Proposition 25 | Vote 2000 Home | Next - Prop 26 | Secretary of State Home |
Election Campaigns. Contributions and
Spending Limits. Public Financing. Disclosures.
Initiative Statute.
Analysis by the Legislative Analyst
 

Background

Political Reform Laws. The Political Reform Act of 1974, approved by California voters in that year, established campaign finance disclosure requirements for candidate and ballot measure election campaigns. Specifically, it required candidates for state and local office, as well as proponents and opponents of ballot measures, to report contributions received and expenditures made on their campaigns. These reports are filed with the Secretary of State's office, local officials, or both. The Fair Political Practices Commission (FPPC) is the state agency primarily responsible for enforcing the law.

In November 1996, California voters approved Proposition 208, an initiative that amended the Political Reform Act to establish limits on campaign contributions to candidates, voluntary limits on campaign spending, and rules on when fund-raising can occur. The measure also required identification of certain donors in campaign advertisements for and against ballot measures.

A lawsuit challenging Proposition 208 resulted in a court order in January 1998 blocking enforcement of its provisions. At the time this analysis was prepared, this lawsuit was still pending and Proposition 208 had not been implemented.

Ballot Pamphlet and Sample Ballot. Each household with a registered California voter is mailed before each statewide election a ballot pamphlet prepared by the Secretary of State. The pamphlet contains information on measures placed on the ballot by the Legislature as well as ballot initiative and referendum measures placed before voters through signature gathering.

State law also directs county elections officials to prepare and mail to each voter a sample ballot listing the candidates and ballot measures.

Proposal

This measure revises state laws on political campaigns for candidates and ballot measures beginning in 2001. Specifically, the measure: Some provisions of this measure are similar to those enacted in 1996 by Proposition 208 which have not gone into effect because of an ongoing lawsuit.

The major provisions of Proposition 25 are described below.

Campaign Contribution Limits

This measure places limits on financial contributions to campaigns for state and local candidates. The major contribution limit provisions are shown in Figure 1. These limits would be adjusted for inflation.

Except for contributions to political parties, no person could contribute a combined total of more than $50,000 per election to state candidates. Other provisions of this measure limit contributions to political parties, political committees not directly controlled by candidates, ballot measure campaigns, and loans to candidates.

Candidates for statewide office generally could not begin to accept contributions for their election campaigns until within 12 months before the primary election. The period would be six months for other state offices. Contributions generally could not be accepted more than 90 days after the election.

This measure further provides that more restrictive campaign contribution limits established under Proposition 208 would override this measure and take effect if the court allows Proposition 208 to go into effect.

Voluntary Spending Limits

This measure establishes a system of voluntary spending limits for state candidates and ballot initiative campaigns. Specifically, a candidate or ballot initiative committee would be required to file a statement at the beginning of the campaign declaring whether it will accept or reject the limits. The major spending limit provisions are shown in Figure 2. These limits would be adjusted for inflation.

The voluntary spending limits applying to a specific elective office or a state ballot initiative campaign would increase by two and a half times the dollar amount of the initial limits if opposing campaigns exceeded certain specified fund-raising or campaign spending levels. Any candidate or ballot initiative campaign which violated a pledge to abide by the voluntary spending limits would be subject to a fine.

Publicly Funded Campaign Assistance

A candidate for statewide office or a campaign for or against a state ballot initiative that accepts the voluntary spending limits with specified exceptions could receive public funding in the form of credits for broadcast media advertising. A candidate for Governor or a state ballot initiative campaign could receive credits worth up to $1 million per election, while candidates for other statewide offices could receive credits worth up to $300,000 per election. A campaign receiving many small contributions would receive more credits than one with fewer but larger contributions. The credits would be allocated on a first-come, first-served basis until the funds set aside for this purpose are exhausted.

In addition to public funding for broadcast advertising, a candidate for any state office and any state initiative campaign that accepted voluntary spending limits could participate free of charge in a voter information packet program. A campaign refusing to accept the spending limits could choose to participate by sharing in the cost of the packets. The packets would be assembled and mailed by the Secretary of State at four specified times before each election.

