Bill to give ethics agency more audit power clears Legislature

SACRAMENTO -- The Assembly gave final legislative approval Monday to a bill that aims to crack down on anonymous campaign money by giving California’s ethics and tax agencies more authority to conduct investigations.

The measure allows the Fair Political Practices Commission and the Franchise Tax Board to initiate audits of campaigns suspected of illegal activities before an election occurs, even if campaign statements or finance reports have not yet been filed.

It also explicitly permits the FPPC to seek an injunction in Superior Court to force disclosure and gives the tax board up to two years to conduct more complex investigations.

Assemblyman Rich Gordon (D-Menlo Park), the author of the bill, said on the Assembly floor the proposal’s intent is “to give the FPPC the ability to address concerns as they arise, to stop improper activity and to clear the innocent expeditiously.”

But Assemblyman Donald P. Wagner (R-Irvine) said the measure gave the ethics agency “unchecked power,” calling it a “perversion of the process.”

FPPC investigators “can come after you, they can come after me, they can come after anybody in this room for no reason because this bill gives them the power,” said Wagner, who voted against it.

The measure is part of a slate of anti-”dark money” bills introduced in the aftermath of an anonymous $11-million donation from an Arizona nonprofit to a committee that opposed Gov. Jerry Brown’s tax-increase initiative. Many of those bills have stalled, stymied by the two-thirds threshold required to amend the 1974 Political Reform Act.

Gordon’s bill sputtered in the Assembly last fall, when Democrats were one vote short of a supermajority. On Monday, all Assembly Democrats except one voted in favor of the bill, giving it the bare 54 votes it needed. (The Democratic holdout, Assemblyman Roger Hernandez (D-West Covina), has faced a probe into his own campaign money by the FPPC.)

Another campaign finance bill awaits final legislative approval in the Senate. That measure, SB 27 by state Sen. Lou Correa (D-Santa Ana), would require more disclosure from nonprofit groups and other organizations that spend money in California elections.

Jason Kaune, president of the California Political Attorneys Assn., said the fallout from the Arizona donation may be the reason for today’s partisan vote.

“The money in the most recent case happened to be money from the right,” Kaune said.

His group opposes the measure, AB 800, arguing it does not provide sufficient oversight of the ethic’s agency’s new power.

“Historically, the FPPC has been an impartial referee, making the call after the play. AB 800 would have the FPPC insert itself into the political process before an election and before an alleged violator has even filed a disclosure form. The referee would be able to interfere with the process,” said Kaune.

But the bill’s passage was heralded by California Common Cause, which sponsored the measure.

“This will make it easier to expose dark money from out-of-state special interests and ensure that voters have the most up-to-date information as they enter the voting booth on election day,” said Sarah Swanbeck, the group’s policy and legislative advocate.

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