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RPVCCA_CC_SR_2011_12_19_02_2011 RWG Public Law Handbooks Richards,Watson &Gershon (RW&G)is widely recognized as one of the premier full service law firms to local governments,providing the highest quality legal services in a cost-effective manner.Local governments rely on RW&G because it has assembled a number of the leading attorneys in the state and dedicated them to creatively solving the problems of local governments. RW&G was established in 1954,and the Firm has been providing public entity legal services for over 50 years.We have a statewide practice with offices in Los Angeles,Orange County,Temecula,and San Francisco. We serve as City/Town Attorney,Special Counsel,and General Counsel,to public entities throughout California.Our representation of public entities includes cities, towns,counties,redevelopment agencies,water districts,school districts,community services districts,airports,other special districts,and joint powers authorities. Core practice areas include public agency and municipal law,public finance,redevelopment, water rights and water law,real estate,litigation,appellate,environmental and energy, e-documents and public records,climate change,labor and employment,eminent domain, public works,telecommunications,and transportation. Please visit us at www.rwglaw.com. We have included our 2011 guides to and .These guides are provided free of charge to our clients and updated annually.They are one example of our commitment to proactive lawyering that helps our clients avoid issues before they arise. Table of Contents Ralph M. Brown Act Page i © 2011 Richards, Watson & Gershon 1342883.1 Table of Contents INTRODUCTION ................................................................................................................. ii SUMMARY OF THE MAJOR PROVISIONS AND REQUIREMENTS OF THE RALPH M. BROWN ACT ................................................................................................. 1 THE TEXT OF THE RALPH M. BROWN ACT ............................................................................ 16 Introduction Ralph M. Brown Act Page ii © 2011 Richards, Watson & Gershon 1342883.1 INTRODUCTION This Handbook is prepared to provide you with a summary of the major provisions of California’s open meeting law for local governments – the Ralph M. Brown Act, including rules about calling and holding various types of meetings and closed sessions, as well as guidelines for how to avoid serial meetings. The second part contains the complete text of the Brown Act. This Handbook is designed for local government officials and staff and we hope you will find it useful. Should you have any questions about the information included in this Handbook, please do not hesitate to contact us. LOS ANGELES 355 South Grand Avenue, 40th Floor Los Angeles, California 90071-3101 Telephone: 213.626.8484 Facsimile: 213.626.0078 E-mail: la@rwglaw.com ORANGE COUNTY 1 Civic Center Circle, PO Box 1059 Brea, California 92822-1059 Telephone: 714.990.0901 Facsimile: 714.990.6230 E-mail: oc@rwglaw.com SAN FRANCISCO 44 Montgomery Street, Suite 3800 San Francisco, California 94104-4811 Telephone: 415.421.8484 Facsimile: 415.421.8486 E-mail: sf@rwglaw.com www.rwglaw.com Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 1 © 2011 Richards, Watson & Gershon 1342883.1 SUMMARY OF THE MAJOR PROVISIONS AND REQUIREMENTS OF THE RALPH M. BROWN ACT The Ralph M. Brown Act, more commonly known as the “Brown Act,” is California’s “sunshine” law for local government. The Brown Act is found in the California Government Code commencing with Section 54950. In a nutshell, the Brown Act requires local government business to be conducted at open and public meetings, except in certain limited situations. This paper briefly summarizes and discusses the major provisions of the Brown Act. I. APPLICATION OF BROWN ACT TO “LEGISLATIVE BODIES” The requirements of the Brown Act apply to “legislative bodies” of local governmental agencies. The term “legislative body” is defined to include the governing body of a local agency (e.g., the city council or the board of supervisors) and any commission, committee, board, or other body of the local agency, whether permanent or temporary, decision making or advisory, that is created by formal action of a legislative body. § 54952(a)-(b). Standing committees of a legislative body, that have either “continuing subject matter jurisdiction” or a meeting schedule fixed by formal action of the legislative body, are also subject to the requirements of the Brown Act. Some common examples include the finance, personnel, or similar policy subcommittees of a legislative body. Standing committees exist to make routine, regular recommendations on a specific subject matter. These committees continue to exist over time and survive resolution of any one issue or matter. They are also a regular part of the governmental structure. The Brown Act does not apply to “ad hoc” committees comprised solely of members of the legislative body that are less than a quorum of the body, provided these committees do not have a “continuing subject matter jurisdiction,” or a meeting schedule fixed by formal action of the legislative body. Such ad hoc committees are purely advisory; they generally serve only a limited or single purpose, are not perpetual, and are dissolved when their specific task is completed. Advisory and standing committees, but not ad hoc committees, are required to have agendas, and to have their agendas posted at least 72 hours in advance of its meetings. If this is done, the meeting is considered to be a regular meeting for all purposes. If the agenda is not posted at least 72 hours in advance, the meeting must be treated as a special meeting, and all of the limitations and requirements for special meetings apply, as discussed later. Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 2 © 2011 Richards, Watson & Gershon 1342883.1 The governing boards of some private corporations, limited liability companies, and private entities may be subject to the Brown Act under certain circumstances. A private entity’s governing board constitutes a legislative body within the meaning of the Brown Act if either of the following applies: (i) the private entity is created by an elected legislative body to exercise lawfully delegated authority of the legislative body; or (ii) the private entity receives funds from a local agency and its governing board includes a member of the legislative body of the local agency who was appointed by the legislative body to the governing board as a full voting member. § 54952(c). The Brown Act also applies to persons who are elected to serve as members of a legislative body of a local agency even before they assume the duties of office. § 54952.1. Under this provision, the statute is applicable to newly elected, but not-yet-sworn-in, city council members and members of county boards of supervisors. II. DEFINITION OF “MEETING” The central provision of the Brown Act requires that all “meetings” of a legislative body be open and public. The Brown Act defines the term “meeting” very broadly, § 54952.2, and encompasses almost every gathering of a majority of legislative body members, including: Any congregation of a majority of the members of a legislative body at the same time and location to hear, discuss, deliberate or take action on any item that is within the subject matter jurisdiction of the legislative body or the local agency to which it pertains. In plain English, this definition means that a meeting is any gathering of a majority of council members, board of directors, or other applicable legislative body, to hear, discuss or deliberate any item of local agency business or potential local agency business. III. EXCEPTIONS TO MEETING REQUIREMENT There are six types of gatherings that are not subject to the Brown Act. We commonly refer to these exceptions as: (1) the individual contact exception; (2) the seminar or conference exception; (3) the community meeting exception; (4) the other legislative body exception; (5) the social or ceremonial occasion exception; and (6) the standing committee exception. Unless a gathering of a majority of the members of a legislative body falls within one of the exceptions discussed below, if a majority of members are in the same room and merely listen to a discussion of local agency business, they will be participating in a meeting within the meaning of the Brown Act that requires notice, an agenda, and a period for public comment. A. The Individual Contact Exception Conversations, whether in person, by telephone or other means, between a member of a legislative body and any other person does not constitute a meeting under the Brown Act. Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 3 © 2011 Richards, Watson & Gershon 1342883.1 § 54952.2(c)(1). However, such contacts may constitute a “serial meeting” (discussed below) in violation of the Brown Act, if the individual also makes a series of individual contacts with other members of the legislative body, and communications with these other members are used to “discuss, deliberate, or take action on any item of business that is within the subject matter jurisdiction of the legislative body.” B. The Seminar or Conference Exception The attendance by a majority of the legislative body at a seminar, conference, or similar educational gathering is generally exempted from Brown Act requirements. § 54952.2(c)(2). However, in order to qualify under this exception, the seminar or conference must be open to the public and must involve issues of general interest to the public or to local agencies. Attendance at a California League of Cities or California Contract Cities seminar is an example of an educational gathering that fulfills these requirements. However, this exception will not apply to a conference or seminar if a majority of legislative body members discuss among themselves items of specific business relating to their own local agency other than as part of the scheduled program. C. The Community Meeting Exception The community meeting exception allows a majority of legislative body members to attend privately sponsored neighborhood meetings, town hall forums, chamber of commerce lunches or other community meetings at which issues of local interest are discussed § 54952.2(c)(3). In order to fall within this exception, however, members of the legislative body must observe several rules that limit this exception. First, the community meeting must be “open and publicized.” Therefore, attendance by a majority of the legislative body at a homeowners association meeting that is limited to the residents of a particular development and only publicized among members of that development would not qualify for this exemption. Also, as with the other exceptions, a majority of legislative body members cannot discuss among themselves items of business of their own local agency other than as part of the scheduled program. D. The Other Legislative Body Exception This exception allows a majority of members of any legislative body to attend open and noticed meetings of other legislative bodies of their local agency, or of another local agency, without treating such attendance as a meeting of the body. § 54952.2(c)(4). Of course, as with other meeting exceptions, the legislative body members are prohibited from discussing items of business of their local agency among themselves other than as part of the scheduled meeting. E. The Social or Ceremonial Occasion Exception As has always been the case, the Brown Act does not apply to attendance by a majority of the legislative body members at purely social or ceremonial occasions. § 54942.2(c)(5). Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 4 © 2011 Richards, Watson & Gershon 1342883.1 This exception only applies, though, if a majority of legislative body members do not discuss among themselves items of business of their local agency. F. The Standing Committee Exception The standing committee exception allows members of a legislative body, who are not members of a standing committee of that body, to attend an open and noticed meeting of the committee without making the gathering a meeting of the full legislative body itself. § 54952.2(c)(6). The exception applies only in the situation where the attendance at a standing committee meeting by legislative body members who are not standing committee members would create a gathering of a majority of the legislative body (and therefore, a “meeting” of the legislative body); otherwise, there is no “meeting” under the Brown Act. In order to fall within the standing committee exception, the legislative body members who are not members of the standing committee may attend only as “observers.” This means that the noncommittee members of the legislative body should not speak at the standing committee’s meeting, sit in their usual seat on the dais or otherwise participate in the meeting. To avoid this awkward situation, it is generally recommended that, if a standing committee meeting is likely to be attended by other legislative body members, then the meeting should be agendized as a meeting of the whole legislative body. This will allow full participation by all members of the legislative body members. IV. PERMITTED LOCATIONS OF MEETINGS AND TELECONFERENCING The Brown Act generally requires all meetings of a legislative body to occur within the boundaries of the local agency. § 54954(b). There are exceptions to this rule, however, such as one to allow meetings with a legislative body of another local agency in that agency’s jurisdiction. Meetings held outside of a local agency’s boundaries pursuant to an exception still must comply with agenda and notice requirements, which are discussed below. “Teleconferencing” may be used as a method for conducting meetings whereby members of a legislative body may be counted towards a quorum and participate fully in the meeting from remote locations. § 54953(b). If a member participates in a meeting via teleconferencing, the following requirements apply: (1) the remote locations must be connected to the main meeting location by telephone, video or both; (2) the notice and agenda of the meeting must identify the remote locations; (3) the remote locations must be posted and accessible to the public; (4) all votes must be by roll call; and (5) the meeting must in all respects comply with the Brown Act, including participation by members of the public present in remote locations. A quorum of the legislative body must participate from locations within the jurisdiction, but other members may participate from outside the jurisdiction. The teleconferencing rules only apply to members of the legislative body. Staff members, attorneys, or consultants may participate remotely without following the posting and public access requirements of the teleconferencing rules. Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 5 © 2011 Richards, Watson & Gershon 1342883.1 V. ADA COMPLIANCE Pursuant to Section 54953.2, all meetings of a legislative body, other than closed session meetings or parts of meetings involving a closed session, are required to be held in a location and conducted in a manner that complies with the Americans with Disabilities Act of 1990. In addition, if requested, the agenda and documents in the agenda packet shall be made available in alternative formats to persons with a disability. § 54954.1. The agenda shall include information regarding how, to whom, and when a request for disability-related modification or accommodation, including auxiliary aids or services, may be made by a person with a disability who requires a modification or accommodation in order to participate in the meeting. § 54954.2. VI. SERIAL MEETINGS In addition to regulating all gatherings of a majority of the members of a legislative body, the Brown Act also addresses certain contacts between individual members of the legislative body. On the one hand, the Brown Act specifically provides that nothing in the Act is intended to impose requirements on individual contacts or conversations between a member of a legislative body and any other person. § 54952.2(c)(1). This provision even applies to individual contacts between two members of the legislative body (the individual contact exception to the “meeting” described above). Despite this exception, however, the Brown Act does prohibit the use of a series of communications of any kind such individual contacts (commonly referred to as a “serial meeting”) outside of a “meeting” that involves a majority of the members of the legislative body to discuss, deliberate, or take action on any item of business that is within the subject matter jurisdiction of the legislative body. § 54952.2(b)(1). A serial meeting is a series of meetings or communications between individual members of the legislative body in which ideas are exchanged among a majority of a legislative body through either one or more persons acting as intermediaries or through use of telephone, telephone answering machine, e-mail, or voice mail. A serial meeting can occur even though a majority of legislative body members never gather in a room at the same time, and it typically results in one of two ways. The first is when a staff member, a legislative body member, or some other person individually contacts a majority of legislative body members and shares ideas among the majority (“I’ve talked to members A and B and they will vote ‘yes.’ Will you?”). Alternatively, member A calls member B, who then calls member C, and so on, until a majority of the legislative body has discussed or deliberated or has taken action on the item of business. The prohibition against serial meetings does not, however, prohibit communications between staff and legislative body members for the purpose of answering questions or providing information regarding a matter that is within the subject matter jurisdiction of the local agency, as long as the staff person does not communicate, with other members of the legislative body, the comments or positions of any other member of the legislative body. Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 6 © 2011 Richards, Watson & Gershon 1342883.1 § 54952.2(b)(2). Observing the following guidelines can avoid inadvertent violation of the serial meeting rule. These rules of conduct apply only when a majority of a legislative body is involved in a series of individual contacts or communications outside of a noticed “meeting,” whether with local agency staff members, constituents, developers, lobbyists, or other members of the legislative body. A. Contacts with Staff Staff can inadvertently become a conduit among a majority of a legislative body in the course of providing briefings on items of local agency business. The Attorney General previously took the position that, when local agency staff individually briefs a majority of legislative body members, such briefing necessarily constitutes an illegal serial meeting. This position was rejected by the California Court of Appeal, which clarified that staff briefings of individual city council members do not constitute an illegal serial meeting under the Brown Act without additional evidence that: (1) staff acted as a personal intermediary for other members of the legislative body; and (2) the meetings led to a collective concurrence among members of the legislative body. The state legislature amended Government Code section 54952.2 in 2008, effective in 2009, to further clarify that staff briefings of individual city council members for the purpose of answering questions or providing information regarding an item of business do not constitute an illegal serial meeting under the Brown Act as long as a staff person does not communicate the comments or positions of a member of the legislative body to other members. Staff briefings must therefore be handled carefully. To avoid having a staff briefing become a serial meeting: i Staff briefings of members of the legislative body should be “unidirectional” when done on an individual basis for a majority of the legislative body members. This means that information should flow from staff to the member, and the member’s participation should be limited to asking questions and acquiring information. Otherwise, if multiple members separately give staff direction thereby causing staff to shape or modify their ultimate recommendations in order to reconcile the views of a majority of the members, a violation could occur. i A legislative body member should not ask staff to describe the views of any other members of the legislative body, and staff should not volunteer those views if known. i Staff may present their views to a legislative body member during an individual contact, but staff should not ask for that member’s views unless it is absolutely clear that staff is not discussing the matter with a majority of the legislative body. Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 7 © 2011 Richards, Watson & Gershon 1342883.1 B. Contacts with Constituents, Developers and Lobbyists A constituent, developer, or lobbyist can also inadvertently become an intermediary among a majority of members of a legislative body thereby creating an illegal serial meeting in violation of the Brown Act. Such persons’ unfamiliarity with the requirements of the Brown Act aggravate this potential problem because they may expect a legislative body member to be willing to commit to a position in a private conversation in advance of a meeting. To avoid violations arising from contacts with constituents, developers and lobbyists: i State the ground rules “up front.” Ask if the person has talked, or intends to talk, with other members of the legislative body about the same subject. If the answer is “yes,” then make it clear that the person should not disclose the views of other legislative body members during the conversation. i Explain to the person that you will not make a final decision on a matter prior to the meeting. For example: “State law prevents me from giving you a commitment outside a noticed meeting. I will listen to what you have to say and give it consideration as I make up my mind.” i Do more listening and asking questions than expressing opinions. If you disclose your thoughts about a matter, counsel the person not to share them with other members of the legislative body. C. Contacts with Fellow Members of the Same Legislative Body Direct contacts concerning local agency business with fellow members of the same legislative body – whether through face-to-face or telephonic conversations, notes, letters, e-mail or staff members – are the most obvious means by which an illegal serial meeting can occur. This is not to say that a member of a legislative body is precluded from discussing items of local agency business with another member of that legislative body outside of a meeting; as long as the communication does not involve a majority of the legislative body, no “meeting” has occurred. There is, however, always the risk that one participant in the communication will disclose the views of the other participant to a third or fourth legislative body member, creating the possibility of a discussion of an item of business outside a noticed public meeting. Therefore, avoid discussing city business with a majority of the members of your legislative body, and communicating the views of other legislative body members outside a meeting. These suggested rules of conduct may seem unduly restrictive and impractical, and may make acquisition of important information more difficult or time-consuming. Nevertheless, following them will help assure that your conduct comports with the Brown Act’s goal of achieving open government. If you have questions about compliance with the Act in any given situation, you should seek advice from your city attorney. Adherence to the foregoing guidelines is not a substitute for securing advice from your legal counsel. Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 8 © 2011 Richards, Watson & Gershon 1342883.1 VII. NOTICE AND AGENDA REQUIREMENTS A. Time of Notice and Content of Agenda Two key provisions of the Brown Act which ensure the public’s business is conducted openly are the requirements that legislative bodies publicly post agendas prior to their meetings, (§§ 54954.2, 54955, 54956, and 54957.5) and that no action or discussion may occur on items or subjects not listed on the posted agenda (§ 54954.2.). Limited exceptions to the rule against discussing or taking action not on a posted agenda are included in the Brown Act and are discussed further below. Legislative bodies, except advisory committees and standing committees, are required to establish a time and place for holding regular meetings. § 54954(a). A “regular” meeting is a meeting that occurs on the legislative body’s established meeting day. Agendas for a regular meeting must be publicly posted 72 hours in advance of the meeting in a place that is freely accessible to the public, and must contain a brief general description of each item of business to be transacted or discussed at the meeting. § 54954.2(a). The description need not exceed 20 words. A “special” meeting is a meeting that is held at a time or place other than the time and place established for regular meetings. For special meetings, the “call and notice” of the meeting and the agenda must be posted at least 24 hours prior to the meeting. § 54956. Additionally, each member of the legislative body must personally receive written notice of the special meeting either by personal delivery or by “any other means” (such as facsimile, e-mail or U.S. mail) at least 24 hours before the time of the special meeting, unless they have previously waived receipt of written notice. Members of the press (including radio and television stations) and other members of the public can also request written notice of special meetings and, if they have, then that notice must be given at the same time notice is provided to members of the legislative body. An “emergency” meeting may be called to address certain emergencies, such as a terrorist act or crippling disaster, without complying with the 24-hour notice requirement. Certain requirements apply for notifying the press and for conducting closed sessions as part of those meetings, and except as specified, all other rules governing special meetings apply. § 54956.5. Both regular and special meetings may be adjourned to another time. Notices of adjourned meetings must be posted on the door of the meeting chambers where the meeting occurred within 24 hours after the meeting is adjourned. § 54955. If the adjourned meeting occurs more than five days after the prior meeting, a new agenda for that adjourned meeting must be posted 72 hours in advance of the adjourned meeting. § 54954.2(b)(3). The Brown Act requires local agencies to mail the agenda or the full agenda packet to any person making a written request no later than the time the agenda is posted or is delivered Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 9 © 2011 Richards, Watson & Gershon 1342883.1 to the members of the body, whichever is earlier. A local agency may charge a fee to recover its costs of copying and mailing. Any person may make a standing request to receive these materials, in which event the request must be renewed annually. Failure by any requestor to receive the agenda does not constitute grounds to invalidate any action taken at a meeting. § 54954.1. B. Action and Discussion on Non-agenda Items The Brown Act also ensures the public’s business is conducted openly by restricting a legislative body’s ability to deviate from posted agendas. The statute affords a legislative body limited authority to act on or discuss non-agenda items at regular meetings, but forbids doing so at special meetings. As a general rule, a legislative body may not act on or discuss any item that does not appear on the agenda posted for a regular meeting. § 54954.2. This rule does not, however, preclude a legislative body from acting on a non-agenda item that comes to the local agency’s attention subsequent to the agenda posting which requires immediate action. In order to utilize this exception, the legislative body must make findings of both components of the exception by a two-thirds vote of those present (by unanimous vote if less than two- thirds of the body is present). This means that if four members of a five-member body are present, three votes are required to add the item; if only three are present, a unanimous vote is required. In addition, an item not appearing on an agenda may be added if the legislative body determines by a majority vote that an emergency situation exists. For purposes of this exception, the term “emergency situation” refers to work stoppages or crippling disasters that severely impair public health, safety, or both. Notwithstanding the two general exceptions set forth above, a legislative body may also discuss non-agenda items at a regular meeting under the following five additional exceptions: i Members of the legislative body or staff may briefly respond to statements made or questions posed by persons during public comment periods; i Members of the legislative body or staff may ask a question for clarification, make a brief announcement or make a brief report on their own activities; i Members of the legislative body may, subject to the procedural rules of the body, provide a reference to staff or other resources for factual information; i Members of the legislative body may, subject to the procedural rules of the body, request staff to report back to the legislative body at a subsequent meeting concerning any matter; and Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 10 © 2011 Richards, Watson & Gershon 1342883.1 i Members of the legislative body may, subject to the procedural rules of the body, take action to direct staff to place a matter of business on a future agenda. The legislative body may not discuss non-agenda items to any significant degree under these exceptions. This means there should not be long or wide-ranging question and answer sessions on non-agenda items between the legislative body and the public or between the legislative body and staff. It is important to follow these exceptions carefully and construe them narrowly to avoid tainting an important and complex action by a non- agendized discussion of the item. The Brown Act contains even more stringent regulations to restrict action and discussion on non-agenda items at special meetings. In particular, the statute mandates that only business that is specified in the “call and notice” of the special meeting may be considered by the legislative body. § 54956. There are no exceptions to this rule. VIII. PUBLIC PARTICIPATION A. Regular Meetings The Brown Act mandates that every agenda for a regular meeting provide an opportunity for members of the public to directly address the legislative body on any matter that is within the subject matter jurisdiction of the legislative body. § 54954.3(a). In addition, the Brown Act requires the legislative body to allow members of the public to comment on any item on the agenda either before or during the body’s consideration of that item. § 54954.3(a). Some local agencies accomplish both requirements by placing a general audience comment period at the beginning of the agenda where the public can comment on both agenda and non-agenda items. Others provide public comment periods as each item or group of items comes up on the agenda, and then leave the general public comment period to the end of the agenda. Either method is permissible, though public comment on public hearing items must be taken during the hearing. The Brown Act allows a legislative body to preclude public comments on an agenda item in one situation – where the item was considered by a committee, composed solely of members of the body, that held a meeting where public comments on that item were allowed. So, if the legislative body has standing committees (which are required to have agendized and open meetings with an opportunity for the public to comment on agenda items), and the committee has previously considered an item, then at the time the item comes before the full legislative body, the body may choose not to take additional public comments on that item. However, if the version presented to the full legislative body is different from the version presented to, and considered by, the committee, then the public must be given another opportunity to speak on that item at the meeting of the full body. § 54954.3. Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 11 © 2011 Richards, Watson & Gershon 1342883.1 B. Public Comments at Special Meetings The Brown Act requires that agendas for special meetings provide an opportunity for members of the public to address the legislative body concerning any item listed on the agenda before or during the body’s consideration of that item. § 54954.3(a). Unlike regular meetings, though, the legislative body does not have to allow public comment on non- agenda matters at a special meeting. C. Limitations on the Length and Content of Public Comments A legislative body may adopt reasonable regulations limiting the total amount of time allocated to each person for public testimony. Typical time limits restrict speakers to three or five minutes. A legislative body may also adopt reasonable regulations limiting the total amount of time allocated for public testimony on legislative matters, such as a zoning ordinance or other regulatory ordinance. § 54954.3(b). However, we do not recommend setting total time limits per item for any quasi-judicial matter, such as a conditional use permit application, because such a restriction could result in a violation of the due process rights of those who were not able to speak to the body during the time allotted. The Brown Act precludes a legislative body from prohibiting public criticism of the policies, procedures, programs, or services of the local agency or the acts or omissions of the body. § 54954.3(c). This prohibition does not mean that a member of the public may say anything during public testimony. If the topic of the public’s comments falls outside the subject matter jurisdiction of the local agency, the legislative body may stop a speaker’s comments. A legislative body also may adopt reasonable rules of decorum that preclude a speaker from disrupting, disturbing or otherwise impeding the orderly conduct of its meetings. § 54954.3(b). The right to publicly criticize a public official does not include the right to slander that official, though the line between criticism and slander is often difficult to determine in the heat of the moment. Care must be given to avoid violating the free speech rights of speakers by suppressing opinions relevant to the business of the legislative body. Finally, in some circumstances, the use of profanity may serve as a basis for stopping a speaker. It will depend, however, upon what profane words or comments are made and the context of those comments. Therefore, no one should be ruled out of order for profanity unless the language both is truly objectionable and causes a disturbance or disruption in the proceeding. D. Additional Rights of the Public The Brown Act grants the public the right to videotape or broadcast a public meeting, as well as the right to make a motion picture or still camera record of such meeting. § 54953.5(a). A legislative body may prohibit or limit recording of a meeting, however, if the body finds that the recording cannot continue without noise, illumination, or view Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 12 © 2011 Richards, Watson & Gershon 1342883.1 obstruction that constitutes, or would constitute, a disruption of the proceedings. § 54953.6. Any audio or videotape record of an open and public meeting that is made, for whatever purpose, by or at the direction of the local agency is a public record and is subject to inspection by the public consistent with the requirements of the Public Records Act. § 54953.5(b). The local agency must not destroy the tape or film record for at least 30 days following the date of the taping or recording. Inspection of the audiotape or videotape must be made available to the public for free on equipment provided by the local agency. The Brown Act requires written material distributed to a majority of the body by any person to be provided to the public without delay. This rule is inapplicable, to attorney-client memoranda, the confidentiality of which was affirmed by the California Supreme Court in Roberts v. City of Palmdale, 5 Cal. 4th 363 (1993). However, if non-privileged material is distributed during the meeting and prepared by the local agency, it must be available for public inspection at the meeting. If it is distributed during the meeting by a member of the public, it must be made available for public inspection after the meeting. § 54957.5(c). If material related to an agenda item is distributed to a majority of the body less than 72 hours prior to an open session of a regular meeting, the writing must be made available at the same time for public inspection at a public office or location that has been designated in advance for such purpose. Each local agency must list the address of the designated office or location on the agendas for all meetings of the legislative body of that agency. § 54957.5(b). Although this Brown Act provision technically requires an agency to list the designated office address on closed session meeting agendas, it does not require an agency to make such closed session documents and materials available for public inspection. A local agency may also post all documents made available for public inspection pursuant to Section 54957.5(b) on the agency’s internet web site. However, a local agency may not post the writings to its web site in lieu of designating a public office or location for inspection of physical copies of the documents. We recommended that local agencies implement the following procedures to comply with Section 54957.5(b): i Place a binder at the agency’s principal place of business next to the public counter agenda packet that identifies the contents as follows: “Disclosable public documents related to an open session agenda item on the _____ Agenda Packet distributed by the [AGENCY] to a majority of the [LEGISLATIVE BODY] less than 72 hours prior to the meeting.” i On the agenda template for all meetings, there should be a standard footer or statement that indicates the following: Any disclosable public writings related to an Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 13 © 2011 Richards, Watson & Gershon 1342883.1 open session item on a regular meeting agenda and distributed by the [AGENCY] to at least a majority of the [LEGISLATIVE BODY] less than 72 hours prior to that meeting are available for public inspection at the _____ Counter at [AGENCY’S PLACE OF BUSINESS] located at [ADDRESS] and [optional] the _____ Counter at the _____ Library located at [LIBRARY ADDRESS] during normal business hours. [Optional] In addition, the Agency may also post such documents on the Agency’s website at [WEBSITE ADDRESS]. It is also suggested that local agencies consider implementing the following optional procedures: i Place a binder at the Library next to the public counter agenda packet that identifies the contents as follows: “Disclosable public documents related to an open session agenda item on the _____ Agenda Packet distributed by the [AGENCY] to a majority of the [LEGISLATIVE BODY] less than 72 hours prior to the meeting.” i On the [AGENCY’S] website, create a subfolder under the agenda packet folder that identifies the contents of the subfolder as follows: “Disclosable public documents related to an open session agenda item on the _____ Agenda Packet distributed by the [AGENCY] to a majority of the [LEGISLATIVE BODY] less than 72 hours prior to the meeting.” i On all documents made available for public inspection pursuant to Section 54957.5(b), make a notation of the date when distributed to at least a majority of the legislative body and placed in the binder at agency’s place of business, [optional] the Library, or [optional] on the agency’s website. i Charge customary photocopying charges for copies of such documents. One problem left unaddressed by Section 54957.5(b) is what to do when written materials are distributed directly to a majority of the legislative body without knowledge of staff, or even without the legislative body members knowing that a majority has received it. The law still requires these materials to be treated as public records. Thus, it is a good idea for at least one member of the legislative body to ensure that staff gets a copy of any document distributed to members of the legislative body so that copies can be made for the local agency’s records and for members of the public who request a copy. IX. CLOSED SESSIONS The Brown Act allows a legislative body to convene a “closed session” during a meeting in order to meet privately with its advisors on specifically enumerated topics. Sometimes people refer to closed sessions as “executive sessions,” which is a holdover term from the statute’s early days. Examples of business that may be conducted in closed session include personnel evaluations, threats to public safety, labor negotiations, pending Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 14 © 2011 Richards, Watson & Gershon 1342883.1 litigation, real estate negotiations, and consideration of a response to an audit report. §§ 54956.8, 54956.9, 54957, 54957.6, 54957.75. Political sensitivity of an item is not a lawful reason for a closed session discussion. The Brown Act requires that closed session business be described on the public agenda. Moreover, there is a “bonus” of sorts for using prescribed language to describe closed sessions in that legal challenges to the adequacy of the description are precluded. § 54954.5. This so-called “safe harbor” encourages many local agencies to use a very similar agenda format. Tape recording of closed sessions is not required unless a court orders such taping after finding a closed session violation. § 54960. Closed sessions may be started in a location different from the usual meeting place as long as the location is noted on the agenda and the public can be present when the meeting first begins. Moreover, public comment on closed session items must be allowed before convening the closed session. After a closed session, the legislative body must reconvene the public meeting and publicly report certain types of actions if they were taken, and the vote on those actions. § 54957.1. There are limited exceptions for specified litigation decisions, and to protect the victims of sexual misconduct or child abuse. Contracts, settlement agreements or other documents that are finally approved or adopted in closed session must be provided at the time the closed session ends to any person who has made a standing request for all documentation in connection with a request for notice of meetings (typically members of the media) and to any person who makes a request within 24 hours of the posting of the agenda, if the requestor is present when the closed session ends. § 54957.1. One perennial area of confusion is whether a legislative body may discuss salary and benefits of an individual employee (such as a city manager) as part of a performance evaluation session under Section 54957. It may not. However, the body may designate a negotiator or negotiators, such as two members of a five member legislative body, to negotiate with that employee and then meet with the negotiator(s) in closed session under Section 54957.6 to provide directions on salary and compensation issues. The employee in question may not be present in such a closed session. The Brown Act prohibits attendees from disclosing confidential information obtained during a closed session, unless the legislative body authorizes the disclosure. Violations can be addressed through injunctions, disciplinary action, and referral to the grand jury. § 54963. X. ENFORCEMENT There are both civil remedies and criminal misdemeanor penalties for Brown Act violations. The civil remedies include injunctions against further violations, orders nullifying any unlawful action, orders determining the validity of any rule to penalize or discourage the Summary of the Major Provisions of the Ralph M. Brown Act Ralph M. Brown Act Page 15 © 2011 Richards, Watson & Gershon 1342883.1 expression of a member of the legislative body, and remedies for breaching closed session confidences. §§ 54960, 54960.1, 54963. Prior to filing suit to challenge an alleged Brown Act violation, the complaining party must make a written demand on the legislative body to cure or correct the alleged violation. The written demand must be made within 90 days after the challenged action was taken. However, if the challenged action was taken in open session and involves a violation of the agenda requirements of Section 54954.2, then the written demand must be made within 30 days. The legislative body is required to cure or correct the challenged action and inform the party who filed the demand of its correcting actions, or its decision not to cure or correct, within 30 days. The complaining party must file suit within 15 days after receipt of the written notice from the legislative body, or if there is no written response, within 15 days after the 30-day cure period expires. § 54960.1(b). A member of a legislative body will not be criminally liable for a violation of the Brown Act unless the member intends to deprive the public of information to which the member knows or has reason to know the public is entitled to under the Brown Act. § 54959. This standard became effective in 1994 and is a different standard from most criminal standards. Until it is applied and interpreted by a court, it is not clear what type of evidence will be necessary to prosecute a Brown Act violation. XI. CONCLUSION The Brown Act can be confusing, and compliance with it can be difficult, due to the statute’s many rules and ambiguities. Nonetheless, noncompliance with the Act is not an option. In the event that you have any questions regarding any provision of the law, you should contact your legal counsel for advice. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 16 © 2011 Richards, Watson & Gershon 1342883.1 The Ralph M. Brown Act updated with changes effective January 1, 2011 Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 17 © 2011 Richards, Watson & Gershon 1342883.1 The Ralph M. Brown Act Government Code §§ 54950-54963 Section 54950. Declaration, intent; sovereignty In enacting this chapter, the Legislature finds and declares that the public commissions, boards and councils and the other public agencies in this State exist to aid in the conduct of the people’s business. It is the intent of the law that their actions be taken openly and that their deliberations be conducted openly. The people of this State do not yield their sovereignty to the agencies which serve them. The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for them to know. The people insist on remaining informed so that they may retain control over the instruments they have created. Section 54950.5. Short title This chapter shall be known as the Ralph M. Brown Act. Section 54951. Local agency, definition As used in this chapter, “local agency” means a county, city, whether general law or chartered, city and county, town, school district, municipal corporation, district, political subdivision, or any board, commission or agency thereof, or other local public agency. Section 54952. Legislative body, definition As used in this chapter, “legislative body” means: (a) The governing body of a local agency or any other local body created by state or federal statute. (b) A commission, committee, board, or other body of a local agency, whether permanent or temporary, decisionmaking or advisory, created by charter, ordinance, resolution, or formal action of a legislative body. However, advisory committees, composed solely of the members of the legislative body that are less than a quorum of the legislative body are not legislative bodies, except that standing committees of a legislative body, irrespective of their composition, which have a continuing subject matter jurisdiction, or a meeting schedule fixed by charter, ordinance, resolution, or formal action of a legislative body are legislative bodies for purposes of this chapter. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 18 © 2011 Richards, Watson & Gershon 1342883.1 (c) (1) A board, commission, committee, or other multimember body that governs a private corporation, limited liability company, or other entity that either: (A) Is created by the elected legislative body in order to exercise authority that may lawfully be delegated by the elected governing body to a private corporation, limited liability company, or other entity. (B) Receives funds from a local agency and the membership of whose governing body includes a member of the legislative body of the local agency appointed to that governing body as a full voting member by the legislative body of the local agency. (2) Notwithstanding subparagraph (B) of paragraph (1), no board, commission, committee, or other multimember body that governs a private corporation, limited liability company, or other entity that receives funds from a local agency and, as of February 9, 1996, has a member of the legislative body of the local agency as a full voting member of the governing body of that private corporation, limited liability company, or other entity shall be relieved from the public meeting requirements of this chapter by virtue of a change in status of the full voting member to a nonvoting member. (d) The lessee of any hospital the whole or part of which is first leased pursuant to subdivision (p) of Section 32121 of the Health and Safety Code after January 1, 1994, where the lessee exercises any material authority of a legislative body of a local agency delegated to it by that legislative body whether the lessee is organized and operated by the local agency or by a delegated authority. Section 54952.1. Member of a legislative body of a local agency; conduct Any person elected to serve as a member of a legislative body who has not yet assumed the duties of office shall conform his or her conduct to the requirements of this chapter and shall be treated for purposes of enforcement of this chapter as if he or she has already assumed office. Section 54952.2. Meeting; prohibited devices for obtaining collective concurrence; exclusions from chapter (a) As used in this chapter, “meeting” means any congregation of a majority of the members of a legislative body at the same time and location, including teleconference location as permitted by Section 54953, to hear, discuss, deliberate, or take action on any item that is within the subject matter jurisdiction of the legislative body. (b) (1) A majority of the members of a legislative body shall not, outside a meeting authorized by this chapter, use a series of communications of any kind, Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 19 © 2011 Richards, Watson & Gershon 1342883.1 directly or through intermediaries, to discuss, deliberate, or take action on any item of business that is within the subject matter jurisdiction of the legislative body. (2) Paragraph (1) shall not be construed as preventing an employee or official of a local agency, from engaging in separate conversations or communications outside of a meeting authorized by this chapter with members of a legislative body in order to answer questions or provide information regarding a matter that is within the subject matter jurisdiction of the local agency, if that person does not communicate to members of the legislative body the comments or position of any other member or members of the legislative body. (c) Nothing in this section shall impose the requirements of this chapter upon any of the following: (1) Individual contacts or conversations between a member of a legislative body and any other person that do not violate subdivision (b). (2) The attendance of a majority of the members of a legislative body at a conference or similar gathering open to the public that involves a discussion of issues of general interest to the public or to public agencies of the type represented by the legislative body, provided that a majority of the members do not discuss among themselves, other than as part of the scheduled program, business of a specified nature that is within the subject matter jurisdiction of the local agency. Nothing in this paragraph is intended to allow members of the public free admission to a conference or similar gathering at which the organizers have required other participants or registrants to pay fees or charges as a condition of attendance. (3) The attendance of a majority of the members of a legislative body at an open and publicized meeting organized to address a topic of local community concern by a person or organization other than the local agency, provided that a majority of the members do not discuss among themselves, other than as part of the scheduled program, business of a specific nature that is within the subject matter jurisdiction of the legislative body of the local agency. (4) The attendance of a majority of the members of a legislative body at an open and noticed meeting of another body of the local agency, or at an open and noticed meeting of a legislative body of another local agency, provided that a majority of the members do not discuss among themselves, other than as part of the scheduled meeting, business of a specific nature that is within the subject matter jurisdiction of the legislative body of the local agency. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 20 © 2011 Richards, Watson & Gershon 1342883.1 (5) The attendance of a majority of the members of a legislative body at a purely social or ceremonial occasion, provided that a majority of the members do not discuss among themselves business of a specific nature that is within the subject matter jurisdiction of the legislative body of the local agency. (6) The attendance of a majority of the members of a legislative body at an open and noticed meeting of a standing committee of that body, provided that the members of the legislative body who are not members of the standing committee attend only as observers. Section 54952.6. Action taken As used in this chapter, “action taken” means a collective decision made by a majority of the members of a legislative body, a collective commitment or promise by a majority of the members of a legislative body to make a positive or a negative decision, or an actual vote by a majority of the members of a legislative body when sitting as a body or entity, upon a motion, proposal, resolution, order or ordinance. Section 54952.7. Copies of chapter to members of legislative body of local agencies A legislative body of a local agency may require that a copy of this chapter be given to each member of the legislative body and any person elected to serve as a member of the legislative body who has not assumed the duties of office. An elected legislative body of a local agency may require that a copy of this chapter be given to each member of each legislative body all or a majority of whose members are appointed by or under the authority of the elected legislative body. Section 54953. Meetings to be open and public; attendance (a) All meetings of the legislative body of a local agency shall be open and public, and all persons shall be permitted to attend any meeting of the legislative body of a local agency, except as otherwise provided in this chapter. (b) (1) Notwithstanding any other provision of law, the legislative body of a local agency may use teleconferencing for the benefit of the public and the legislative body of a local agency in connection with any meeting or proceeding authorized by law. The teleconferenced meeting or proceeding shall comply with all requirements of this chapter and all otherwise applicable provisions of law relating to a specific type of meeting or proceeding. (2) Teleconferencing, as authorized by this section, may be used for all purposes in connection with any meeting within the subject matter jurisdiction of the legislative body. All votes taken during a teleconferenced meeting shall be by rollcall. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 21 © 2011 Richards, Watson & Gershon 1342883.1 (3) If the legislative body of a local agency elects to use teleconferencing, it shall post agendas at all teleconference locations and conduct teleconference meetings in a manner that protects the statutory and constitutional rights of the parties or the public appearing before the legislative body of a local agency. Each teleconference location shall be identified in the notice and agenda of the meeting or proceeding, and each teleconference location shall be accessible to the public. During the teleconference, at least a quorum of the members of the legislative body shall participate from locations within the boundaries of the territory over which the local agency exercises jurisdiction, except as provided in subdivision (d). The agenda shall provide an opportunity for members of the public to address the legislative body directly pursuant to Section 54954.3 at each teleconference location. (4) For the purposes of this section, “teleconference” means a meeting of a legislative body, the members of which are in different locations, connected by electronic means, through either audio or video, or both. Nothing in this section shall prohibit a local agency from providing the public with additional teleconference locations. (c) No legislative body shall take action by secret ballot, whether preliminary or final. (d) (1) Notwithstanding the provisions relating to a quorum in paragraph (3) of subdivision (b), when a health authority conducts a teleconference meeting, members who are outside the jurisdiction of the authority may be counted toward the establishment of a quorum when participating in the teleconference if at least 50 percent of the number of members that would establish a quorum are present within the boundaries of the territory over which the authority exercises jurisdiction, and the health authority provides a teleconference number, and associated access codes, if any, that allows any person to call in to participate in the meeting and that number and access codes are identified in the notice and agenda of the meeting. (2) Nothing in this subdivision shall be construed as discouraging health authority members from regularly meeting at a common physical site within the jurisdiction of the authority or from using teleconference locations within or near the jurisdiction of the authority. A teleconference meeting for which a quorum is established pursuant to this subdivision shall be subject to all other requirements of this section. (3) For purposes of this subdivision, a health authority means any entity created pursuant to Sections 14018.7, 14087.31, 14087.35, 14087.36, 14087.38, and 14087.9605 of the Welfare and Institutions Code, any joint powers authority created pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 for the purpose of contracting pursuant to Section 14087.3 of the Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 22 © 2011 Richards, Watson & Gershon 1342883.1 Welfare and Institutions Code, and any advisory committee to a county sponsored health plan licensed pursuant to Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code if the advisory committee has 12 or more members. (4) This subdivision shall remain in effect only until January 1, 2009. Section 54953.1. Testimony of members before grand jury The provisions of this chapter shall not be construed to prohibit the members of the legislative body of a local agency from giving testimony in private before a grand jury, either as individuals or as a body. Section 54953.2. Legislative body meetings to meet protections and prohibitions of the Americans with Disabilities Act All meetings of a legislative body of a local agency that are open and public shall meet the protections and prohibitions contained in Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in implementation thereof. Section 54953.3. Conditions to Attendance A member of the public shall not be required, as a condition to attendance at a meeting of a legislative body of a local agency, to register his or her name, to provide other information, to complete a questionnaire, or otherwise to fulfill any condition precedent to his or her attendance. If an attendance list, register, questionnaire, or other similar document is posted at or near the entrance to the room where the meeting is to be held, or is circulated to the persons present during the meeting, it shall state clearly that the signing, registering, or completion of the document is voluntary, and that all persons may attend the meeting regardless of whether a person signs, registers, or completes the document. Section 54953.5. Right to record proceedings; conditions; tape or film records made by or under direction of local agencies (a) Any person attending an open and public meeting of a legislative body of a local agency shall have the right to record the proceedings with an audio or video tape recorder or a still or motion picture camera in the absence of a reasonable finding by the legislative body of the local agency that the recording cannot continue without noise, illumination, or obstruction of view that constitutes, or would constitute, a persistent disruption of the proceedings. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 23 © 2011 Richards, Watson & Gershon 1342883.1 (b) Any tape or film record of an open and public meeting made for whatever purpose by or at the direction of the local agency shall be subject to inspection pursuant to the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1), but, notwithstanding Section 34090, may be erased or destroyed 30 days after the taping or recording. Any inspection of a video or tape recording shall be provided without charge on a video or tape player made available by the local agency. Section 54953.6. Prohibitions or restrictions on broadcasts of proceedings of legislative body; reasonable findings No legislative body of a local agency shall prohibit or otherwise restrict the broadcast of its open and public meetings in the absence of a reasonable finding that the broadcast cannot be accomplished without noise, illumination, or obstruction of view that would constitute a persistent disruption of the proceedings. Section 54953.7. Allowance of greater access to meetings than minimal standards in this chapter Notwithstanding any other provision of law, legislative bodies of local agencies may impose requirements upon themselves which allow greater access to their meetings than prescribed by the minimal standards set forth in this chapter. In addition thereto, an elected legislative body of a local agency may impose such requirements on those appointed legislative bodies of the local agency of which all or a majority of the members are appointed by or under the authority of the elected legislative body. Section 54954. Time and place of regular meetings; special meetings; emergencies (a) Each legislative body of a local agency, except for advisory committees or standing committees, shall provide, by ordinance, resolution, bylaws, or by whatever other rule is required for the conduct of business by that body, the time and place for holding regular meetings. Meetings of advisory committees or standing committees, for which an agenda is posted at least 72 hours in advance of the meeting pursuant to subdivision (a) of Section 54954.2, shall be considered for purposes of this chapter as regular meetings of the legislative body. (b) Regular and special meetings of the legislative body shall beheld within the boundaries of the territory over which the local agency exercises jurisdiction, except to do any of the following: (1) Comply with state or federal law or court order, or attend a judicial or administrative proceeding to which the local agency is a party. (2) Inspect real or personal property which cannot be conveniently brought within the boundaries of the territory over which the local agency exercises Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 24 © 2011 Richards, Watson & Gershon 1342883.1 jurisdiction provided that the topic of the meeting is limited to items directly related to the real or personal property. (3) Participate in meetings or discussions of multiagency significance that are outside the boundaries of a local agency’s jurisdiction. However, any meeting or discussion held pursuant to this subdivision shall take place within the jurisdiction of one of the participating local agencies and be noticed by all participating agencies as provided for in this chapter. (4) Meet in the closest meeting facility if the local agency has no meeting facility within the boundaries of the territory over which the local agency exercises jurisdiction, or at the principal office of the local agency if that office is located outside the territory over which the agency exercises jurisdiction. (5) Meet outside their immediate jurisdiction with elected or appointed officials of the United States or the State of California when a local meeting would be impractical, solely to discuss a legislative or regulatory issue affecting the local agency and over which the federal or state officials have jurisdiction. (6) Meet outside their immediate jurisdiction if the meeting takes place in or nearby a facility owned by the agency, provided that the topic of the meeting is limited to items directly related to the facility. (7) Visit the office of the local agency’s legal counsel for a closed session on pending litigation held pursuant to Section 54956.9, when to do so would reduce legal fees or costs. (c) Meetings of the governing board of a school district shall be held within the district, except under the circumstances enumerated in subdivision (b), or to do any of the following: (1) Attend a conference on nonadversarial collective bargaining techniques. (2) Interview members of the public residing in another district with reference to the trustees’ potential employment of an applicant for the position of the superintendent of the district. (3) Interview a potential employee from another district. (d) Meetings of a joint powers authority shall occur within the territory of at least one of its member agencies, or as provided in subdivision (b). However, a joint powers authority which has members throughout the state may meet at any facility in the state which complies with the requirements of Section 54961. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 25 © 2011 Richards, Watson & Gershon 1342883.1 (e) If, by reason of fire, flood, earthquake, or other emergency, it shall be unsafe to meet in the place designated, the meetings shall be held for the duration of the emergency at the place designated by the presiding officer of the legislative body or his or her designee in a notice to the local media that have requested notice pursuant to Section 54956, by the most rapid means of communication available at the time. Section 54954.1. Mailed notice to persons who filed written request; time; duration and renewal of requests; fee Any person may request that a copy of the agenda, or a copy of all the documents constituting the agenda packet, of any meeting of a legislative body be mailed to that person. If requested, the agenda and documents in the agenda packet shall be made available in appropriate alternative formats to persons with a disability, as required by Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in implementation thereof. Upon receipt of the written request, the legislative body or its designee shall cause the requested materials to be mailed at the time the agenda is posted pursuant to Section 54954.2 and 54956 or upon distribution to all, or a majority of all, of the members of a legislative body, whichever occurs first. Any request for mailed copies of agendas or agenda packets shall be valid for the calendar year in which it is filed, and must be renewed following January 1 of each year. The legislative body may establish a fee for mailing the agenda or agenda packet, which fee shall not exceed the cost of providing the service. Failure of the requesting person to receive the agenda or agenda packet pursuant to this section shall not constitute grounds for invalidation of the actions of the legislative body taken at the meeting for which the agenda or agenda packet was not received. Section 54954.2. Agenda; posting; action on other matters (a) (1) At least 72 hours before a regular meeting, the legislative body of the local agency, or its designee, shall post an agenda containing a brief general description of each item of business to be transacted or discussed at the meeting, including items to be discussed in closed session. A brief general description of an item generally need not exceed 20 words. The agenda shall specify the time and location of the regular meeting and shall be posted in a location that is freely accessible to members of the public. If requested, the agenda shall be made available in appropriate alternative formats to persons with a disability, as required by Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in implementation thereof. The agenda shall include information regarding how, to whom, and when a request for disability related modification or accommodation, including auxiliary aids or services may be made by a person with a disability who requires a modification or accommodation in order to participate in the public meeting. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 26 © 2011 Richards, Watson & Gershon 1342883.1 (2) No action or discussion shall be undertaken on any item not appearing on the posted agenda, except that members of a legislative body or its staff may briefly respond to statements made or questions posed by persons exercising their public testimony rights under Section 54954.3. In addition, on their own initiative or in response to questions posed by the public, a member of a legislative body or its staff may ask a question for clarification, make a brief announcement, or make a brief report on his or her own activities. Furthermore, a member of a legislative body, or the body itself, subject to rules or procedures of the legislative body, may provide a reference to staff or other resources for factual information, request staff to report back to the body at a subsequent meeting concerning any matter, or take action to direct staff to place a matter of business on a future agenda. (b) Notwithstanding subdivision (a), the legislative body may take action on items of business not appearing on the posted agenda under any of the conditions stated below. Prior to discussing any item pursuant to this subdivision, the legislative body shall publicly identify the item. (1) Upon a determination by a majority vote of the legislative body that an emergency situation exists, as defined in Section 54956.5. (2) Upon a determination by a two-thirds vote of the members of the legislative body present at the meeting, or, if less than two-thirds of the members are present, a unanimous vote of those members present, that there is a need to take immediate action and that the need for action came to the attention of the local agency subsequent to the agenda being posted as specified in subdivision (a). (3) The item was posted pursuant to subdivision (a) for a prior meeting of the legislative body occurring not more than five calendar days prior to the date action is taken on the item, and at the prior meeting the item was continued to the meeting at which action is being taken. (c) This section is necessary to implement and reasonably within the scope of paragraph (1) of subdivision (b) of Section 3 of Article I of the California Constitution. Section 54954.3. Opportunity for public to address legislative body; adoption of regulations; public criticism of policies (a) Every agenda for regular meetings shall provide an opportunity for members of the public to directly address the legislative body on any item of interest to the public, before or during the legislative body’s consideration of the item, that is within the subject matter jurisdiction of the legislative body, provided that no action shall be taken on any item not appearing on the agenda unless the action is otherwise Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 27 © 2011 Richards, Watson & Gershon 1342883.1 authorized by subdivision (b) of Section 54954.2. However, the agenda need not provide an opportunity for members of the public to address the legislative body on any item that has already been considered by a committee, composed exclusively of members of the legislative body, at a public meeting wherein all interested members of the public were afforded the opportunity to address the committee on the item, before or during the committee’s consideration of the item, unless the item has been substantially changed since the committee heard the item, as determined by the legislative body. Every notice for a special meeting shall provide an opportunity for members of the public to directly address the legislative body concerning any item that has been described in the notice for the meeting before or during consideration of that item. (b) The legislative body of a local agency may adopt reasonable regulations to ensure that the intent of subdivision (a) is carried out, including, but not limited to, regulations limiting the total amount of time allocated for public testimony on particular issues and for each individual speaker. (c) The legislative body of a local agency shall not prohibit public criticism of the policies, procedures, programs, or services of the agency, or of the acts or omissions of the legislative body. Nothing in this subdivision shall confer any privilege or protection for expression beyond that otherwise provided by law. Section 54954.4. Reimbursements to local agencies and school districts for costs (a) The Legislature hereby finds and declares that Section 12 of Chapter 641 of the Statutes of 1986, authorizing reimbursement to local agencies and school districts for costs mandated by the state pursuant to that act, shall be interpreted strictly. The intent of the Legislature is to provide reimbursement for only those costs which are clearly and unequivocally incurred as the direct and necessary result of compliance with Chapter 641 of the Statutes of 1986. (b) In this regard, the Legislature directs all state employees and officials involved in reviewing or authorizing claims for reimbursement, or otherwise participating in the reimbursement process, to rigorously review each claim and authorize only those claims, or parts thereof, which represent costs which are clearly and unequivocally incurred as the direct and necessary result of compliance with Chapter 641 of the Statutes of 1986 and for which complete documentation exists. For purposes of Section 54954.2, costs eligible for reimbursement shall only include the actual cost to post a single agenda for any one meeting. (c) The Legislature hereby finds and declares that complete, faithful, and uninterrupted compliance with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code) is a matter of overriding public importance. Unless specifically stated, no future Budget Act, or Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 28 © 2011 Richards, Watson & Gershon 1342883.1 related budget enactments, shall, in any manner, be interpreted to suspend, eliminate, or otherwise modify the legal obligation and duty of local agencies to fully comply with Chapter 641 of the Statutes of 1986 in a complete, faithful, and uninterrupted manner. Section 54954.5. Closed session item descriptions For purposes of describing closed session items pursuant to Section 54954.2, the agenda may describe closed sessions as provided below. No legislative body or elected official shall be in violation of Section 54954.2 or 54956 if the closed session items were described in substantial compliance with this section. Substantial compliance is satisfied by including the information provided below, irrespective of its format. (a) With respect to a closed session held pursuant to Section 54956.7: LICENSE/PERMIT DETERMINATION Applicant(s): (Specify number of applicants) (b) With respect to every item of business to be discussed in closed session pursuant to Section 54956.8: CONFERENCE WITH REAL PROPERTY NEGOTIATORS Property: (Specify street address, or if no street address, the parcel number or other unique reference, of the real property under negotiation) Agency negotiator: (Specify names of negotiators attending the closed session) (If circumstances necessitate the absence of a specified negotiator, an agent or designee may participate in place of the absent negotiator so long as the name of the agent or designee is announced at an open session held prior to the closed session.) Negotiating parties: (Specify name of party (not agent)) Under negotiation: (Specify whether instruction to negotiator will concern price, terms of payment, or both) (c) With respect to every item of business to be discussed in closed session pursuant to Section 54956.9: CONFERENCE WITH LEGAL COUNSEL--EXISTING LITIGATION (Subdivision (a) of Section 54956.9) Name of case: (Specify by reference to claimant’s name, names of parties, case or claim numbers) or Case name unspecified: (Specify whether disclosure would jeopardize service of process or existing settlement negotiations) Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 29 © 2011 Richards, Watson & Gershon 1342883.1 CONFERENCE WITH LEGAL COUNSEL--ANTICIPATED LITIGATION Significant exposure to litigation pursuant to subdivision (b) of Section 54956.9: (Specify number of potential cases) (In addition to the information noticed above, the agency may be required to provide additional information on the agenda or in an oral statement prior to the closed session pursuant to subparagraphs (B) to (E), inclusive, of paragraph (3) of subdivision (b) of Section 54956.9.) Initiation of litigation pursuant to subdivision (c) of Section 54956.9: (Specify number of potential cases) (d) With respect to every item of business to be discussed in closed session pursuant to Section 54956.95: LIABILITY CLAIMS Claimant: (Specify name unless unspecified pursuant to Section 54961) Agency claimed against: (Specify name) (e) With respect to every item of business to be discussed in closed session pursuant to Section 54957: THREAT TO PUBLIC SERVICES OR FACILITIES Consultation with: (Specify name of law enforcement agency and title of officer, or name of applicable agency representative and title) PUBLIC EMPLOYEE APPOINTMENT Title: (Specify description of position to be filled) PUBLIC EMPLOYMENT Title: (Specify description of position to be filled) PUBLIC EMPLOYEE PERFORMANCE EVALUATION Title: (Specify position title of employee being reviewed) PUBLIC EMPLOYEE DISCIPLINE/DISMISSAL/RELEASE (No additional information is required in connection with a closed session to consider discipline, dismissal, or release of a public employee. Discipline includes potential reduction of compensation.) (f) With respect to every item of business to be discussed in closed session pursuant to Section 54957.6: CONFERENCE WITH LABOR NEGOTIATORS Agency designated representatives: (Specify names of designated representatives attending the closed session) (If circumstances necessitate the absence of a specified designated representative, an agent or designee may participate in place Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 30 © 2011 Richards, Watson & Gershon 1342883.1 of the absent representative so long as the name of the agent or designee is announced at an open session held prior to the closed session.) Employee organization: (Specify name of organization representing employee or employees in question) or Unrepresented employee: (Specify position title of unrepresented employee who is the subject of the negotiations) (g) With respect to closed sessions called pursuant to Section 54957.8: CASE REVIEW/PLANNING (No additional information is required in connection with a closed session to consider case review or planning.) (h) With respect to every item of business to be discussed in closed session pursuant to Sections 1461, 32106, and 32155 of the Health and Safety Code or Sections 37606 and 37624.3 of the Government Code: REPORT INVOLVING TRADE SECRET Discussion will concern: (Specify whether discussion will concern proposed new service, program, or facility) Estimated date of public disclosure: (Specify month and year) HEARINGS Subject matter: (Specify whether testimony/deliberation will concern staff privileges, report of medical audit committee, or report of quality assurance committee) (i) With respect to every item of business to be discussed in closed session pursuant to Section 54956.86: CHARGE OR COMPLAINT INVOLVING INFORMATION PROTECTED BY FEDERAL LAW (No additional information is required in connection with a closed session to discuss a charge or complaint pursuant to Section 54956.86.) (j) With respect to every item of business to be discussed in closed session pursuant to Section 54956.96: CONFERENCE INVOLVING A JOINT POWERS AGENCY (Specify by name) Discussion will concern: (Specify closed session description used by the joint powers agency) Name of local agency representative on joint powers agency board: (Specify name) (Additional information listing the names of agencies or titles of representatives attending the closed session as consultants or other representatives.) Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 31 © 2011 Richards, Watson & Gershon 1342883.1 (k) With respect to every item of business to be discussed in closed session pursuant to Section 54956.75: AUDIT BY BUREAU OF STATE AUDITS Section 54954.6. New or increased taxes or assessments; public meetings and public hearings; joint notice requirements (a) (1) Before adopting any new or increased general tax or any new or increased assessment, the legislative body of a local agency shall conduct at least one public meeting at which local officials shall allow public testimony regarding the proposed new or increased general tax or new or increased assessment in addition to the noticed public hearing at which the legislative body proposes to enact or increase the general tax or assessment. For purposes of this section, the term “new or increased assessment” does not include any of the following: (A) A fee that does not exceed the reasonable cost of providing the services, facilities, or regulatory activity for which the fee is charged. (B) A service charge, rate, or charge, unless a special district’s principal act requires the service charge, rate, or charge to conform to the requirements of this section. (C) An ongoing annual assessment if it is imposed at the same or lower amount as any previous year. (D) An assessment that does not exceed an assessment formula or range of assessments previously specified in the notice given to the public pursuant to subparagraph (G) of paragraph (2) of subdivision (c) and that was previously adopted by the agency or approved by the voters in the area where the assessment is imposed. (E) Standby or immediate availability charges. (2) The legislative body shall provide at least 45 days’ public notice of the public hearing at which the legislative body proposes to enact or increase the general tax or assessment. The legislative body shall provide notice for the public meeting at the same time and in the same document as the notice for the public hearing, but the meeting shall occur prior to the hearing. (b) (1) The joint notice of both the public meeting and the public hearing required by subdivision (a) with respect to a proposal for a new or increased general tax shall be accomplished by placing a display advertisement of at least one- Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 32 © 2011 Richards, Watson & Gershon 1342883.1 eighth page in a newspaper of general circulation for three weeks pursuant to Section 6063 and by a first-class mailing to those interested parties who have filed a written request with the local agency for mailed notice of public meetings or hearings on new or increased general taxes. The public meeting pursuant to subdivision (a) shall take place no earlier than 10 days after the first publication of the joint notice pursuant to this subdivision. The public hearing shall take place no earlier than seven days after the public meeting pursuant to this subdivision. Notwithstanding paragraph (2) of subdivision (a), the joint notice need not include notice of the public meeting after the meeting has taken place. The public hearing pursuant to subdivision (a) shall take place no earlier than 45 days after the first publication of the joint notice pursuant to this subdivision. Any written request for mailed notices shall be effective for one year from the date on which it is filed unless a renewal request is filed. Renewal requests for mailed notices shall be filed on or before April 1 of each year. The legislative body may establish a reasonable annual charge for sending notices based on the estimated cost of providing the service. (2) The notice required by paragraph (1) of this subdivision shall include, but not be limited to, the following: (A) The amount or rate of the tax. If the tax is proposed to be increased from any previous year, the joint notice shall separately state both the existing tax rate and the proposed tax rate increase. (B) The activity to be taxed. (C) The estimated amount of revenue to be raised by the tax annually. (D) The method and frequency for collecting the tax. (E) The dates, times, and locations of the public meeting and hearing described in subdivision (a). (F) The phone number and address of an individual, office, or organization that interested persons may contact to receive additional information about the tax. (c) (1) The joint notice of both the public meeting and the public hearing required by subdivision (a) with respect to a proposal for a new or increased assessment on real property shall be accomplished through a mailing, postage prepaid, in the United States mail and shall be deemed given when so deposited. The public meeting pursuant to subdivision (a) shall take place no earlier than 10 days after the joint mailing pursuant to this subdivision. The public hearing Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 33 © 2011 Richards, Watson & Gershon 1342883.1 shall take place no earlier than seven days after the public meeting pursuant to this subdivision. The envelope or the cover of the mailing shall include the name of the local agency and the return address of the sender. This mailed notice shall be in at least 10-point type and shall be given to all property owners proposed to be subject to the new or increased assessment by a mailing by name to those persons whose names and addresses appear on the last equalized county assessment roll or the State Board of Equalization assessment roll, as the case may be. (2) The joint notice required by paragraph (1) of this subdivision shall include, but not be limited to, the following: (A) The estimated amount of the assessment per parcel. If the assessment is proposed to be increased from any previous year, the joint notice shall separately state both the amount of the existing assessment and the proposed assessment increase. (B) A general description of the purpose or improvements that the assessment will fund. (C) The address to which property owners may mail a protest against the assessment. (D) The phone number and address of an individual, office, or organization that interested persons may contact to receive additional information about the assessment. (E) A statement that a majority protest will cause the assessment to be abandoned if the assessment act used to levy the assessment so provides. Notice shall also state the percentage of protests required to trigger an election, if applicable. (F) The dates, times, and locations of the public meeting and hearing described in subdivision (a). (G) A proposed assessment formula or range as described in subparagraph (D) of paragraph (1) of subdivision (a) if applicable and that is noticed pursuant to this section. (3) Notwithstanding paragraph (1), in the case of an assessment that is proposed exclusively for operation and maintenance expenses imposed throughout the entire local agency, or exclusively for operation and maintenance assessments proposed to be levied on 50,000 parcels or more, notice may be provided pursuant to this subdivision or pursuant to paragraph (1) of subdivision (b) and shall include the estimated amount of the assessment of Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 34 © 2011 Richards, Watson & Gershon 1342883.1 various types, amounts, or uses of property and the information required by subparagraphs (B) to (G), inclusive, of paragraph (2) of subdivision (c). (4) Notwithstanding paragraph (1), in the case of an assessment proposed to be levied pursuant to Part 2 (commencing with Section 22500) of Division 2 of the Streets and Highways Code by a regional park district, regional park and open-space district, or regional open-space district formed pursuant to Article 3 (commencing with Section 5500) of Chapter 3 of Division 5 of, or pursuant to Division 26 (commencing with Section 35100) of, the Public Resources Code, notice may be provided pursuant to paragraph (1) of subdivision (b). (d) The notice requirements imposed by this section shall be construed as additional to, and not to supersede, existing provisions of law, and shall be applied concurrently with the existing provisions so as to not delay or prolong the governmental decisionmaking process. (e) This section shall not apply to any new or increased general tax or any new or increased assessment that requires an election of either of the following: (1) The property owners subject to the assessment. (2) The voters within the local agency imposing the tax or assessment. (f) Nothing in this section shall prohibit a local agency from holding a consolidated meeting or hearing at which the legislative body discusses multiple tax or assessment proposals. (g) The local agency may recover the reasonable costs of public meetings, public hearings, and notice required by this section from the proceeds of the tax or assessment. The costs recovered for these purposes, whether recovered pursuant to this subdivision or any other provision of law, shall not exceed the reasonable costs of the public meetings, public hearings, and notice. (h) Any new or increased assessment that is subject to the notice and hearing provisions of Article XIIIC or XIIID of the California Constitution is not subject to the notice and hearing requirements of this section. Section 54955. Adjournment; adjourned meetings The legislative body of a local agency may adjourn any regular, adjourned regular, special or adjourned special meeting to a time and place specified in the order of adjournment. Less than a quorum may so adjourn from time to time. If all members are absent from any regular or adjourned regular meeting the clerk or secretary of the legislative body may declare the meeting adjourned to a stated time and place and he shall cause a written Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 35 © 2011 Richards, Watson & Gershon 1342883.1 notice of the adjournment to be given in the same manner as provided in Section 54956 for special meetings, unless such notice is waived as provided for special meetings. A copy of the order or notice of adjournment shall be conspicuously posted on or near the door of the place where the regular, adjourned regular, special or adjourned special meeting was held within 24 hours after the time of the adjournment. When a regular or adjourned regular meeting is adjourned as provided in this section, the resulting adjourned regular meeting is a regular meeting for all purposes. When an order of adjournment of any meeting fails to state the hour at which the adjourned meeting is to be held, it shall be held at the hour specified for regular meetings by ordinance, resolution, bylaw, or other rule. Section 54955.1. Continuance Any hearing being held, or noticed or ordered to be held, by a legislative body of a local agency at any meeting may by order or notice of continuance be continued or recontinued to any subsequent meeting of the legislative body in the same manner and to the same extent set forth in Section 54955 for the adjournment of meetings; provided, that if the hearing is continued to a time less than 24 hours after the time specified in the order or notice of hearing, a copy of the order or notice of continuance of hearing shall be posted immediately following the meeting at which the order or declaration of continuance was adopted or made. Section 54956. Special meetings; call; notice A special meeting may be called at any time by the presiding officer of the legislative body of a local agency, or by a majority of the members of the legislative body, by delivering written notice to each member of the legislative body and to each local newspaper of general circulation and radio or television station requesting notice in writing. The notice shall be delivered personally or by any other means and shall be received at least 24 hours before the time of the meeting as specified in the notice. The call and notice shall specify the time and place of the special meeting and the business to be transacted or discussed. No other business shall be considered at these meetings by the legislative body. The written notice may be dispensed with as to any member who at or prior to the time the meeting convenes files with the clerk or secretary of the legislative body a written waiver of notice. The waiver may be given by telegram. The written notice may also be dispensed with as to any member who is actually present at the meeting at the time it convenes. The call and notice shall be posted at least 24 hours prior to the special meeting in a location that is freely accessible to members of the public. Section 54956.5. Emergency meetings in emergency situations (a) For purposes of this section, “emergency situation” means both of the following: Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 36 © 2011 Richards, Watson & Gershon 1342883.1 (1) An emergency, which shall be defined as a work stoppage, crippling activity, or other activity that severely impairs public health, safety, or both, as determined by a majority of the members of the legislative body. (2) A dire emergency, which shall be defined as a crippling disaster, mass destruction, terrorist act, or threatened terrorist activity that poses peril so immediate and significant that requiring a legislative body to provide one- hour notice before holding an emergency meeting under this section may endanger the public health, safety, or both, as determined by a majority of the members of the legislative body. (b) (1) Subject to paragraph (2), in the case of an emergency situation involving matters upon which prompt action is necessary due to the disruption or threatened disruption of public facilities, a legislative body may hold an emergency meeting without complying with either the 24-hour notice requirement or the 24-hour posting requirement of Section 54956 or both of the notice and posting requirements. (2) Each local newspaper of general circulation and radio or television station that has requested notice of special meetings pursuant to Section 54956 shall be notified by the presiding officer of the legislative body, or designee thereof, one hour prior to the emergency meeting, or, in the case of a dire emergency, at or near the time that the presiding officer or designee notifies the members of the legislative body of the emergency meeting. This notice shall be given by telephone and all telephone numbers provided in the most recent request of a newspaper or station for notification of special meetings shall be exhausted. In the event that telephone services are not functioning, the notice requirements of this section shall be deemed waived, and the legislative body, or designee of the legislative body, shall notify those newspapers, radio stations, or television stations of the fact of the holding of the emergency meeting, the purpose of the meeting, and any action taken at the meeting as soon after the meeting as possible. (c) During a meeting held pursuant to this section, the legislative body may meet in closed session pursuant to Section 54957 if agreed to by a two-thirds vote of the members of the legislative body present, or, if less than two-thirds of the members are present, by a unanimous vote of the members present. (d) All special meeting requirements, as prescribed in Section 54956 shall be applicable to a meeting called pursuant to this section, with the exception of the 24-hour notice requirement. (e) The minutes of a meeting called pursuant to this section, a list of persons who the presiding officer of the legislative body, or designee of the legislative body, notified Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 37 © 2011 Richards, Watson & Gershon 1342883.1 or attempted to notify, a copy of the rollcall vote, and any actions taken at the meeting shall be posted for a minimum of 10 days in a public place as soon after the meeting as possible. Section 54956.6. Fees No fees may be charged by the legislative body of a local agency for carrying out any provision of this chapter, except as specifically authorized by this chapter. Section 54956.7. Closed sessions, license applications; rehabilitated criminals Whenever a legislative body of a local agency determines that it is necessary to discuss and determine whether an applicant for a license or license renewal, who has a criminal record, is sufficiently rehabilitated to obtain the license, the legislative body may hold a closed session with the applicant and the applicant’s attorney, if any, for the purpose of holding the discussion and making the determination. If the legislative body determines, as a result of the closed session, that the issuance or renewal of the license should be denied, the applicant shall be offered the opportunity to withdraw the application. If the applicant withdraws the application, no record shall be kept of the discussions or decisions made at the closed session and all matters relating to the closed session shall be confidential. If the applicant does not withdraw the application, the legislative body shall take action at the public meeting during which the closed session is held or at its next public meeting denying the application for the license but all matters relating to the closed session are confidential and shall not be disclosed without the consent of the applicant, except in an action by an applicant who has been denied a license challenging the denial of the license. Section 54956.75. Closed session; response to confidential final draft audit report; public release of report (a) Nothing contained in this chapter shall be construed to prevent the legislative body of a local agency that has received a confidential final draft audit report from the Bureau of State Audits from holding closed sessions to discuss its response to that report. (b) After the public release of an audit report by the Bureau of State Audits, if a legislative body of a local agency meets to discuss the audit report, it shall do so in an open session unless exempted from that requirement by some other provision of law. Section 54956.8. Real property transactions; closed meeting with negotiator Notwithstanding any other provision of this chapter, a legislative body of a local agency may hold a closed session with its negotiator prior to the purchase, sale, exchange, or lease of real property by or for the local agency to grant authority to its negotiator regarding the price and terms of payment for the purchase, sale, exchange, or lease. However, prior to the Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 38 © 2011 Richards, Watson & Gershon 1342883.1 closed session, the legislative body of the local agency shall hold an open and public session in which it identifies its negotiators, the real property or real properties which the negotiations may concern, and the person or persons with whom its negotiators may negotiate. For purposes of this section, negotiators may be members of the legislative body of the local agency. For purposes of this section, “lease” includes renewal or renegotiation of a lease. Nothing in this section shall preclude a local agency from holding a closed session for discussions regarding eminent domain proceedings pursuant to Section 54956.9. Section 54956.81. Investment of pension funds; closed session Notwithstanding any other provision of this chapter, a legislative body of a local agency that invests pension funds may hold a closed session to consider the purchase or sale of particular, specific pension fund investments. All investment transaction decisions made during the closed session shall be made by rollcall vote entered into the minutes of the closed session as provided in subdivision (a) of Section 54957.2. Section 54956.86. Charges or complaints from members of local agency health plans; closed hearings; members’ rights Notwithstanding any other provision of this chapter, a legislative body of a local agency which provides services pursuant to Section 14087.3 of the Welfare and Institutions Code may hold a closed session to hear a charge or complaint from a member enrolled in its health plan if the member does not wish to have his or her name, medical status, or other information that is protected by federal law publicly disclosed. Prior to holding a closed session pursuant to this section, the legislative body shall inform the member, in writing, of his or her right to have the charge or complaint heard in an open session rather than a closed session. Section 54956.87. Records of certain health plans; meetings on health plan trade secrets (a) Notwithstanding any other provision of this chapter, the records of a health plan that is licensed pursuant to the Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code) and that is governed by a county board of supervisors, whether paper records, records maintained in the management information system, or records in any other form, that relate to provider rate or payment determinations, allocation or distribution methodologies for provider payments, formulas or calculations for these payments, and contract negotiations with providers of health care for alternative rates are exempt from disclosure for a period of three years after the contract is fully Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 39 © 2011 Richards, Watson & Gershon 1342883.1 executed. The transmission of the records, or the information contained therein in an alternative form, to the board of supervisors shall not constitute a waiver of exemption from disclosure, and the records and information once transmitted to the board of supervisors shall be subject to this same exemption. (b) Notwithstanding any other provision of law, the governing board of a health plan that is licensed pursuant to the Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code) and that is governed by a county board of supervisors may order that a meeting held solely for the purpose of discussion or taking action on health plan trade secrets, as defined in subdivision (f), shall be held in closed session. The requirements of making a public report of action taken in closed session, and the vote or abstention of every member present, may be limited to a brief general description without the information constituting the trade secret. (c) Notwithstanding any other provision of law, the governing board of a health plan may meet in closed session to consider and take action on matters pertaining to contracts and contract negotiations by the health plan with providers of health care services concerning all matters related to rates of payment. The governing board may delete the portion or portions containing trade secrets from any documents that were finally approved in the closed session held pursuant to subdivision (b) that are provided to persons who have made the timely or standing request. (d) Nothing in this section shall be construed as preventing the governing board from meeting in closed session as otherwise provided by law. (e) The provisions of this section shall not prevent access to any records by the Joint Legislative Audit Committee in the exercise of its powers pursuant to Article 1 (commencing with Section 10500) of Chapter 4 of Part 2 of Division 2 of Title 2. The provisions of this section also shall not prevent access to any records by the Department of Corporations in the exercise of its powers pursuant to Article 1 (commencing with Section 1340) of Chapter 2.2 of Division 2 of the Health and Safety Code. (f) For purposes of this section, “health plan trade secret” means a trade secret, as defined in subdivision (d) of Section 3426.1 of the Civil Code, that also meets both of the following criteria: (1) The secrecy of the information is necessary for the health plan to initiate a new service, program, marketing strategy, business plan, or technology, or to add a benefit or product. