Group Seeks Changes in Campaign Reform Law

Twenty-four years after Californians approved the nation’s toughest political reform law, an unlikely pair of allies are gearing up to give the Watergate-era initiative a tune-up.

They want to make the law friendlier for state and local politicians, chiefly by allowing the minimum levels of campaign contributions, personal wealth and gifts to at least double in size before they must be made public.

Other proposed changes include allowing officeholders to increase their investments without incurring a conflict of interest, letting lobbyists treat officials to meals costing $50 instead of $10, and giving politicians who run small local campaigns a break from some financial disclosure requirements.

However, opposition to some of the changes is starting to emerge, mainly from strong backers of the current law who are suspicious of anything that might weaken it.

“Eighty percent of the bill is perfectly acceptable, but the other 20% isn’t, and that should sink the bill,” said Robert M. Stern, who was a coauthor of the campaign reform law.

The proposed changes, subject to approval by the Legislature and Gov. Pete Wilson, find the watchdog Fair Political Practices Commission and one of its critics, Assemblyman Lou Papan (D-Millbrae), cast in a rare alliance.

Papan is a tenacious veteran lawmaker who left the Legislature in 1986 after 14 years and was reelected in 1996. He has long had a reputation for taking on issues that are controversial with the public but popular with his colleagues--such as bills to raise legislators’ pay. This time, he took on the ethics panel.

At Papan’s urging, the state Bureau of Audits investigated the commission. The audit was finished this spring and is being used as the impetus behind the more than three dozen changes now being proposed and which the commission also embraces.

“I think for the most part, we agree on everything,” Papan said of his new partnership with the commission.

James Hall, the new panel chairman appointed by Wilson, acknowledges that some of the proposed changes, such as boosting the limits on meals bought by lobbyists, are bound to stir up controversy.

Even so, Hall said in an interview, “I think everybody is a winner in this one, including the public. It’s significant. It’s a step in the right direction” toward making it easier for politicians to comply with the law.

Papan said the changes are aimed chiefly at low-budget local races, and should have virtually no impact on the multimillion-dollar campaign extravaganzas run by statewide and legislative candidates.

Watergate-Era Legislation

The Watergate-era restrictions have remained almost unchanged since voters approved Proposition 9 in 1974, despite increases in inflation.

At that time, the reforms--embodied in the California Political Reform Act of 1974--were considered the toughest of their kind and a model for the rest of the nation. Proposition 9 requires not only timely disclosure of political contributions and expenditures, but annual reports of income and other financial interests of officeholders.

Violators are subject to a maximum $2,000 fine for each offense as determined by the ethics panel, whose five members are appointed by the governor and other statewide officers. Under the proposed changes, the maximum fine would not be changed, but some lesser fines would be doubled from $500 per violation to $1,000.

From the beginning, state and local politicians have chafed under the reporting requirements, which critics contend are unduly burdensome, particularly for small local contests known as “kitchen table” campaigns.

Papan said unsophisticated local candidates complain that the law and its administration have become so complex that they must hire costly accountants and lawyers merely to stay legal, long a complaint of legislative candidates as well.

“The problems are not only here [in the Capitol]. The locals have a real problem to try to meet the law,” Papan said.

A grumbling point with Sacramento politicians is the law’s prohibition against lobbyists spending more than $10 a month on public officials. (Although early Proposition 9 supporter and then-Secretary of State Edmund G. “Jerry” Brown Jr. said at the time: “That’s enough for two hamburgers and a Coke.”)

Today, critics charge that the $10 limit is unreasonably low and prevents officials and lobbyists from exchanging information that can lead to good public policy.

Papan and Hall want to increase the monthly $10 limit to $50 over three months. “If a few bucks will allow somebody to go to dinner and get acquainted personally with members of government, I think that is important,” Hall said.

Although Papan and Hall are cautiously confident that their plan will become law, opposition is starting to build.

One group, the Proposition 103 Enforcement Project, which deals with insurance issues, believes the plan would turn the panel into a “lap dog with no bark and no bite.”

Enforcement Project spokesman Philip Romero said it was clear to him that backers of the new legislation want to weaken the law and “prefer to meet with the special interests at ritzy hotels and resorts in a shroud of secrecy.”

No Free Lunch

Activist Stern, co-director of the independent Center for Governmental Studies in Los Angeles, who helped write Proposition 9, said he agrees with most of the proposed changes that would keep pace with inflation, but opposes several others.

Stern, for example, strongly disapproves of increasing the limit on meals provided by lobbyists. “There shouldn’t be any gifts from lobbyists, period,” he said. “They are going from a lunch to a very fancy filet mignon steak dinner.”

Stern said the proposed $50 limit “allows the interests that have the money to get more access [to officeholders] than the people who do not. An hour of a legislator’s time is worth a lot of money. That was the whole purpose of the limit.”

He also said other parts of the reform law should not be tampered with.

Stern said doubling the minimum threshold for reporting a late campaign contribution from $1,000 to $2,000 could have a major impact in a local race.

“Late contributions can have a big influence. If a local candidate is receiving a contribution of over $1,000, it is a big deal and it should be reported,” Stern said.

He also criticized the proposal to raise the threshold for reporting income, loans or gifts from $250 to $1,000. “We’re not talking about gifts from family members but gifts, basically, from strangers,” he said.

The new legislation was spun off from recommendations made by the state audits bureau. The auditors concluded that the commission “reasonably interprets” the political reform act, but said “its enforcement activities and customer service need improvement.”

They also told the Legislature that the law’s dollar limits are unrealistically low and may create unfair situations that restrict the “normal and reasonable activities of public officials.”

While disputing some conclusions, Hall, an early member of Gov. Ronald Reagan’s administration in the 1960s, generally embraced the report as a launching pad to revise the law. He also favors increasing the agency’s budget by $500,000 for additional staff.

Hall said candidates “zoom beyond that $1,000 [contribution / expenditure reporting threshold] awfully fast. I think this [rise to $2,000] will relieve a lot of people in local politics of some rather nit-picking levels of compliance.”

“The large campaigns where there are millions of dollars being moved around . . . have an accountant and a lawyer” who can handle the reporting responsibility, Hall said.

The commission and Papan also want to double the monthly compensation of the panel’s members to $200.

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Proposed Changes to Political Reform Act

The Legislature will soon consider about three dozen changes to the Watergate-era law that requires politicians to disclose campaign contributions and personal financial interests, and sets guidelines for what constitutes conflicts of interest. The proposal would double the amount of money politicians receive or spend before having to report it. Proposed changes:

* Monthly gift limit from a lobbyist: Currently $10 per month; would change to $50 per quarter.

* Threshold for reporting income, gifts or loans: Currently $250; would become $1,000.

* Value of an unwritten loan a public official may receive: Currently $500; would become $1,000.

* Amount of campaign funds that can be used for a security system: Currently $5,000; would become $10,000.

* Threshold at which public official is deemed to have a financial interest: Currently $1,000 investment in real property and $250 in income; would become $5,000 in real property, $1,000 income.

* Reportable late contribution: Currently $1,000; would change to $2,000.

* Total contribution an appointed board or commission member may receive without being disqualified from voting: Currently $250; would become $500.

* Fine for violations of restrictions on cash contributions, in-kind contributions, anonymous contributions, lobbyist gifts and unlawful gifts: Currently $500; would become $1,000.