one-page paper form
which lobbyists are asked to fax, mail or email to the County office. Someone there then copies
the information into a spreadsheet which is updated and web -posted as new information arrives.
Not only would it be impossible for those reading the spreadsheet to distinguish Newport Beach
registrants from County registrants, but lobbyists visiting the site would be misinformed that they
are being asked to register as County lobbyists and required to update their registration each
January (where our proposed ordinance asks for updates on the anniversary of the original
registration).
Palm Springs accomplishes essentially the same thing in a very simple fashion on a single
webpage, and goes the County one better by asking what the lobbyist has been hired to lobby
about. Surely we could do the same without having to involve the County.
Moreover, we already contract with NetFile for electronic filing and posting FPPC forms. At no
extra cost they offer their "Local Lobbyist Filing Suite" in which they will allow the Clerk to upload
scans of paper lobbyist forms to the system and add access to them to the search function (as
one sees for Irvine', in addition to the variety of processed lobbying information they post). At
extra cost, NetFile can develop custom forms for electronic filing (which is likely what the City of
San Diego has paid for). Or our own IT Department could likely implement a web -based
electronic form -submittal system similar to that on the San Diego County Regional Airport
Authority website. Or submitted lobbyist forms could simply be added to our existing LaserFiche
document archive, like Carson does.
' The Newport Beach NetFile site already lists the search -by -date "For Lobbyists only?" option if
accessed by this link: https://public.netfile.com/pub2/Default.aspx?aid=CNB — although, of course, no
lobbyist paper forms have yet been filed/posted under it.
Nov. 5, 2019, City Council Item 13 Comments - Jim Mosher Page 5 of 7
Given these many alternatives, involving the County, as the proposed ordinance does, seems
limiting, awkward and unnecessary.
As to the remaining substance of the proposed ordinance, I believe comparison with the many
other California local lobbyist ordinances (and the many more nationwide) would be useful.
At the October 14 Committee meeting, those in attendance were told we felt constrained to stay
within the confines of the San Jose lobbying ordinance, because it had been vetted in court.
However, not only is the San Jose ordinance far more expansive, but the only court case
involving it that I could find was the unpublished Smith v. City of San Jose,2 Cal: Court of
Appeal, 6th Appellate Dist. No. H037626 (2013). And it seems telling that their 2013 analysis of
the San Jose ordinance relied mostly on federal court jurisprudence regarding lobbying, and
found little, if anything, to cite in California case law subsequent to our state Supreme Court's
1979 approval in part and rejection in part3 of the lobbying provisions in the Political Reform Act
of 1974 (Fair Political Practices Com. v. Superior Court, 25 Cal.3d 33; approved: registration,
reporting and limitations on gifts in connection with the lobbying; rejected: limitations on political
contributions by or at behest of lobbyists, and reporting of private financial matters irrelevant to
the lobbying activity).
Comparing to other cities' ordinances:
Attempting to define "City representative" (the people who may be the targets of lobbying) by
enumeration (as is done in proposed Section 1.28.020.A, page 13-17) may be well intentioned,
but it seems overly restrictive. The public is likely concerned about outside parties lobbying
many employees not listed, as well as the City's many consultants. To avoid this problem, some
jurisdictions define the relevant "city officials" as anyone required to file with the city an FPPC
Form 700 Statement of Economic Interests. Alternatively, some cite "any member of the City
Council, board or commission, and any City employee or consultant who participates in the
consideration of any municipal legislation other than in a purely clerical or secretarial capacity"
(which is essentially the basis for requiring the Form 700 filing).
As to the dollar threshold in Section 1.28.020.D, it is good to see "contingent compensation"
triggering the reporting requirement, but $500 per month for non -contingent compensation
sounds high to me for an agency the size of Newport Beach. Some have no threshold and
define anyone advocating for compensation as a lobbyist. In addition, most require registration
of what are called "expenditure lobbyists": persons or organizations that are neither themselves
direct lobbyists, nor hire lobbyists, but instead spent money over some threshold (typically
$5,000 per year) in advertising and public relations efforts to encourage others to lobby the
agency on an issue of interest to the expenditure lobbyist.