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 40 © 2011 Richards, Watson & Gershon 1342883.1 (2) Premature disclosure of the trade secret would create a substantial probability of depriving the health plan of a substantial economic benefit or opportunity. Section 54956.9. Pending litigation; closed session; lawyer-client privilege; notice; memorandum Nothing in this chapter shall be construed to prevent a legislative body of a local agency, based on advice of its legal counsel, from holding a closed session to confer with, or receive advice from, its legal counsel regarding pending litigation when discussion in open session concerning those matters would prejudice the position of the local agency in the litigation. For purposes of this chapter, all expressions of the lawyer-client privilege other than those provided in this section are hereby abrogated. This section is the exclusive expression of the lawyer-client privilege for purposes of conducting closed-session meetings pursuant to this chapter. For purposes of this section, “litigation” includes any adjudicatory proceeding, including eminent domain, before a court, administrative body exercising its adjudicatory authority, hearing officer, or arbitrator. For purposes of this section, litigation shall be considered pending when any of the following circumstances exist: (a) Litigation, to which the local agency is a party, has been initiated formally. (b) (1) A point has been reached where, in the opinion of the legislative body of the local agency on the advice of its legal counsel, based on existing facts and circumstances, there is a significant exposure to litigation against the local agency. (2) Based on existing facts and circumstances, the legislative body of the local agency is meeting only to decide whether a closed session is authorized pursuant to paragraph (1) of this subdivision. (3) For purposes of paragraphs (1) and (2), “existing facts and circumstances” shall consist only of one of the following: (A) Facts and circumstances that might result in litigation against the local agency but which the local agency believes are not yet known to a potential plaintiff or plaintiffs, which facts and circumstances need not be disclosed. (B) Facts and circumstances, including, but not limited to, an accident, disaster, incident, or transactional occurrence that might result in litigation against the agency and that are known to a potential plaintiff Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 41 © 2011 Richards, Watson & Gershon 1342883.1 or plaintiffs, which facts or circumstances shall be publicly stated on the agenda or announced. (C) The receipt of a claim pursuant to the Tort Claims Act or some other written communication from a potential plaintiff threatening litigation, which claim or communication shall be available for public inspection pursuant to Section 54957.5. (D) A statement made by a person in an open and public meeting threatening litigation on a specific matter within the responsibility of the legislative body. (E) A statement threatening litigation made by a person outside an open and public meeting on a specific matter within the responsibility of the legislative body so long as the official or employee of the local agency receiving knowledge of the threat makes a contemporaneous or other record of the statement prior to the meeting, which record shall be available for public inspection pursuant to Section 54957.5. The records so created need not identify the alleged victim of unlawful or tortious sexual conduct or anyone making the threat on their behalf, or identify a public employee who is the alleged perpetrator of any unlawful or tortuous conduct upon which a threat of litigation is based, unless the identity of the person has been publicly disclosed. (F) Nothing in this section shall require disclosure of written communications that are privileged and not subject to disclosure pursuant to the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1). (c) Based on existing facts and circumstances, the legislative body of the local agency has decided to initiate or is deciding whether to initiate litigation. Prior to holding a closed session pursuant to this section, the legislative body of the local agency shall state on the agenda or publicly announce the subdivision of this section that authorizes the closed session. If the session is closed pursuant to subdivision (a), the body shall state the title of or otherwise specifically identify the litigation to be discussed, unless the body states that to do so would jeopardize the agency’s ability to effectuate service of process upon one or more unserved parties, or that to do so would jeopardize its ability to conclude existing settlement negotiations to its advantage. A local agency shall be considered to be a “party” or to have a “significant exposure to litigation” if an officer or employee of the local agency is a party or has significant exposure to litigation concerning prior or prospective activities or alleged activities Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 42 © 2011 Richards, Watson & Gershon 1342883.1 during the course and scope of that office or employment, including litigation in which it is an issue whether an activity is outside the course and scope of the office or employment. Section 54956.95. Closed sessions; insurance pooling; tort liability losses; public liability losses; workers’ compensation liability (a) Nothing in this chapter shall be construed to prevent a joint powers agency formed pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1, for purposes of insurance pooling, or a local agency member of the joint powers agency, from holding a closed session to discuss a claim for the payment of tort liability losses, public liability losses, or workers’ compensation liability incurred by the joint powers agency or a local agency member of the joint powers agency. (b) Nothing in this chapter shall be construed to prevent the Local Agency Self-Insurance Authority formed pursuant to Chapter 5.5 (commencing with Section 6599.01) of Division 7 of Title 1, or a local agency member of the authority, from holding a closed session to discuss a claim for the payment of tort liability losses, public liability losses, or workers’ compensation liability incurred by the authority or a local agency member of the authority. (c) Nothing in this section shall be construed to affect Section 54956.9 with respect to any other local agency. Section 54956.96. Joint powers agency; legislative body; closed session; confidential information (a) Nothing in this chapter shall be construed to prevent the legislative body of a joint powers agency formed pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1, from adopting a policy or a bylaw or including in its joint powers agreement provisions that authorize either or both of the following: (1) All information received by the legislative body of the local agency member in a closed session related to the information presented to the joint powers agency in closed session shall be confidential. However, a member of the legislative body of a member local agency may disclose information obtained in a closed session that has direct financial or liability implications for that local agency to the following individuals: (A) Legal counsel of that member local agency for purposes of obtaining advice on whether the matter has direct financial or liability implications for that member local agency. (B) Other members of the legislative body of the local agency present in a closed session of that member local agency. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 43 © 2011 Richards, Watson & Gershon 1342883.1 (2) Any designated alternate member of the legislative body of the joint powers agency who is also a member of the legislative body of a local agency member and who is attending a properly noticed meeting of the joint powers agency in lieu of a local agency member’s regularly appointed member to attend closed sessions of the joint powers agency. (b) If the legislative body of a joint powers agency adopts a policy or a bylaw or includes provisions in its joint powers agreement pursuant to subdivision (a), then the legislative body of the local agency member, upon the advice of its legal counsel, may conduct a closed session in order to receive, discuss, and take action concerning information obtained in a closed session of the joint powers agency pursuant to paragraph (1) of subdivision (a). Section 54957. Closed sessions; personnel matters; exclusion of witnesses (a) Nothing contained in this chapter shall be construed to prevent the legislative body of a local agency from holding closed sessions with the Attorney General, district attorney, agency counsel, sheriff, or chief of police, or their respective deputies, or a security consultant or a security operations manager, on matters posing a threat to the security of public buildings, a threat to the security of essential public services, including water, drinking water, wastewater treatment, natural gas service, and electric service, or a threat to the public’s right of access to public services or public facilities. (b) (1) Subject to paragraph (2), nothing contained in this chapter shall be construed to prevent the legislative body of a local agency from holding closed sessions during a regular or special meeting to consider the appointment, employment, evaluation of performance, discipline, or dismissal of a public employee or to hear complaints or charges brought against the employee by another person or employee unless the employee requests a public session. (2) As a condition to holding a closed session on specific complaints or charges brought against an employee by another person or employee, the employee shall be given written notice of his or her right to have the complaints or charges heard in an open session rather than a closed session, which notice shall be delivered to the employee personally or by mail at least 24 hours before the time for holding the session. If notice is not given, any disciplinary or other action taken by the legislative body against the employee based on the specific complaints or charges in the closed session shall be null and void. (3) The legislative body also may exclude from the public or closed meeting, during the examination of a witness, any or all other witnesses in the matter being investigated by the legislative body. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 44 © 2011 Richards, Watson & Gershon 1342883.1 (4) For the purposes of this subdivision, the term “employee” shall include an officer or an independent contractor who functions as an officer or an employee but shall not include any elected official, member of a legislative body or other independent contractors. Nothing in this subdivision shall limit local officials’ ability to hold closed session meetings pursuant to Sections 1461, 32106, and 32155 of the Health and Safety Code or Sections 37606 and 37624.3 of the Government Code. Closed sessions held pursuant to this subdivision shall not include discussion or action on proposed compensation except for a reduction of compensation that results from the imposition of discipline. Section 54957.1. Closed sessions; public report of action taken (a) The legislative body of any local agency shall publicly report any action taken in closed session and the vote or abstention on that action of every member present, as follows: (1) Approval of an agreement concluding real estate negotiations pursuant to Section 54956.8 shall be reported after the agreement is final, as follows: (A) If its own approval renders the agreement final, the body shall report that approval and the substance of the agreement in open session at the public meeting during which the closed session is held. (B) If final approval rests with the other party to the negotiations, the local agency shall disclose the fact of that approval and the substance of the agreement upon inquiry by any person, as soon as the other party or its agent has informed the local agency of its approval. (2) Approval given to its legal counsel to defend, or seek or refrain from seeking appellate review or relief, or to enter as an amicus curiae in any form of litigation as the result of a consultation under Section 54956.9 shall be reported in open session at the public meeting during which the closed session is held. The report shall identify, if known, the adverse party or parties and the substance of the litigation. In the case of approval given to initiate or intervene in an action, the announcement need not identify the action, the defendants, or other particulars, but shall specify that the direction to initiate or intervene in an action has been given and that the action, the defendants, and the other particulars shall, once formally commenced, be disclosed to any person upon inquiry, unless to do so would jeopardize the agency’s ability to effectuate service of process on one or more unserved parties, or that to do so would jeopardize its ability to conclude existing settlement negotiations to its advantage. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 45 © 2011 Richards, Watson & Gershon 1342883.1 (3) Approval given to its legal counsel of a settlement of pending litigation, as defined in Section 54956.9, at any stage prior to or during a judicial or quasi- judicial proceeding shall be reported after the settlement is final, as follows: (A) If the legislative body accepts a settlement offer signed by the opposing party, the body shall report its acceptance and identify the substance of the agreement in open session at the public meeting during which the closed session is held. (B) If final approval rests with some other party to the litigation or with the court, then as soon as the settlement becomes final, and upon inquiry by any person, the local agency shall disclose the fact of that approval, and identify the substance of the agreement. (4) Disposition reached as to claims discussed in closed session pursuant to Section 54956.95 shall be reported as soon as reached in a manner that identifies the name of the claimant, the name of the local agency claimed against, the substance of the claim, and any monetary amount approved for payment and agreed upon by the claimant. (5) Action taken to appoint, employ, dismiss, accept the resignation of, or otherwise affect the employment status of a public employee in closed session pursuant to Section 54957 shall be reported at the public meeting during which the closed session is held. Any report required by this paragraph shall identify the title of the position. The general requirement of this paragraph notwithstanding, the report of a dismissal or of the nonrenewal of an employment contract shall be deferred until the first public meeting following the exhaustion of administrative remedies, if any. (6) Approval of an agreement concluding labor negotiations with represented employees pursuant to Section 54957.6 shall be reported after the agreement is final and has been accepted or ratified by the other party. The report shall identify the item approved and the other party or parties to the negotiation. (7) Pension fund investment transaction decisions made pursuant to Section 54956.81 shall be disclosed at the first open meeting of the legislative body held after the earlier of the close of the investment transaction or the transfer of pension fund assets for the investment transaction. (b) Reports that are required to be made pursuant to this section may be made orally or in writing. The legislative body shall provide to any person who has submitted a written request to the legislative body within 24 hours of the posting of the agenda, or to any person who has made a standing request for all documentation as part of a request for notice of meetings pursuant to Section 54954.1 or 54956, if the requester Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 46 © 2011 Richards, Watson & Gershon 1342883.1 is present at the time the closed session ends, copies of any contracts, settlement agreements, or other documents that were finally approved or adopted in the closed session. If the action taken results in one or more substantive amendments to the related documents requiring retyping, the documents need not be released until the retyping is completed during normal business hours, provided that the presiding officer of the legislative body or his or her designee orally summarizes the substance of the amendments for the benefit of the document requester or any other person present and requesting the information. (c) The documentation referred to in subdivision (b) shall be available to any person on the next business day following the meeting in which the action referred to is taken or, in the case of substantial amendments, when any necessary retyping is complete. (d) Nothing in this section shall be construed to require that the legislative body approve actions not otherwise subject to legislative body approval. (e) No action for injury to a reputational, liberty, or other personal interest may be commenced by or on behalf of any employee or former employee with respect to whom a disclosure is made by a legislative body in an effort to comply with this section. (f) This section is necessary to implement, and reasonably within the scope of, paragraph (1) of subdivision (b) of Section 3 of Article I of the California Constitution. Section 54957.2. Minute book record of closed sessions; inspection (a) The legislative body of a local agency may, by ordinance or resolution, designate a clerk or other officer or employee of the local agency who shall then attend each closed session of the legislative body and keep and enter in a minute book a record of topics discussed and decisions made at the meeting. The minute book made pursuant to this section is not a public record subject to inspection pursuant to the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1), and shall be kept confidential. The minute book shall be available only to members of the legislative body or, if a violation of this chapter is alleged to have occurred at a closed session, to a court of general jurisdiction wherein the local agency lies. Such minute book may, but need not, consist of a recording of the closed session. (b) An elected legislative body of a local agency may require that each legislative body all or a majority of whose members are appointed by or under the authority of the elected legislative body keep a minute book as prescribed under subdivision (a). Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 47 © 2011 Richards, Watson & Gershon 1342883.1 Section 54957.5. Agendas and other writings distributed for discussion or consideration at public meetings; public records; inspection; closed sessions1 (a) Notwithstanding Section 6255 or any other provisions of law, agendas of public meetings and any other writings, when distributed to all, or a majority of all, of the members of a legislative body of a local agency by any person in connection with a matter subject to discussion or consideration at an open meeting of the body, are disclosable public records under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1), and shall be made available upon request without delay. However, this section shall not include any writing 93 exempt from public disclosure under Section 6253.5, 6254, 6254.3, 6254.7, 6254.15, 6254.16, or 6254.22. (b) (1) If a writing that is a public record under subdivision (a), and that relates to an agenda item for an open session of a regular meeting of the legislative body of a local agency, is distributed less than 72 hours prior to that meeting, the writing shall be made available for public inspection pursuant to paragraph (2) at the time the writing is distributed to all, or a majority of all, of the members of the body. (2) A local agency shall make any writing described in paragraph (1) available for public inspection at a public office or location that the agency shall designate for this purpose. Each local agency shall list the address of this office or location on the agendas for all meetings of the legislative body of that agency. The local agency also may post the writing on the local agency’s Internet Web site in a position and manner that makes it clear that the writing relates to an agenda item for an upcoming meeting. (3) This subdivision shall become operative on July 1, 2008. (c) Writings that are public records under subdivision (a) and that are distributed during a public meeting shall be made available for public inspection at the meeting if prepared by the local agency or a member of its legislative body, or after the meeting if prepared by some other person. These writings shall be made available in appropriate alternative formats upon request by a person with a disability, as required by Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in implementation thereof. (d) Nothing in this chapter shall be construed to prevent the legislative body of a local agency from charging a fee or deposit for a copy of a public record pursuant to Section 6253, except that no surcharge shall be imposed on persons with disabilities 1 See Section VIII.D of the Brown Act Handbook for a discussion of Section 54957.5(b). Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 48 © 2011 Richards, Watson & Gershon 1342883.1 in violation of Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in implementation thereof. (e) This section shall not be construed to limit or delay the public’s right to inspect or obtain a copy of any record required to be disclosed under the requirements of the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1). Nothing in this chapter shall be construed to require a legislative body of a local agency to place any paid advertisement or any other paid notice in any publication. Section 54957.6. Closed sessions; salaries, salary schedules or fringe benefits (a) Notwithstanding any other provision of law, a legislative body of a local agency may hold closed sessions with the local agency’s designated representatives regarding the salaries, salary schedules, or compensation paid in the form of fringe benefits of its represented and unrepresented employees, and, for represented employees, any other matter within the statutorily provided scope of representation. However, prior to the closed session, the legislative body of the local agency shall hold an open and public session in which it identifies its designated representatives. Closed sessions of a legislative body of a local agency, as permitted in this section, shall be for the purpose of reviewing its position and instructing the local agency’s designated representatives. Closed sessions, as permitted in this section, may take place prior to and during consultations and discussions with representatives of employee organizations and unrepresented employees. Closed sessions with the local agency’s designated representative regarding the salaries, salary schedules, or compensation paid in the form of fringe benefits may include discussion of an agency’s available funds and funding priorities, but only insofar as these discussions relate to providing instructions to the local agency’s designated representative. Closed sessions held pursuant to this section shall not include final action on the proposed compensation of one or more unrepresented employees. For the purposes enumerated in this section, a legislative body of a local agency may also meet with a state conciliator who has intervened in the proceedings. (b) For the purposes of this section, the term “employee” shall include an officer or an independent contractor who functions as an officer or an employee, but shall not Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 49 © 2011 Richards, Watson & Gershon 1342883.1 include any elected official, member of a legislative body, or other independent contractors. Section 54957.7. Disclosure of items to be discussed in closed sessions (a) Prior to holding any closed session, the legislative body of the local agency shall disclose, in an open meeting, the item or items to be discussed in the closed session. The disclosure may take the form of a reference to the item or items as they are listed by number or letter on the agenda. In the closed session, the legislative body may consider only those matters covered in its statement. Nothing in this section shall require or authorize a disclosure of information prohibited by state or federal law. (b) After any closed session, the legislative body shall reconvene into open session prior to adjournment and shall make any disclosures required by Section 54957.1 of action taken in the closed session. (c) The announcements required to be made in open session pursuant to this section may be made at the location announced in the agenda for the closed session, as long as the public is allowed to be present at that location for the purpose of hearing the announcements. Section 54957.8. Closed sessions; legislative body of a multijurisdictional drug law enforcement agency (a) For purposes of this section, “multijurisdictional law enforcement agency” means a joint powers entity formed pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 that provides law enforcement services for the parties to the joint powers agreement for the purpose of investigating criminal activity involving drugs; gangs; sex crimes; firearms trafficking or felony possession of a firearm; high technology, computer, or identity theft; human trafficking; or vehicle theft. (b) Nothing contained in this chapter shall be construed to prevent the legislative body of a multijurisdictional law enforcement agency, or an advisory body of a multijurisdictional law enforcement agency, from holding closed sessions to discuss the case records of any ongoing criminal investigation of the multijurisdictional law enforcement agency or of any party to the joint powers agreement, to hear testimony from persons involved in the investigation, and to discuss courses of action in particular cases. Section 54957.9. Disorderly conduct of general public during meeting; clearing of room In the event that any meeting is willfully interrupted by a group or groups of persons so as to render the orderly conduct of such meeting unfeasible and order cannot be restored by the Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 50 © 2011 Richards, Watson & Gershon 1342883.1 removal of individuals who are willfully interrupting the meeting, the members of the legislative body conducting the meeting may order the meeting room cleared and continue in session. Only matters appearing on the agenda may be considered in such a session. Representatives of the press or other news media, except those participating in the disturbance, shall be allowed to attend any session held pursuant to this section. Nothing in this section shall prohibit the legislative body from establishing a procedure for readmitting an individual or individuals not responsible for willfully disturbing the orderly conduct of the meeting. Section 54957.10. Closed sessions; local agency employee application for early withdrawal of funds in deferred compensation plan; financial hardship Notwithstanding any other provision of law, a legislative body of a local agency may hold closed sessions to discuss a local agency employee’s application for early withdrawal of funds in a deferred compensation plan when the application is based on financial hardship arising from an unforeseeable emergency due to illness, accident, casualty, or other extraordinary event, as specified in the deferred compensation plan. Section 54958. Application of chapter The provisions of this chapter shall apply to the legislative body of every local agency notwithstanding the conflicting provisions of any other state law. Section 54959. Penalty for unlawful meeting Each member of a legislative body who attends a meeting of that legislative body where action is taken in violation of any provision of this chapter, and where the member intends to deprive the public of information to which the member knows or has reason to know the public is entitled under this chapter, is guilty of a misdemeanor. Section 54960. Actions to stop or prevent violations of meeting provisions; applicability of meeting provisions; validity of rules or actions on recording closed sessions (a) The district attorney or any interested person may commence an action by mandamus, injunction or declaratory relief for the purpose of stopping or preventing violations or threatened violations of this chapter by members of the legislative body of a local agency or to determine the applicability of this chapter to actions or threatened future action of the legislative body, or to determine whether any rule or action by the legislative body to penalize or otherwise discourage the expression of one or more of its members is valid or invalid under the laws of this state or of the United States, or to compel the legislative body to tape record its closed sessions as hereinafter provided. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 51 © 2011 Richards, Watson & Gershon 1342883.1 (b) The court in its discretion may, upon a judgment of a violation of Section 54956.7, 54956.8, 54956.9, 54956.95, 54957, or 54957.6, order the legislative body to tape record its closed sessions and preserve the tape recordings for the period and under the terms of security and confidentiality the court deems appropriate. (c) (1) Each recording so kept shall be immediately labeled with the date of the closed session recorded and the title of the clerk or other officer who shall be custodian of the recording. (2) The tapes shall be subject to the following discovery procedures: (A) In any case in which discovery or disclosure of the tape is sought by either the district attorney or the plaintiff in a civil action pursuant to Section 54959, 54960, or 54960.1 alleging that a violation of this chapter has occurred in a closed session which has been recorded pursuant to this section, the party seeking discovery or disclosure shall file a written notice of motion with the appropriate court with notice to the governmental agency which has custody and control of the tape recording. The notice shall be given pursuant to subdivision (b) of Section 1005 of the Code of Civil Procedure. (B) The notice shall include, in addition to the items required by Section 1010 of the Code of Civil Procedure, all of the following: (i) Identification of the proceeding in which discovery or disclosure is sought, the party seeking discovery or disclosure, the date and time of the meeting recorded, and the governmental agency which has custody and control of the recording. (ii) An affidavit which contains specific facts indicating that a violation of the act occurred in the closed session. (3) If the court, following a review of the motion, finds that there is good cause to believe that a violation has occurred, the court may review, in camera, the recording of that portion of the closed session alleged to have violated the act. (4) If, following the in camera review, the court concludes that disclosure of a portion of the recording would be likely to materially assist in the resolution of the litigation alleging violation of this chapter, the court shall, in its discretion, make a certified transcript of the portion of the recording a public exhibit in the proceeding. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 52 © 2011 Richards, Watson & Gershon 1342883.1 (5) Nothing in this section shall permit discovery of communications which are protected by the attorney-client privilege. Section 54960.1. Unlawful action by legislative body; action for mandamus or injunction; prerequisites (a) The district attorney or any interested person may commence an action by mandamus or injunction for the purpose of obtaining a judicial determination that an action taken by a legislative body of a local agency in violation of Section 54953, 54954.2, 54954.5, 54954.6, 54956, or 54956.5 is null and void under this section. Nothing in this chapter shall be construed to prevent a legislative body from curing or correcting an action challenged pursuant to this section. (b) Prior to any action being commenced pursuant to subdivision (a), the district attorney or interested person shall make a demand of the legislative body to cure or correct the action alleged to have been taken in violation of Section 54953, 54954.2, 54954.5, 54954.6, 54956, or 54956.5. The demand shall be in writing and clearly describe the challenged action of the legislative body and nature of the alleged violation. (c) (1) The written demand shall be made within 90 days from the date the action was taken unless the action was taken in an open session but in violation of Section 54954.2, in which case the written demand shall be made within 30 days from the date the action was taken. (2) Within 30 days of receipt of the demand, the legislative body shall cure or correct the challenged action and inform the demanding party in writing of its actions to cure or correct or inform the demanding party in writing of its decision not to cure or correct the challenged action. (3) If the legislative body takes no action within the 30-day period, the inaction shall be deemed a decision not to cure or correct the challenged action, and the 15-day period to commence the action described in subdivision (a) shall commence to run the day after the 30-day period to cure or correct expires. (4) Within 15 days of receipt of the written notice of the legislative body’s decision to cure or correct, or not to cure or correct, or within 15 days of the expiration of the 30-day period to cure or correct, whichever is earlier, the demanding party shall be required to commence the action pursuant to subdivision (a) or thereafter be barred from commencing the action. (d) An action taken that is alleged to have been taken in violation of Section 54953, 54954.2, 54954.5, 54954.6, 54956, or 54956.5 shall not be determined to be null and void if any of the following conditions exist: Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 53 © 2011 Richards, Watson & Gershon 1342883.1 (1) The action taken was in substantial compliance with Sections 54953, 54954.2, 54954.5, 54954.6, 54956, and 54956.5. (2) The action taken was in connection with the sale or issuance of notes, bonds, or other evidences of indebtedness or any contract, instrument, or agreement thereto. (3) The action taken gave rise to a contractual obligation, including a contract let by competitive bid other than compensation for services in the form of salary or fees for professional services, upon which a party has, in good faith and without notice of a challenge to the validity of the action, detrimentally relied. (4) The action taken was in connection with the collection of any tax. (5) Any person, city, city and county, county, district, or any agency or subdivision of the state alleging noncompliance with subdivision (a) of Section 54954.2, Section 54956, or Section 54956.5, because of any defect, error, irregularity, or omission in the notice given pursuant to those provisions, had actual notice of the item of business at least 72 hours prior to the meeting at which the action was taken, if the meeting was noticed pursuant to Section 54954.2, or 24 hours prior to the meeting at which the action was taken if the meeting was noticed pursuant to Section 54956, or prior to the meeting at which the action was taken if the meeting is held pursuant to Section 54956.5. (e) During any action seeking a judicial determination pursuant to subdivision (a) if the court determines, pursuant to a showing by the legislative body that an action alleged to have been taken in violation of Section 54953, 54954.2, 54954.5, 54954.6, 54956, or 54956.5 has been cured or corrected by a subsequent action of the legislative body, the action filed pursuant to subdivision (a) shall be dismissed with prejudice. (f) The fact that a legislative body takes a subsequent action to cure or correct an action taken pursuant to this section shall not be construed or admissible as evidence of a violation of this chapter. Section 54960.5. Costs and attorney fees A court may award court costs and reasonable attorney fees to the plaintiff in an action brought pursuant to Section 54960 or 54960.1 where it is found that a legislative body of the local agency has violated this chapter. The costs and fees shall be paid by the local agency and shall not become a personal liability of any public officer or employee of the local agency. Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 54 © 2011 Richards, Watson & Gershon 1342883.1 A court may award court costs and reasonable attorney fees to a defendant in any action brought pursuant to Section 54960 or 54960.1 where the defendant has prevailed in a final determination of such action and the court finds that the action was clearly frivolous and totally lacking in merit. Section 54961. Meetings prohibited in facilities; grounds; identity of victims of tortious sexual conduct or child abuse (a) No legislative body of a local agency shall conduct any meeting in any facility that prohibits the admittance of any person, or persons, on the basis of ancestry or any characteristic listed or defined in Section 11135, or which is inaccessible to disabled persons, or where members of the public may not be present without making a payment or purchase. This section shall apply to every local agency as defined in Section 54951. (b) No notice, agenda, announcement, or report required under this chapter need identify any victim or alleged victim of tortious sexual conduct or child abuse unless the identity of the person has been publicly disclosed. Section 54962. Closed session by legislative body prohibited Except as expressly authorized by this chapter, or by Sections 1461, 1462, 32106, and 32155 of the Health and Safety Code, or by Sections 37606, 37606.1, and 37624.3 of the Government Code as they apply to hospitals, or by any provision of the Education Code pertaining to school districts and community college districts, no closed session may be held by any legislative body of any local agency. Section 54963. Confidential information acquired during an authorized closed legislative session; authorization by legislative body; remedies for violation; exceptions (a) A person may not disclose confidential information that has been acquired by being present in a closed session authorized by Section 54956.7, 54956.8, 54956.86, 54956.87, 54956.9, 54957, 54957.6, 54957.8, or 54957.10 to a person not entitled to receive it, unless the legislative body authorizes disclosure of that confidential information. (b) For purposes of this section, “confidential information” means a communication made in a closed session that is specifically related to the basis for the legislative body of a local agency to meet lawfully in closed session under this chapter. (c) Violation of this section may be addressed by the use of such remedies as are currently available by law, including, but not limited to: Appendix A – The Text of the Ralph M. Brown Act Ralph M. Brown Act Page 55 © 2011 Richards, Watson & Gershon 1342883.1 (1) Injunctive relief to prevent the disclosure of confidential information prohibited by this section. (2) Disciplinary action against an employee who has willfully disclosed confidential information in violation of this section. (3) Referral of a member of a legislative body who has willfully disclosed confidential information in violation of this section to the grand jury. (d) Disciplinary action pursuant to paragraph (2) of subdivision (c) shall require that the employee in question has either received training as to the requirements of this section or otherwise has been given notice of the requirements of this section. (e) A local agency may not take any action authorized by subdivision (c) against a person, nor shall it be deemed a violation of this section, for doing any of the following: (1) Making a confidential inquiry or complaint to a district attorney or grand jury concerning a perceived violation of law, including disclosing facts to a district attorney or grand jury that are necessary to establish the illegality of an action taken by a legislative body of a local agency or the potential illegality of an action that has been the subject of deliberation at a closed session if that action were to be taken by a legislative body of a local agency. (2) Expressing an opinion concerning the propriety or legality of actions taken by a legislative body of a local agency in closed session, including disclosure of the nature and extent of the illegal or potentially illegal action. (3) Disclosing information acquired by being present in a closed session under this chapter that is not confidential information. (f) Nothing in this section shall be construed to prohibit disclosures under the whistleblower statutes contained in Section 1102.5 of the Labor Code or Article 4.5 (commencing with Section 53296) of Chapter 2 of this code. Richards,Watson &Gershon (RW&G)is widely recognized as one of the premier full service law firms to local governments,providing the highest quality legal services in a cost-effective manner.Local governments rely on RW&G because it has assembled a number of the leading attorneys in the state and dedicated them to creatively solving the problems of local governments. RW&G was established in 1954,and the Firm has been providing public entity legal services for over 50 years. We have a statewide practice with offices in Los Angeles,Orange County,Temecula,and San Francisco. We serve as City/Town Attorney,Special Counsel,and General Counsel,to public entities throughout California. Our representation of public entities includes cities,towns,counties,redevelopment agencies,water districts, school districts,community services districts,airports,other special districts,and joint powers authorities. Core practice areas include public agency and municipal law,public finance,redevelopment,water rights and water law,real estate,litigation,appellate,environmental and energy,e-documents and public records,climate change,labor and employment,eminent domain,public works,telecommunications,and transportation. Table of Contents Summary of Principal Conflicts of Interest Laws Page i © 2011 Richards, Watson & Gershon 1342872.1 Table of Contents INTRODUCTION ....................................................................................................... iii SUMMARY OF THE MAJOR PROVISIONS AND REQUIREMENTS OF THE PRINCIPAL CONFLICTS OF INTEREST LAWS.................................................................................. 1 I. Laws Affecting Decision-making .................................................................... 2 A. The Political Reform Act....................................................................... 2 B. Government Code Section 1090 ......................................................... 17 C. Common Law Doctrine Against Conflicts of Interest ........................... 24 II. Other Specialized Conflict of Interest Laws ................................................... 25 A. Common Law Doctrine Against Incompatible Offices .......................... 25 B. Incompatible Outside Activities (Government Code Section 1126 et seq.) ............................................................................................. 28 C. Redevelopment Conflicts .................................................................. 29 D. Discount Passes on Common Carriers (California Constitution, Article XII, Section 7) .................................................................................... 30 E. Activities of Public Officials and Employees may be Deemed to be Incompatible with their Public Entity Position Pursuant to a Local Ordinance Adopted Under Government Code Section 1126 ................. 31 F. Conflicts Upon Leaving Office – The “Revolving Door” Limitations.......32 G. Laws Prohibiting Bribery..................................................................... 33 H. Campaign Contributions ....................................................................34 I. Nepotism .......................................................................................... 36 III. Laws Regulating Receipt of Gifts, Honoraria and Loans ................................ 38 A. Limitations on Receipt of Gifts ........................................................... 38 Table of Contents Summary of Principal Conflicts of Interest Laws Page ii © 2011 Richards, Watson & Gershon 1342872.1 B. Prohibitions on Receipt of Honoraria .................................................. 51 C. Prohibitions on Receipt of Certain Types of Loans ............................... 53 IV. Prohibition Against Mass Mailings ............................................................... 55 A. Test for Prohibited Mass Mailing ........................................................ 55 B. Exceptions to the Mass Mailing Prohibition ........................................58 V. Expenditures to Support or Defeat a Ballot Measure ..................................... 58 VI. Prohibition on Gifts of Public Funds ............................................................. 62 VII. Conclusion ................................................................................................. 63 APPENDICES A. Selected Regulations of The Fair Policical Practices Commission, Title 2, Division 6, California Code of Regulations ................................................... A-1 B. Text of Government Code Sections 1090-1099 ............................................. B-1 Introduction Summary of Principal Conflicts of Interest Laws Page iii © 2011 Richards, Watson & Gershon 1342872.1 INTRODUCTION This Handbook is prepared to provide you with a summary of the major provisions of California’s principal conflicts of interest laws. The first part of the Handbook summarizes the basic provisions of the laws. The second part contains the complete text of these laws. This Handbook is designed for city officials and staff. We hope you will find it useful. Should you have any questions about the information included in this Handbook, please do not hesitate to contact us. LOS ANGELES 355 South Grand Avenue, 40th Floor Los Angeles, California 90071-3101 Telephone: 213.626.8484 Facsimile: 213.626.0078 E-mail: la@rwglaw.com ORANGE COUNTY 1 Civic Center Circle, PO Box 1059 Brea, California 92822-1059 Telephone: 714.990.0901 Facsimile: 714.990.6230 E-mail: oc@rwglaw.com SAN FRANCISCO 44 Montgomery Street, Suite 3800 San Francisco, California 94104-4811 Telephone: 415.421.8484 Facsimile: 415.421.8486 E-mail: sf@rwglaw.com Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 1 © 2011 Richards, Watson & Gershon 1342872.1 Summary of the Major Provisions and Requirements of the Principal Conflicts of Interest Laws Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 2 © 2011 Richards, Watson & Gershon 1342872.1 SUMMARY OF THE MAJOR PROVISIONS AND REQUIREMENTS OF THE PRINCIPAL CONFLICTS OF INTEREST LAWS I. LAWS AFFECTING DECISION-MAKING A. The Political Reform Act In 1974, the California voters approved Proposition 9, a statewide initiative entitled “The Political Reform Act.” Gov’t Code § 81000 et seq.1 At the time, the measure was the most detailed disclosure law in the nation, and it included new requirements for reporting campaign and lobbying activities. Although the Act was initially written before the Watergate scandal broke, by the time Proposition 9 appeared on the ballot the drama had unfolded, and nationwide reform proposals were being drafted. The Political Reform Act (the “Act”) passed by an overwhelming majority, and one of its provisions created a new state agency called the Fair Political Practices Commission (the “FPPC”). The FPPC was charged with interpreting and enforcing the Act, and pursuant to this authority, the agency drafted a series of regulations. Since the Act went into effect in 1975, the FPPC has issued amendments and revisions to the law almost every year. The Act covers numerous topics germane to ethical behavior in public office—financial data reporting obligations, lobbying restrictions, required campaign disclosures, limitations on campaign financing, proscriptions on mass mailings, restrictions on gifts and honoraria, and most significantly, prohibitions on conflicts of interest in the making of governmental decisions. The Act also contains both reporting procedures for financial interests and campaign contributions, and disqualification requirements when certain of those interests or contributions exist. Please note that this handbook is general in nature and may not cover all aspects of an actual conflicts of interest question. Thus, it is not intended to constitute advice on specific conflicts of interest questions. In the event of an actual conflicts of interest issue, you should contact your city attorney or agency counsel for further advice. 1 All statutory references are to the California Government Code unless otherwise indicated. Regulations of the FPPC are referred to as “Regulation Section.” Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 3 © 2011 Richards, Watson & Gershon 1342872.1 1. Financial Interest Disclosure Requirements of the Political Reform Act (a) Statements of Economic Interests The Political Reform Act requires public officials to disclose assets and income that may be materially affected by their official actions by filing a “Statement of Economic Interests” (also known as a “Form 700”) with the Fair Political Practices Commission. § 87202; Regulation § 18115. The requirement applies to council members, judges, elected state officers, members of planning commissions, members of boards of supervisors, district attorneys, county counsels, city managers, city attorneys, city treasurers, and other public officials who manage public investments, and to candidates for any of these offices at any election. § 87200. Officials must file the Form 700 within 30 days of assuming office, and candidates must file no later than the final filing date of a declaration of candidacy. §§ 87201-02. An official must file annually thereafter until he or she leaves office, at which point he or she must file a final statement. §§ 87202-03. The required disclosures on the Form 700 include: i Investments in business entities (e.g., stock holdings, owning a business, a partnership) that do business in the jurisdiction; i Interests in real estate (real property) in the jurisdiction, but not including the official’s home address; i Sources of personal income, including gifts, loans and travel payments; and i Positions of management or employment with business entities that do business in the jurisdiction. § 87203. If the official no longer holds certain investments and real property interests at the time of filing, but held them during the 12 months prior to filing, he or she must still disclose those interests on the Form 700. Id. The Form 700 is a public document open to inspection and duplication. For public officials not covered by these requirements, including employees of state and local government agencies, it is up to the agencies that employ them to decide what their disclosure requirements are. Each state and local agency must adopt a conflicts of interest code tailoring the disclosure requirements for each position within the agency to the types of governmental decisions a person holding that position would make. For example, an employee who approves contracts for goods or services purchased by his or her agency would not be required to disclose real estate interests, but would be required to disclose Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 4 © 2011 Richards, Watson & Gershon 1342872.1 investments in and income from individuals and entities that supply equipment, materials, or services to the agency. §§ 87301-02. (b) Behested Contributions There are also disclosure requirements for certain fundraising activities that elected officials perform for others. Elected officials who successfully solicit a contribution of $5,000 or more for a “legislative, governmental or charitable cause” during a calendar year must file a report with the official’s agency (typically the city clerk) within 30 days of reaching the $5,000 threshold. Gov’t Code § 82015(b)(2)(B)(iii). The report must contain the following information: i The contributor’s name and address; i The amount of the contribution; i The date or dates on which the payments were made; i The name and address of the contribution recipient; i If goods or services were contributed, a description of those goods and services; and i A description of the purpose or event for which the contribution was used. The statute does not define the term “legislative, governmental or charitable cause,” but charitable causes typically involve 501(c)(3) organizations. Examples of “governmental” causes include fundraising for a new city hall roof, an inaugural celebration committee,2 litigation expenses,3 a breakfast honoring public safety personnel,4 and youth conferences.5 The term “legislative cause,” in turn, refers to a 1996 FPPC opinion in which a state senator asked a private party to pay for a witness’s airfare and expenses to testify at a legislative hearing.6 2 Sutton Advice Letter, No. A-05-256, 2005 WL 3693740 (2005). 3 Stoen Advice Letter, No. A-03-185, 2004 WL 334564 (2004) (district attorney’s expenses in suing a private company when governing body withdrew funding for effort). 4 Gallegos Advice Letter, No. A-00-059, 2000 WL 311529 (2000). 5 Gallegos Advice Letter, No. A-98-192, 1998 WL 671296 (1998). 6 Schmidt Advice Letter, No. A-96-098, 1996 WL 779579 (1996). Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 5 © 2011 Richards, Watson & Gershon 1342872.1 2. Conflicts of Interest Under the Political Reform Act In addition to the disclosure requirements, the Political Reform Act requires public officials to disqualify themselves from making, participating in making, or in any way attempting to use their official position to influence a governmental decision in which they know or have reason to know they have a financial interest. § 87100. An official has a financial interest in a decision if it is reasonably foreseeable that the decision will have a material financial effect, distinguishable from its effect on the public generally, on the official, a member of his or her immediate family, or on certain listed financial interests. The listed financial interests are: i Any business entity in which the public official has a direct or indirect investment worth $2,000 or more. i Any real property in which the public official has a direct or indirect interest worth $2,000 or more. i Any source of income, except gifts or loans by a commercial lending institution made in the regular course of business on terms available to the public without regard to official status, aggregating $500 or more in value provided or promised to, received by, the public official within 12 months prior to the time when the decision is made. i Any business entity in which the public official is a director, officer, partner, trustee, employee, or holds any position of management. i Any donor of, or any intermediary or agent for a donor of, a gift or gifts aggregating $420 or more in value provided to, received by, or promised to the public official within 12 months prior to the time when the decision is made. § 87103. The Regulations of the FPPC interpret and provide guidance to most of the terms used in the Act as well as provide standards for determining if each element of the Act’s prohibitions has been satisfied. 3. The FPPC’s Eight-Step Test for Analyzing Conflict of Interest Questions The FPPC regulations set forth an eight-step test to determine whether a conflict of interest exists under the Act. Regulation § 18700. Each step of that test is discussed below. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 6 © 2011 Richards, Watson & Gershon 1342872.1 STEP ONE: Is a Public Official Involved? Determine whether the individual is a public official within the meaning of the Act. The Political Reform Act applies only to “public officials.” A “public official” is defined to include a “member, officer, employee, or consultant” of a local government agency. § 82048. The regulations define “member” and “consultant” as follows: i A “member” includes persons serving on boards or commissions with decision-making authority. A board or commission possesses decision-making authority, in turn, if it can make a final governmental decision; compel or prevent a governmental decision; or make substantive recommendations that are, and over an extended period of time have been, regularly approved without significant amendment or modification by another official or agency. Regulation § 18701(a)(1). i A “consultant” includes an individual who, pursuant to a contract with a state or local government agency, is empowered to make a governmental decision or serve in a staff capacity with the agency. Regulation § 18701(a)(2). STEP TWO: Is There a Government Decision Involved? Determine whether the public official will be making, participating in the making, or using or attempting to use his/her official position to influence a governmental decision. The Political Reform Act applies when a public official is “making, participating in making, or using or attempting to use his/her official position to influence a government decision.” Regulation § 18702. The FPPC regulations define each of these actions for purposes of applying the Act: i A public official “makes” a governmental decision when the official, acting within the authority of his or her office or position, votes on a matter, appoints a person, commits his or her agency to a course of action, enters into a contract, or determines not to act.7 Regulation § 18702.1. 7 A public official’s “determination not to act” does not constitute participating in “making” a government decision when the public official is abstaining from a decision due to a personal financial interest. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 7 © 2011 Richards, Watson & Gershon 1342872.1 i A public official “participates in making” a governmental decision, when the official, acting within the authority of his or her office or position, advises or makes recommendations to a decision-maker, or negotiates, without significant substantive review, with a third party regarding a government decision. Regulation § 18702.2. i A public official is “attempting to use his or her official position to influence” a decision if, for purpose of influencing the decision, the official contacts, or appears before, or otherwise attempts to influence any member, officer, employee or consultant of the agency. Regulation § 18702.3. A public official is also “attempting to use his or her official position to influence” a decision if he or she advocates on behalf of his or her agency to another governmental agency. There are limited exceptions to this rule. A public official is not making, participating in making, or influencing a government decision when the official appears before the public agency as a member of the general public to represent specific and limited “personal interests,” speaks to the public or press, or negotiates his or her compensation or terms of employment. Regulation § 18702.4. STEP THREE: What are the Public Official’s Economic Interests that are Affected? Identify the public official’s economic interests. A public official’s economic interests under the Act include investments and positions in business entities, interests in real property, sources of income and gifts, and the personal expenses, income, assets and liabilities of the public official, as detailed in the following list: i Any direct or indirect investment worth at least $2,000 in a business entity. i Any real property in which the public official has a direct or indirect interest worth at least $2,000. Real property interests include leases, excluding month-to-month leases and leases with terms shorter than a month. i Any “source of income” that provided or promised the public official at least $500 within 12 months prior to a governmental decision, not including gifts and loans by banks available to the general public. The Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 8 © 2011 Richards, Watson & Gershon 1342872.1 term “source of income” includes individuals, organizations, and businesses. i Any business entity in which the public official is a director, officer, partner, trustee, or employee, or holds any position of management. i Any donor of gifts aggregating at least $420 in the 12 months prior to a governmental decision. i The personal finances of the public official and immediate family. This is a sort of “catch-all” provision that is meant to address economic interests of a public official and his or her immediate family that do not qualify as investments, property, or business entities, but are nonetheless potentially affected by government decisions. Gov’t Code §§ 82047, 87103; Regulation §§ 18703-18703.5. The terms “indirect investment” and “indirect interest” are used to indicate investments and interests owned by the spouse or dependent child of the public official, an agent of the public official, or a business entity in which the official or his or her family has at least a ten percent ownership interest. STEP FOUR: Are Those Interests Directly or Indirectly Involved? For each of the public official’s economic interests, determine whether that interest is directly or indirectly involved in the governmental decision at issue. The next step is to determine whether the financial interests are directly or indirectly involved in the government decision. Whether the interest is direct or indirect will affect whether the interest is considered “material” in steps five and six. The standards are set forth in the following table: Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 9 © 2011 Richards, Watson & Gershon 1342872.1 A person (including business entities, sources of income, and sources of gifts) is “directly involved” in a decision, if: that person or entity i initiates, i is a named party in, or i is the subject of a proceeding An interest in real property the decision concerns i a site within 500 feet of the official’s property i the zoning, annexation, sale or lease of the official’s property i the issuance or denial of a license, permit or other entitlement for the property i the imposition or modification to taxes or fees on the property i a redevelopment project area in which the property lies i streets, sewers, and other infrastructure serving the property A public official’s personal finances the decision has any personal financial effect on his or her personal finances, or the finances of his or her immediate family Regulation §§ 18704.1, 18704.2, 18704.5. Economic interests that do not qualify as being “directly involved” are deemed to be “indirectly involved” in the decision. STEP FIVE: Which “Materiality” Standard Applies? Determine the applicable materiality standard for each economic interest. The fifth step in the analysis is to determine the applicable “materiality” standard as set by the regulations. This will depend, in turn, on the degree of involvement of the interest in the governmental decision, as established in step four. The materiality thresholds are significantly lower for direct financial interests than indirect interests. The materiality standards for the various forms of financial interests are set forth below. (a) Business entities The financial effect of a decision on a directly involved for-profit business entity interest is presumed to be material unless the official’s only economic interest is an investment worth $25,000 or less. Regulation §§ 18704.1, 18705.1. For nonprofit business entities, a similar Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 10 © 2011 Richards, Watson & Gershon 1342872.1 standard applies: the financial effect of a decision on a directly involved non-profit business entity is material if there is any reasonably foreseeable financial effect on the nonprofit entity. Regulation § 18705.3. When the interest of a business entity is indirectly involved, or the official’s only economic interest is an investment worth $25,000 or less, the materiality of a financial effect hinges on the size of the entity and the decision’s impact on the entity’s gross revenue, expenses, assets and liabilities. Regulation §§ 18704.1, 18705.1. For large “Fortune 500” business entities, a decision will be found to materially affect the business entity if the decision will affect the gross revenues, expenses, assets or liabilities by $10,000,000 or more in a fiscal year or result in an increase or decrease in expenses by $2,500,000 or more in a fiscal year. Regulation § 18705.1(c)(1). Lower thresholds apply for companies that are listed or meet the criteria for listing on the New York Stock Exchange or the NASDAQ or American Stock Exchange. Regulation § 18705.1(c)(2), (3). For small companies that are not listed or that do not meet the criteria for listing on the Fortune 500, NYSE, NASDAQ, or AMEX, the decision is regarded as materially affecting the company if the decision will result in an increase or decrease in gross revenues for a fiscal year of $20,000 or more, or increase or reduce expenses by $5,000 or more in a fiscal year, or result in an increase or decrease in the value of its assets or liabilities by $20,000 or more. Regulation § 18705.1(c)(4). Certain other standards apply if the business entity is a non-profit organization. Regulation § 18705.3(b)(2). All of these standards are set forth in the following table. Type of Business Change in revenues, assets, or liabilities ($) Change in Expenses ($) Listed in the Fortune 500 10,000,000. 2,500,000. Listed on NYSE, or had pretax earnings of at least $2.5M 500,000. 200,000. Listed on NASDAQ/AMEX, or had net income of $500K or pretax $750K 300,000. 100,000. For-profit entities not falling into the above 3 categories 20,000. 5,000. Nonprofit entity with gross receipts of at least $400M 1,000,000. 250,000. Nonprofit with gross receipts of at least $100M but less than $400M 400,000. 100,000. Nonprofit with gross receipts of at least $10M but less than $100M 200,000. 50,000. Nonprofit with gross receipts of at least $1M but less than $10M 100,000. 25,000. Nonprofit with gross receipts of at least $100K but less than $1M 50,000. 12,500. Nonprofit with gross receipts of less than $100K 10,000. 2,500. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 11 © 2011 Richards, Watson & Gershon 1342872.1 Independent of all the above thresholds, a special rule called the “nexus test” applies to situations in which a public official receives or is promised income to achieve a goal or purpose that would be affected by the governmental decision. Under this test, any reasonably foreseeable effect of the decision on a business entity that is a source of income or promised source of income to the public official is deemed material. Regulation § 18705.3(c). The thresholds stated above would not apply, and a financial effect of even one penny would be “material” under the regulation. Accordingly, a public official must consider carefully whether his or her job description involves accomplishing goals that would be achieved by a governmental decision. (b) Real Property – the “500-foot Rule” The financial effect of a decision on a directly involved real property interest is presumed to be material, without regard to the effect of the decision on the value of the real property. Property in which the public official has an interest is deemed directly involved in a decision when the governmental decision involves property within 500 feet of the public official’s real property. However, the presumption may be rebutted by proof that it is not reasonably foreseeable the decision will have any financial effect on the public official’s real property. Regulation § 18705.2. For indirectly involved real property, the financial effect of the governmental decision is presumed not to be material. Property of a public official that is located more than 500 feet from the property that is the subject of the decision is deemed indirectly involved and thus presumed to not be materially affected. This presumption, too, may be rebutted, by proof that there are specific circumstances regarding the governmental decision, its financial effect, and the nature of the real property that make it reasonably foreseeable that the effect will be material. The FPPC regulations list three specific factors to consider: i The development potential or income producing potential of the real property in which the official has an economic interest; i The use of the real property in which the official has an economic interest; i The character of the neighborhood including, but not limited to, substantial effects on: traffic, view, privacy, intensity of use, noise levels, air emissions, or similar traits of the neighborhood. Regulation § 18705.2(b)(1). It should be noted that the foregoing is not an all-inclusive list and other factors may be relevant to analyzing the financial effect of a decision on real property. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 12 © 2011 Richards, Watson & Gershon 1342872.1 The regulation adds a few extra provisions for leasehold properties. In the event a public official leases a property with a term of longer than 30 days, and the property is directly involved in a governmental decision, then there is a presumption of materiality, just as with owned properties. For leased properties, however, the FPPC identifies specific factors that an official may use to rebut the presumption of materiality: i The termination date of the lease; i The amount of rent paid by the lessee for the leased real property, either positively or negatively; i The value of the lessee’s right to sublease the real property, either positively or negatively; i The legally allowable use or the current use of the real property by the lessee; or i The use or enjoyment of the leased real property by the lessee. Regulation § 18705.2(a)(2). If an official can provide proof that the government decision will have no effect on any of the above factors, he or she can rebut the presumption of materiality and still participate in the decision. Similarly, for indirectly involved leasehold properties, there are specific factors that will rebut the presumption of non-materiality. In particular, if there is proof that the circumstances of the governmental decision, its financial effect, and the nature of the real property make any of the following factors reasonably foreseeable, then the interest would be material: i A change in the legally allowable use of the leased real property, when the lessee has a right to sublease the real property; i A change in the lessee’s actual use of the real property; i A substantial enhancement or a significant decrease in the lessee’s use or enjoyment of the leased real property; i An increase or decrease in the amount of rent for the leased real property by at least 5 percent during any 12-month period following the decision; or Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 13 © 2011 Richards, Watson & Gershon 1342872.1 i A change in the termination date of the lease. Regulation § 18705.2(b)(2). (c) Sources of Income The FPPC regulations also provide materiality standards for sources of income. A “source of income,” as discussed above, is any person from whom a public official has received at least $500 in the last twelve months, Regulation § 18705.3, and “person” includes individuals, organizations, and business entities, Gov’t Code § 82047. For sources of income that are directly involved in a governmental decision, the FPPC regulations presume that the effect of the decision is material. For business entities and organizations that are indirectly affected sources of income, the materiality standards for business entities already discussed above apply. Indirectly affected sources of income that are individuals are materially affected if the decision affects the individual’s income, investments, liabilities or assets by $1,000 or more, affects their real property materially (as explained in the section above), or if there is a “nexus” between the official’s receipt of the income and the governmental decision. Regulation §§ 18705.3(b)(3), (c). (d) Sources of Gifts Finally, the regulations provide materiality standards for sources of gifts. Recall that under the regulations, a donor becomes a “source of gifts” by providing a public official with gifts valued at $420 or more in the aggregate in the 12 months prior to a governmental decision. Regulation § 18703.4. Sources of gifts are “materially” affected by a governmental decision if the source of the gift is directly involved in the decision or if the decision is likely to affect the source of the gift in a manner deemed material for business entities, non-profit entities or individuals, whichever is applicable. Regulation § 18705.4. STEP SIX: Is it Reasonably Foreseeable that the Government Decision Will Materially Affect the Official’s Economic Interests? Determine whether it is reasonably foreseeable that the governmental decision will have a material financial effect on each economic interest. A material financial effect on an economic interest is reasonably foreseeable if it is substantially likely that one or more of the materiality standards applicable to that economic interest will be met as a result of the governmental decision. Regulation § 18706. In order to determine whether it is substantially likely that the materiality threshold will be exceeded, a public official should consider the following factors: Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 14 © 2011 Richards, Watson & Gershon 1342872.1 i The extent to which the official or the official’s source of income has engaged, is engaged, or plans on engaging in business activity in the jurisdiction; i The market share held by the official or the official’s source of income in the jurisdiction; i The extent to which the official or the official’s source of income has competition for business in the jurisdiction; i The scope of the governmental decision in question; and i The extent to which the occurrence of the material financial effect is contingent upon intervening events. Regulation § 18706. The FPPC indicated that this is not meant to be an exclusive list. The “reasonably foreseeable” test is likely the most subjective determination in the eight- step test, and ultimately the public official must make his or her own determination as to whether it is “substantially likely” that the applicable materiality threshold will be exceeded. While certainty is not required, an effect that is merely a possibility is not reasonably foreseeable. Downey Cares v. Downey Community Development Comm’n, 196 Cal. App. 3d 983 (1987); In re Thorner, 1 FPPC Ops. 198 (1975). STEP SEVEN: Does the “Public Generally” Exception Apply? Determine if the reasonably foreseeable financial effect is distinguishable from the effect on the public generally. Once it is determined that it is reasonably foreseeable that a decision will have a material financial effect on a public official’s economic interest, it is necessary to evaluate whether an exception to the disqualification requirement is applicable. One exception known as the “public generally” exception provides that even if a governmental decision will have a reasonably foreseeable, material financial effect on the official’s financial interest, disqualification is required only if the effect on the public official is distinguishable from the effect on the financial interests of the public generally, or a significant segment of that public. The “public generally” is comprised of the entire jurisdiction of the public agency. In re Legan, 9 FPPC Ops. 1 (1985). The “public generally” exception involves two core elements. First, the governmental decision must affect a “significant segment” of the public in the jurisdiction of the public agency. Second, the governmental decision must affect the official’s economic interest in Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 15 © 2011 Richards, Watson & Gershon 1342872.1 “substantially the same manner” as it will affect that significant segment. Regulation § 18707. In order to determine what constitutes a sufficiently “significant” segment of the public, the FPPC has provided the standards summarized in the following table: Individuals i 10% of population of the jurisdiction, or i 5,000 residents of the jurisdiction Real Property i 10% of property owners of jurisdiction, or i 5,000 property owners of the jurisdiction Business Entities, including Nonprofit Organizations i 2,000 business entities in the jurisdiction, or i 25% of business entities in the jurisdiction Governmental Entities i All members of the public under the jurisdiction of the agency Regulation § 18707.1. Whether an official’s interest will be affected in “substantially the same manner” as other decisions is largely an individual determination. For example, a council member owning one home in the city who votes on a citywide zoning regulation would likely be affected in substantially the same manner as other homeowners. If, however, the council member owned five houses, the impact of the decision would potentially be much greater on the council member than most homeowners, and so it is likely the exception would not apply. Note that specialized “public generally” exceptions exist for decisions to establish or adjust assessments, taxes, fees, charges, or rates, Regulation § 18707.2, decisions affecting principal industries, trades, or professions in the jurisdiction, Regulation § 18707.7, decisions made by appointed members of certain types of boards or commissions, Regulation § 18707.4, decisions affecting sources of income to owners of retail business entities, Regulation § 18707.5, and decisions in specified “states of emergency,” Regulation § 18707.6. STEP EIGHT: Is the Public Official’s Participation Legally Required? Determine if the public official’s participation is legally required despite the conflict of interest. The last step in the FPPC eight-step analysis is to determine whether the exception for “legally required participation” applies to the governmental decision. A public official is permitted to participate in making a governmental decision, despite having a conflict of interest in the decision, if there exists no alternative source of decision consistent with the purposes and terms of the statute authorizing the decision. Regulation § 18708. This exception is applied when a quorum of a legislative body cannot be convened due to the disqualifying conflicts of interests of its members. In that situation, one, or as many members as is needed to create the minimum number for the quorum, may be selected at Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 16 © 2011 Richards, Watson & Gershon 1342872.1 random to participate. In these situations, stringent disclosure requirements apply, not only regarding the basis of the selected member’s conflict of interest, but also the reason why there is no alternative source of decision-making authority. Regulation § 18708(b). Note that this rule is construed narrowly and may not be invoked to permit an official, who is otherwise disqualified, to vote to break a tie or to vote if a quorum can be convened of other members of the agency who are not disqualified, whether or not such other members are actually present at the time of the decision. Regulation § 18708(c). 4. Abstention When a public official has a conflict of interest under the Political Reform Act, he or she is required to abstain from making, participating in making, or using or attempting to use his or her official position to influence the local agency’s decision. Gov’t Code § 87103. Abstention avoids a violation of the conflict of interest provisions of the Act. The Act establishes specific rules of procedure when a public official has a conflict of interest and is required to abstain from a decision. Immediately prior to the consideration of the matter, the official must: (i) identify the financial interest that gives rise to the conflict in detail sufficient to be understood by the public (except that disclosure of the exact street address of a residence is not required); (ii) publicly state his or her recusal from the matter; and (iii) leave the room until after the disposition of the matter unless the matter appears on a consent calendar or other similar portion of an agenda for uncontested matters. § 87105; Regulation § 18702.5. Although the official must leave the chambers, the regulation allows the official to return briefly—depending on the nature of his or her interest, the official may comment on the item as a member of the public during the public comment period on a matter related to his or her “personal interests.” The term “personal interest” is defined to include an interest in real property, or a business entity that is wholly owned by the official or his or her immediate family. Regulation § 18702.4. It also includes business entities over which the official, or the official and his or her spouse, exercise sole direction and control. Regulation § 18702.4(b). There are a few other minor “personal interests.” If a public official wishes to speak on a matter related to his or her “personal interests,” the official may wish to observe the comments of other speakers via closed-circuit television, so that he or she may effectively rebut anything those speakers discuss. Note that when a public official abstains from a decision, his or her presence does not count toward achieving a quorum. Regulation § 18702.1(b). Accordingly, if several officials must abstain from a decision under the Political Reform Act, there may not be sufficient members of the body present to consider a matter under the Brown Act. In such a circumstance, it may be possible to use the Rule of Legally Required Participation, as discussed above. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 17 © 2011 Richards, Watson & Gershon 1342872.1 5. Penalties for Violation Administrative, civil and criminal penalties exist for violation of the conflict of interest provisions of the Political Reform Act. The FPPC may levy administrative penalties after a hearing and may impose a fine of up to $5,000 per violation, a cease and desist order, and an order to file reports. § 83116. Civil penalties include injunctive relief that may be sought by the district attorney or any person residing in the jurisdiction. § 91003. In the event a court finds that the actions would not have been taken but for the action of the official with the conflict of interest, the court is empowered to void the decision. § 91003. Misdemeanor criminal penalties are provided in situations where a knowing or willful violation of the act occurs, § 91000, and generally, persons convicted of violating the act may not be a candidate for elective office or act as a lobbyist for four years after the conviction, § 91002. The statute of limitations for civil and criminal enforcement actions is four years from the date of the violation. §§ 91000(c), 91011(b). The statute of limitations for administrative actions brought by the FPPC is five years from the date of the violation. § 91000.5. 6. Seeking Advice on Conflict of Interest Questions It is important to note that only a formal advice letter from the FPPC staff can immunize a public official from potential enforcement by the FPPC or the District Attorney in the event the public official participates in a decision and someone subsequently alleges the public official had a prohibited conflict of interest. A formal advice letter usually takes the Commission staff at least a month to prepare and is only provided if the request relates to prospective acts as distinguished from past acts, and if it contains sufficient facts upon which the FPPC is able to render a decision. Informal written advice (without immunity from potential enforcement action) may also be requested from the FPPC staff as well as informal telephonic advice through their technical assistance division at 1-866-ASK-FPPC (1-866-275-3772). Based on the time frames required to obtain formal or informal written advice from the FPPC, it is important for public officials to consult their city attorney or local agency counsel as early as possible so as to provide adequate time to gather all relevant facts, draft a letter to the FPPC, and respond to the advice once given. B. Government Code Section 1090 Government Section 1090 provides in relevant part: Members of the Legislature, state, county, district, judicial district, and city officers or employees shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 18 © 2011 Richards, Watson & Gershon 1342872.1 The purpose of the prohibition contained in Section 1090 is to preclude a public official from using his or her position to obtain business or financial advantage through the approval of contracts by the public entities on which they serve. As more fully explained below, the prohibition applies to not only preclude a member of the body or board that approves the contract to directly contract with that same public entity, but it also applies when the public official has a financial or other specified relationship to the entity that seeks to contract with the public entity. The intent of the law is to remove the possibility of any personal influence that might bear on an official’s decision-making activities on contracts entered into with public entities. Upon the enactment of the Political Reform Act of 1974, questions arose as to whether that new law impliedly repealed or preempted the provisions of Section 1090. The California Attorney General addressed this issue first, concluding in a 1976 opinion that the PRA did not implicitly repeal or preempt Section 1090. 59 Ops. Cal. Att’y Gen. 604, 671 (1976). Since that time, the courts and the Attorney General have consistently considered Section 1090 as having continuing effect. For example, in People v. Honig, 48 Cal. App. 4th 289, 328-29 (1996), the defendant in a criminal case for violations of Section 1090 argued that the provisions of the Political Reform Act superseded Section 1090. The court declined to so rule, holding instead that the term “financially interested” in Section 1090 has a different meaning than the term “material financial effect” in the Political Reform Act. In another case, a California Court of Appeal again held that the Political Reform Act and Section 1090 are “two different statutory schemes.” City of Vernon v. Central Basin Mun. Water Dist., 69 Cal. App. 4th 508, 513 (1999); see also Fraser-Yamor Agency, Inc. v. County of Del Norte, 68 Cal. App. 3d 201 (1977); People v. Vallerga, 67 Cal. App. 3d 847 (1977); City Council v. McKinley, 80 Cal. App. 3d 204 (1978); City of Imperial Beach v. Bailey, 103 Cal. App. 3d 191 (1980); Thomson v. Call, 38 Cal. 3d 633 (1985); Campagna v. City of Sanger, 42 Cal. App. 4th 533 (1996); 67 Ops. Cal. Att’y Gen. 369, 375 (1984); 69 Ops. Cal. Att’y Gen. 102 (1986); 70 Ops. Cal. Att’y Gen. 45, 47 (1987); 73 Ops. Cal. Att’y Gen. 191, 194-95 (1990). Both the Political Reform Act and the common law doctrine against conflicts of interest require the public official with the conflict of interest to abstain from participation in the decision. Section 1090, by contrast, prohibits the local agency from entering into the contract in which one of its officers or employees has a financial interest unless certain exceptions apply. Specifically, if an official is a member of a board or commission that executes the contract, he or she is conclusively presumed to be involved in the making of his or her agency’s contracts. Thomson v. Call, 38 Cal. 3d at 649. This absolute prohibition applies regardless of whether the contract is found to be fair and equitable or the official abstains from all participation in the decision. Thomson, 38 Cal. 3d at 649-50; Fraser-Yamor Agency, 68 Cal. App. 3d at 211-12; City of Imperial Beach, 103 Cal. App. 3d at 195. The only way a public entity could still enter into a contract in which an official has a financial interest would be if that interest qualifies as a “remote interest” or “non-interest” within the meaning of specified provisions discussed below. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 19 © 2011 Richards, Watson & Gershon 1342872.1 1. Three Principal Components to Section 1090’s Prohibition The prohibition contained in Section 1090 involves three principal components: (1) the person subject to the prohibition must be an officer or employee of one of the types of governmental entities listed in Section 1090; (2) the public officer or employee must be “financially interested” in a contract; and (3) the contract must be made by either (i) the public official in his or her official capacity; or (ii) the body or board of which the official is a member. (a) Officer or employee of listed government entity The first element is whether the person subject to the prohibition is an officer or employee of “the Legislature, state, county, district, [or] judicial district,” or a “city officer or employee.” Virtually every officer or employee of a municipality or local governmental district is subject to the prohibitions of Section 1090. (b) Financial interest in a contract – Section 1090 applies to direct and indirect financial interests in contracts The second element of the prohibition is the existence of a direct or indirect financial interest in a contract. The courts have interpreted the term “financially interested” as including any direct interest, such as that involved when a public official enters directly into a contract with the body of which he is a member. Thomson v. Call, 38 Cal. 3d 633 (1985). The courts have also interpreted “financially interested” as including indirect financial interests in a contract, where, for example, a public official has a business relationship with the entity that would be contracting with the public entity, or when the public official would gain something financially by the making of the contract. Fraser-Yamor Agency, 68 Cal. App. 3d 201 (1977); Finnegan v. Schrader, 91 Cal. App. 4th 572, 579 (2001). In Thomson v. Call, the California Supreme Court described the breadth of the statute this way: Section 1090 forbids city officers such as Call from being “financially interested in any contract made by them in their official capacity, or by any body or board of which they are members.” The proscribed interest certainly includes any direct interest, such as that involved when an officer enters directly into a contract with the body of which he is a member. California courts have also consistently voided such contracts where the public officer was found to have an indirect interest therein. . . . Neither the absence of actual fraud nor the possibility of a “good faith” mistake on Call’s part can affect the conclusion that this contract violates section 1090 and is therefore void. 38 Cal. 3d at 645-46 (citations omitted) (emphasis added). Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 20 © 2011 Richards, Watson & Gershon 1342872.1 In Thomson, a city councilman sold certain real property to a third party, knowing that the city was negotiating a deal to acquire multiple parcels of property in that area for a public park. The third party then conveyed the councilman’s property to the city, in an apparent attempt to evade the provisions of Section 1090. The court essentially “unwound” and invalidated the entire transaction based on the councilman’s interest in the transaction. The court refused to focus on the isolated contract between the city and the third-party that bought the property from the council member, but rather viewed all of the successive contracts as one complex multi-party agreement. The court ordered the council member to disgorge all funds he received in the transaction and ordered that the city retain title to the property. The court noted that this type of severe remedy was necessary to discourage violations of Section 1090. Other decisions have followed this same broad reading of “indirect interests.” In People v. Vallerga, the court summarized court decisions addressing financial interests under Section 1090 as follows: However devious and winding the chain may be which connects the officer with the forbidden contract, if it can be followed and the connection made, the contract is void. 67 Cal. App. 3d 847, 867 (1977); see also People v. Honig, 48 Cal. App. 4th 289, 315 (1996) (stating the same rule). The scope of indirect interests that could form a “devious and winding chain” back to a public contract is broad, but this reflects the judicial stance of vigilant enforcement of Section 1090. See, e.g., Thomson, 38 Cal. 3d at 652 (“[T]he policy of strict enforcement of conflict-of-interest statutes . . . provides a strong disincentive for those officers who might be tempted to take personal advantage of their public offices, and it is a bright-line remedy which may be appropriate in many different factual situations.”); Berka v. Woodward, 125 Cal. 119, 128 (1899) (noting the need for “strict enforcement” of the conflict of interest statutes). In addition to a “financial interest,” there must be a contract in order for Section 1090 to apply. General contract principles apply to this determination and include such arrangements as purchase and service contracts as well as development agreements between a city and a developer, 78 Ops. Cal. Att’y Gen. 230 (1995); 82 Ops. Cal. Att’y Gen. 126, 129 n.4 (1999), joint powers agreements, People v. Gnass, 101 Cal. App. 4th 1271, 1301 (2002), and payments for conference attendance expenses, 75 Ops. Cal. Att’y Gen. 20 (1992). Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 21 © 2011 Richards, Watson & Gershon 1342872.1 (c) Contract “made” by the official or by a body or board of which the official is a member – the term “made” has been interpreted very broadly and includes even very preliminary actions The third element necessary for a Section 1090 violation is that the contract has to be “made” either by the official or employee acting in his or her official capacity, or by any body or board of which the official is a member. The “making” of a contract is most commonly implicated by a city council’s approval of a simple purchase order as part of the approval of a demand warrant registrar; this is likely to constitute the making of a contract within the scope of Section 1090. The courts have construed the term “made” as encompassing such elements in the formation of a contract as preliminary discussions, negotiations, compromises, reasoning, planning, drawing of plans or specifications and solicitation for bids. Millbrae Ass’n for Residential Survival v. City of Millbrae, 262 Cal. App. 2d 222, 237 (1968). For example, in City Council of San Diego v. McKinley, 80 Cal. App. 3d 204, 212 (1978), a court of appeal found a Section 1090 violation when a city council entered into an agreement with a landscape architectural firm, of which the president and stockholder was also a member of the city’s parks and recreation board. The board investigated and advised the city council on parks and recreation development issues, and it approved plans for a Japanese garden for which the board member’s company ultimately received the development contract. Even though the board member was not a member of the city council, which awarded the contract to his company, the board member’s participation in the planning for the garden was sufficient to constitute participation in “making” the contract: [T]here is ample authority the negotiations, discussions, reasoning, planning, and give and take which go beforehand in the making of a decision to commit oneself must all be deemed to be a part of the making of an agreement in the broad sense. Thus, the final execution of a contract, which is the time when the contract is technically made, is not the only time when a conflict of interest may be presented. 80 Cal. App. 3d at 212. Similarly, in Stigall v. City of Taft, 58 Cal. 2d 565, 569-70 (1962), the California Supreme Court held that an impermissible conflict existed in a contract with a plumbing company owned by a city council member, even though the council member resigned before the plumbing company’s bid was accepted. The court recognized that activities prior to the signing of a contract can be integral to the decision to accept the contract. “[T]he negotiations, discussions, reasoning, planning and give and take which goes beforehand in the making of the decision to commit oneself must all be deemed to be a part of the making of an agreement in the broad sense. . . .” Id. at 569; see also Campagna v. City of Sanger, 42 Cal. App. 4th 533, 538 (1996) (noting that a contract “made” in an official capacity Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 22 © 2011 Richards, Watson & Gershon 1342872.1 includes one in which a person governed by Section 1090 engages only in “preliminary discussions, negotiations, compromises, [and] reasoning”). 2. Exceptions to Section 1090 (a) A public entity may enter into and amend contracts in which a member of its governing body or board has a statutorily defined “remote interest” if the board member discloses and does not participate in the decision on the contract or amendment. There are two categories of exceptions to Section 1090. The first, encompassing what are commonly referred to as “remote interests,” is set forth in Section 1091. If an official has only a remote interest in a contract, then the local agency may enter into the contract as long as the official abstains from participating in the decision in any way. Some examples of “Remote interest” exceptions that can apply to a public entity contract decision include the following: i remote interest exception for compensated officer or employee of a nonprofit corporation – Section 1091 (b)(1); and i government salary remote interest exception when the contract involves the department of the government entity that employs the board member – Section 1091 (b)(13). i remote interest exception for a litigation settlement agreement between an officer that is party to litigation involving the body or board of which the officer is a member – Section 1091 (b)(15). The “remote interest” exception applies only if the interest is disclosed to the body that approves the contract, the disclosure is noted in that body’s official records, and the official abstains from voting. Further, members with a “remote interest” may not attempt to influence any other member of the body or board of which they are members to enter into the contract. (b) Public entity board members may participate in decisions to enter into or amend contracts in which the board member has a statutorily defined “non-interest” The second category of exceptions is found in Section 1091.5. These are called “non- interest” exceptions and apply to a type of interest that is completely exempt from Section 1090 and, if held by the official, does not require abstention. The “non-interest” exceptions are listed in Section 1091.5. Examples of some of those exceptions are listed below: Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 23 © 2011 Richards, Watson & Gershon 1342872.1 i non-interest exception for government salary when the contract does not involve the department of the government entity that employs the board member – Section 1091.5 (a)(9)); i non-interest exception for government salary to a board member’s spouse when the board members’ spouse was employed by the government entity for at least one year prior to board member’s appointment – Section 1091.5 (a)(6); i non-interest exception for non-compensated officer of a non-profit corporation that supports the functions of the public entity and to which the public entity is required to give particular consideration – Section 1091.5 (a)(8); i non-interest exception for non-compensated member of a non-profit corporation – Section 1091.5 (a)(7); and i non-interest exception involving the receipt of public services on the same terms as would be provided if not a member – Section 1091.5 (a)(3). 3. Penalties – A Contract Made in Violation of Section 1090 is Void and Officials Violating Section 1090 are Subject to Severe Penalties Finally, it is important to note the extreme consequences of a Section 1090 violation and thus the caution with which persons must act to ensure compliance with this law. A public official who willfully violates any of the provisions of Section 1090 “is punishable by a fine of not more than $1,000, or by imprisonment in the state prison, and is forever disqualified from holding any office in this state.” Gov’t Code § 1097. In addition, a contract made in violation of Section 1090 is void under Section 1092. People ex rel. State v. Drinkhouse, 4 Cal. App. 3d 931, 935 (1970) (“[A] contract in which a public officer is interested is void, rather than voidable as the statute indicates.”). And as with the Political Reform Act, acting on the advice of counsel is not a defense to a Section 1090 violation. See People v. Chacon, 40 Cal. 4th 558 (2007); Chapman v. Superior Court, 130 Cal. App. 4th 261 (2005). Given these consequences, it is advisable for public officials to be very cautious in deciding whether they may participate in a contracting decision based on the existence of a “non- interest exception,” whether they must abstain from those decisions based on the application of a “remote interest” exception, or whether their financial interest lies outside any exception and therefore precludes the public entity from entering into the contact altogether. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 24 © 2011 Richards, Watson & Gershon 1342872.1 4. Statute of Limitations The statute of limitations for bringing a criminal prosecution under Government Code Section 1090 is three years from the discovery of the violation. People v. Honig, 48 Cal. App. 4th 289, 304 (fn. 1) (1996); Penal Code §§ 801, 803(c). However, under Government Code Section 1092, a four-year statute of limitations applies to actions brought under Section 1090 to invalidate a contract. This four-year statute of limitations begins to run from the date that the plaintiff has discovered the violation, or in the exercise of reasonable care, should have discovered the violation. C. Common Law Doctrine Against Conflicts of Interest The common law doctrine against conflicts of interest constitutes the courts’ expression of the public policy against public officials using their official positions for their private benefit. See Terry v. Bender, 143 Cal. App. 2d 198, 206 (1956). This doctrine provides an independent basis for requiring public officials and employees to abstain from participating in matters in which they have a financial interest. Violation of the doctrine can amount to official misconduct and can result in loss of office. Nussbaum v. Weeks, 214 Cal. App. 3d 1589 (1989). By virtue of holding public office, an elected official “is impliedly bound to exercise the powers conferred on him with disinterested skill, zeal, and diligence and primarily for the benefit of the public.” Noble v. City of Palo Alto, 89 Cal. App. 47, 51 (1928). An elected official bears a fiduciary duty to exercise the powers of office for the benefit of the public and is not permitted to use those powers for the benefit of a private interest. Id. The common law doctrine against conflicts of interest has been primarily applied to require a public official to abstain from participation in cases where the official’s private financial interest may conflict with his or her official duties. 64 Ops. Cal. Att’y Gen. 795, 797 (1981). However, the doctrine also applies when specific circumstances preclude a public official from being a disinterested, unbiased decision maker for a quasi-judicial matter. In one case, a council member who voted to deny permits for a condominium project near his house was deemed to have a common law conflict of interest (e.g., bias) due to his interest in preserving his ocean view and his personal animosity toward the applicants. Clark v. City of Hermosa Beach, 48 Cal. App. 4th 1152 (1996). However, a more recent court decision creates some uncertainty as to whether the common law doctrine should be applied when statutory conflict of interest laws already address the particular situation. In BreakZone Billiards v. City of Torrance, 81 Cal. App. 4th 1205, 1233 (2000), the court declined to construe allegations of an official’s bias in a decision to constitute a conflict of interest at common law when the applicable statutes already had been construed not to create a conflict of interest in that situation. In BreakZone, the court indicated, “We continue to be cautious in finding common law conflicts of interest . . . . We Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 25 © 2011 Richards, Watson & Gershon 1342872.1 reject the application of the doctrine in this case, assuming, arguendo, it exists.” 81 Cal. App. 4th at 1233. II. OTHER SPECIALIZED CONFLICT OF INTEREST LAWS A. Common Law Doctrine Against Incompatible Offices 1. The Court-Made (Common Law) Doctrine Against Holding Incompatible Offices In addition to Section 1126, a common law doctrine (that is, legal principles established over time by court decisions) applies to prevent public officials from holding multiple public offices simultaneously. The common law doctrine against incompatibility of offices arose from a concern that the public interest would suffer when one person holds two public offices which might possibly come into conflict. The California Supreme Court set forth the following test for incompatibility of office in People ex rel. Chapman v. Rapsey, 16 Cal. 2d 636 (1940): Two offices are said to be incompatible when the holder cannot in every instance discharge the duties of each. Incompatibility arises, therefore, from the nature of the duties of the offices, when there is an inconsistency in the functions of the two, where the functions of the two are inherently inconsistent or repugnant, as where antagonism would result in the attempt by one person to discharge the duties of both offices, or where the nature and duties of the two offices are such as to render it improper from considerations of public policy for one person to retain both. 16 Cal. 2d at 641-42. Incompatibility of offices is not measured only by conflicts which do exist, but also by those conflicts which might arise. Chapman, 16 Cal. 2d 636, 641-42 (1940); 66 Ops. Cal. Att’y Gen. 382, 384 (1983); 64 Ops. Cal. Att’y Gen. 288, 289 (1981). In order to determine whether two positions are in conflict, it is necessary to determine first whether the two positions are both public offices within the scope of the doctrine. No statutory definition is given to the term “public officer.” However, in Chapman, the court stated: [A] public office is said to be the right, authority, and duty, created and conferred by law—the tenure of which is not transient, occasional, or incidental—by which for a given period an individual is invested with power to perform a public function for public benefit . . . . One of the prime requisites is that the office be created by the Constitution or authorized by some statute. And it is essential that the incumbent be clothed Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 26 © 2011 Richards, Watson & Gershon 1342872.1 with a part of the sovereignty of the state to be exercised in the interest of the public. 16 Cal. 2d at 640 (citation omitted). Incompatibility can be triggered if the duties of the two offices “overlap so that their exercise may require contradictory or inconsistent action, to the detriment of the public interest.” People ex rel. Bagshaw v. Thomson, 55 Cal. App. 2d 147, 150 (1942). Only one significant clash of duties and loyalties is required to make offices incompatible. 37 Ops. Cal. Att’y Gen. 21, 22 (1961). The policy set forth in Chapman includes prospective as well as present clashes of duties and loyalties. 63 Ops. Cal. Att’y Gen. 623 (1980). Abstention has not been recognized as a remedy for incompatible offices. The general rule provides: The existence of devices to avoid . . . [conflicts] neither changes the nature of the potential conflicts nor provides assurances that they would be employed. Accordingly, the ability to abstain when a conflict arises will not excuse the incompatibility or obviate the effects of the doctrine. 66 Ops. Cal. Att’y Gen. 176, 177 (1983) (citation omitted). The effect of the doctrine of incompatibility of offices is that a public official who enters into the duties of a second office is deemed to have automatically vacated the first office if the two are incompatible. Chapman, 16 Cal. 2d at 644. A list of some of the offices that the California Attorney General has found to be incompatible are as follows: i county board of supervisors member and community college board member, 78 Ops. Cal. Att’y Gen. 316 (1995) i fire chief and board of supervisors member, 66 Ops. Cal. Att’y Gen. 176 (1983) i public utility district member and county board of supervisors member, 64 Ops. Cal. Att’y Gen. 137 (1981) i school district trustee and city council member, 73 Ops. Cal. Att’y Gen. 354 (1990) i school board member and city council member, 65 Ops. Cal. Att’y Gen. 606 (1982) Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 27 © 2011 Richards, Watson & Gershon 1342872.1 i county planning commissioner and city council member, 63 Ops. Cal. Att’y Gen. 607 (1980) i fire chief and city council member, 76 Ops. Cal. Att’y Gen. 38 (1993) i county planning commissioner and city planning commissioner, 66 Ops. Cal. Att’y Gen. 293 (1983) i county planning commissioner and county water district director, 64 Ops. Cal. Att’y Gen. 288 (1981) i city planning commissioner and school district board member, 84 Ops. Cal. Att’y Gen. 91 (1997) i city manager and school district board member, 80 Ops. Cal. Att’y Gen. 74 (1997) i school district board member and community services district board member, 75 Ops. Cal. Att’y Gen 112 (1992) 2. The Statutory Codification of the Common Law Doctrine of Incompatible Offices – Government Code Section 1099 The Legislature recently adopted Government Code Section 1099, which is intended to create a statutory rule against holding incompatible offices. This new section is not intended to expand or contract the common law rule and is intended to be interpreted based on precedent created by the courts through court decisions under the common law doctrine. Stats. 