A candidate would have to collect a specified number of valid signatures of registered voters to qualify for public assistance during the primary election . The level of public assistance provided during the subsequent general election would depend upon a candidate's share of the primary election vote.

State candidates and ballot initiative committees that agree to voluntary spending limits would be so designated in the voter information packets as well as in the regular ballot pamphlet prepared by the Secretary of State and the sample ballots prepared by local elections officials.

Campaign Web Site

This measure directs the Secretary of State to establish and maintain a Campaign Web Site on the Internet to provide specified information on state candidates and state ballot measure campaigns. Copies of campaign advertisements, information about the candidates, and financial disclosure reports would be made accessible to the public through the Internet web site within 24 hours of their receipt. Links would also be provided to web sites established by campaign committees.

Campaign information would be similarly disclosed for some local election campaigns beginning in 2002. The Secretary of State would provide this information on the state web site after that date if local elections officials lacked the technological capability to do so.

Campaign Advertising and Financial Disclosures

This measure requires that state candidates and state ballot measure committees provide earlier financial disclosure through reports of contributions of $1,000 or more and expenditures in excess of certain specified levels. Certain candidates and ballot measure committees would have to disclose in their campaign advertising their top two financial donors, the use of a paid spokesperson, and the amount spent by the campaign to date. Additional disclosure requirements would be established for so-called "slate mailers," campaign mass mailings that contain recommendations on candidates and ballot measures.

Ballot pamphlets mailed to voters would also list the top five contributors over $25,000 for and against a ballot measure. Petitions for state or local ballot measures would include a statement indicating whether the individual circulating the petition is paid or a volunteer.

Provisions Affecting Major Donors

Under existing law, so-called major donors who make political contributions with a combined total of $10,000 or more in a year must file reports listing their contributions. Under this measure, only someone contributing a combined total of $100,000 or more would have to file such reports. However, the Secretary of State would be required to compile the names of all persons who gave $10,000 or more per year to state candidates or ballot measure committees. Such donors would be sent forms to verify their contributions and could be fined for failure to complete them in a timely manner.

Compensation for Voting Prohibited

State law already makes it illegal to pay someone to vote for or against a specific candidate or ballot measure. This measure would also make it illegal under any circumstances to pay someone to vote in an election. Thus, it would become illegal to pay someone to vote even if the voter was not paid to vote for or against a specific candidate or ballot measure.

Fiscal Effect

This measure would result in significant net costs for state and local governments, which are discussed below.

Publicly Funded Campaign Assistance. This measure requires that $1 for every state income taxpayer be appropriated annually from the state General Fund to pay for broadcast advertising credits. We estimate this would result in an annual state cost of about $17 million.

The Secretary of State has estimated that the cost for coordinating, producing, and mailing the voter information packets would probably be about $35 million annually. These costs would be partly offset by an unknown amount of revenue from campaigns which agreed to pay to participate in the voter information packet program.

Additional Secretary of State Implementation Costs. The Secretary of State would likely incur additional costs of several million dollars annually to fulfill the other requirements of this measure. These costs are likely to significantly exceed the initial appropriation of $1.5 million and ongoing appropriations of $750,000 to the Secretary of State provided in the measure. The Secretary of State would primarily incur these costs to establish the Campaign Web Site, to track and fine major donors, to certify the campaigns eligible for public assistance, and to reimburse counties for verifying signatures submitted to qualify for public assistance. The process of verifying major donors would generate revenue through fines thereby offsetting these state costs to an unknown amount.

FPPC Implementation. The FPPC has estimated that it may need as much as $600,000 annually in additional funding beyond the $1 million appropriation provided in this measure to establish necessary regulations, to provide technical assistance to the public, and to prosecute violators of the proposed new law. These state costs would be offset by an unknown amount to the extent that enforcement of various provisions of the measure results in the collection of fines from campaigns.

Local Government. City and county governments could incur significant costs, potentially exceeding several millions of dollars annually on a statewide basis, to implement this measure primarily for maintaining local campaign web sites. To the extent that city and county governments lacked the technological capability to implement these provisions, local government costs would be lower but state costs to provide this information would increase.
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