2 Not to be confused with the precedent -setting City of San Jose v. Superior Court, 2 Cal.5th 608 (2017)
in which the same plaintiff won disclosure of public communications on personal devices.
3 Four justices thought these provisions should be rejected, two justices thought they should be upheld
and the seventh justice thought the Act should be rejected in its entirety as not complying with the "single
subject" rule (without considering its merits).
Nov. 5, 2019, City Council Item 13 Comments - Jim Mosher Page 6 of 7
In Section 1.28.030.13, it is good to see the exemption for attorneys toned down. There is, in
fact, no need for any exemption for attorneys. See the Institute for Local Government's
Regulating Lobbying Activities publication: "California law also acknowledges that local
regulation of lobbying activities can apply equally to attorney lobbyists without creating
issues under state law regulating attorney conduct." That statement is backed up by its citation
to Cal. Bus. & Prof. Code 6009, which quite clearly empowers cities to collect basic lobbying
information from attorney lobbyists "notwithstanding any other provision of law."
In fact, the information that can be requested of attorney lobbyists under that state law is far
more extensive than we would appear to be asking for if we were to use the County for
registration.
Additional information that can be requested of an attorney (or anyone else, but is not by the
County) includes:
1. "the amount of money paid to the lobbyist for lobbying"
2. "the total expenses of the lobbyist for lobbying, itemized by client"
3. "All gifts or payments made by the lobbyist to officials in the jurisdiction, itemized by the
name of the official, the amount, date, and description of the gift or payment, and the
names of the person making the gift or payment and the person receiving the gift or
payment"
4. "All campaign contributions made, arranged, or delivered by the lobbyist to officials in
the jurisdiction, specified by amount, date, and name of the official receiving the
contribution"
Beyond that, I am struck by the great variety of local lobbyist disclosure programs in California.
The LA Unified School District appears to have a particularly novel and extensive program. As
explained in narrative form, including helpful examples of how it applies, in their FAQ Handout, it
requires prospective lobbyists to not just register, but to complete their registration (which
includes passing a quiz verifying an understanding of their lobbying codes) and have the
registration approved by the District before conducting any lobbying activity. Unlike what
Newport Beach seems to be trying to achieve, it includes non -profits and charitable organization
and includes activities that do not involve direct interaction with public officials (such as
preparing materials for or advising others in connection with those persons' contacts).
In addition to the information that can be requested of attorney lobbyists (above), common
disclosure requirements include reporting who contacts were made with, and what the
substance/outcome of the contact was. Some agencies put this burden on the elected and
appointed officials, requiring them to orally disclose contacts with lobbyists on the matters that
come before them at a public meeting. And a few cities, like the City of Santa Clara, require the
web -posting of the appointment/activity calendars of council members and key public officials. In
that way, the public can see who has been talking to them, and about what. Similarly, some
require registration and posting of the activities of lobbyists working for the city. And many
require identification of public officials, or relatives of officials, working for or connected with the
firms lobbying them.
Nov. 5, 2019, City Council Item 13 Comments - Jim Mosher Page 7 of 7
Prohibited activities in some other jurisdictions include:
1. Public officials working as lobbyists at their own agencies, including serving on boards,
commissions or committees.
2. Public officials becoming lobbyists within a certain time of departing their agency.
3. Lobbyists being hired by the agency within a certain time after ending their lobbying
engagement.
4. Lobbying public officials to whom they are related.
5. Gifts of any value to public officials.
In summary, the proposed lobbyist disclosure ordinance is a possible -- maybe even a
reasonable -- baby step toward greater transparency, but it needs additional work before its
introduction and adoption. If nothing else, the collection and posting of lobbyist information
needs to be disconnected from the County's system and brought "in house."