2005, c.254 (S.B. 274), § 2. Government Code Section 1099 provides that a public officer, including, but not limited to, an appointed or elected member of a governmental board, commission, committee or other body, shall not simultaneously hold two public offices that are incompatible as defined by the statute. Section 1099 provides that offices are incompatible when: i Either of the offices may audit, overrule, remove members of, dismiss employees of, or exercise supervisory powers over the other office or body; i Based on the powers and jurisdiction of the offices, there is a possibility of a significant clash of duties and loyalties between the offices; or Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 28 © 2011 Richards, Watson & Gershon 1342872.1 i Public policy considerations make it improper for one person to hold both offices. As is the case under the common law doctrine, Section 1099 provides that when two public offices are incompatible, a public officer shall be deemed to have forfeited the first office upon acceding to the second office. However, Section 1099 recognizes that certain state laws or local ordinances may expressly provide for the simultaneous holding of particular offices and that result would not be precluded by Section 1099. Section 1099 also does not apply if one of the positions is an employment rather than an office. It also does not apply when one of the positions is a member of a legislative body that has only advisory powers. Gov’t Code § 1099(c), (d). B. Incompatible Outside Activities (Government Code Section 1126 et seq.) California Government Code Section 1126 provides: “(a) Except as provided in Sections 1128 and 1129, a local agency officer or employee shall not engage in any employment, activity, or enterprise for compensation which is inconsistent, incompatible, in conflict with, or inimical to his or her duties as a local agency officer or employee or with the duties, functions, or responsibilities of his or her appointing power or the agency by which he or she is employed. . . .” The provisions of Section 1126 prohibit officials and employees of a local government agency from engaging in outside employment or activities where any part of the employment or activity will be subject to approval by any other officer, employee, board or commission of the local agency. Exceptions are created to permit a public official to engage in outside employment by a private business (Section 1127), and to permit an attorney employed by a local agency in a non-elective position to serve on an appointed or elected governmental board of another agency (Section 1128). However, the court in Mazzola v. City and County of San Francisco, 112 Cal. App. 3d 141 (1980) ruled that Section 1126 provides only authorization to implement standards for incompatibility pursuant to paragraph (b) of Section 1126. The court ruled that the restrictions of Section 1126 are not self-executing because existing and future employees should have notice that specific outside activities are or are not compatible with their duties as an officer or employee of the local agency. Thus, Section 1126 would not bar a public official from holding a position outside their public agency unless the public agency in which they serve as a public official adopts an ordinance in compliance with the requirements of Section 1126 that specifies that the two positions or activities are incompatible. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 29 © 2011 Richards, Watson & Gershon 1342872.1 In light of the court’s decision in Mazzola, the Attorney General ruled that Section 1126 did not apply to any elected official, such as a City councilmember, since elected officials do not have an “appointing power” that can promulgate guidelines for their activities pursuant to Section 1126. However, if a local agency adopts such guidelines, they can be made applicable to officers and employees subordinate to the legislative body of the local agency, including members of advisory boards and commissions. C. Redevelopment Conflicts Health and Safety Code Section 33130 requires any officer or employee of a city or redevelopment agency who is required to participate in the formulation of, or to approve plans or policies for, the redevelopment of a project area, to immediately disclose his or her ownership interest in any real property located within the proposed project area. This requirement applies to members of a city council, a planning commission and other officers and employees of a city or redevelopment agency. Failure to make the disclosure constitutes misconduct in office. Section 33130 also precludes any city or redevelopment agency official who is required to participate in the formulation of, or to approve plans or policies for, the redevelopment of a project area, from acquiring any interest in property located within the boundaries of the project area. This means that redevelopment agency employees and persons elected to the city council and serving as agency board members may not purchase property in the redevelopment agency’s project area. Also, if the redevelopment agency commences the process to establish a new project area, city and redevelopment agency employees and officials involved in redevelopment decisions are precluded from acquiring any additional or new interests in property within that new project area boundary. As discussed below, there are three exceptions to the prohibition against acquiring interests in property in a project area. Upon acquiring any interest under one of these exceptions, disclosure of the interest is required. The first exception allows an officer or employee to acquire an interest for the purpose of participating as an owner or re-entering into business if that officer or employee has owned a substantially equal interest to that being acquired for three years immediately preceding the selection of the project area. Health and Safety Code (“HSC”) § 33130(b). The second exception allows an officer or employee to enter into a rental agreement or lease of property for the purpose of the principal business, occupation, or profession of the officer or employee. However, this exception is limited to rental agreements or leases that have terms substantially equivalent to those offered the general public. Also the rental agreement or lease may not allow the property to be sublet at a rate in excess of the rate in the original rental agreement or lease. HSC § 33130(c). Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 30 © 2011 Richards, Watson & Gershon 1342872.1 The third exception allows for the purchase or lease of property for personal residential use, but only after the redevelopment agency has certified that all construction or improvements to the property have been completed. HSC § 33130.5. D. Discount Passes on Common Carriers (California Constitution, Article XII, Section 7) Article XII, Section 7 of the California Constitution states: “A transportation company may not grant free passes or discounts to anyone holding an office in this state; and the acceptance of a pass or discount by a public officer, other than a Public Utilities Commissioner, shall work a forfeiture of that office. A Public Utilities Commissioner may not hold an official relation to nor have a financial interest in a person or corporation subject to regulation by the commission.” The Attorney General has explained this provision applies in the following manner: i The prohibition applies to public officers, both elected and non- elected, but not employees. i The prohibition applies to interstate and foreign carriers as well as domestic carriers, and to transportation received outside California. i The prohibition applies irrespective of whether the pass or discount was provided in connection with personal or public business. i Violation of the prohibition is punishable by forfeiture of office. There have only been a few decisions that address this Constitutional prohibition. In one Opinion, the Attorney General granted leave to sue two members of a city council who accepted free airline tickets to London given by Laker Airlines as part of the airline’s promotion of its new Los Angeles to London service. Despite the fact that the councilmembers were unaware of the prohibition, the Attorney General allowed a quo warranto suit that subsequently settled before judgment (cited in 76 Ops. Cal. Atty. Gen. 1, 3 (1993)). In another Opinion, the mayor of a city received an upgrade from a coach seat to a first class seat on Hawaiian Airlines (76 Ops. Cal. Atty. Gen. 1 (1993)). There, the mayor’s ticket was one of 20 first-class upgraded tickets that the airline was allowed to provide to “high profile, prominent members of the community.” At issue was whether that situation fit within an exception to the Constitutional prohibition for situations when the free transportation or discount is provided to a public officer as a member of a larger group Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 31 © 2011 Richards, Watson & Gershon 1342872.1 unrelated to the official’s position. The Attorney General ruled that the facts did not satisfy the exception and that a violation of the prohibition had occurred. The exception considered in that Opinion stemmed out of a 1984 Opinion of the Attorney General which held that a public officer could accept first-class ticket upgrades by virtue of the airline’s policy to do so for all persons on their honeymoon. In 67 Ops. Cal. Atty. Gen. 81 (1984), the Attorney General concluded that a public officer, whose spouse was a flight attendant, could accept a free transportation pass or discount when such was offered to all spouses of flight attendants without distinction to the official status of the recipient. Consequently, if the pass or discount is provided to the official because of his or her position as a governmental official, the prohibition applies. If it is provided to the official as a member of a larger group that is not related to the functions of his or her office, the prohibition may not be applicable. E. Activities of Public Officials and Employees may be Deemed to be Incompatible with their Public Entity Position Pursuant to a Local Ordinance Adopted Under Government Code Section 1126 California statutory law limits the authority of public officials to participate in activities that are “incompatible” with their public office: [A] local agency officer or employee shall not engage in any employment, activity, or enterprise for compensation which is inconsistent, incompatible, in conflict with, or inimical to his or her duties as a local agency officer or employee or with the duties, functions, or responsibilities of his or her appointing power or the agency by which he or she is employed. . . . Gov’t Code § 1126. However, Government Code Section 1126 has been interpreted as only applying to local governmental officials if the local government has adopted an ordinance implementing its provisions. In Mazzola v. City and County of San Francisco, 112 Cal. App. 3d 141 (1980), a court of appeal ruled that Section 1126 provides only authorization to implement standards for incompatibility, rather than actually imposing those standards. The court ruled that the restrictions of Section 1126 are not self-executing because existing and future employees should have notice that specific outside activities are or are not compatible with their duties for the local agency. Thus, Section 1126 would not bar a public official from holding an outside position unless the public agency adopts an ordinance with notice to public officials and employees that specifies which outside activities are incompatible with their public positions or employment. Many cities have not adopted such ordinances. The Attorney General has also opined that Section 1126 does not apply to any elected official, such as a city council member, because elected officials do not have an “appointing Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 32 © 2011 Richards, Watson & Gershon 1342872.1 power” that can promulgate guidelines for their activities pursuant to Section 1126. 64 Ops. Cal. Att’y Gen. 795 (1981). If a local agency adopts such guidelines, however, these guidelines can be made applicable to officers and employees subordinate to the legislative body of the local agency, including members of advisory boards and commissions. Gov’t Code § 1126(a). If implemented with an ordinance, the provisions of Section 1126 prohibit officials and employees of a local government agency from engaging in outside employment or activities in which any part of the employment or activity will be subject to approval by any other officer, employee, board or commission of the local agency. There are limited exceptions to the rule. First, a public official may engage in outside employment by a private business. Gov’t Code § 1127. In addition, an attorney employed by a local agency in a non-elective position may serve on an appointed or elected governmental board of another agency. Gov’t Code § 1128. And finally, service on a joint powers insurance authority does not, by itself, create an incompatibility. Gov’t Code § 1129. F. Conflicts Upon Leaving Office – The “Revolving Door” Limitations In 2006, the Legislature enacted a new statute affecting public officials’ activities after leaving office. Stats. 2005, c. 680 (S.B. 8 – Soto). Under this law, former elected officials and former city managers will be restricted from receiving compensation for lobbying their city for one year after they leave public office. The new law also applies to elected county and district officials and to their chief administrative officers or general managers, but not to department directors or other public officials and employees. Gov’t Code § 87406.3(a). Given that the new statute is a part of the Political Reform Act, a violation of the statute constitutes a misdemeanor, and the Fair Political Practices Commission is authorized to impose administrative fines and penalties for its violation. Gov’t Code § 91000. The type of lobbying subject to the ban includes both formal and informal appearances before a local agency and making any oral or written communication to the agency. The statute proscribes the appearances and communications if they are made to influence administrative or legislative action, or affect the issuance, amendment, awarding or revocation of a permit, license, grant, or contract, or the sale or purchase of goods or property. Gov’t Code § 87406.3(a). The term “administrative actions” within the scope of the lobbying ban includes “the proposal, drafting, development, consideration, amendment, enactment, or defeat by any local government agency of any matter, including any rule, regulation, or other action in any regulatory proceeding, whether quasi-legislative or quasi-judicial.” However, matters that are “solely ministerial” are expressly excluded from the prohibition. Gov’t Code § 87406.3(d)(1). The type of “legislative action” within the scope of the ban includes “the drafting, introduction, modification, enactment, defeat, approval, or veto of any ordinance, Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 33 © 2011 Richards, Watson & Gershon 1342872.1 amendment, resolution, report, nomination, or other matter by the legislative body of a local government agency or by any committee or subcommittee thereof, or by a member or employee of the legislative body of the local government agency acting in his or her official capacity.” Gov’t Code § 87406.3(d)(2). The lobbying ban does not apply to any public official who is appearing or communicating on behalf of another local governing body or public agency of which the individual is a board member, officer or employee. Therefore, if such former elected city official or former city manager is contacting his or her city on behalf of the state, county, a school district or some other governmental entity, such activity is not precluded by the ban. State Senator Soto, who authored the legislation, stated that the law is a common sense policy because the public expects their elected officials to be motivated by a desire to benefit their communities – not to better themselves financially from their position. Senator Soto also described the law as a “step toward giving the public more reason to trust their elected officeholders.” Some cities have their own preexisting “revolving door” ordinances that regulate the lobbying activities of their former public officials. This new state law expressly does not preempt those ordinances or prevent cities from adopting additional ordinances on the subject in the future, provided those ordinances are more restrictive than the state law. Gov’t Code § 87406.3(c). Thus, the new state law merely sets a new minimum standard applicable to all cities. G. Laws Prohibiting Bribery A number of state statutes prohibit bribery of public officials. Specifically, it is illegal to give or offer to give a bribe to a public official, Penal Code § 67, or for a public official to ask, receive, or agree to receive any bribe. Pen. Code § 68. Under a strict reading of these statutes, Section 68 applies to bribery of a “ministerial officer, employee, or appointee,” and Section 67 applies only to bribery of an “executive officer in this state,” but the courts have interpreted both statutes as having a broad scope applicable to public officials generally. People v. Hallner, 43 Cal. 2d 715, 717 (1954) (observing that Section 67, despite its wording, is “all inclusive” and includes city officials, and that “[b]y the sixty-seventh section the offense defined is that of one who offers; by the sixty-eighth, that of one who receives a bribe”); People v. Strohl, 57 Cal. App. 3d 347, 360 (1976) (“Numerous California Supreme Court and appellate court decisions since 1954 have held that ‘executive officers’ of various levels of local government, including the county level, as herein involved, come within Section 67.”). The Legislature also expressly made bribery of council members and supervising officials a crime, as well as solicitation of bribes by council members and supervisors. Penal Code § 165. Another statute makes it a crime for anyone to attempt to bribe “any person who may Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 34 © 2011 Richards, Watson & Gershon 1342872.1 be authorized by law to hear or determine any question or controversy.” Penal Code § 92. Considered together, these statutes cover the spectrum of public officials. The term “bribe” signifies anything of value or advantage, present or prospective, or any promise or undertaking to give any, asked, given, or accepted, with a corrupt intent to influence, unlawfully, the person to whom it is given, in his or her action, vote, or opinion, in any public or official capacity. Pen. Code § 7(6). Note that under all of the bribery statutes, it is not only the actual giving or accepting of a bribe that is criminal; merely offering to give or receive a bribe constitutes a violation of law. See, e.g., People v. Pic’l (1982) 31 Cal. 3d 731, 739 (noting that a “meeting of the minds” is unnecessary for a bribery conviction). A public officer forfeits his office if he requests, receives, or agrees to receive a bribe. Pen. Code § 68. In addition, every officer convicted of any crime defined in the Penal Code sections pertaining to bribery and corruption is forever disqualified from holding any office in the state. Pen. Code § 98. Note also that bribery and soliciting bribery potentially violate not only the Penal Code, but also the conflict of interest statutes. For example, in Terry v. Bender, 143 Cal. App. 2d 198 (1956), a court of appeal held that a city council member violated Government Code Section 1090 when he solicited and received a bribe from an attorney in exchange for the council member’s vote to employ the attorney with the city. 143 Cal. App. 2d at 207 (observing that by accepting the bribe, the council member “had placed himself in a position of economic servitude” in violation of Section 1090). Because the bribe “restricted the free exercise of the discretion vested in him for the public good,” there was an impermissible conflict of interest. H. Campaign Contributions 1. Conflicts of Interests Arising on Appointed Boards and Commissions The Political Reform Act contains restrictions on the receipt and solicitation of campaign contributions. Under a portion of the PRA known as the “Levine Act,” a public agency official may not participate in decisions affecting individuals or entities who have given the official more than $250 in campaign contributions within the past 12 months. Gov’t Code § 84308. However, a city council is not considered an “agency” for purposes of the statute. Gov’t Code § 84308(a)(3). This disqualification therefore does not apply to a city council member when participating in a decision of the council. It also does not apply to a city council member who sits on the board of a redevelopment agency or other agency of the city if the governing board of that agency is made up entirely of members of the city council when that member is participating in a decision of that agency. 2 C.C.R. § 18438.1 (a)(1). However, it does apply to a council member when that person is serving on the board of a joint powers authority and it does apply to planning commissioners and other officers of the public entity who are not directly elected by the voters. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 35 © 2011 Richards, Watson & Gershon 1342872.1 The Political Reform Act also classifies campaign contributions differently than other financial interests. As discussed previously, the PRA requires that public officials abstain from government decisions in which they have a financial interest, with certain exceptions. Gov’t Code § 87100. A public official generally has a proscribed financial interest in a decision if it is reasonably foreseeable that the decision will have a material financial effect on (among other things): (i) a source of income aggregating $500 or more in value during the 12 months prior to the decision; or (ii) a donor of a gift or gifts aggregating $420 or more in value during the 12 months prior to the decision. Gov’t Code § 87103(c), (e); 2 C.C.R. § 18703.4. Campaign contributions, however, are not considered a “financial interest” for purposes of this disqualification because they are neither “income” nor a “gift” within the meaning of the statute. Gov’t Code §§ 82028(b)(4), 82030(b)(1). This disqualification therefore is not triggered as a result of a city council member’s receipt of a campaign contribution. In other words, city council members acting in their capacity as elected council members are not prohibited from acting on a matter which involves someone who has given them a political contribution. Regulation § 18438.1(a). For example, the California Supreme Court ruled that Los Angeles city council members were not disqualified from voting on a subdivision map by reason of receiving campaign contributions from the applicants and their agents. Woodland Hills Residents Ass’n, Inc. v. City Council, 26 Cal. 3d 938, 945 (1980) (“Plaintiffs’ accusation that receipt of a campaign contribution inevitably results in an appearance of bias or prevents a fair hearing is unwarranted.”). Similarly, a court of appeal concluded that Torrance city council members were not disqualified from voting on a CUP application by reason of receiving campaign contributions from a party alleged to be in opposition to the application. BreakZone Billiards v. City of Torrance, 81 Cal. App. 4th 1205 (2000). Receipt of a campaign contribution can, however, disqualify a public official who serves on more than one public body. For example, under the Levine Act, a Council Member acting on behalf of an agency other than the city must abstain from a license, permit or other use entitlement decision involving an applicant, proponent or opponent who has made a contribution to the Council Member’s campaign in excess of $250 within the preceding 12 months. The fact of the campaign contribution must also be disclosed prior to the abstention. This disqualification is inapplicable, however, if the campaign contribution is returned within 30 days of receipt. Gov’t Code § 84308. 2. Application of Federal Corruption Laws to the Offer or Solicitation of Illegal Campaign Contributions Tied to an Official Act Another exception to the general rule that campaign contributions do not preclude an official from voting on a matter affecting a campaign contributor is the application of federal corruption laws to situations where the receipt of illegal, laundered or unreported campaign contribution are tied to an official act. In one recent case arising out of the City of San Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 36 © 2011 Richards, Watson & Gershon 1342872.1 Diego, two council members were charged and convicted of wire fraud for conspiring to change the city’s ordinance regulating adult-oriented businesses in exchange for campaign contributions from an adult-oriented business that had been illegally “laundered” through contributions made by citizens of the city or which had been unreported and which constituted bribes. See United States v. Inzunza, 303 F. Supp. 2d 1041, 1043 (S.D. Cal. 2004) for a list of the charges; the case was referred to in the press as the San Diego “Strippergate” case. The charges included the alleged use of wire communications in interstate commerce in furtherance of the alleged conspiracy to defraud the public of their intangible right to honest service, in violation of 18 U.S.C. §§ 1951 (the Hobbs Act) and 1952 (Interstate Transportation in Aid of Racketeering). One of those convictions was later overturned. However, the case points out that direct connections between official acts and illegal or unreported campaign contributions may result in charges of bribery under California law and a violation of certain federal wire fraud and racketeering laws. 3. Ban on Local Agency Officials and Employees Soliciting Campaign Contributions from Other Officials and Employees of the Same Local Agency – Government Code Section 3205 In an effort to avoid local agency public employees being drawn into local political campaigns or having their positions the subject of political reward or retribution, California law contains a prohibition on the solicitation of campaign contributions by a local agency official or employee of other officials or employees within the same local agency. Government Code Section 3205 prohibits an officer or employee of a local agency from soliciting political contributions from an officer or employee of that same local agency. The prohibition applies to incumbents seeking re-election and to non-incumbent candidates for local agency office. An exception exists for broad general public solicitations to a “significant segment of the public” that also include some local agency officials and employees of that agency. § 3205(c). No definition exists as to what constitutes a significant segment of the public. In the context of conflict of interest provisions in the Political Reform Act, that term is defined to include segments of the local agency population such as ten percent of all residents, and, in the absence of any court interpretation of the law, that standard provides some guidance on what may be a sufficiently broad solicitation to come with the scope of the exception. Violation of the prohibition is punishable as a misdemeanor and may be prosecuted only by the County District Attorney. § 3205(d). I. Nepotism One other potential source of a conflict of interest is a governmental decision that affects a family member. If a public official’s relative has an application before the government agency on which the public official serves, the public official would potentially have an improper incentive to approve the relative’s application. Because the financial interests of a public official’s spouse and dependent children (children under 18 years of age who are dependent financially on their parents) are attributed to the public official under the Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 37 © 2011 Richards, Watson & Gershon 1342872.1 Political Reform Act and Government Code Section 1090, participation in decisions financially benefiting spouses and dependent children is limited. Gov’t Code §§ 82030, 87103; Thorpe v. Long Beach Community College Dist., 83 Cal. App. 4th 655 (2000) (holding that Section 1090 prohibited a community college district board from voting to approve the promotion of the spouse of a board member). If the approval did not require a decision by the legislative body, however, the public entity could still potentially approve an application or make a decision if the related public official did not participate. With respect to adult children and more extended family members, the Political Reform Act and Section 1090 would not automatically apply in the absence of some financial relationship between the public official and the adult child or extended family members. Davies Advice Letter, No. I-90-329, 1990 WL 698051 (1990). Currently, state law only prohibits such “extended family” interests for the governing boards of school districts. Educ. Code § 35107(e). Under that statute, a school board member must abstain from participating in personnel matters that uniquely affect his or her relative. “Relative” is defined as an adult who is related to the official by blood or affinity within the third degree, or in an adoptive relationship within the third degree. There is no comparable statute for cities and counties, but some local governments have established restrictions through ordinances or policies. The issue of familial relations comes up more frequently in the context of personnel decisions, as when a public entity prohibits the hiring of relatives of public officials or employees. Such anti-nepotism policies are generally upheld by the courts. For example, in Parsons v. County of Del Norte, 728 F. 2d 1234 (9th Cir. 1984), the Ninth Circuit upheld a county policy prohibiting spouses from working in the same department. The Ninth Circuit held that the policy did not violate the Equal Protection and Due Process clauses of the U.S. Constitution and was rationally related to a legitimate government interest: avoidance of conflicts of interest and favoritism in employee hiring, supervision and allocation of duties. See also Kimura v. Roberts, 89 Cal. App. 3d 871, 875 (1979) (upholding a policy prohibiting spouses from serving on both the city council and planning commission, reasoning that “the finding of the mayor and the city council that an actual or implied conflict of interest existed, is eminently rational, practical and legally sound”). Note, however, that state law prohibits the application of anti-nepotism rules to spouses in some circumstances. The Fair Employment and Housing Act prohibits an employer from making an employment decision based on whether an employee or applicant has a spouse presently employed, except in two specific situations: i For business reasons of supervision, safety, security or morale, an employer may refuse to place one spouse under the direct supervision of the other spouse. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 38 © 2011 Richards, Watson & Gershon 1342872.1 i For business reasons of supervision, security or morale, an employer may refuse to place both spouses in the same department, division or facility if the work involves potential conflicts of interest or other hazards greater for married couples than for other persons. 2 C.C.R. § 7292.5(a) (emphasis added). Accordingly, any anti-nepotism policy that a city or county adopts must not apply to the hiring of spouses, except in cases of direct supervision or where greater conflicts or hazards occur for married persons, or if a conflict of interest statute applies. III. LAWS REGULATING RECEIPT OF GIFTS, HONORARIA AND LOANS The PRA provisions and other conflict of interest laws discussed above do not prohibit a public official from having an interest in a business or real property. Instead, they merely limit the official’s ability to participate in a decision that would materially affect those interests. There are additional restrictions in the PRA, however, with regard to certain gifts, honoraria and loans. The statute precludes local officials (including City Councilmembers and planning commissioners) from receiving certain gifts, honoraria and loans. These prohibitions apply whether or not the source of the gift, honorarium or loan is, or will ever be, affected by a decision of the official’s agency. This section outlines these prohibitions. A. Limitations on Receipt of Gifts 1. General Gift Limitation Government Code Section 89503(a) provides: “No elected state officer, elected officer of a local government agency, or other individual specified in Section 87200 shall accept gifts from any single source in any calendar year with a total value of more than [$420].” (Emphasis added). § 89503(a); Regulation § 18703.4. Officials listed in Section 87200, in turn, include mayors, city councilmembers, planning commissioners, city managers, city attorneys, city treasurers, and candidates for any of these offices. A similar limitation prohibits a City employee designated in a local conflict of interest code from accepting gifts from a single source totaling more than $420 in value in any calendar year, if the gifts would be required to be reported on his or her statement of economic interests. § 89503(c); Regulation § 18703.4. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 39 © 2011 Richards, Watson & Gershon 1342872.1 2. Biennial Gift Limit Adjustment The Political Reform Act authorizes the FPPC to make an inflationary adjustment of the gift limitations set forth in Section 89503 every two years. § 89503(f). The most recent adjustment became effective on January 1, 2011, wherein the gift limit stayed at $420 (Regulation § 18940.2). This figure will be further adjusted in future odd-numbered years. 3. Exceptions to Gifts and Gift Limitations None of the following is a gift and none is subject to any limitation on gifts (Regulation Section 18942): (a) Informational Materials Informational materials such as books, calendars, videotapes, and free or discounted admission to informational conferences or seminars that are provided to assist the official in the performance of official duties are not considered gifts. (b) Returned Gifts Except for passes and tickets as provided for in Regulation 18946.1, a gift that is not used and that, within 30 days after receipt, is returned or donated pursuant to Regulation Section 18943, or for which reimbursement is paid pursuant to Regulation Section 18943, is not a gift. (c) Family Gifts A gift from an individual’s spouse, child, parent, grandparent, grandchild, brother, sister, parent-in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or first cousin or the spouse of any such person is not subject to the gift limitations, unless the donor is acting as an agent or intermediary for any other person. (d) Campaign Contributions Campaign contributions are not subject to gift limitations. However, officials are nonetheless required to report campaign contributions on their Form 700. (e) Inherited Money or Property Devises or inheritances of any kind are exempt from gift limitations. (f) Awards A personalized plaque or trophy with an individual value of less than $250 is not a gift. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 40 © 2011 Richards, Watson & Gershon 1342872.1 (g) Home Hospitality Hospitality (including food, beverages, or occasional lodging) provided to an official by an individual in his or her home when the host is present and is not being reimbursed for, or deducting the cost from, his or her taxes. In determining where this exception is available, the official is to “presume” that the cost of the hospitality is paid by the host unless he or she learns otherwise or it is clear from the “surrounding circumstance” that someone other than the host paid the cost or part of the cost of the hospitality (h) Presents on Personal or Family Occasions Presents exchanged between an official and an individual, other than a lobbyist, on holidays, birthdays, or similar occasions, are not gifts, as long as the presents exchanged are not substantially disproportionate in value. For purposes of this exception and notwithstanding Regulation 18946.2(b), “gifts exchanged” includes food, beverages, entertainment, and nominal benefits provided at the occasion by the honoree or other individual (other than a lobbyist) hosting the event. (i) Wedding Gifts Wedding gifts given to a public official are exempt from the limitations on gifts. The gifts, however, are required to be reported pursuant to Regulation 18946.3. (j) Leave Credits Donated to an Official Leave credits, including vacation, sick leave, or compensatory time off, donated to an official in accordance with a bona fide catastrophic or similar emergency leave program established by the official’s employer are not gifts as long as they are available to all employees in the same job classification or position. This exception does not include donations of cash. (k) Disaster Assistance Payments received under a government agency program or a program established by a 501(c)(3) organization designed to provide disaster relief or food, shelter, or similar assistance to qualified recipients are not gifts as long as such payments are available to members of the public regardless of official status. (l) Admission and Incidentals at Speaking Events Free admission, and refreshments and similar non-cash nominal benefits provided at an event at which the official gives a speech, participates in a panel or seminar, or provides a similar services, and transportation and any necessary lodging and subsistence that is exempt under Regulation § 18950.3, are exempt and need not be reported by any official. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 41 © 2011 Richards, Watson & Gershon 1342872.1 (m) Campaign Travel The transportation, lodging, and subsistence provided in direct connection with campaign activities, including attendance at political fundraisers, are exempt from the gift limitations. (n) Ticket or Pass for Ceremonial Role A ticket or pass which is provided to an official for his or her admission to an event where the official performs a ceremonial role or function on behalf of the agency, is exempt from the gift limitations, but the official must post the distribution of the ticket on the agency’s website on FPPC Form 802. 4. Gifts to an Agency (a) There is a narrow exception to the normal gift reporting requirements and value limitations for gifts made directly to a public agency. A payment made to a state or local government agency, that is controlled by the agency and used for official agency business, is not considered a gift to an individual public official who is the end recipient, even though the official receives an incidental personal benefit from the payment. As such, the gift does not have to be reported by the individual and is not subject to the annual value limitation. (b) A payment shall be considered a gift to the public official’s agency and not a gift to the public official if all of the following requirements are met: (1) The agency must receive and control the payment; (2) The payment must be used for official agency business; and (3) The agency, in its sole discretion, must determine the specific official or officials who shall use the payment. (c) Reporting Requirements. Within 30 days after use of the payment, the agency must report the payment on new Form 801 that includes the following information: (1) Donor Information: The new reporting form requires not only the donor’s name, but also his or her address, and must identify any other persons who contributed to the gift, as well as the amount each person contributed. If the donor is not an individual, the report must describe the business activity or nature of the entity giving the gift. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 42 © 2011 Richards, Watson & Gershon 1342872.1 (2) Description of Payment: The form requires a description of the payment, the date received, the intended purpose and the amount of the payment or the actual or estimated value of the goods or services provided. (3) Recipient Information: The form also requires that the agency specify the name, title, and department of the recipient, and a breakdown of specific expenses. (4) Retention: The agency is now required to maintain the form for a minimum of four years. (5) Posting: Finally, the form must be available to the public on the internet. The agency must post the form on its website, or for a public agency that does not maintain a website, the agency must send the form to the FPPC, which will post the document on its own website. The form must be filed within 30 days of the receipt of the payment, and must be signed by the agency head or his or her designee. (d) Payments for travel, including transportation, lodging, and meals, for any public official who is required to file a Form 700 pursuant to state law, can no longer be considered a “gift to the agency.” These payments are now reportable as regular gifts on the officials’ individual Form 700s and subject to the annual gift limit (currently $420). Additionally, payments for travel for other officials and employees will not qualify as “gifts to the agency” if the travel was not preapproved, or the amount of travel exceeds standard reimbursement rates. (e) Passes or tickets to a facility, event, show or performance for an entertainment, amusement, recreational or similar purpose, are governed by Regulation 18944.1. 5. Payments for Food Regulation Section 18941.1 provides, in summary: A payment made to an official for his or her food is a gift except as provided in Government Code Section 82028 and Regulation Sections 18727.5, 18941, 18942, 18943, 18946.2, 18946.5, 18950.3, and 18950.4. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 43 © 2011 Richards, Watson & Gershon 1342872.1 6. Gifts to Your Family Regulation § 18944 governs gifts to an official’s or candidate’s family. This regulation was substantially revised in late 2009, and became operative on February 10, 2010. Regulation § 18944 adds new definitions and requirements that should be carefully reviewed by public officials. (a) Definitions. Regulation § 18944 adds definitions for “Official’s Family or Family Member”. An “official’s family” and “family member” includes an official’s spouse, a dependent child, and an official’s child. (1) Dependent Child. A “dependent child” means a child (including an adoptive child or stepchild) of a public official who is under 18 years old and whom the official is entitled to claim as a dependent on his or her federal tax return. (2) Official’s Child. An “official’s child” (including an adoptive child or stepchild) means a child who meets all of the following criteria: (i) Is at least 18 but no more than 23 years old and is a full- time or part-time student; (ii) Has the same principal residence as the official. For purposes of this provision, a place, located away from the official’s residence, at which the child resides for the purpose of attending school is not the child’s “principal place of residence”; and (iii) Does not provide more than one-half of his or her own support. (b) Gifts to both an official and one or more family members. A single gift to both an official and one or more members of the official’s family is a gift to the official for the full value of the gift. (c) Gifts solely to family members. A gift given solely to a member of an official’s family is a gift to the official, when the gift confers a clear personal benefit on the official. A gift confers a clear personal benefit on the official when: (1) It is reasonably foreseeable at the time the gift is made that the official will enjoy a financial benefit from the gift. A “financial Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 44 © 2011 Richards, Watson & Gershon 1342872.1 benefit” includes but is not limited to, a payment (other than occasional meals, lodging, or local transportation) to fulfill a commitment, obligation, or expense of a type normally paid by a family for the ordinary care and support of one of its members; or (2) It is reasonably foreseeable that at the time the gift is made the official will use the gift, except for minimal use; or (3) The official exercises discretion or control over who will use or dispose of the gift. The phrase “exercises discretion or control” includes, but is not limited to, when an official or his/her agent requests the gift for, or to be used by, the official’s family member. (d) Presumed personal benefit for 87200 filers. If the public official is one who is required to file a Form 700 pursuant to State law, a gift given solely to a member of an official’s family, and not covered by Subsection (c), is a gift to the official if the gift confers a presumed personal benefit on the official. A gift to an official’s family member confers a presumed personal benefit in any of the following circumstances: (1) The gift is made to a family member of a state agency official who is subject to Section 87200 by a donor who is a lobbyist, lobbying firm, lobbyist employer or other person required to file reports under Chapter 6 (commencing with Section 86100) of the Political Reform Act. (2) The gift is made to a family member of a local government agency official who is required to file a Form 700 pursuant to State law by a donor who is or has been directly involved in a governmental decision, as defined in Regulation § 18704.1(a), in which the official will foreseeably participate or has participated in the prior 12-month period. (e) Exemptions. (1) There is no gift to an official as a result of a gift given solely to a family member if (i) the official can show there is an established working, social or similar relationship between the donor and the official’s family member independent of the relationship between the donor and the official; and (ii) the Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 45 © 2011 Richards, Watson & Gershon 1342872.1 person who made the gift is not a donor as identified in Section (d)(1) or (d)(2), above. (2) For 87200 filers, an official can rebut the presumption if he or she can show that there is an established working, social, or similar relationship between the donor and the official’s family member independent of the relationship between the donor and the official. 7. Testimonial Dinners and Events, Invitation-only Events, and Ceremonial Functions (a) Testimonial Dinners Regulation Section 18946.42 provides that when an official is honored at a testimonial dinner or similar event, at which campaign fundraising for the official does not occur, the value received is the official’s pro-rata share of the cost of the event, plus the value of any specific item that is presented to the official at the event. The term “pro-rata share of the cost of the event” means the cost of all the food and beverages, rent of the facilities, decorations, entertainment, and all other costs associated with the event, divided by the number of acceptances or the number of attendees. (b) Invitation-only Events When an official attends an invitation-only event such as a banquet, party, gala, celebration, or other similar function, other than a non-profit or political fundraiser as set forth in Regulation Section 18964.4, the value received is the official’s pro-rata share of the cost of the event, plus the value of any specific item that is presented to the official at the event. “Pro-rata share of the cost of the event” means the cost of all the food and beverages, rent of the facilities, decorations, entertainment, and all other costs associated with the event, divided by the number of acceptances or the number of attendees. (c) Official or Ceremonial Functions When an official performs an official or ceremonial function at an invitation-only event in which the official is invited to participate by the event’s sponsor or organizer to perform an official or ceremonial function, the value received is the cost of any food or beverages provided to the official, plus the value of any specific item that is presented to the official at the event. (d) Drop-in Visit Except for an event sponsored by a lobbyist, lobbying firm, and lobbyist employer, if an official attends a testimonial dinner or an invitation-only event, and does not stay for any Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 46 © 2011 Richards, Watson & Gershon 1342872.1 meal or entertainment otherwise provided at the event, and receives only minimal appetizers or drinks, the value of the gift received is the cost of the food and beverages consumed by the official and guests accompanying the official, plus the value of any specific item that is presented to the official at the event. For purposes of this subdivision, “entertainment” means a feature show or performances intended for an audience, and does not include music provided for background ambiance. (e) Lobbyists, Lobbying Firms, and Lobbyist Employers Where an official attends a testimonial dinner or an invitation-only event sponsored by a lobbyist, lobbying firm, or lobbyist employer, the value of the gift is determined pursuant to Regulation Section 18640. 8. Tickets to Political and Charitable Fundraisers. The Political Reform Act has special rules for tickets provided to public officials to fundraisers for nonprofit and political organizations. Such tickets are not considered gifts to a public official if certain requirements are met. This exception applies only to one ticket provided to an official, and only if it is provided directly by the charity or campaign committee; additional tickets are treated as regular gifts. The requirements vary depending on whether the organization is a 501(c)(3) nonprofit, a non-501(c)(3) nonprofit, or a political organization. (a) Non-501(c)(3) Nonprofit Fundraiser Regulation Section 18946.4 provides that a ticket to a fundraising event for a nonprofit, tax- exempt organization that is neither a political campaign committee nor a 501(c)(3) nonprofit shall be valued as follows: (1) Where the ticket to the fundraiser clearly states that a portion of the ticket price is a donation to the organization, then the value of the gift is the face value of the ticket or admission reduced by the amount of the donation. (2) If the ticket has no stated price or no stated donation portion, the value of the gift is the fair market value of any food, beverage, or other tangible benefits provided to each attendee. (b) Fundraiser for a 501(c)(3) religious, charitable, scientific, literary or educational organization Where the event is a fundraising event for an organization exempt from taxation under Internal Revenue Code § 501(c)(3), such an organization may provide one ticket per event to an official, and the ticket shall have no value, so long as the actual value of the non- donation portion of the ticket, plus the aggregate of all other non-donation tickets the Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 47 © 2011 Richards, Watson & Gershon 1342872.1 official receives from that donor, do not exceed $420 in a calendar year. Gov’t Code § 89503, Regulation § 18940.2. (c) Political Fundraiser For the gift of a ticket, pass, or other admission privilege to a political fundraising event for a campaign committee defined in Government Code Section 82013(a), or a comparable committee regulated under federal law holding an event in California, the committee or candidate may provide one ticket per event to an official and that ticket shall be deemed to have no value. 9. Tickets and Passes to Events (a) Exempt from Reporting Requirements & Value Restrictions. In 2010, the FPPC completely revised the regulations regarding tickets and passes that provide admission or access to facilities. Regulation 18944.1 applies only to tickets or passes given to an agency for admission to a facility, event, show or performance for an entertainment, amusement, recreational or similar purpose. The regulation does not apply to tickets to lunch or dinner events such as non-profit fundraisers where there is no recreation or entertainment. Accordingly, when a public official receives a ticket or pass that qualifies under this regulation, and the official uses the ticket or pass, it does not have to be reported as a gift if one or more of the following exceptions apply: (1) Agency-Distributed Ticket or Pass from Outside Source. If a third party gives a ticket or pass to an agency, and the agency then distributes the ticket to an official for his or her use, it is not a gift so long as the following applies: A. The original source of the ticket or pass has not earmarked it for use by particular agency officials. B. The agency determines in its sole discretion who may use the ticket or pass. C. The distribution of the ticket or pass by the agency furthers a specific governmental or public purpose in addition to the private benefit the official may receive. (2) Agency-Provided Ticket or Pass. A ticket or pass that an agency obtains (1) pursuant to the terms of a contract for use of public property, (2) obtains or controls because the agency controls the event or venue, or (3) purchases at fair market value and distributes to an official for his or her use is not a gift by the Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 48 © 2011 Richards, Watson & Gershon 1342872.1 agency to the official if the distribution of the ticket or pass by the agency accomplishes a specific governmental or public purpose in addition to any private benefit the official may receive. (b) Written Policy for Distribution of Tickets. The distribution of tickets and passes must be made pursuant to a written policy approved by the agency board and posted on the agency website. (c) New Form 802 For Reporting Distribution of Tickets and Passes. The head of the agency must fill out and certify a new Form 802 describing the distribution of tickets or passes to an official. The Form requires (1) identifying information about the agency, (2) the name of the official who received the ticket or pass, (3) if the official gave the ticket or pass to another person, the name of that person, (4) the number of tickets or passes distributed to the official, (5) a description of the event and date of event, (6) the source of the ticket or pass if given to the agency, (7) the face value of each ticket or pass, and (8) the specific governmental or public purpose under which the distribution was made. This form must be completed and posted on the agency's website within thirty (30) days of the distribution of the ticket or pass. (d) Regulations Limited to Ticket or Pass and Not Food/Beverage or Gifts Event. If the distribution of a ticket or pass to an official is not a gift to the official, the provision of other benefits, such as food or beverage or other gifts provided to the official “that are included with the admission” are not exempt from the gift reporting requirements and value limitations. 