Panel Urges Funding Disclosure Rules for L.A. Secession Groups

California’s campaign finance watchdog, the Fair Political Practices Commission, unanimously declared Friday that groups actively promoting or opposing secession from Los Angeles should be required to disclose who is funding their campaigns.

But commission members disagreed over how that should be done, and ultimately wound up punting the heated issue to the Legislature, where Assembly Speaker-elect Bob Hertzberg (D-Sherman Oaks) has already introduced a bill that would institute similar reforms.

Unlike drives to place measures on the ballot or elect candidates to office, campaigns to break up cities are not subject to any financial disclosure requirements until the issue qualifies for the ballot.

That could take years, because before being put to a vote, secession bids have to be scrutinized by the Local Agency Formation Commission, a little-known panel that usually oversees small-time boundary changes.

However, the Los Angeles City Ethics Commission and others are arguing that the loophole needs to be closed because the campaigns are clearly raising and spending huge sums to influence voters and achieve a consequential political outcome.

Moreover, they argue that lobbyists trying to influence local agency formation commissions should have to file financial disclosure statements, something none of the state’s 57 local panels require. There is a local agency formation commission in every county except San Francisco.

The commission’s five members agreed on both counts but splintered on the details, including fundamental questions such as what types of acts are political enough to require financial disclosure.

“Regardless of what you call it, it is the beginning of a political act,” said commission member William Deaver.

Pointing to a placard by Valley VOTE, the main group pushing secession in Los Angeles, Deaver said, “That looks like a political poster to me.”

Los Angeles County’s commission debated whether it had the power to regulate lobbyists last year and concluded it did not, a position that contradicts the views of the state attorney general’s office. Its director, Larry Calemine, and many of its members have also stated that they do not feel lobbying will become a concern as it considers secession, but Fair Political Practices Commission attorneys disagreed, calling the process ripe for lobbying.

“I see something that has a big hole here,” said Commissioner Carol Scott, a Sherman Oaks attorney.

Valley VOTE has acknowledged spending more than $500,000, but has refused to release all but a few names of those bankrolling its effort. One name it has disclosed: the Daily News of Los Angeles, a tireless booster of secession in its editorial pages.

Several other groups, including two in San Pedro and Wilmington and one in Hollywood, are also pushing to cleave those areas from Los Angeles. The Valley and San Pedro efforts are being reviewed by the Local Agency Formation Commission. If the panel decides the breakups could occur without hurting the rest of the city financially, and that the two areas are economically able to run their own cities, the breakups could wind up on the ballot as early as 2002. Secession requires a majority vote of the area breaking away, as well as the entire city.

Valley VOTE President Jeff Brain, who testified at the meeting, said afterward that he welcomed disclosure--as long as it is applied evenly.

Because they have already completed or started gathering signatures, Valley VOTE and the other secession groups probably would not be forced to release names of contributors. But they may have to disclose all lobbying they do over the next few years as they work to place the breakups on the ballot.

“As long as the city has to do it, as long as the [Los Angeles] Chamber of Commerce has to do it, then it is fine,” Brain said.

Worried that a disclosure decision by them could open a Pandora’s box, applying to splinter movements in schools and other government agencies, Fair Political Practices Commission members decided to support what Hertzberg was doing. But by not taking action, some acknowledged, they were creating a situation where state laws might contradict each other.

Hertzberg’s bill, AB 2838, is not aimed solely at secession. It actually represents a sweeping effort to rewrite the Cortese-Knox Act, the state law that created the local agency formation commissions and significantly strengthen the role of the panels as players in growth decisions around the state.