Received After Agenda Printed
November 5, 2019
Item No. 13
From:
Lynn Lorenz <lynnierlo@icloud.com>
Sent:
Monday, November 04, 2019 11:12 AM
To:
Dept - City Council
Cc:
City Clerk's Office
Subject:
Election Reform
Dear Council members ( particularly Joy Brenner, Brad Avery and Will O' Neill)
I have read Jennifer McDonald's letter concerning election reform in city council elections. This is a very important issue
that was discussed in the spring and there was/is concern among residents about some problems with the rules or lack
of, now in place. Jennifer's letter addresses some of the problems and solutions that would make our elections more
democratic in that they would remove the threat of outside money from controlling city government, giving more
residents the opportunity to get involved in the decision making process.
One of the biggest flaws in our campaign contribution laws is that our enforcement process of campaign contribution
violations is weak or simply non-existent. Right now if a violation occurs, the candidate has 14 days to correct the
violation then it is turned over to the district attorney. But the DA in the past has sent it back, saying that it is a local
jurisdiction issue. To rectify this problem, the city attorney needs to automatically refer this to an independent outside
prosecutor.
Also, I wish that there had been more communication with the city residents about attending this meeting. I certainly
would have had I known about it and I think others would have too. I find Jennifer's suggestion of holding more public
meetings on this issue to get more citizens involved in the process a most excellent one and I hope that you will strongly
consider it. Another parallel idea would be to do as Jennifer suggests and form a citizen task force or committee to
provide more input into this very important Issue. Thank you, Lynn Lorenz PS Dear City Clerk, please acknowledge
receipt of this email and include it in the packet. Thank you!
Sent from my iPad
Received After Agenda Printed
November 5, 2019
Item No. 13
From: City Clerk's Office
Sent: Tuesday, November 05, 2019 3:33 PM
To: Mulvey, Jennifer; Rieff, Kim
Subject: FW: Election Reform
From: TOMLU BAKER
Sent: Tuesday, November 5, 2019 3:32:33 PM (UTC -08:00) Pacific Time (US & Canada)
To: Dept - City Council; City Clerk's Office
Cc: TOMLU BAKER
Subject: Election Reform
City Council Members,
Thank you for addressing election reforms and f'or the time and effort expended to date.
I think it is very unfortunate that more residents weren't involved in the Election Reform process. It is such a
significant issue in a time when citizens are growing disillusioned with government. Active participation by
shareholders goes a long way toward ensuring a better functioning system. Newport residents want government
to establish fair rules which are followed by all. Additionally they want the council representatives to listen to
their wants and needs.
I have seen Jennifer McDonald's email addressing city council election reforms and agree with her suggestions
and the supporting rationale. The proposed reforms on the agenda do not contain meaningful changes and do
not reflect significantly the current input of the residents to assure Community Buy -In. More public meetings
are needed to gather additional vital inputs from the residents. The proposed reforms are incomplete and need to
be updated to be meaningful.
Sincerely,
Tom Baker
Received After Agenda Printed
November 5, 2019
Item No. 13
From: City Clerk's Office
Sent: Tuesday, November 05, 2019 3:35 PM
To: Mulvey, Jennifer; Rieff, Kim
Subject: FW: Election Reform Concerns
From: Portia Weiss
Sent: Tuesday, November 5, 2019 3:35:05 PM (UTC -08:00) Pacific Time (US & Canada)
To: City Clerk's Office
Subject: Election Reform Concerns
Dear Council Members,
I am one of the 86,000 residents of Newport Beach who was not informed about or was unable to attend this year's
Committee Meeting on Election Reform. I understand that this meeting was attended by less than 10 residents. The
chambers should have been overflowing. I am sure you agree and were disappointed by the less than sparse turnout.
I am aware of the informative letter to you from resident Jennifer MacDonald outlining just a few of the major concerns
that I also share in the arena of Election Reform. Why Election Reform? Because we need it desperately in order to bring
Newport Beach's elected representatives up to a standard of transparency and receptivity to honestly balance resident
needs with a healthy plan for the city. Informed constituents can support fair government and enable a smooth process
to enable necessary progress. The reporting of election funding violations sans consequences? This should not be a
circus. Newport Beach is an exceptional city and should strive at modeling a sound, democratic government. Please
make every effort to reach out and publicly inform the residents about what is going on, hold well publicized meeting to
ask for their feedback and move toward the best coastal city imaginable.
Appreciatively,
Portia Weiss