10. Gifts from a Government Agency to Official in that Agency. The FPPC recently enacted new Regulation section 18944.3, which provides that a payment by an agency that provides food, beverage, entertainment, goods or services of more than a nominal value to an individual is a reportable gift to that individual, unless the payment is a “lawful expenditure of public funds.” Several commentators have questioned the need or usefulness of this regulation, because a public agency is already prohibited from making a payment that is not a “lawful expenditure of public funds.” Boiled down, the regulation states that it is illegal for an agency to give a gift unless the gift is legal. Until the FPPC issues some formal opinions or advice letters clarifying the regulation, or revises the text, its immediate application is unclear. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 49 © 2011 Richards, Watson & Gershon 1342872.1 11. Prizes and Awards from Competitions Regulation Section 18946.5 provides, in summary: A prize or an award received shall be reported as a gift unless the prize or award is received in a bona fide competition not related to the recipient’s status as an official or candidate. A prize or award which is not reported as a gift shall be reported as income. 12. Certain Gifts of Travel Exempt from Gift Limitations In 2010, the FPPC substantially amended the rules regarding payments for transportation, meals and lodging provided to an official when that official is making a speech or participating on a panel or seminar. The various regulations are summarized below. (a) Travel for Public Employees Who Give a Speech for Official Agency Business Regulation 18950.3 applies to payments made for travel in connection with speeches given by public employees. This regulation does not apply to state or local elected officials nor does it apply to those officials who are required by State law to file a Form 700, such as the City Manager, City Attorney, Members of the Planning Commission, City Treasurer, etc.) (See, Gov’t Code § 87200). Under the amended regulation, a payment for admission to an event at which an official makes a speech, participates in a panel or seminar, or provides a similar service and for the costs of food, transportation, lodging, beverages, or nominal non-cash benefits provided to the official, is not “payment” under Government Code Section 82044 and need not be reported as a gift by the official if all of the following provisions apply: (1) The speech is for official agency business and the official is representing his or her government agency in the course and scope of his or her official duties; and (2) The payment is a lawful expenditure made only by a federal, state, or local government agency for purposes related to that agency’s official business; and (3) The payment is for (i) free admission, food, beverages and nominal non-cash benefits provided to an official on the day he or she makes a speech and/or (ii) transportation; and/or (iii) necessary lodging, food, or beverages provided directly in connection with the speech on the day immediately preceding, the day of, and the day immediately following the speech. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 50 © 2011 Richards, Watson & Gershon 1342872.1 (4) The official making the speech is not a state or local elected official as defined in Section 82020 or an official specified in 87200. (b) Travel for Officials Giving a Speech Employees Who Give a Speech for Official Agency Business Regulation 18950.1 applies to payments made for travel when an official is making a speech or participating on a panel or seminar. This exception applies to elected officials and all other officials that file a Form 700. Under the amended regulation, a payment for travel, including actual transportation and related lodging and subsistence, is not subject to the prohibitions or limitations on honoraria and gifts if all of the following provisions apply (1) The travel is reasonably related to a legislative or governmental purpose, or to an issue of state, national, or international public policy, and (2) The travel, including actual transportation and related lodging and subsistence, is in connection with a speech given by the official or candidate; the lodging and subsistence expenses are limited to the day immediately preceding, the day of, and the day immediately following the speech; and the travel is within the United States. The travel payments, however, must be reported either on a travel reimbursement schedule or as gifts or income on one’s Form 700. (See, Gov’t Code § 87207(c).) (c) Travel Provided by Governmental Entity or Charity Regulation 18950.1(b) applies to payments made for travel provided by a governmental entity when an official is making a speech or participating on a panel or seminar. This exception applies to elected officials and all other officials that file a Form 700. A payment made for travel, including actual transportation and related lodging and subsistence, is not subject to the prohibitions or limitations on honoraria and gifts if: (1) The travel is reasonably related to a legislative or governmental purpose, or to an issue of state, national, or international public policy; and (2) The payment is provided by a government, a governmental agency, a foreign government, a governmental authority, a Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 51 © 2011 Richards, Watson & Gershon 1342872.1 bona fide public or private educational institution, defined in Revenue and Taxation Code Section 203, or by a nonprofit charitable or religious organization that is exempt from taxation under Internal Revenue Code Section 501(c)(3), or by a person that is domiciled outside the United States and that substantially satisfies the requirements for tax exempt status under Internal Revenue Code Section 501(c)(3). The travel payments, however, must be reported either on a travel reimbursement schedule or as gifts or income on one’s Form 700. (See Gov’t Code § 87207(c).) (d) Travel Paid from Campaign Funds A payment made for transportation and necessary lodging and subsistence, which payment is made from campaign funds as permitted by Section 89513, or which is a contribution, is not an honorarium or a gift. Regulation § 18950.1(c). (e) Travel Provided by Official’s Agency A payment made for transportation and necessary lodging and subsistence, which payment is made by the agency of an official, is not an honorarium or a gift. Regulation § 18950.1(d). (f) Travel in Connection with Bona Fide Business A payment made for transportation, lodging, and subsistence, which payment is reasonably necessary in connection with a bona fide business trade, or profession, and which satisfies the criteria for federal income tax deductions for business expenses specified in Internal Revenue Code Sections 162 and 274, is not an honorarium or gift unless the sole or predominant activity of the business, trade or profession is making speeches. Regulation § 18950.1(e). B. Prohibitions on Receipt of Honoraria Section 89502 provides that no elected officer of a local government agency nor any official listed in Section 87200 shall accept an honorarium. An “honorarium” means any payment made in consideration for any speech given, article published, or attendance at any public or private conference, convention, meeting, social event, meal, or like gathering. 1. Exceptions to the Prohibition on Honoraria (a) Earned Income Exception “Honorarium” does not include income earned for personal services if: Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 52 © 2011 Richards, Watson & Gershon 1342872.1 (1) The services are provided in connection with an individual’s business or the individual’s practice of or employment in a bona fide business, trade, or profession, such as teaching, practicing law, medicine, insurance, real estate, banking, or building contracting; and (2) The services are customarily provided in connection with the business, trade, or profession. (b) Informational Materials “Honorarium” does not include informational materials such as books, calendars, videotapes, or free or discounted admission to educational conferences that are provided to assist the official in the performance of official duties. (c) Family Payments “Honorarium” does not include a payment received from one’s spouse, child, parent, grandparent, grandchild, brother, sister, parent-in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle or first cousin or the spouse of any such person. However, a payment from any such person is an honorarium if the donor is acting as an agent or intermediary for any person not listed in this paragraph. (d) Campaign contributions “Honorarium” does not include a campaign contributions that is required to be reported. (e) Personalized Plaque or Trophy “Honorarium” does not include a personalized plaque or trophy with an individual value of less than $250. (f) Admission and Incidentals at Place of Speech “Honorarium” does not include free admission, refreshments and similar non-cash nominal benefits provided to an official during the entire event at which the official gives a speech, participates in a panel or seminar, or provides a similar service, and actual intrastate transportation and any necessary lodging and subsistence provided directly in connection with the speech, panel, seminar, or service, including but not limited to meals and beverages on the day of the activity. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 53 © 2011 Richards, Watson & Gershon 1342872.1 (g) Incidentals at Private Conference Likewise, “honorarium” does not include any of the following items, when provided to an individual who attends any public or private conference, convention, meeting, social event, meal, or like gathering without providing any substantive service: (1) Benefits, other than cash, provided at the conference, convention, meeting, social event, meal, or gathering. (2) Free admission and food or beverages provided at the conference, convention, meeting, social event, meal, or gathering. However, the foregoing may be reportable as gifts. (h) Travel that is Exempt from Gifts Any payment made for transportation, lodging and subsistence that is exempt by the gift exceptions listed in Government Code Section 89506 and Regulation Section 18950, et. seq. C. Prohibitions on Receipt of Certain Types of Loans 1. Prohibition on Loans Exceeding $250 from Other City Officials, Employees, Consultants and Contractors Elected officials and other City officials specified in Section 87200, including City Councilmembers, may not receive a personal loan that exceeds $250 at any given time from an officer, employee, member or consultant of their city or any local government agency over which their city exercises direction and control (Section 87460 (a) and (b)). In addition, elected officials and other city officials specified in Section 87200 may not receive a personal loan that exceeds $250 at any given time from any individual or entity that has a contract with their city or any agency over which their city exercises direction and control (Section 87460 (c) and (d).) 2. Requirement for Loans of $500 or More from Other Persons and Entities to be in Writing Elected local officials may not receive a personal loan of $500 or more unless the loan is made in writing and clearly states that terms of the loan. The loan document must include the names of the parties to the loan agreement, as well as the date, amount, interest rate, and term of the loan. The loan document must also include the date or dates when payments are due and the amount of the payments (Section 87461). Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 54 © 2011 Richards, Watson & Gershon 1342872.1 3. Exceptions to Loan Limits and Documentation Requirements The following loans are not subject to the limits and documentation requirements specified in subparts 1 and 2 above: i Loans received from banks or other financial institutions, and retail or credit card transactions, made in the normal course of business on terms available to members of the public without regard to official status. i Loans received by an elected officer’s or candidate’s campaign committee. i Loans received from the elected or appointed official’s spouse, child, parent, grandparent, grandchild, brother, sister, parent-in-law, brother-in-law, sister- in-law, nephew, niece, aunt, uncle, or first cousin, or the spouse of any such person unless he or she is acting as an agent or intermediary for another person not covered by this exemption. i Loans made, or offered in writing, prior to January 1, 1998. 4. Loans that Become Gifts Subject to the Gift Prohibition Under the following circumstances, a personal loan received by any public official (elected and other officials specified in Section 87200, as well as any other local government official or employee required to file a Statement of Economic Interest) may become a gift and subject to gift and reporting limitations: i If the loan has a defined date or dates for repayment and has not been repaid, the loan will become a gift when the statute of limitations for filing an action for default has expired. i If the loan has no defined date or dates for repayment, the loan will become a gift if it remains unpaid when one year has elapsed from the later of: (1) the date the loan was made; (2) the date the last payment of $100 or more was made on the loan; or (3) the date upon which the official has made payments aggregating to less than $250 during the previous 12-month period. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 55 © 2011 Richards, Watson & Gershon 1342872.1 5. Exceptions – Loans that do not Become Gifts The following loans will not become gifts to an official: i A loan made to an elected officer’s or candidate’s campaign committee. i A loan on which the creditor has taken reasonable action to collect the balance due. i A loan described above on which the creditor, based on reasonable business considerations, has not undertaken collection action. (However, except in a criminal action, the creditor has the burden of proving that the decision not to take collection action was based on reasonable business considerations.) i A loan made to an official who has filed for bankruptcy and the loan is ultimately discharged in bankruptcy. i A loan that would not be considered a gift as outlined in paragraph 3 above (e.g., loans from family members) (Section 87462). IV. PROHIBITION AGAINST MASS MAILINGS The Political Reform Act also prohibits the sending of newsletters and other so-called “mass mailings” at public expense. Gov’t Code § 89001. A “mass mailing” is defined as the mailing or distribution at public expense of 200 or more items within a calendar month featuring the name, office, photograph or other reference to an elected officer of the agency. Regulation § 18901. The underlying intent of the Government Code provision and the implementing FPPC Regulation is to preclude elected officials from using newsletters as indirect campaign flyers for themselves. The law and regulations are intended to clamp down on prior abuses of newsletters so that elected officials cannot use publicly funded newsletters to bolster their name or accomplishments while in office. A. Test for Prohibited Mass Mailing The FPPC Regulations provide a four prong test to determine the legality of mass mailings. A mass mailing is prohibited if each of the following elements are present: i A delivery of a tangible item, i that “features,” or includes reference to, an elected official, i at public expense, Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 56 © 2011 Richards, Watson & Gershon 1342872.1 i in a quantity of 200 or more items. Regulation § 18901. Most public agencies that publish newsletters attempt to avoid the prohibition by ensuring that the newsletter does not meet the second element of the test. Each of the four elements is discussed in numerical order below. 1. Delivery of Tangible Item First, a court will determine whether: Any item sent is delivered, by any means, to the recipient at his or her residence, place of employment or business, or post office box. . . . [T]he item delivered to the recipient must be a tangible item, such as a videotape, record, or button, or a written document. Regulation § 18901(a)(1). This means that if a city intends to deliver a written document, such as a city newsletter, by U.S. mail or by hand to residents or businesses, this element is satisfied. 2. “Features,” or Includes Reference to, an Elected Official The second part of the test is the most important and is stated as follows: The item sent either: i Features an elected officer affiliated with the agency which produces or sends the mailing, or i Includes the name, office, photograph, or other reference to an elected officer affiliated with the agency which produces or sends the mailing, and is prepared or sent in cooperation, consultation, coordination, or concert with the elected officer. Regulation § 18901(a)(2). The term “features an elected officer” is defined in a later portion of the Regulation as follows: “Features an elected officer” means that the item mailed includes the elected officer’s photograph or signature, or singles out the elected officer by the manner of display of his or her name or office in the layout of the document, such as by headlines, captions, type size, type face, or type color. Regulation § 18901(c)(2). And the term “elected officer affiliated with the agency” in this manner: Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 57 © 2011 Richards, Watson & Gershon 1342872.1 “Elected officer affiliated with the agency” means an elected officer who is a member, officer, or employee of the agency, or of a subunit thereof such as a committee, or who has supervisory control over the agency, or who appoints one or more members of the agency. Regulation § 18901(c)(1). This means that if the written document includes the photograph of a council member, even if it just shows the council member cutting a ribbon on a civic project or giving out a plaque to a member of the community, this element would be satisfied and the mailing would be prohibited. It also precludes articles about an elected city official or articles in which they are “singled out” for discussion or reference. The other way this second part of the mass mailing test can be satisfied is if an elected city official’s “name, office, photograph, or other reference” is included in a written document and the document, or any part of it “is prepared or sent in cooperation, consultation, coordination, or concert with the elected officer.” This restriction presents elected officials with a choice. If the elected official involves him- or herself in the preparation of the document, then even the official’s name is excluded from appearing in the document pursuant to this second sub-part. If, on the other hand, the elected official does not involve him- or herself in the preparation of the document, his or her name may appear in the document, but just not in a way that it is “featured” by way of headlines, captions, type size, type face, or type color. 3. Public Expense The third part of the test is whether: i Any of the costs of distribution [are] paid for with public moneys; or i Costs of design, production, and printing exceeding $50 are paid with public moneys, and the design, production, or printing is done with the intent of sending the item other than as permitted by this regulation. Regulation § 18901(a)(3). This part of the test precludes the city from either paying the costs of mailing a mass mailing, or paying more than $50 of the cost of having it produced if another entity then pays for the cost of distributing the mailing. 4. At least 200 Copies of the Item The fourth and final element of the test to determine whether a mass mailing is prohibited is whether: Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 58 © 2011 Richards, Watson & Gershon 1342872.1 More than 200 substantially similar items are sent, in a single calendar month, excluding any item sent in response to an unsolicited request . . . . Regulation § 18901(a)(4). This means that if more than 200 copies of the same written document, such as a city newsletter, are sent to the public in the same month, this element will be satisfied, with minor exceptions discussed below. Consequently, a city newsletter is particularly prone to violating the mass mailing proscriptions, especially the first, third and fourth elements of the test. The key to a lawful newsletter is to ensure that each issue of the newsletter fully avoids meeting the criteria of the second element of the test. This means that the newsletter cannot “feature” an elected city official and cannot include an elected official’s name or reference if that official participates in the preparation of the newsletter, as discussed above. For example, many cities issue proclamations and awards at council meetings, and it is customary for an honoree to be photographed with the mayor. In order to comply with the mass mailing restrictions, the cities take two photographs: one of the honoree shaking the mayor’s hand, for distribution to non-city publications such as a local newspaper, and one of the honoree standing alone, for publication in the city newsletter. B. Exceptions to the Mass Mailing Prohibition Subdivision (b) of the Regulation contains a list of certain types of documents that are exempt from the prohibition of mass mailings. The first of these documents is a letter on city letterhead where the elected official’s name only appears in the letterhead along with a list of all other elected officers of the city and the letter does not contain other references to the elected official. Regulation § 18901(b)(1). Under this exemption, a non-elected official, such as the city manager, may send a letter on city letterhead at city expense to members of the community but an elected officer, such as the mayor, cannot do the same because the signature on the letter will be considered a separate reference to the elected official. If a letter signed by the mayor is to be sent to the community, a private individual or group would have to pay for the cost of producing and sending that letter. Other exemptions include press releases to the media, intra-agency communications, Regulation § 18901(b)(4), statements and bills, Regulation § 18901(b)(5), telephone directories, Regulation § 18901(b)(8), meeting or event announcements, Regulation § 18901(b)(9), and meeting agendas, Regulation § 18901(b)(10). All of these items are subject to their own specific limitations, as set forth in the Regulation. V. EXPENDITURES TO SUPPORT OR DEFEAT A BALLOT MEASURE A local government may not spend public funds to assist with the passage or defeat of an initiative or other ballot measure or to contribute to a campaign for or against a candidate. Public monies may not be spent on commercials, announcements, banners or any other Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 59 © 2011 Richards, Watson & Gershon 1342872.1 promotional materials. This is based on the theory that it would be unfair to voters with opposing views to use public funds in this way. The prohibition also serves to prevent elected officials from using government funds to promote themselves or their allies in office. Stanson v. Mott, 17 Cal. 3d 206, 217 (1976); League of Women Voters v. County-Wide Criminal Justice Coordinating Comm’n, 203 Cal. App. 3d 529 (1988); Gov’t Code § 54964. However, this section does not prohibit the expenditure of city funds to provide information to the public about the possible effects of the ballot measure on the activities, operations, or policies of the city, as long as these activities are otherwise allowed under California law, and the information is factual, accurate, fair, and impartial. The leading California case setting forth the basic rule with respect to government involvement in political campaigns is Stanson v. Mott, 17 Cal. 3d 206(1976). In Stanson, the California Supreme Court addressed the question of whether the State Director of Beaches and Parks was authorized to expend public funds in support of certain state bond measures for the enhancement of state and local recreational facilities. The court concluded that the Director of Beaches and Parks lacked such authority and set forth the basic rule that “in the absence of clear and explicit legislative authorization, a public agency may not expend public funds to promote a partisan position in an election campaign.” Only impartial “informational” communications would be permissible, such as a fair presentation of the facts in response to a citizen’s request for information. The Stanson Court also recognized that the line between improper “campaign” expenditures and proper “informational” activities is not always clear. “[T]he determination of the propriety or impropriety of the expenditure depends upon a careful consideration of such factors as the style, tenor and timing of the publication; no hard and fast rule governs every case.” Id. At 221-22. The Stanson test was recently reaffirmed by the California Supreme Court in Vargas v. City of Salinas, 46 Cal.4th 1 (2009). Prior to Vargas, courts attempting to interpret and apply Stanson used varying tests to determine the permissibility of expenditures. For example, in California Common Cause v. Duffy, an appellate court held that a local sheriff’s use of public facilities and personnel to distribute postcards critical of then-Supreme Court Justice Rose Bird was “political” and not “informational” as permitted by Stanson because the cards presented only one side of Justice Bird’s fitness to be retained in office. California Common Cause v. Duffy, 200 Cal. App. 3d 730, 746-747 (1987). In another appellate decision, Schroeder v. City Council of Irvine, another court of appeal upheld Irvine’s “Vote 2000” Program. Schroeder v. City Council of Irvine, 97 Cal. App. 4th 174 (2002). The program encouraged voter registration, without specifically advocating a particular position on any measure. Although the city had taken a public position in favor of the proposed ballot measure, the materials it distributed did not advocate any particular vote on the measure and rarely mentioned the measure at all. The Schroeder court held that the funds spent on the Vote 2000 program would be political expenditures and unlawful under Stanson only if the communications expressly advocated, or taken as a whole unambiguously urged, the passage or defeat of the Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 60 © 2011 Richards, Watson & Gershon 1342872.1 measure. Because the city presented a neutral position on “Measure F,” at least in the campaign materials, the court upheld the program as valid. However, in Vargas v. City of Salinas, the California Supreme Court decided that “express advocacy” is an insufficient standard. In Vargas, proponents of a local ballot initiative to repeal the city’s utility user’s tax (“Measure O”) sued the city alleging improper government expenditures, the court held that even if a communication does not expressly advocate for either side of an issue, a Stanson analysis must nonetheless be conducted to determine whether the activity was for informational or campaigning purposes based on its style, tenor, and timing. Although the court did not specifically refer to the Schroeder analysis in its opinion, the court clearly stated that the “express advocacy” standard does not meaningfully address potential constitutional problems arising from the use of public funds for campaign activities that were identified in Stanson. Thus, local governments must look to Vargas rather than Schroeder for the proper standard to evaluate whether an expenditure is permissible. A variety of factors led to the Vargas court’s conclusion that the communications were informational, including the fact that the publications avoided argumentative or inflammatory rhetoric and did not urge citizens to vote in a particular manner. The challenged expenditures were made pursuant to general appropriations in the city’s regular annual budget pertaining to the maintenance of the city’s website, the publication of the city’s regular quarterly newsletter, and the ordinary provision of information to the public regarding the city’s operations. The Supreme Court found that in posting on the city’s website the minutes of city council meetings relating to the council’s action along with reports prepared by various municipal departments and presented by officials at city council meetings, the city engaged in informational rather than campaign activity. Similarly, the city did not engage in campaign activity in producing a one-page document listing the program reductions that the city council voted to implement should Measure O be approved, or in making copies of the document available to the public at the city clerk’s office and public libraries. The court reasoned that viewed from the perspective of an objective observer, the document clearly constituted an informational statement that merely advised the public of specific plans that the city council voted to implement should Measure O be approved. Finally, the court found that the city engaged in permissible informational activity by mailing to city residents the fall 2002 “City Round-Up” newsletter containing articles describing proposed reductions in city services. Although under some circumstances the mailing of material relating to a ballot measure to a large number of voters shortly before an upcoming election would constitute campaign activity, a number of factors supported the court’s conclusion that the mailing of the newsletter constituted informational rather than campaign activity: it was a regular edition of the newsletter that was mailed to all city residents as a general practice, the style and tenor of the publication was entirely consistent with an ordinary municipal newsletter and readily distinguishable from Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 61 © 2011 Richards, Watson & Gershon 1342872.1 traditional campaign material, and the article provided residents with important information about the tax in an objective and nonpartisan manner. The Supreme Court illustrated the insufficiency of the “express advocacy” standard by suggesting that if the City of Salinas were to post billboards throughout the city prior to an election stating, “IF MEASURE O IS APPROVED, SIX RECREATION CENTERS, THE MUNICIPAL POOL, AND TWO LIBRARIES WILL CLOSE,” it would defy common sense to suggest that the city had not engaged in campaign activity even though such advertisements would not have violated the express advocacy standard. Vargas and Stanson reflect that local agencies must exercise caution when communicating to voters about local measures. Unfortunately, there is no hard and fast rule to assist public officials in distinguishing improper partisan campaign expenditures from permissible expenditures for “informational activities.” Whether a communication is permissible will be based on a combination of these factors, and public officials should therefore seek the advice of the city attorney on a case-by-case basis. Assistance may also be obtained from the FPPC. Last, public officials should also be aware of a new mass mailing rule that regulates communications pertaining to candidates and ballot measures. In 2009, the FPPC adopted a new regulation to prohibit government agencies from paying for mass mailings that expressly advocate or "unambiguously urge" a particular result in an election. Regulation 18901.1 prohibits a mailing if all of the following criteria are met: i A delivery of a tangible item such as a written document, video tape, record, or button and is delivered to the recipient at his or her residence, place of employment or business, or post office box, i The item sent (1) expressly advocates or (2) unambiguously urges a particular result in an election, i The public agency (1) pays to distribute the item or (2) pays costs, exceeding $50, reasonably related to designing, producing, printing or formulating the content of the item including, but not limited to payments for polling or research and payments for the salary, expenses, or fees of the agency’s employees, agents, vendors, or consultants with the intention of sending the item, and i More than 200 substantially similar items are sent during the course of the election including items sent during the qualification drive or in anticipation of an upcoming election. Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 62 © 2011 Richards, Watson & Gershon 1342872.1 A mailing “unambiguously urges a particular result in an election” if the communication (1) can be reasonably characterized as campaign material or activity and (2) is not a fair presentation of facts serving only an informational purpose when taking into account the style, tenor, and timing of the communication. There are exceptions to this rule and the following are not considered campaign related mass mailings: (i) an agency report providing the agency's internal evaluation of a measure sent to a member of the public upon the individual's request; (ii) a written argument sent to a voter in the voter information pamphlet; and (iii) a communication clearly and unambiguously authorized by law. Essentially, this regulation utilizes the standards articulated by the Supreme Court in the Vargas case and provides that communications that violate those standards are prohibited mass mailings. VI. PROHIBITION ON GIFTS OF PUBLIC FUNDS Article XVI, Section 6 of the California Constitution prohibits state and local governments from making gifts of public funds or property. A transfer of property without consideration is a gift. Civ. Code § 1146. However, where property is transferred for a “public purpose” it will not be considered a gift of public funds. There, “[t]he benefit to the government from an expenditure for a ‘public purpose’ is in the nature of consideration and funds expended are therefore not a gift even though private persons are benefited therefrom.” 69 Ops. Cal. Att’y Gen. 168 (1986) (citing California Employment Stabilization Comm’n v. Payne, 31 Cal. 2d 210, 216 (1947); Alameda County v. Janssen, 16 Cal. 2d 276, 281 (1940)). In determining whether a legislative body has made a gift of public funds, courts will look first at “whether the money is to be used for a public or private purpose.” Oakland v. Garrison, 194 Cal. 298, 302 (1941). “If it is for a public purpose within the jurisdiction of the appropriating board or body, it is not, generally speaking, to be regarded as a gift.” Id. As the California Court of Appeal explained in Board of Supervisors v. Dolan, “[i]t is settled that if a public purpose is served by the expenditure of public funds, the constitutional prohibition is not violated even though there may be incidental benefits to private persons.” 45 Cal. App. 3d 237, 243 (1975). However, to avoid violating the constitutional prohibition, public financial assistance must be tailored or “directly related” to a public purpose. California Housing Finance Authority v. Elliott, 17 Cal. 3d 575 (1976). Thus, financial assistance that does not directly further the proffered public purpose may still be found to be unconstitutional. Courts defer to the legislative body’s determination of what constitutes a “public purpose.” The concept of public purpose has been “liberally construed by the courts,” and a city council’s determination of public purpose will be upheld unless it is “totally arbitrary.” County of Alameda v. Carleson, 5 Cal. 3d 730, 746 (1971). Where a city acts pursuant to a Summary of Conflicts of Interest Laws Summary of Principal Conflicts of Interest Laws Page 63 © 2011 Richards, Watson & Gershon 1342872.1 state statute or in furtherance a state statute, courts will defer to the state legislature in determining whether a public purpose exists. VII. CONCLUSION More often than not, determining the application of conflicts of interest laws in particular circumstances requires complicated analysis. Because the consequences for a violation of these laws can be very serious, it is important that potential conflicts be identified as soon as possible to ensure that the appropriate analysis can be performed. To that end, we recommend that public agency staff prepare 500 feet radius maps of councilmembers (and other public officials such as planning commissioners, etc.) so that such officials may be alerted to projects that are located within 500 feet of their residence. Keep in mind, however, that it is the individual responsibility of a public official to determine whether that public official has a conflict. We encourage you to seek advice from your City Attorney whenever you are in doubt about a conflicts of interest issue. In that only a formal, written opinion from the FPPC can immunize you from prosecution, we strongly encourage you to seek such advice as early as possible, so that, if necessary, the public agency may request a formal opinion from the FPPC prior to your participation in any decision where a public official may have a conflict. In addition, the Legislature recently enacted a statute that requires public officials to take at least two hours of ethics training every two years if the local agency provides that official with any type of compensation, salary of stipend or provides reimbursement for necessary and reasonable expenses incurred by that official in the performance of their official duties. (Gov’t Code § 53235(a).) Ethics training would also be required of any employee designated by the local agency to receive such training. (Gov’t Code § 53234(c).) If you have questions about whether you are required to attend ethics training, please seek advice from your City Attorney. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-1 © 2011 Richards, Watson & Gershon 1342872.1 Appendix A Selected Regulations of The Fair Political Practices Commission Title 2, Division 6, California Code of Regulations Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-2 © 2011 Richards, Watson & Gershon 1342872.1 SELECTED REGULATIONS OF THE FAIR POLITICAL PRACTICES COMMISSION, Title 2, Division 6, California Code of Regulations CHAPTER 7. CONFLICTS OF INTEREST ARTICLE 1. GENERAL PROHIBITION Section 18700. Basic Rule; Guide to Conflict of Interest Regulations. (a) No public official at any level of state or local government may make, participate in making or in any way use or attempt to use his/her official position to influence a governmental decision in which he/she knows or has reason to know he/she has a disqualifying conflict of interest. A public official has a conflict of interest if the decision will have a reasonably foreseeable material financial effect on one or more of his/her economic interests, unless the public official can establish either: (1) that the effect is indistinguishable from the effect on the public generally, or (2) a public official’s participation is legally required. (b) To determine whether a given individual has a disqualifying conflict of interest under the Political Reform Act, proceed with the following analysis: (1) Determine whether the individual is a public official, within the meaning of the Act. (See Government Code section 82048; 2 Cal. Code Regs. Section 18701.) If the individual is not a public official, he or she does not have a conflict of interest within the meaning of the Political Reform Act. (2) Determine whether the public official will be making, participating in making, or using or attempting to use his/her official position to influence a government decision. (See 2 Cal. Code Regs. Section 18702.) If the public official is not making, participating in making, or using or attempting to use his/her official position to influence a government decision, then he or she does not have a conflict of interest within the meaning of the Political Reform Act. (3) Identify the public official’s economic interests. (See 2 Cal. Code Regs. Section 18703.) (4) For each of the public official’s economic interests, determine whether that interest is directly or indirectly involved in the governmental decision which the public official will be making, participating in making, or using or attempting to use his/her official position to influence. (See 2 Cal. Code Regs. Section 18704.) Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-3 © 2011 Richards, Watson & Gershon 1342872.1 (5) Determine the applicable materiality standard for each economic interest, based upon the degree of involvement determined pursuant to California Code of Regulations, title 2, section 18704. (See 2 Cal. Code Regs. Section 18705.) (6) Determine whether it is reasonably foreseeable that the governmental decision will have a material financial effect (as defined in California Code of Regulations, title 2, section 18705) on each economic interest identified pursuant to California Code of Regulations, title 2, section 18703. (See 2 Cal. Code Regs. Section 18706.) If it is not reasonably foreseeable that there will be a material financial effect on any of the public official’s economic interests, he or she does not have a conflict of interest within the meaning of the Political Reform Act. If it is reasonably foreseeable that there will be a material financial effect on any of the public official’s economic interests, and the official does not participate in the decision, determine whether the official may segment the decision into separate decisions to allow his or her participation in subsequent decisions. (See 2 Cal. Code Regs. Section 18709.) (7) Determine if the reasonably foreseeable financial effect is distinguishable from the effect on the public generally. If the official can establish that the reasonably foreseeable material financial effect on his or her economic interest is indistinguishable from the effect on the public generally, he or she does not have a conflict of interest within the meaning of the Political Reform Act. If the reasonably foreseeable material financial effect on the public official’s economic interest is distinguishable from the effect on the public generally, he or she has a conflict of interest within the meaning of the Political Reform Act. (See 2 Cal. Code Regs. Section 18707.) (8) Determine if the public official’s participation is legally required despite the conflict of interest. If the official can establish that his or her participation is legally required, he or she may participate in the governmental decision despite the conflict of interest. (See 2 Cal. Code Regs. Section 18708.) Section 18701. Public Official, Definitions. (a) For purposes of Government Code section 82048, which defines “public official,” and Government Code section 82019, which defines “designated employee,” the following definitions apply: (1) “Member” shall include, but not be limited to, salaried or unsalaried members of committees, boards or commissions with decisionmaking authority. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-4 © 2011 Richards, Watson & Gershon 1342872.1 (A) A committee, board or commission possesses decisionmaking authority whenever: (i) It may make a final governmental decision; (ii) It may compel a governmental decision; or it may prevent a governmental decision either by reason of an exclusive power to initiate the decision or by reason of a veto that may not be overridden; or (iii) It makes substantive recommendations that are, and over an extended period of time have been, regularly approved without significant amendment or modification by another public official or governmental agency. (B) A committee, board, or commission does not possess decisionmaking authority under subsection (a)(1)(A)(i) of this regulation if it is formed for the sole purpose of researching a topic and preparing a report or recommendation for submission to another governmental body that has final decisionmaking authority. (2) “Consultant” means an individual who, pursuant to a contract with a state or local government agency: (A) Makes a governmental decision whether to: (i) Approve a rate, rule, or regulation; (ii) Adopt or enforce a law; (iii) Issue, deny, suspend, or revoke any permit, license, application, certificate, approval, order, or similar authorization or entitlement; (iv) Authorize the agency to enter into, modify, or renew a contract provided it is the type of contract that requires agency approval; (v) Grant agency approval to a contract that requires agency approval and to which the agency is a party, or to the specifications for such a contract; (vi) Grant agency approval to a plan, design, report, study, or similar item; Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-5 © 2011 Richards, Watson & Gershon 1342872.1 (vii) Adopt, or grant agency approval of, policies, standards, or guidelines for the agency, or for any subdivision thereof; or (B) Serves in a staff capacity with the agency and in that capacity participates in making a governmental decision as defined in regulation 18702.2 or performs the same or substantially all the same duties for the agency that would otherwise be performed by an individual holding a position specified in the agency’s Conflict of Interest Code under Government Code section 87302. (b) For purposes of Government Code section 87200, the following definitions apply: (1) “Other public officials who manage public investments” means: (A) Members of boards and commissions, including pension and retirement boards or commissions, or of committees thereof, who exercise responsibility for the management of public investments; (B) High-level officers and employees of public agencies who exercise primary responsibility for the management of public investments, such as chief or principal investment officers or chief financial managers. This category shall not include officers and employees who work under the supervision of the chief or principal investment officers or the chief financial managers; and (C) Individuals who, pursuant to a contract with a state or local government agency, perform the same or substantially all the same functions that would otherwise be performed by the public officials described in subdivision(b)(1)(B) above. (2) “Public investments” means the investment of public moneys in real estate, securities, or other economic interests for the production of revenue or other financial return. (3) “Public moneys” means all moneys belonging to, received by, or held by, the state, or any city, county, town, district, or public agency therein, or by an officer thereof acting in his or her official capacity, and includes the proceeds of all bonds and other evidences of indebtedness, trust funds held by public pension and retirement systems, deferred compensation funds held for investment by public agencies, and public moneys held by a financial institution under a trust indenture to which a public agency is a party. (4) “Management of public investments” means the following nonministerial functions: directing the investment of public moneys; formulating or Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-6 © 2011 Richards, Watson & Gershon 1342872.1 approving investment policies; approving or establishing guidelines for asset allocations; or approving investment transactions. COMMENT: In limited circumstances, the members of a nonprofit organization may be “public officials.” (In re Siegel (1977) 3 FPPC Ops. 62.) Note: Authority cited: Section 83112, Government Code. Reference: Sections 82019, 82048, 87100, 87200 and 87302, Government Code. Section 18702. Making, Participating in Making, or Using or Attempting to Use Official Position to Influence a Government Decision, Defined. (a) To determine if a public official is making, participating in making, or using or attempting to use his/her official position to influence a government decision, apply 2 Cal. Code Regs. sections 18702.1 through 18702.4, respectively. (b) Notwithstanding subdivision (a) of this regulation, to determine if a public official who holds an office specified in Government Code section 87200 is making, participating in making, or using or attempting to use his or her official position to influence a governmental decision relating to an agenda item which is noticed for a meeting subject to the provisions of the Bagley-Keene Act (Government Code section 11120 et seq.) or the Brown Act (Government Code section 54950 et seq.) apply 2 Cal. Code Regs. sections 18702.1(a)(1) – (a)(4), 18702.2, 18702.3, 18702.4, and 18702.5. Note: Authority cited: Section 83112, Government Code. Reference: Sections 81002, 81003, 87100, 87101, 87105, and 87200, Government Code. Section 18702.1. Determining When a Public Official is Making a Governmental Decision. (a) A public official “makes a governmental decision,” except as provided in 2 Cal. Code Regs. section 18702.4, when the official, acting within the authority of his or her office or position: (1) Votes on a matter; (2) Appoints a person; (3) Obligates or commits his or her agency to any course of action; (4) Enters into any contractual agreement on behalf of his or her agency; (5) Determines not to act, within the meaning of subdivisions (a)(1), (a)(2), (a)(3), or (a)(4), above, unless such determination is made because of his or her Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-7 © 2011 Richards, Watson & Gershon 1342872.1 financial interest. When the determination not to act occurs because of the official’s financial interest, the official’s determination may be accompanied by an oral or written disclosure of the financial interest. (b) When an official with a disqualifying conflict of interest abstains from making a governmental decision in an open session of the agency and the official remains on the dais or in his or her designated seat during deliberations of the governmental decision in which he or she is disqualified, his or her presence shall not be counted toward achieving a quorum. (c) During a closed meeting of the agency, a disqualified official shall not be present when the decision is considered or knowingly obtain or review a recording or any other non-public information regarding the governmental decision. (d) Notwithstanding subdivision (a) of this regulation, to determine if a public official who holds an office specified in Government Code section 87200 is making, participating in making, or using or attempting to use his or her official position to influence a governmental decision relating to an agenda item which is noticed for a meeting subject to the provisions of the Bagley-Keene Act (Government Code section 11120 et seq.) or the Brown Act (Government Code section 54950 et seq.) apply 2 Cal. Code Regs. sections 18702.1(a)(1) – (a)(4), 18702.2, 18702.3, 18702.4, and 18702.5. COMMENT: Nothing in this section authorizes or prohibits an agency by local rule or custom from requiring a disqualified member to step down from the dais and/or leave the chambers. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 81002, 81003, 87100, 87101, 87105 and 87200, Government Code. Section 18702.2. Determining When a Public Official is Participating in Making a Governmental Decision. A public official “participates in making a governmental decision,” except as provided in Title 2, California Code of Regulations, section 18702.4, when, acting within the authority of his or her position, the official: (a) Negotiates, without significant substantive review, with a governmental entity or private person regarding a governmental decision referenced in Title 2, California Code of Regulations, section 18701(a)(2)(A); or (b) Advises or makes recommendations to the decisionmaker either directly or without significant intervening substantive review, by: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-8 © 2011 Richards, Watson & Gershon 1342872.1 (1) Conducting research or making any investigation which requires the exercise of judgment on the part of the official and the purpose of which is to influence a governmental decision referenced in Title 2, California Code of Regulations, section 18701(a)(2)(A); or (2) Preparing or presenting any report, analysis, or opinion, orally, or in writing, which requires the exercise of judgment on the part of the official and the purpose of which is to influence a governmental decision referenced in Title 2, California Code of Regulations, section 18701(a)(2)(A). NOTE: Authority cited: Section 83112, Government Code. Reference: Section 87100, Government Code. Section 18702.3. Determining When a Public Official is Using or Attempting to Use His/Her Official Position to Influence a Governmental Decision. (a) With regard to a governmental decision which is within or before an official’s agency or an agency appointed by or subject to the budgetary control of his or her agency, the official is attempting to use his or her official position to influence the decision if, for the purpose of influencing the decision, the official contacts, or appears before, or otherwise attempts to influence, any member, officer, employee or consultant of the agency. Attempts to influence include, but are not limited to, appearances or contacts by the official on behalf of a business entity, client, or customer. (b) With regard to a governmental decision which is within or before an agency not covered by subsection (a), the official is attempting to use his or her official position to influence the decision if, for the purpose of influencing the decision, the official acts or purports to act on behalf of, or as the representative of, his or her agency to any member, officer, employee or consultant of an agency. Such actions include, but are not limited to the use of official stationery. Note: Authority: Section 83112, Government Code. Reference: Section 87100, Government Code. Section 18702.4. Exceptions. (a) Making or participating in making a governmental decision shall not include: (1) Actions of public officials which are solely ministerial, secretarial, manual, or clerical; Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-9 © 2011 Richards, Watson & Gershon 1342872.1 (2) Appearances by a public official as a member of the general public before an agency in the course of its prescribed governmental function to represent himself or herself on matters related solely to the official’s personal interests as defined in Title 2, California Code of Regulations, section 18702.4(b)(1); or (3) Actions by public officials relating to their compensation or the terms or conditions of their employment or contract. In the case of public officials who are “consultants,” as defined in Title 2, California Code of Regulations, section 18701(a)(2), this includes actions by consultants relating to the terms or conditions of the contract pursuant to which they provide services to the agency, so long as they are acting in their private capacity. (b) Notwithstanding Title 2, California Code of Regulations, section 18702.3(a), an official is not attempting to use his or her official position to influence a governmental decision of an agency covered by that subsection if the official: (1) Appears in the same manner as any other member of the general public before an agency in the course of its prescribed governmental function solely to represent himself or herself on a matter which is related to his or her personal interests. An official’s “personal interests” include, but are not limited to: (A) An interest in real property which is wholly owned by the official or members of his or her immediate family. (B) A business entity wholly owned by the official or members of his or her immediate family. (C) A business entity over which the official exercises sole direction and control, or over which the official and his or her spouse jointly exercise sole direction and control. (2) Communicates with the general public or the press. (3) Negotiates his or her compensation or the terms and conditions of his or her employment or contract. (4) Prepares drawings or submissions of an architectural, engineering or similar nature to be used by a client in connection with a proceeding before any agency. However, this provision applies only if the official has no other direct oral or written contact with the agency with regard to the client’s proceeding before the agency except for necessary contact with agency staff concerning the processing or evaluation of the drawings or submissions prepared by the official. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-10 © 2011 Richards, Watson & Gershon 1342872.1 (5) Appears before a design or architectural review committee or similar body of which he or she is a member to present drawings or submissions of an architectural, engineering or similar nature which the official has prepared for a client if the following three criteria are met: (A) The review committee’s sole function is to review architectural or engineering plans or designs and to make recommendations in that instance concerning those plans or designs to a planning commission or other agency; (B) The ordinance or other provision of law requires that the review committee include architects, engineers or persons in related professions, and the official was appointed to the body to fulfill this requirement; and (C) The official is a sole practitioner. (c) Academic Decisions (1) Except as provided in subsection (c)(2), neither disclosure of financial interests nor disqualification is required under Government Code sections 87100, 87302, or any Conflict of Interest Code, in connection with: (A) Teaching decisions, including the selection by a teacher of books or other educational materials for use within his or her own school or institution, and other decisions incidental to teaching; (B) Decisions made by a person who has teaching or research responsibilities at an institution of higher education to pursue personally a course of academic study or research, to apply for funds to finance such a project, to allocate financial and material resources for such academic study or research, and all decisions relating to the manner or methodology with which such study or research will be conducted. Provided, however, that the provisions of this subsection (c)(1)(B) shall not apply with respect to any decision made by the person in the exercise of institution or campus wide administrative responsibilities respecting the approval or review of any phase of academic research or study conducted at that institution or campus. (2) Disclosure (consistent with 2 Cal. Code Regs. section 18755) shall be required under Government Code section 87302 or any Conflict of Interest Code in connection with a decision made by a person or persons at an institution of higher education with principal responsibility for a research project to Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-11 © 2011 Richards, Watson & Gershon 1342872.1 undertake such research, if it is to be funded or supported, in whole or in part, by a contract or grant (or other funds earmarked by the donor for a specific research project or for a specific researcher) from a nongovernmental entity, but disqualification may not be required under Government Code sections 87100, 87302 or any Conflict of Interest Code in connection with any such decision if the decision is substantively reviewed by an independent committee established within the institution. Note: Authority cited: Section 83112, Government Code. Reference: Section 87100, Government Code. Section 18702.5. Public Identification of a Conflict of Interest for Section 87200 Filers. (a) Government Code section 87105 and this regulation apply when a public official who holds an office specified in Government Code section 87200 has a financial interest in a decision within the meaning of Government Code section 87100, and the governmental decision relates to an agenda item which is noticed for a meeting subject to the provisions of the Bagley-Keene Act (Government Code section 11120 et seq.) or the Brown Act (Government Code section 54950 et seq.). (b) Content & Timing of Identification: The public official shall, following the announcement of the agenda item to be discussed or voted upon but before either the discussion or vote commences, do all of the following: (1) The public official shall publicly identify: (A) Each type of economic interest held by the public official which is involved in the decision and gives rise to the conflict of interest (i.e., investment, business position, interest in real property, personal financial effect, or the receipt or promise of income or gifts), and (B) The following details identifying the economic interest(s): (i) if an investment, the name of the business entity in which each investment is held; (ii) if a business position, a general description of the business activity in which the business entity is engaged as well as the name of the business entity; (iii) if real property, the address or another indication of the location of the property, unless the property is the public Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-12 © 2011 Richards, Watson & Gershon 1342872.1 official’s principal or personal residence, in which case, identification that the property is a residence; (iv) if income or gifts, then identification of the source; and (v) if personal financial effect, then identification of the expense, liability, asset or income affected. (2) Form of Identification: If the governmental decision is to be made during an open session of a public meeting, the public identification shall be made orally and shall be made part of the official public record. (3) Recusal/Leaving the Room: The public official must recuse himself or herself and leave the room after the identification required by subdivisions (b)(1) and (b)(2) of this regulation is made. He or she shall not be counted toward achieving a quorum while the item is discussed. (c) Special Rules for Closed Session: If the governmental decision is made during a closed session of a public meeting, the public identification may be made orally during the open session before the body goes into closed session and shall be limited to a declaration that his or her recusal is because of a conflict of interest under Government Code section 87100. The declaration shall be made part of the official public record. The public official shall not be present when the decision is considered in closed session or knowingly obtain or review a recording or any other non-public information regarding the governmental decision. (d) Exceptions: (1) Uncontested Matters: The exception from leaving the room granted in Government Code section 87105(a)(3) for a “matter [that] has been placed on the portion of the agenda reserved for uncontested matters” shall mean agenda items on the consent calendar. When the matter in which the public official has a financial interest is on the consent calendar, the public official must comply with subdivisions (b)(1) and (b)(2) of this regulation, and recuse himself or herself from discussing or voting on that matter, but the public official is not required to leave the room during the consent calendar. (2) Absence: If the public official is absent when the agenda item subject to subdivision (a) of this regulation is considered, then Government Code section 87105 and this regulation impose no public identification duties on the public official for that item at that meeting. (3) Speaking as a Member of the Public Regarding an Applicable Personal Interest: When a personal interest found in 2 Cal. Code Regs. section Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-13 © 2011 Richards, Watson & Gershon 1342872.1 18702.4(b) is present, a public official may speak as a member of the general public if he or she complies with subdivisions (b)(1) and (b)(2) of this regulation, recuses himself or herself from voting on the matter and leaves the dais to speak from the same area as the members of the public. He or she may listen to the public discussion of the matter with the members of the public. COMMENT: Nothing in the provisions of this regulation is intended to cause an agency or public official to make any disclosure that would reveal the confidences of a closed session or any other privileged information as contemplated by law including but not limited to the recognized privileges found in 2 Cal. Code Regs. section 18740. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87105, and 87200, Government Code. Section 18703.1. Economic Interest, Defined: Business Entities. For purposes of disqualification under Government Code sections 87100 and 87103, a public official has an economic interest in a business entity if any of the following are true: (a) The public official has a direct or indirect investment worth two thousand dollars ($2,000) or more in the business entity. (b) The public official is a director, officer, partner, trustee, employee, or holds any position of management in the business entity. (c) Parent, Subsidiary, Otherwise Related Business Entity. An official has an economic interest in a business entity which is a parent or subsidiary of, or is otherwise related to, a business entity in which the official has one of the interests defined in Government Code section 87103(a) or (d). (d) Parent, Subsidiary, Otherwise Related Business Entity, defined. (1) Parent subsidiary. A parent subsidiary relationship exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation. (2) Otherwise related business entity. Business entities, including corporations, partnerships, joint ventures and any other organizations and enterprises operated for profit, which do not have a parent subsidiary relationship are otherwise related if any one of the following three tests is met: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-14 © 2011 Richards, Watson & Gershon 1342872.1 (A) One business entity has a controlling ownership interest in the other business entity. (B) There is shared management and control between the entities. In determining whether there is shared management and control, consideration should be given to the following factors: (i) The same person or substantially the same person owns and manages the two entities; (ii) There are common or commingled funds or assets; (iii) The business entities share the use of the same offices or employees, or otherwise share activities, resources or personnel on a regular basis; (iv) There is otherwise a regular and close working relationship between the entities; or (C) A controlling owner (50% or greater interest as a shareholder or as a general partner) in one entity also is a controlling owner in the other entity. (e) Although a public official may not have an economic interest in a given business entity pursuant to subdivisions (a)-(c) of this section, the public official may nonetheless have an economic interest in the business entity if it is a source of income to him or her. (See 2 Cal. Code Regs. section 18703.3.) NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18703.2. Economic Interest, Defined: Real Property. (a) For purposes of disqualification under Government Code sections 87100 and 87103, a public official has an economic interest in any real property in which the public official has a direct or indirect interest worth two thousand dollars ($2,000) or more in fair market value. COMMENT: For the statutory definition of “interest in real property,” see Government Code section 82033. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-15 © 2011 Richards, Watson & Gershon 1342872.1 Section 18703.3. Economic Interest, Defined: Source of Income. (a) (1) For purposes of disqualification under Government Code sections 87100 and 87103, a public official has an economic interest in any person from whom he or she has received income, including commission income and incentive compensation as defined in this regulation, aggregating five hundred dollars ($500) within 12 months prior to the time when the relevant governmental decision is made. A public official’s income includes income which has been promised to the public official but not yet received by him or her, if he or she has a legally enforceable right to the promised income. (2) Parent, Subsidiary, Otherwise Related Business Entity. An official has an economic interest in a business entity which is a parent or subsidiary of, or is otherwise related to, a business entity in which the official has an interest as defined in Government Code section 87103(c). “Parents, subsidiaries, and otherwise related business entities” are defined in 2 Cal. Code Regs. section 18703.1(d). (b) Former employers. Source of income, as used in Government Code section 87103(c) and this section, shall not include a former employer if: All income from the employer was received by or accrued to the public official prior to the time he or she became a public official; the income was received in the normal course of the previous employment; and there was no expectation by the public official at the time he or she assumed office of renewed employment with the former employer. (c) Sources of Commission Income to Brokers, Agents and Salespersons (1) “Commission income” means gross payments received by a public official as a result of services rendered as a broker, agent, or other salesperson for a specific sale or similar transaction. Commission income is received when it is paid or credited. (2) The sources of commission income in a specific sale or similar transaction include for each of the following: (A) An insurance broker or agent: (i) The insurance company providing the policy; (ii) The person purchasing the policy; and (iii) The brokerage firm, agency, company, or other business entity through which the broker or agent conducts business. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-16 © 2011 Richards, Watson & Gershon 1342872.1 (B) A real estate broker: (i) The person the broker represents in the transaction; (ii) If the broker receives a commission from a transaction conducted by an agent working under the broker’s auspices, the person represented by the agent; (iii) Any brokerage business entity through which the broker conducts business; and (iv) Any person who receives a finder’s or other referral fee for referring a party to the transaction to the broker, or who makes a referral pursuant to a contract with the broker. (C) A real estate agent: (i) The broker and brokerage business entity under whose auspices the agent works; (ii) The person the agent represents in the transaction; and (iii) Any person who receives a finder’s or other referral fee for referring a party to the transaction to the broker, or who makes a referral pursuant to a contract with the broker. (D) A travel agent or salesperson: (i) The airline, hotel, tour operator or other person who provided travel services or accommodations in the transaction; (ii) The person who purchases or has a contract for travel services or accommodations through the agent or salesperson; and (iii) The person, travel agent, company, travel agency or other business entity for which the agent or salesperson is an agent. (E) A stockbroker: (i) The brokerage business entity through which the broker conducts business; and (ii) The person who trades the stocks, bonds, securities or other investments through the stockbroker. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-17 © 2011 Richards, Watson & Gershon 1342872.1 (F) A retail or wholesale salesperson: (i) The person, store or other business entity which provides the salesperson with the product or service to sell and for which the salesperson acts as a representative in the transaction; and (ii) The person who purchases the product or service. (3) For purposes of determining whether disqualification is required under the provisions of Government Code sections 87100 and 87103(c), the full gross value of any commission income for a specific sale or similar transaction shall be attributed to each source of income in that sale or transaction. (d) Sources of Incentive Compensation. “Incentive compensation” means income received by an official who is an employee, over and above salary, which is either ongoing or cumulative, or both, as sales or purchases of goods or services accumulate. Incentive compensation is calculated by a predetermined formula set by the official’s employer which correlates to the conduct of the purchaser in direct response to the effort of the official. Incentive compensation does not include: salary; commission income; bonuses for activity not related to sales or marketing, the amount of which is based solely on merit or hours worked over and above a predetermined minimum; and such executive incentive plans as may be based on company performance, provided that the formula for determining the amount of the executive’s incentive income does not include a correlation between that amount and increased profits derived from increased business with specific and identifiable clients or customers of the company. Incentive compensation also does not include payments for personal services which are not marketing or sales. The purchaser is a source of income to the official if all three of the following apply: (1) The official’s employment responsibilities include directing sales or marketing activity toward the purchaser; and (2) There is direct personal contact between the official and the purchaser intended by the official to generate sales or business; and (3) There is a direct relationship between the purchasing activity of the purchaser and the amount of the incentive compensation received by the official. COMMENT: For further discussion of incentive compensation, see Peninsula Health Care District v. Fair Political Practices Commission, Sacramento County Superior Court, Case No. 02CS01766, and In re Hanko, O-02-088 (August 9, 2002). NOTE: Authority cited: Section 83112, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-18 © 2011 Richards, Watson & Gershon 1342872.1 Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18703.4. Economic Interest, Defined: Source of Gifts. For purposes of disqualification under Government Code sections 87100 and 87103, a public official has an economic interest in any donor of, or any intermediary or agent for a donor of, a gift or gifts aggregating four hundred twenty dollars ($420) or more in value provided to, received by, or promised to the public official within 12 months prior to the time when the decision is made. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103 and 89503, Government Code. Section 18703.5. Economic Interest, Defined: Personal Finances. For purposes of disqualification under Government Code sections 87100 and 87103, a public official has an economic interest in his or her personal finances and those of his or her immediate family. A governmental decision will have an effect on this economic interest if the decision will result in the personal expenses, income, assets, or liabilities of the official or his or her immediate family increasing or decreasing. COMMENT: Cross-references: For the definition of “immediate family,” see Government Code section 82029. For the definition of “income,” see Government Code section 82030 and California Code of Regulations, Title 2, section 18232. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18703. Economic Interests, Defined. For purposes of Title 2, Division 6, Chapter 7 of the California Code of Regulations, the term “economic interest” includes the interests defined in Title 2, California Code of Regulations, sections 18703.1 through 18703.5, inclusive. Note: Authority: Section 83112, Government Code Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-19 © 2011 Richards, Watson & Gershon 1342872.1 Section 18704. Determining Whether an Economic Interest is Directly or Indirectly Involved in a Governmental Decision. (a) In order to determine if a governmental decision’s reasonably foreseeable financial effect on a given economic interest is material, it must first be determined if the official’s economic interest is directly involved or indirectly involved in the governmental decision: (1) For governmental decisions which affect business entities, sources of income, and sources of gifts--apply Title 2, California Code of Regulations, section 18704.1; (2) For governmental decisions which affect real property interests--apply Title 2. California Code of Regulations, section 18704.2. (3) For governmental decisions which affect the personal expenses, income, assets or liabilities of the public official or his or her immediate family (personal financial effect)--apply Title 2, California Code of Regulations, section 18704.5. Note: Authority: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103(c), Government Code. Section 18704.1. Determining Whether Directly or Indirectly Involved in a Government Decision; Business Entities, Sources of Income, Sources of Gifts. (a) A person, including business entities, sources of income, and sources of gifts, is directly involved in a decision before an official’s agency when that person, either directly or by an agent: (1) Initiates the proceeding in which the decision will be made by filing an application, claim, appeal, or similar request or; (2) Is a named party in, or is the subject of, the proceeding concerning the decision before the official or the official’s agency. A person is the subject of a proceeding if a decision involves the issuance, renewal, approval, denial or revocation of any license, permit, or other entitlement to, or contract with, the subject person. (b) If a business entity, source of income, or source of a gift is directly involved in a governmental decision, apply the materiality standards in California Code of Regulations, Title 2, section 18705.1(b), section 18705.3(a), or section 18705.4(a), respectively. If a business entity, source of income, or source of a gift is not directly Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-20 © 2011 Richards, Watson & Gershon 1342872.1 involved in a governmental decision, apply the materiality standards in California Code of Regulations, Title 2, section 18705.1(c), section 18705.3(b), or section 18705.4(b), respectively. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18704.2. Determining Whether Directly or Indirectly Involved in a Governmental Decision: Interest in Real Property. (a) Real property in which a public official has an economic interest is directly involved in a governmental decision if any of the following apply: (1) The real property in which the official has an interest, or any part of that real property, is located within 500 feet of the boundaries (or the proposed boundaries) of the property which is the subject of the governmental decision. For purposes of subdivision (a)(5), real property is located “within 500 feet of the boundaries (or proposed boundaries) of the real property which is the subject of the governmental decision” if any part of the real property is within 500 feet of the boundaries (or proposed boundaries) of the redevelopment project area. (2) The governmental decision involves the zoning or rezoning, annexation or deannexation, sale, purchase, or lease, or inclusion in or exclusion from any city, county, district or other local governmental subdivision, of the real property in which the official has an interest or a similar decision affecting the real property. For purposes of this subdivision, the terms “zoning” and “rezoning” shall refer to the act of establishing or changing the zoning or land use designation on the real property in which the official has an interest. (3) The governmental decision involves the issuance, denial or revocation of a license, permit or other land use entitlement authorizing a specific use or uses of the real property in which the official has an interest. (4) The governmental decision involves the imposition, repeal or modification of any taxes or fees assessed or imposed on the real property in which the official has an interest. (5) The governmental decision is to designate the survey area, to select the project area, to adopt the preliminary plan, to form a project area committee, to certify the environmental document, to adopt the redevelopment plan, to add territory to the redevelopment area, or to rescind or amend any of the above decisions; and real property in which the official has an interest, or any Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-21 © 2011 Richards, Watson & Gershon 1342872.1 part of it is located within the boundaries (or the proposed boundaries) of the redevelopment area. (6) The decision involves construction of, or improvements to, streets, water, sewer, storm drainage or similar facilities, and the real property in which the official has an interest will receive new or improved services. (b) Notwithstanding subdivision (a) above, real property in which a public official has an interest is not directly involved in a governmental decision, but is instead indirectly involved if: (1) The decision solely concerns the amendment of an existing zoning ordinance or other land use regulation (such as changes in the uses permitted, or development standards applicable, within a particular zoning category) which is applicable to all other properties designated in that category, which shall be analyzed under 2 Cal. Code Regs. section 18705.2(b). (2) The decision solely concerns repairs, replacement, or maintenance of existing streets, water, sewer, storm drainage or similar facilities. (3) The decision solely concerns the adoption or amendment of a general plan and all of the following apply: (A) The decision only identifies planning objectives or is otherwise exclusively one of policy. A decision will not qualify under this subdivision if the decision is initiated by the public official, by a person that is an economic interest of the public official, or by a person representing either the public official or an economic interest of the public official. (B) The decision requires a further decision or decisions by the public official’s agency prior to implementing the planning or policy objectives. Examples of further decisions include, but are not limited to, permitting, licensing, rezoning, or the approval of or change to a zoning variance, land use ordinance, or specific plan or its equivalent. (C) The decision does not concern an identifiable parcel or parcels or development project. A decision does not “concern an identifiable parcel or parcels” solely because, in the proceeding before the agency in which the decision is made, the parcel or parcels are merely included in an area depicted on a map or diagram offered in connection with the decision, provided that the map or diagram Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-22 © 2011 Richards, Watson & Gershon 1342872.1 depicts all parcels located within the agency’s jurisdiction and economic interests of the official are not singled out. (D) The decision does not concern the agency’s prior, concurrent, or subsequent approval of, or change to, a permit, license, zoning designation, zoning variance, land use ordinance, or specific plan or its equivalent. (c) Definitions - General Plans. The definitions below apply to this regulation: (1) A decision “solely concerns the adoption or amendment of a general plan” when the decision, in the manner described in Government Code sections 65301 and 65301.5, grants approval of, substitutes for, or modifies any component of, a general plan, including elements, a statement of development policies, maps, diagrams, and texts, or any other component setting forth objectives, principles, standards, and plan proposals, as described in Government Code sections 65302 and 65303. (2) “General plan” means “general plan” as used in Government Code, Title 7 (Planning and Zoning), Division 1 (Local Planning), Article 5, sections 65300, et seq. (3) “Specific plan or its equivalent” means a “specific plan” or any equivalent plan adopted by the jurisdiction to meet the purposes described in Government Code, Title 7 (Planning and Zoning), Division 1 (Local Planning), Article 8, sections 65450, et seq. (d) Determining the applicable materiality standard. (1) If the real property in which the public official has an economic interest is directly involved in a governmental decision, apply the materiality standards in 2 Cal. Code Regs. section 18705.2(a). (2) If a real property interest is not directly involved in a governmental decision, apply the materiality standards in 2 Cal. Code Regs. section 18705.2(b). NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-23 © 2011 Richards, Watson & Gershon 1342872.1 Section 18704.5. Determining Whether Directly or Indirectly Involved in a Governmental Decision: Economic Interest in Personal Finances. (a) A public official or his or her immediate family is deemed to be directly involved in a governmental decision which has any financial effect on his or her personal finances or those of his or her immediate family. NOTE: Authority cited: Section 83112, Government Code. Section 18705. Standards for Determining Whether a Financial Effect on an Economic Interest is Material. (a) In order to determine if a governmental decision’s reasonably foreseeable financial effect on a given economic interest is material: (1) For governmental decisions which affect economic interests in business entities -- apply 2 Cal. Code Regs. section 18705.1; (2) For governmental decisions which affect economic interests in real property -- apply 2 Cal. Code Regs. section 18705.2; (3) For governmental decisions which affect economic interests in sources of income -- apply 2 Cal. Code Regs. section 18705.3; (4) For governmental decisions which affect economic interests in sources of gifts -- apply 2 Cal. Code Regs. section 18705.4; (5) For governmental decisions which affect the personal expenses, income, assets or liabilities of the public official or his immediate family (personal financial effect) -- apply 2 Cal. Code Regs. section 18705.5; (b) General Rule: Whenever the specific provisions of 2 Cal. Code Regs. sections 18705.1 through 18705.5, inclusive, cannot be applied, the following general rule shall apply: The financial effect of a governmental decision is material if the decision will have a significant effect on the official or a member of the official’s immediate family, or on the source of income, the source of gifts, the business entity, or the real property, which is an economic interest of the official. (c) Special Rules. Notwithstanding 2 Cal. Code Regs. sections 18705.1 through 18705.5, inclusive, an official does not have to disqualify himself or herself from a governmental decision if: Although a conflict of interest would otherwise exist under 2 Cal. Code Regs. sections 18705.1 through 18705.5, inclusive, and 18706, the decision will have no financial effect on the person or business entity who appears before the official, or on the real property in which the official holds a direct or Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-24 © 2011 Richards, Watson & Gershon 1342872.1 indirect interest, or on the personal finances of the official and/or his immediate family. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18705.1. Materiality Standard: Economic Interests in Business Entities. (a) Introduction. (1) If a business entity in which a public official has an economic interest is directly involved in a governmental decision (see 2 Cal. Code Regs., section 18704.1(a)), use the standards in subdivision (b) of this regulation. (2) If a business entity in which a public official has an economic interest is indirectly involved in a governmental decision (see 2 Cal. Code Regs., section 18704.1(b)), use the standards in subdivision (c) of this regulation. (b) Directly involved business entities. (1) General Rule: Unless the exception in subdivision (b)(2) of this regulation applies, the financial effects of a governmental decision on a business entity which is directly involved in the governmental decision is presumed to be material. This presumption may be rebutted by proof that it is not reasonably foreseeable that the governmental decision will have any financial effect on the business entity. (2) Exception: If the public official’s only economic interest in the business entity is an investment interest (see Government Code section 87103(a)), and the public official’s investment in the business entity is worth $25,000 or less, then apply the materiality standards in subdivision (c)(1) of this regulation if the business entity is listed on the Fortune 500, or the materiality standards in subdivision (c)(2) of this regulation if the business entity is listed on the New York Stock Exchange, or if not listed on the New York Stock Exchange, for its most recent fiscal year had earnings before taxes of no less than: (A) $2.5 million, or (B) such other amount described at Rule 102.01C of the New York Stock Exchange’s Listed Company Manual (or any superseding rule of the New York Stock Exchange describing its financial standards for initial listing). Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-25 © 2011 Richards, Watson & Gershon 1342872.1 (c) Indirectly involved business entities. The following materiality standards apply when a business entity in which a public official has an economic interest is indirectly involved in a governmental decision. If more than one of the following subdivisions is applicable to the business entity in question, apply the subdivision with the highest dollar thresholds. (1) If the business entity is listed in the Fortune 500, the financial effect of a governmental decision on the business entity is material if it is reasonably foreseeable that: (A) The governmental decision will result in an increase or decrease in the business entity’s gross revenues for a fiscal year of $10,000,000 or more; or (B) The governmental decision will result in the business entity incurring or avoiding additional expenses or reducing or eliminating existing expenses for a fiscal year in the amount of $2,500,000 or more; or (C) The governmental decision will result in an increase or decrease in the value of the business entity’s assets or liabilities of $10,000,000 or more. (2) If the business entity is listed on the New York Stock Exchange, or if not listed on the New York Stock Exchange, for its most recent fiscal year had earnings before taxes of no less than $2.5 million, or such other amount described at Rule 102.01C of the New York Stock Exchange’s Listed Company Manual (or any superseding rule of the New York Stock Exchange describing its financial standards for initial listing), the financial effect of a governmental decision on the business entity is material if it is reasonably foreseeable that: (A) The governmental decision will result in an increase or decrease to the business entity’s gross revenues for a fiscal year in the amount of $500,000 or more; or, (B) The governmental decision will result in the business entity incurring or avoiding additional expenses or reducing or eliminating existing expenses for a fiscal year in the amount of $200,000 or more; or, (C) The governmental decision will result in an increase or decrease in the value of assets or liabilities of $500,000 or more. (3) If the business entity is listed on either the NASDAQ or American Stock Exchange, or if not so listed, for its most recent fiscal year had: net income of no less than $500,000 (or such other amount described in the minimum Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-26 © 2011 Richards, Watson & Gershon 1342872.1 financial requirements for continued listing on the NASDAQ SmallCap market), or earnings before taxes of no less than $750,000 (or such other amount of earnings before taxes described under initial listing standard 1 of Section 101(a) of the Rules of the American Stock Exchange, or any superseding Section of the Rules of that Exchange), the financial effect of a governmental decision on the business entity is material if it is reasonably foreseeable that: (A) The governmental decision will result in an increase or decrease to the business entity’s gross revenues for a fiscal year in the amount of $300,000 or more; or, (B) The governmental decision will result in the business entity incurring or avoiding additional expenses or reducing or eliminating existing expenses for a fiscal year in the amount of $100,000 or more; or, (C) The governmental decision will result in an increase or decrease in the value of assets or liabilities of $300,000 or more. (4) If the business entity is not covered by subdivisions (c)(1)-(3), the financial effect of a governmental decision on the business entity is material if it is reasonably foreseeable that: (A) The governmental decision will result in an increase or decrease in the business entity’s gross revenues for a fiscal year in the amount of $20,000 or more; or, (B) The governmental decision will result in the business entity incurring or avoiding additional expenses or reducing or eliminating existing expenses for a fiscal year in the amount of $5,000 or more; or, (C) The governmental decision will result in an increase or decrease in the value of the business entity’s assets or liabilities of $20,000 or more. (d) Terminology. The accounting terms described below are the same as, or not inconsistent with, terms used in Generally Accepted Accounting Principles and Generally Accepted Auditing Standards. Nothing in this subdivision should be construed to incorporate new items not contemplated under Generally Accepted Accounting Principles and Generally Accepted Auditing Standards, nor to exclude any items that might be included in the definitions of these terms under Generally Accepted Accounting Principles and Generally Accepted Auditing Standards. (1) Assets. As used in this section, “assets” means all property, real and personal, tangible and intangible, which belongs to any business entity. This Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-27 © 2011 Richards, Watson & Gershon 1342872.1 includes, but is not limited to, cash, securities, merchandise, raw materials, finished goods, operating supplies, and ordinary maintenance material and parts, accounts receivable and notes and loans receivable, and prepaid expenses (such as prepaid insurance, interests, rents, taxes, advertising, and operating supplies). (A) When a business entity holds a claim over collateral (including real property) as security for a loan made by the business entity, such a claim does not make the collateral (including real property) an “asset” of the business entity, unless the business entity has initiated proceedings to foreclose upon, or acquire the asset based on the debtor’s failure to repay the loan. The loan or note secured by the collateral is an asset. (B) The definition of “assets” also includes intangible assets. Intangible assets, include, but are not limited to, long-lived legal rights and competitive advantages developed or acquired by a business enterprise, patents, copyrights, franchises, trademarks, organizational costs, goodwill, and secret processes. (2) Earnings Before Taxes: Revenue, less the cost of goods sold and selling, general, and administrative expenses (but not excluding depreciation and amortization expenses); otherwise defined as operating and non-operating profit before the deduction of income taxes. Described variously as EBT, Income Before Income Taxes, or Income Before Provision for Income Taxes. (3) Expenses: In general, the term refers to the current costs of carrying on an activity. (4) Gross Revenue: Actual or expected inflows of cash or other assets. “Gross Revenue” is the revenue of a business entity before adjustments or deductions are made for returns and allowances and the costs of goods sold, and prior to any deduction for these and any other expenses. (5) Liabilities: Obligations of the business entity, liquidation of which is reasonably expected to require the transfer of assets or the creation of other new liabilities. Any financial obligation or cash expenditures that must be made by the business entity at a specific time to satisfy the contractual terms of such an obligation. (6) Net Income: A business entity’s total earnings; otherwise defined as revenues adjusted for the costs of doing business, depreciation, interest, Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-28 © 2011 Richards, Watson & Gershon 1342872.1 taxes, and other expenses. This amount is usually found at the bottom of a business entity’s Profit and Loss statement. Also described as Net Profit. (e) Financial statements. In complying with this regulation, public officials may rely on the most recent independently audited financial statements of the business entity so long as those statements are reflective of the current condition of the business entity. Financial statements are not considered “reflective of the current condition of the business entity” where: (1) The most recent independently audited financial statements of the business entity are for a fiscal year ending more than twenty-four months prior to the date of the governmental decision. (2) The most recent audit of the financial statements resulted in an adverse opinion, was issued with a disclaimer, or was otherwise qualified in such a manner that the statement of assets, liabilities, expenses, or gross revenues is questioned in the audit report, or (3) There has been a subsequent event, intervening between the date that the financial statement was created and the date of the decision of the public official, that makes the statement no longer representative, including, but not limited to, business reorganizations. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18705.2. Materiality Standard: Economic Interests in Real Property. (a) Directly involved real property. (1) Real property, other than leaseholds. The financial effect of a governmental decision on the real property is presumed to be material. This presumption may be rebutted by proof that it is not reasonably foreseeable that the governmental decision will have any financial effect on the real property. (2) Real property, leaseholds. The financial effect of a governmental decision on the real property in which an official holds a leasehold interest is presumed to be material. This presumption may be rebutted by proof that it is not reasonably foreseeable that the governmental decision will have any effect on any of the following: (A) The termination date of the lease; Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-29 © 2011 Richards, Watson & Gershon 1342872.1 (B) The amount of rent paid by the lessee for the leased real property, either positively or negatively; (C) The value of the lessee’s right to sublease the real property, either positively or negatively; (D) The legally allowable use or the current use of the real property by the lessee; or (E) The use or enjoyment of the leased real property by the lessee. (b) Indirectly involved real property interests. (1) Real property, other than leaseholds. The financial effect of a governmental decision on real property which is indirectly involved in the governmental decision is presumed not to be material. This presumption may be rebutted by proof that there are specific circumstances regarding the governmental decision, its financial effect, and the nature of the real property in which the public official has an economic interest, which make it reasonably foreseeable that the decision will have a material financial effect on the real property in which the public official has an interest. Examples of specific circumstances that will be considered include, but are not limited to, circumstances where the decision affects: (A) The development potential or income producing potential of the real property in which the official has an economic interest; (B) The use of the real property in which the official has an economic interest; (C) The character of the neighborhood including, but not limited to, substantial effects on: traffic, view, privacy, intensity of use, noise levels, air emissions, or similar traits of the neighborhood. (2) Real property, leaseholds. The financial effect of a governmental decision on real property in which a public official has a leasehold interest and which is indirectly involved in the governmental decision is presumed not to be material. This presumption may be rebutted by proof that there are specific circumstances regarding the governmental decision, its financial effect, and the nature of the real property in which the public official has an economic interest, which make it reasonably foreseeable that the governmental decision will: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-30 © 2011 Richards, Watson & Gershon 1342872.1 (A) Change the legally allowable use of the leased real property, and the lessee has a right to sublease the real property; (B) Change the lessee’s actual use of the real property; (C) Substantially enhance or significantly decrease the lessee’s use or enjoyment of the leased real property; (D) Increase or decrease the amount of rent for the leased real property by 5+ percent during any 12-month period following the decision; or (E) Result in a change in the termination date of the lease. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18705.3. Materiality Standard: Economic Interests in Persons Who Are Sources of Income. (a) Directly involved sources of income. Any reasonably foreseeable financial effect on a person who is a source of income to a public official, and who is directly involved in a decision before the official’s agency, is deemed material. (b) Indirectly involved sources of income. (1) Sources of income which are business entities. If the source of income is a business entity, apply the materiality standards stated in Title 2, California Code of Regulations, section 18705.1(c). (2) Sources of income which are non-profit entities, including governmental entities. The effect of a decision is material as to a nonprofit entity which is a source of income to the official if any of the following applies: (A) For an entity whose gross annual receipts are $400,000,000 or more, the effect of the decision will be any of the following: (i) The decision will result in an increase or decrease of the entity’s gross annual receipts for a fiscal year in the amount of $1,000,000 or more; or (ii) The decision will cause the entity to incur or avoid additional expenses or to reduce or eliminate existing expenses for a fiscal year in the amount of $250,000 or more; or Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-31 © 2011 Richards, Watson & Gershon 1342872.1 (iii) The decision will result in an increase or decrease in the value of the entity’s assets or liabilities in the amount of $1,000,000 or more. (B) For an entity whose gross annual receipts are more than $100,000,000 but less than $400,000,000, the effect of the decision will be any of the following: (i) The decision will result in an increase or decrease of the entity’s gross annual receipts for a fiscal year in the amount of $400,000 or more; or (ii) The decision will cause the entity to incur or avoid additional expenses or to reduce or eliminate existing expenses for a fiscal year in the amount of $100,000 or more; or (iii) The decision will result in an increase or decrease in the value of the entity’s assets or liabilities in the amount of $400,000 or more. (C) For an entity whose gross annual receipts are more than $10,000,000, but less than or equal to $100,000,000 the effect of the decision will be any of the following: (i) The decision will result in an increase or decrease of the entity’s gross annual receipts for a fiscal year in the amount of $200,000 or more. (ii) The decision will cause the entity to incur or avoid additional expenses or to reduce or eliminate existing expenses for a fiscal year in the amount of $50,000 or more. (iii) The decision will result in an increase or decrease in the value of the entity’s assets or liabilities in the amount of $200,000 or more. (D) For an entity whose gross annual receipts are more than $1,000,000, but less than or equal to $10,000,000 the effect of the decision will be any of the following: (i) The decision will result in an increase or decrease of the entity’s gross annual receipts for a fiscal year in the amount of $100,000 or more. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-32 © 2011 Richards, Watson & Gershon 1342872.1 (ii) The decision will cause the entity to incur or avoid additional expenses or to reduce or eliminate existing expenses for a fiscal year in the amount of $25,000 or more. (iii) The decision will result in an increase or decrease in the value of the entity’s assets or liabilities in the amount of $100,000 or more. (E) For an entity whose gross annual receipts are more than $100,000 but less than or equal to $1,000,000 the effect of the decision will be any of the following: (i) The decision will result in an increase or decrease of the entity’s gross annual receipts for a fiscal year in the amount of $50,000 or more. (ii) The decision will cause the entity to incur or avoid additional expenses or to reduce or eliminate existing expenses for a fiscal year in the amount of $12,500 or more. (iii) The decision will result in an increase or decrease in the value of the entity’s assets or liabilities in the amount of $50,000 or more. (F) For an entity whose gross annual receipts are $100,000 or less, the effect of the decision will be any of the following: (i) The decision will result in an increase or decrease of the entity’s gross annual receipts for a fiscal year in the amount of $10,000 or more. (ii) The decision will cause the entity to incur or avoid additional expenses or to reduce or eliminate existing expenses for a fiscal year in the amount of $2,500 or more. (iii) The decision will result in an increase or decrease in the value of the entity’s assets or liabilities in the amount of $10,000 or more. (3) Sources of income who are individuals. The effect of a decision is material as to an individual who is a source of income to an official if any of the following applies: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-33 © 2011 Richards, Watson & Gershon 1342872.1 (A) The decision will affect the individual’s income, investments, or other tangible or intangible assets or liabilities (other than real property) by $1,000 or more; or (B) The decision will affect the individual’s real property interest in a manner that is considered material under Title 2, California Code of Regulations, sections 18705.2(b). (c) Nexus. Any reasonably foreseeable financial effect on a person who is a source of income to a public official is deemed material if the public official receives or is promised the income to achieve a goal or purpose which would be achieved, defeated, aided, or hindered by the decision. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8, and 87103, Government Code. Section 18705.4. Materiality Standard: Economic Interests in Persons Who Are Sources of Gifts. (a) Directly involved sources of gifts. Any reasonably foreseeable financial effect on a person who is a source of a gift to a public official, and which person is directly involved in a decision before the official’s agency, is deemed material. (b) Indirectly involved sources of gifts. (1) Sources of gifts which are indirectly involved business entities. If the source of a gift is a business entity, apply the materiality standards stated in 2 Cal. Code Regs. section 18705.1(c). (2) Sources of gifts which are indirectly involved nonprofit entities or government agencies. If the source of a gift is a nonprofit entity or a government agency, apply the materiality standards stated in 2 Cal. Code Regs. section 18705.3(b)(2). (3) Sources of gifts who are indirectly involved individuals. If the source of a gift is an individual, apply the materiality standards stated in 2 Cal. Code Regs. section 18705.3(b)(3). NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-34 © 2011 Richards, Watson & Gershon 1342872.1 Section 18705.5. Materiality Standard: Economic Interest in Personal Finances. (a) A reasonably foreseeable financial effect on a public official’s or his or her immediate family’s personal finances is material if it is at least $250 in any 12-month period. When determining whether a governmental decision has a material financial effect on a public official’s economic interest in his or her personal finances, neither a financial effect on the value of real property owned directly or indirectly by the official, nor a financial effect on the gross revenues, expenses, or value of assets and liabilities of a business entity in which the official has a direct or indirect investment interest shall be considered. (b) The financial effects of a decision which affects only the salary, per diem, or reimbursement for expenses the public official or a member of his or her immediate family receives from a federal, state, or local government agency shall not be deemed material, unless the decision is to appoint, hire, fire, promote, demote, suspend without pay or otherwise take disciplinary action with financial sanction against the official or a member of his or her immediate family, or to set a salary for the official or a member of his or her immediate family which is different from salaries paid to other employees of the government agency in the same job classification or position, or when the member of the public official’s immediate family is the only person in the job classification or position. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. COMMENT: Cross-references: For the definition of “immediate family,” see Government Code section 82029. Section 18706. Determining Whether a Material Financial Effect Is Reasonably Foreseeable. (a) A material financial effect on an economic interest is reasonably foreseeable, within the meaning of Government Code section 87103, if it is substantially likely that one or more of the materiality standards (see Cal. Code Regs., tit. 2, Section 18704, 18705) applicable to that economic interest will be met as a result of the governmental decision. (b) In determining whether a governmental decision will have a reasonably foreseeable material financial effect on an economic interest as defined in subdivision (a) above, the following factors should be considered. These factors are not intended to be an exclusive list of the relevant facts that may be considered in determining whether a financial effect is reasonably foreseeable, but are included as general guidelines: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-35 © 2011 Richards, Watson & Gershon 1342872.1 (1) The extent to which the official or the official’s source of income has engaged, is engaged, or plans on engaging in business activity in the jurisdiction; (2) The market share held by the official or the official’s source of income in the jurisdiction; (3) The extent to which the official or the official’s source of income has competition for business in the jurisdiction; (4) The scope of the governmental decision in question; and (5) The extent to which the occurrence of the material financial effect is contingent upon intervening events, not including future governmental decisions by the official’s agency, or any other agency appointed by or subject to the budgetary control of the official’s agency. (c) Possession of a real estate sales or brokerage license, or any other professional license, without regard to the official’s business activity or likely business activity, does not in itself make a material financial effect on the official’s economic interest reasonably foreseeable. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87102.5, 87102.6, 87102.8 and 87103, Government Code. Section 18707. Public Generally. (a) Introduction. Notwithstanding a determination that the reasonably foreseeable financial effect of a governmental decision on a public official’s economic interests is material, a public official does not have a disqualifying conflict of interest in the governmental decision if the official can establish that the governmental decision will affect the public official’s economic interests in a manner which is indistinguishable from the manner in which the decision will affect the public generally as set forth in 2 Cal. Code Regs. sections 18707.1 – 18707.9. (b) Steps to Determine Application of Public Generally. To determine if the effect of a decision is not distinguishable from the effect on the public generally as set forth in subdivision (a) of this regulation, apply Steps One through Four: (1) Step One: Identify each specific person or real property (economic interest) that is materially affected by the governmental decision. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-36 © 2011 Richards, Watson & Gershon 1342872.1 (2) Step Two: For each person or real property identified in Step One, determine the applicable “significant segment” rule according to the provisions of 2 Cal. Code Regs. section 18707.1(b). (3) Step Three: Determine if the significant segment is affected by the governmental decision as set forth in the applicable “significant segment” rule. If the answer is “no,” then the analysis ends because the first prong of a two-part test set forth in 2 Cal. Code Regs. section 18707.1(b) is not met, and the public official cannot participate in the governmental decision. If the answer is “yes,” proceed to Step Four. (4) Step Four: Following the provisions of 2 Cal. Code Regs. section 18707.1(b)(2), determine if the person or real property identified in Step One is affected by the governmental decision in “substantially the same manner” as other persons or real property in the applicable significant segment. If the answer is “yes” as to each person or real property identified in Step One, then the effect of the decision is not distinguishable from the effect on the public generally and the public official may participate in the decision. If the answer is “no” as to any person or real property identified in Step One, the public official may not participate in the governmental decision unless one of the special rules set forth in 2 Cal. Code Regs. sections 18707.2 through 18707.9 applies to each person or real property triggering the conflict of interest. (c) For purposes of Government Code section 87102.5 (Members of the Legislature) and Government Code section 87102.8 (elected state officers), Government Code section 87102.6(b)(2) applies. NOTE: Authority cited: Section 83112, Government Code. Section 18707.1. Public Generally. General Rule. (a) Except as provided in Government Code sections 87102.6 and 87103.5, the material financial effect of a governmental decision on a public official’s economic interests is indistinguishable from its effect on the public generally if both subdivisions (b)(1) and (b)(2) of this regulation apply. (b) Significant Segments and Indistinguishable Effects. (1) Significant Segment. The governmental decision will affect a “significant segment” of the public generally if any of the following are affected as set forth below: (A) Individuals. For decisions that affect the personal expenses, income, assets, or liabilities of a public official or a member of his or her Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-37 © 2011 Richards, Watson & Gershon 1342872.1 immediate family, or that affect an individual who is a source of income or a source of gifts to a public official, the decision also affects: (i) Ten percent or more of the population in the jurisdiction of the official’s agency or the district the official represents; or (ii) 5,000 individuals who are residents of the jurisdiction. (B) Real Property. For decisions that affect a public official’s interest in real property, the decision also affects: (i) Ten percent or more of all property owners or all residential property owners in the jurisdiction of the official’s agency or the district the official represents; or (ii) 5,000 property owners or residential property owners in the jurisdiction of the official’s agency. (iii) While the public official must identify ten percent or more of residential property owners or 5,000 residential property owners as provided above, and not residential properties, for purposes of subdivision (b)(1)(B) the official may choose to count each residential property affected as being owned by one property owner if, and only if, the official counts himself or herself as the sole owner of the public official’s residential property regardless of his or her actual ownership interest. (iv) For purposes of this subdivision, residential property means any real property that contains a single family home, or a multi- family structure of four units or fewer, on a single lot, or a condominium unit. (C) Business Entities. For decisions that affect a business entity in which a public official has an economic interest, the decision also affects either 2,000 or twenty-five percent of all business entities in the jurisdiction or the district the official represents, so long as the effect is on persons composed of more than a single industry, trade, or profession. For purposes of this subdivision, a not for profit entity other than a governmental entity is treated as a business entity. (D) Governmental Entities. For decisions that affect a federal, state or local government entity in which the public official has an economic Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-38 © 2011 Richards, Watson & Gershon 1342872.1 interest, the decision will affect all members of the public under the jurisdiction of that governmental entity. (E) Exceptional Circumstances. The decision will affect a segment of the population which does not meet any of the standards in subsections (b)(1)(A) through (b)(1)(D), however, due to exceptional circumstances regarding the decision, it is determined such segment constitutes a significant segment of the public generally. (2) Substantially the Same Manner: The governmental decision will financially affect a public official’s economic interest in substantially the same manner as it will affect the significant segment identified in subdivision (b)(1) of this regulation. The financial effect need not be identical for the official’s economic interest to be considered “financially affected” in “substantially the same manner.” (A) Comparing Financial Effects on Real Property: For a decision that affects a public official’s economic interest in his or her real property, financial effects are measured in terms of the overall dollar amount of the increase or decrease in the value of the property and not by a percentage increase or decrease affecting property values as a whole. Factors to be considered in determining the financial effect on the official’s property in comparison with the financial effect on the public generally include, but are not limited to, the following: (i) The magnitude of the financial effect of the governmental decision on the official’s property as compared with other properties contained within the significant segment; (ii) The lot size of the official’s property compared with other properties contained within the significant segment (e.g., one acre versus 10 acres); (iii) The square footage of the building space of the property compared with the square footage of the building space of other properties contained within the significant segment; (iv) The proximity of the official’s property to the property that is the subject of the governmental decision compared with the proximity of other properties contained within the significant segment; Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-39 © 2011 Richards, Watson & Gershon 1342872.1 (v) The number of units/parcels owned by the official compared to others in the significant segment; (vi) The physical characteristics or permitted use of the property (i.e., historical, commercial, residential) as compared to other properties in the significant segment; (vii) The location of the official’s property compared with the location of other properties contained within the significant segment; (viii) The neighborhood in which the official’s property is located is comparable to the neighborhoods in which other properties contained within the significant segment are located; (ix) The quality of the structure contained on the official’s property compared with the quality of other structures contained on properties within the significant segment; (x) The current fair market value of the property as compared to other properties in the significant segment; (xi) Improvements made to the official’s property as compared with other properties contained within the significant segment; (xii) The developmental potential or income producing potential of the real property in which the official has an economic interest compared with other properties contained within the significant segment; and (xiii) The character of the effects on the neighborhood of the property in which the official has an economic interest including, but not limited to, substantial effects on: traffic, view, privacy, intensity of use, noise levels, air emissions, or similar traits of the neighborhood compared with the neighborhoods of other properties contained within the significant segment. COMMENT: The term “affect all members of the public” as used in subdivision (b)(1)(D) above, is intended to cover decisions affecting the public in general but to exclude decisions which that uniquely benefit a public official. NOTE: Authority cited: Section 83112, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-40 © 2011 Richards, Watson & Gershon 1342872.1 Reference: Section 87103, Government Code. Section 18707.2. Special Rule for Rates, Assessments, and Similar Decisions. The financial effect of a governmental decision on the official’s economic interest is indistinguishable from the decision’s effect on the public generally if any of the following apply: (a) The decision is to establish or adjust assessments, taxes, fees, charges, or rates or other similar decisions which are applied on a proportional basis on the official’s economic interest and on a significant segment of the jurisdiction, as defined in 2 Cal. Code of Regulations, section 18707.1(b). (b) The decision is made by the governing board of a landowner voting district and affects the official’s economic interests and ten percent of the landowners or water users subject to the jurisdiction of the district in proportion to their real property interests or by the same percentage or on an “across-the-board” basis for all classes. (c) The decision is made by the governing board of a water, irrigation, or similar district to establish or adjust assessments, taxes, fees, charges, or rates or other similar decisions, such as the allocation of services, which are applied on a proportional or “across-the-board” basis on the official’s economic interests and ten percent of the property owners or other persons receiving services from the official’s agency. NOTE: Authority cited: Section 83112, Government Code. Reference: Section 87103, Government Code. Section 18707.4. Public Generally: Appointed Members of Boards and Commissions. (a) For the purposes of Government Code section 87103, the “public generally” exception applies to appointed members of boards and commissions who are appointed to represent a specific economic interest, as specified in section 87103(a) through (d), if all of the following apply: (1) The statute, ordinance, or other provision of law which creates or authorizes the creation of the board or commission contains a finding and declaration that the persons appointed to the board or commission are appointed to represent and further the interests of the specific economic interest. (2) The member is required to have the economic interest the member represents. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-41 © 2011 Richards, Watson & Gershon 1342872.1 (3) The board’s or commission’s decision does not have a reasonably foreseeable material financial effect on any other economic interest held by the member, other than the economic interest the member was appointed to represent. (4) The decision of the board or commission will financially affect the member’s economic interest in a manner that is substantially the same or proportionately the same as the decision will financially affect a significant segment of the persons the member was appointed to represent. For purposes of this regulation, a significant segment constitutes fifty percent of the persons the member was appointed to represent. (b) In the absence of an express finding and declaration or requirement of the types described in 2 Cal. Code Regs. section 18707.4(a)(1) and (2), the “public generally” exception only applies if such a finding and declaration or requirement is implicit, taking into account the language of the statute, ordinance, or other provision of law creating or authorizing the creation of the board or commission, the nature and purposes of the program, any applicable legislative history, and any other relevant circumstance. NOTE: Authority cited: Section 83112, Government Code. Reference: Section 87103, Government Code. Section 18707.5. Sources of Income to Owners of Retail Business Entities. (a) Significant Segment Test (1) For purposes of Government Code section 87103.5(a), as to a business entity located in a jurisdiction with a population of more than 10,000 or which is located in a county with more than 350 retail businesses, the retail customers constitute a significant segment of the public generally if either of the following applies: (A) The retail customers of the business entity during the preceding 12 months are sufficient in number to equal 10 percent or more of the population or households of the jurisdiction; or (B) The retail customers of the business entity during the preceding 12 months number at least 10,000. (2) For purposes of Government Code section 87103.5(b), as to a business entity located in a jurisdiction with a population of 10,000 or less which is located in a county with 350 or fewer retail businesses, the retail customers Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-42 © 2011 Richards, Watson & Gershon 1342872.1 constitute a significant segment of the public generally if the retail customers of the business entity during the preceding 12 months are sufficient in number to equal 10 percent or more of the population or households of the jurisdiction. (3) For purposes of this subdivision, a customer of a retail business entity is each separate and distinct purchaser of goods or services, whether an individual, household, business or other entity. If records are not maintained by customer name, a good faith estimate shall be made to determine what percentage of sales transactions represent multiple transactions by repeat customers. The total number of sales transactions shall then be reduced by the estimated percentage of repeat customers to yield the number of customers for purposes of applying this subdivision. (b) Indistinguishable Income Test (1) For purposes of Government Code section 87103.5(a), as to a business entity located in a jurisdiction with a population of more than 10,000 or which is located in a county with more than 350 retail businesses, the amount of income received from a retail customer is not distinguishable from the amount of income received from its other retail customers if the amount spent by the customer in question is less than one-tenth of one percent of the gross sales revenues that the business entity earned during the 12 months prior to the time the decision is made. (2) For purposes of Government Code section 87103.5(b), as to a business entity located in a jurisdiction with a population of 10,000 or less which is located in a county with 350 or fewer retail businesses, the amount of income received from a retail customer is not distinguishable from the amount of income received from its other retail customers if the amount spent by the customer in question does not exceed one percent of the gross sales revenues that the business entity earned during the 12 months prior to the time the decision is made. (c) For purposes of Government Code section 87100, an official who owns 10 percent or more of a retail business entity, whose retail customers meet the criteria in either subdivision (a)(l)(A), (a)(1)(B) or (a)(2), does not “have reason to know” that a decision will affect a source of income to the retail business entity when either of the following applies: (1) If all of the following are true: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-43 © 2011 Richards, Watson & Gershon 1342872.1 (A) The customer does not have a charge account or open book account with the retail business; (B) The retail business does not maintain records for noncharge customer transactions by customer name or other method for tracking transactions which would provide the customer name; and (C) The fact that the person is a customer is not personally known to the official; or (2) If all of the following are true: (A) The accounts and books of the retail business entity are maintained by someone other than the official or a member of the official’s immediate family; and (B) The fact that the person is a customer is not personally known to the official. (d) For purposes of subdivision (c), a credit card transaction utilizing a credit card not issued by the retail business entity is considered a “noncharge customer transaction.” (e) Subdivision (c) shall not be utilized in determining whether an official “knows” of a financial interest in a decision within the meaning of Government Code section 87100. When such knowledge exists, or the fact that a person is a source of income is brought to the attention of the official prior to the governmental decision, the provisions of subdivision (c) shall have no effect on the official’s duty to disqualify. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87103 and 87103.5, Government Code. Section 18707.6. States of Emergency. Notwithstanding Title 2, California Code of Regulations, sections 18707 through 18707.5, inclusive, the financial effect of a governmental decision on an official is indistinguishable from its financial effect on the public generally if both of the following apply: (a) The decision will affect an economic interest of the official, other than an economic interest as defined in section 87103(e), in substantially the same manner as other persons subject to a state of emergency, proclaimed by the Governor pursuant to Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-44 © 2011 Richards, Watson & Gershon 1342872.1 Government Code section 8625, or proclaimed by the governing body of a city or county. (b) The decision is required to mitigate against the effects directly arising out of the emergency, and strict adherence to the Act will prevent, hinder, or delay the mitigation of the effects of the emergency. Note: Authority: Section 83112, Government Code. Reference: Section 87103, Government Code. Section 18707.7. Public Generally - Industries, Trades, or Professions. Where a decision will affect an industry, trade, or profession in substantially the same manner as the decision will affect an official’s economic interest, the industry, trade, or profession constitutes a “significant segment” of the jurisdiction only as set forth below: (a) In the case of an elected state officer, an industry, trade, or profession constitutes a significant segment of the public generally, as set forth in section 87102.6 of the Government Code. (b) In the case of any other official, an industry, trade, or profession constitutes a significant segment of the public generally if that industry, trade, or profession is a predominant industry, trade, or profession in the official’s jurisdiction or in the district represented by the official. An industry, trade, or profession that constitutes fifty percent or more of business entities in the jurisdiction of the official’s agency or the district the official represents is a “predominant” industry, trade, or profession for purposes of this regulation. For purposes of this subdivision, a not for profit entity other than a governmental entity is treated as a business entity. NOTE: Authority cited: Section 83112, Government Code. Reference: Section 87103, Government Code. Section 18707.9. Public Generally – Residential Properties. (a) For purposes of this regulation, the effect of a governmental decision on a public official’s real property interests is indistinguishable from the effect on the public generally if 5,000 or ten percent or more of all property owners or all homeowners in the jurisdiction of the official’s agency or the district the official represents are affected by the decision and the official owns three or fewer residential property units. A public official’s principal residence does not count as one of these residential property units. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-45 © 2011 Richards, Watson & Gershon 1342872.1 (b) The effect of a governmental decision on any of a public official’s economic interests (including real property and business interests) is indistinguishable from the effect on the public generally if all of the following apply: (1) The decision is to establish, eliminate, amend, or otherwise affect the respective rights or liabilities of tenants and owners of residential property pursuant to a resolution, rule, ordinance, or other law of general application; (2) No economic interest of the public official other than one created by ownership of residential real property, or the rental of that property, is analyzed under this regulation; (3) The official’s economic interests are not directly involved in the decision (as provided in 2 Cal. Code Regs. sections 18704.1, 18704.2(a), and 18705.1); (4) The decision affects at least ten percent of the residential property units in the jurisdiction of the public official or district he or she represents; and (5) The decision will affect the official’s economic interests in substantially the same manner as it will affect other residential property owners or owners of residential rental property. A public official will be affected in substantially the same manner for purposes of this subdivision if the decision will be applied on a proportional or “across-the-board” basis on the official’s economic interests as on other residential property owners or other owners of residential rental property affected by the decision. NOTE: Authority cited: Section 83112, Government Code. Reference: Section 87103, Government Code. Section 18707.10. Public Generally, Small Jurisdictions; Effects on Official’s Domicile. (a) The effect of a governmental decision on the residential real property that is the domicile of a public official is not distinguishable from the effect on the public generally if all of the following conditions are met: (1) The jurisdiction of the public official's agency has a population of 30,000 or less and covers a geographic area of ten square miles or less; (2) The public official is required to live within the jurisdiction; (3) The public official, if elected, has been elected in an at-large jurisdiction; Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-46 © 2011 Richards, Watson & Gershon 1342872.1 (4) The official's property is more than 300 feet from the boundaries of the property that is the subject of the governmental decision; (5) The official's property is located on a lot not more than one-quarter acre in size or not larger than 125 percent of the median residential lot size for the jurisdiction; and (6) There are at least 20 other properties under separate ownership within a 500 foot radius of the boundaries of the property that is the subject of the governmental decision that are similar in value. (b) For purposes of this regulation, "domicile" means the real property upon which the official makes his or her true, fixed, and permanent residence and the place to which he or she has the intention of returning after any absence. A person may have more than one residence but only one domicile. With respect to an ownership interest in any real estate containing the official's domicile where portions of the real estate are designated for separate ownership and portions are designated for common ownership solely by the owners of the separate portions, the official's domicile is the unit, area, or space in which the official has a separate ownership interest. (c) Nothing contained in this regulation shall preclude the application of the public generally provisions of regulation 18707.1 or any other regulations not applicable solely to small jurisdictions. Note: Authority cited: Section 83112, Government Code. Reference: Section 87103, Government Code. Section 18708. Legally Required Participation. (a) A public official who has a financial interest in a decision may establish that he or she is legally required to make or to participate in the making of a governmental decision within the meaning of Government Code section 87101 only if there exists no alternative source of decision consistent with the purposes and terms of the statute authorizing the decision. (b) Whenever a public official who has a financial interest in a decision is legally required to make or to participate in making such a decision, he or she shall state the existence of the potential conflict as follows: (1) The public official shall disclose the existence of the conflict and describe with particularity the nature of the economic interest. “Particularity” as used in this regulation shall be satisfied if the official discloses: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-47 © 2011 Richards, Watson & Gershon 1342872.1 (A) whether the conflict involves an investment, business position, interest in real property, or the receipt of income, loans or gifts; (B) if the interest is an investment, the name of the business entity in which each investment is held; if the interest is a business position, a general description of the business activity in which the business entity is engaged; if the interest is real property, the address or another indication of the location of the property, unless the property is the official’s principal or personal residence, in which case the official shall disclose this fact. For income, loans or gifts, the official shall disclose the person or entity that is the source. (2) The public official or another officer or employee of the agency shall give a summary description of the circumstances under which he or she believes the conflict may arise. (3) Either the public official or another officer or employee of the agency shall disclose the legal basis for concluding that there is no alternative source of decision. (4) The disclosures required by this regulation shall be made in the following manner: (A) If the governmental decision is made during an open session of a public meeting, the disclosures shall be made orally before the decision is made, by either the public official or by another officer or employee of the agency. The information contained in the disclosures shall be made part of the official public record either as a part of the minutes of the meeting or as a writing filed with the agency. The writing shall be prepared by the public official and/or any officer or employee and shall be placed in a public file of the agency within 30 days after the meeting; or (B) If the governmental decision is made during a closed session of a public meeting, the disclosures shall be made orally during the open session either before the body goes into closed session or immediately after the closed session. The information contained in the disclosures shall be made part of the official public record either as a part of the minutes of the meeting or as a writing filed with the agency. The writing shall be prepared by the public official and/or any officer or employee and shall be placed in a public file of the agency within 30 days after the meeting; or Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-48 © 2011 Richards, Watson & Gershon 1342872.1 (C) If the government decision is made or participated in other than during the open or closed session of a public meeting, the disclosures shall be made in writing and made part of the official public record, either by the public official and/or by another officer or employee of the agency. The writing shall be filed with the public official’s appointing authority or supervisor and shall be placed in a public file within 30 days after the public official makes or participates in the decision. Where the public official has no appointing authority or supervisor, the disclosure(s) shall be made in writing and filed with the agency official who maintains the records of the agency’s statements of economic interests, or other designated office for the maintenance of such disclosures, within 30 days of the making of or participating in the decision. (c) This regulation shall be construed narrowly, and shall: (1) Not be construed to permit an official, who is otherwise disqualified under Government Code section 87100, to vote to break a tie. (2) Not be construed to allow a member of any public agency, who is otherwise disqualified under Government Code section 87100, to vote if a quorum can be convened of other members of the agency who are not disqualified under Government Code section 87100, whether or not such other members are actually present at the time of the disqualification. (3) Require participation by the smallest number of officials with a conflict that are “legally required” in order for the decision to be made. A random means of selection may be used to select only the number of officials needed. When an official is selected, he or she is selected for the duration of the proceedings in all related matters until his or her participation is no longer legally required, or the need for invoking the exception no longer exists. (d) For purposes of this section, a “quorum” shall constitute the minimum number of members required to conduct business and when the vote of a supermajority is required to adopt an item, the “quorum” shall be that minimum number of members needed for that adoption. COMMENT: Nothing in the provisions of subsection (b)(4)(B) is intended to cause an agency or public official to reveal the confidences of a closed session contemplated by law. For example, under the Brown Act (Government Code sections 54950 et seq.) a city council may enter a closed session to discuss personnel matters and need not publicly disclose the name of the employee who is the subject of the meeting. (Government Code section 54957.) This regulation does not require a city council person who is legally required to Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-49 © 2011 Richards, Watson & Gershon 1342872.1 participate in that closed session to disclose that employee’s name when the council member makes the record required by this regulation. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 81002, 81003 and 87101, Government Code. Section 18709. Governmental Decision: Segmentation. (a) An agency may segment a decision in which a public official has a financial interest, to allow participation by the official, provided all of the following conditions apply: (1) The decision in which the official has a financial interest can be broken down into separate decisions that are not inextricably interrelated to the decision in which the official has a disqualifying financial interest; (2) The decision in which the official has a financial interest is segmented from the other decisions; (3) The decision in which the official has a financial interest is considered first and a final decision is reached by the agency without the disqualified official’s participation in any way; and (4) Once the decision in which the official has a financial interest has been made, the disqualified public official’s participation does not result in a reopening of, or otherwise financially affect, the decision from which the official was disqualified. (b) For purposes of this regulation, decisions are “inextricably interrelated” when the result of one decision will effectively determine, affirm, nullify, or alter the result of another decision. (c) Budget Decisions and General Plan Adoption or Amendment Decisions Affecting an Entire Jurisdiction: Once all the separate decisions related to a budget or general plan affecting the entire jurisdiction have been finalized, the public official may participate in the final vote to adopt or reject the agency’s budget or to adopt, reject, or amend the general plan. COMMENT: This regulation implements the segmentation principle outlined in the Commission’s opinion In re Owen (1976) 2 FPPC Ops. 77. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100 and 87103, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-50 © 2011 Richards, Watson & Gershon 1342872.1 CHAPTER 7. CONFLICTS OF INTEREST ARTICLE 2.5. POST-EMPLOYMENT LAWS Section 18746.3. Revolving Door; Local Officials. (a) The prohibitions of Section 87406.3 apply to a public official who, on or after July 1, 2006, holds any of the following positions: (1) Local elected official. (2) Chief administrative officer of a county. (3) City manager, including the chief administrator of a city. (4) General manager or chief administrator of a special district who holds a position with a local government agency as defined by Section 82041, including the general manager or chief administrator of an air pollution control district or air quality management district. (b) A public official covered by subdivision (a) of this regulation is prohibited from making any appearance or communication if all of the following apply: (1) The official has permanently left, as defined in Regulation 18746.4(b), any particular office or employment specified in subdivision (a) of this regulation. (2) The appearance or communication is made within 12 months after leaving that office or employment. (3) The public official is compensated, or promised compensation, for the appearance or communication. For purposes of Section 87406.3, a payment made for necessary travel, meals, and accommodations received directly in connection with voluntary services is not considered compensation. (4) The appearance or communication is made on behalf of any person as an agent, attorney, or representative of that person. An appearance or communication made by a public official to represent his or her personal interests, as defined in subdivision (b)(1) of Regulation 18702.4, is not prohibited or limited by this section unless the appearance or communication is made in a quasi-judicial proceeding, as defined in subdivision (b)(5)(C) of this regulation, in which the official participated while serving as a local government employee or officer. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-51 © 2011 Richards, Watson & Gershon 1342872.1 (5) The appearance or communication is made for the purpose of influencing, as defined in Regulation 18746.2, any legislative or administrative action, or any discretionary act involving the issuance, amending, awarding, or revocation of a permit, license, grant, or contract, or the sale or purchase of goods or property. Notwithstanding Sections 82002 and 82037, for purposes of Section 87406.3, the following definitions apply: (A) "Administrative action," as defined in Section 87406.3(d)(1), means the proposal, drafting, development, consideration, amendment, enactment, or defeat by any local government agency of any matter, including any rule, regulation, or other action in any regulatory proceeding including a ratemaking proceeding, whether quasi- legislative or quasi-judicial. "Administrative action" does not include any action that is solely ministerial. (B) "Quasi-legislative" means any proceeding involving the adoption of rules of general applicability, including but not limited to annexations of territory to a city or district, adoption or amendment of zoning ordinances, adoption of regulations, or granting of franchises. (C) "Quasi-judicial" means any proceeding that determines the rights of specific parties, or applies existing laws to specific situations, including but not limited to any proceedings to issue or revoke licenses, building permits, zoning variances, conditional use permits, parcel and subdivision maps, or coastal development permits. (D) "Legislative action," as defined in Section 87406.3(d)(2), means the drafting, introduction, modification, enactment, defeat, approval, or veto of any ordinance, amendment, resolution, report, nomination, or other matter by the legislative body of a local government agency or by any committee or subcommittee thereof, or by a member or employee of the legislative body of the local government agency acting in his or her official capacity. (6) The appearance or communication is made before any officer or employee of any of the following: (A) The local government agency, including any officer or employee of any committee, subcommittee, or present member of that local government agency, that the public official worked for or represented as specified in subdivision (a) of this regulation. An employee loaned to a local government agency is deemed to have worked for or represented that agency. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-52 © 2011 Richards, Watson & Gershon 1342872.1 (B) Any local government agency whose budget, personnel, and other operations are subject to the direction and control of any agency described in subdivision (b)(6)(A) of this regulation. (C) The prohibitions of Section 87406.3 and this regulation do not apply to any individual who, at the time of the appearance or communication, was a board member, officer, or employee of another local government agency or an employee or representative of a public agency and is appearing or communicating on behalf of that agency. Note: Authority cited: Section 83112, Government Code. Reference: Section 87406.3, Government Code. Section 18747. Influencing Prospective Employment. (a) No public official shall “make,” “participate in making,” or “use his or her official position to influence” any governmental decision, as defined in 2 Cal. Code Regs., sections 18702.1, 18702.2, 18702.3, 18702.4, if the decision directly relates to a prospective employer. (b) A governmental decision “directly relates” to a prospective employer if the public official knows or has reason to know: (1) The prospective employer is “directly involved” in the decision, as defined in 2 Cal. Code Regs. section 18704.1(a); or (2) It is reasonably foreseeable that the financial effect of a decision on a prospective employer is material as follows: (A) For a business entity, the same as set forth in 2 Cal. Code Regs. section 18705.1(c); (B) For a nonprofit entity, the same as set forth in 2 Cal. Code Regs. section 18705.3(b)(2); or (C) For an individual, the same as set forth in 2 Cal. Code Regs. section 18705.3(b)(3). (c) A person is a “prospective employer” of a public official if the official, either personally or through an agent, is “negotiating” or has an “arrangement” concerning prospective employment with that person. (1) A public official is “negotiating” employment when he or she interviews or discusses an offer of employment with an employer or his or her agent. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-53 © 2011 Richards, Watson & Gershon 1342872.1 (2) A public official has an “arrangement” concerning prospective employment when he or she accepts an employer’s offer of employment. (3) A public official is not “negotiating” or does not have an “arrangement” concerning prospective employment if he or she rejects or is rejected for employment. (d) Notwithstanding subdivision (a), the prohibitions of Government Code section 87407 do not apply if: (1) The governmental decision will affect the prospective employer in substantially the same manner as it will affect a “significant segment,” as set forth in 2 Cal. Code Regs. section 18707.1(b)(1), of the public generally; (2) The public official is legally required to make or participate in the making of the governmental decision within the meaning of Government Code section 87101 and 2 Cal. Code Regs. section 18708; or (3) The prospective employer is a state, local, or federal governmental agency. NOTE: Authority cited: Section 83112, Government Code. Reference: Section 87407, Government Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-54 © 2011 Richards, Watson & Gershon 1342872.1 CHAPTER 9. INCUMBENCY Section 18901. Mass Mailings Sent at Public Expense. (a) Except as provided in subdivision (b), a mailing is prohibited by Section 89001 if all of the following criteria are met: (1) Any item sent is delivered, by any means, to the recipient at his or her residence, place of employment or business, or post office box. For purposes of this subdivision (a)(1), the item delivered to the recipient must be a tangible item, such as a videotape, record, or button, or a written document. (2) The item sent either: (A) Features an elected officer affiliated with the agency which produces or sends the mailing, or (B) Includes the name, office, photograph, or other reference to an elected officer affiliated with the agency which produces or sends the mailing, and is prepared or sent in cooperation, consultation, coordination, or concert with the elected officer. (3) (A) Any of the costs of distribution is paid for with public moneys; or (B) Costs of design, production, and printing exceeding $50.00 are paid with public moneys, and the design, production, or printing is done with the intent of sending the item other than as permitted by this regulation. (4) More than two hundred substantially similar items are sent, in a single calendar month, excluding any item sent in response to an unsolicited request and any item described in subdivision (b). (b) Notwithstanding subdivision (a), mass mailing of the following items is not prohibited by Section 89001: (1) Any item in which the elected officer’s name appears only in the letterhead or logotype of the stationery, forms (including “For Your Information” or “Compliments of” cards), and envelopes of the agency sending the mailing, or of a committee of the agency, or of the elected officer, or in a roster listing containing the names of all elected officers of the agency. In any such item, the names of all elected officers must appear in the same type size, typeface, type color, and location. Such item may not include the elected officer’s Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-55 © 2011 Richards, Watson & Gershon 1342872.1 photograph, signature, or any other reference to the elected officer, except as specifically permitted in this subdivision (b)(1) or elsewhere in this regulation. (2) A press release sent to members of the media. (3) Any item sent in the normal course of business from one governmental entity or officer to another governmental entity or officer. (4) Any intra-agency communication sent in the normal course of business to employees, officers, deputies, and other staff. (5) Any item sent in connection with the payment or collection of funds by the agency sending the mailing, including tax bills, checks, and similar documents, in any instance where use of the elected officer’s name, office, title, or signature is necessary to the payment or collection of the funds. Such item may not include the elected officer’s photograph, signature, or any other reference to the elected officer except as specifically permitted in this subdivision (b)(5) or elsewhere in this regulation. (6) Any item sent by an agency responsible for administering a government program, to persons subject to that program, in any instance where the mailing of such item is essential to the functioning of the program, where the item does not include the elected officer’s photograph; and where use of the elected officer’s name, office, title, or signature is necessary to the functioning of the program. (7) Any legal notice or other item sent as required by law, court order, or order adopted by an administrative agency pursuant to the Administrative Procedure Act, and in which use of the elected officer’s name, office, title, or signature is necessary in the notice or other mailing. For purposes of this subdivision (b)(7), inclusion of an elected officer’s name on a ballot as a candidate for elective office, and inclusion of an elected officer’s name and signature on a ballot argument, shall be considered necessary to such a notice or other item. (8) A telephone directory, organization chart, or similar listing or roster which includes the names of elected officers as well as other individuals in the agency sending the mailing, where the name of each elected officer and individual listed appears in the same type size, typeface, and type color. Such item may not include an elected officer’s photograph, name, signature, or any other reference to an elected officer, except as specifically permitted in this subdivision (b)(8) or elsewhere in this regulation. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-56 © 2011 Richards, Watson & Gershon 1342872.1 (9) (A) An announcement of any meeting or event of the type listed in paragraphs 1 or 2. 1. An announcement sent to an elected officer’s constituents concerning a public meeting which is directly related to the elected officer’s incumbent governmental duties, which is to be held by the elected officer, and which the elected officer intends to attend. 2. An announcement of any official agency event or events for which the agency is providing the use of its facilities or staff or other financial support. (B) Any announcement provided for in this subdivision (b)(9) shall not include the elected officer’s photograph or signature and may include only a single mention of the elected officer’s name except as permitted elsewhere in this regulation. (10) An agenda or other writing that is required to be made available pursuant to Sections 11125.1 and 54957.5 of the Government Code, or a bill, file, history, journal, committee analysis, floor analysis, agenda of an interim or special hearing of a committee of the Legislature, or index of legislation, published by the Legislature. (11) A business card which does not contain the elected officer’s photograph or more than one mention of the elected officer’s name. (c) The following definitions shall govern the interpretation of this regulation: (1) “Elected officer affiliated with the agency” means an elected officer who is a member, officer, or employee of the agency, or of a subunit thereof such as a committee, or who has supervisory control over the agency, or who appoints one or more members of the agency. (2) “Features an elected officer” means that the item mailed includes the elected officer’s photograph or signature, or singles out the elected officer by the manner of display of his or her name or office in the layout of the document, such as by headlines, captions, type size, typeface, or type color. (3) “Substantially similar” is defined as follows: (A) Two items are “substantially similar” if any of the following applies: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-57 © 2011 Richards, Watson & Gershon 1342872.1 1. The items are identical, except for changes necessary to identify the recipient and his or her address. 2. The items are intended to honor, commend, congratulate, or recognize an individual or group, or individuals or groups, for the same event or occasion; are intended to celebrate or recognize the same holiday; or are intended to congratulate an individual or group, or individuals or groups, on the same type of event, such as birthdays or anniversaries. 3. Both of the following apply to the items mailed: a. Most of the bills, legislation, governmental action, activities, events, or issues of public concern mentioned in one item are mentioned in the other. b. Most of the information contained in one item is contained in the other. (B) Enclosure of the same informational materials in two items mailed, such as copies of the same bill, public document, or report, shall not, by itself, mean that the two items are “substantially similar.” Such informational materials may not include the elected officer’s name, photograph, signature, or any other reference to the elected officer except as permitted elsewhere in this regulation. (4) “Unsolicited request” is defined as follows: (A) A written or oral communication (including a petition) which specifically requests a response and which is not requested or induced by the recipient elected officer or by any third person acting at his or her behest. However, an unsolicited oral or written communication (including a petition) which contains no specific request for a response, will be deemed to constitute an unsolicited request for a single written response. (B) An unsolicited request for continuing information on a subject shall be considered an unsolicited request for multiple responses directly related to that subject for a period of time not to exceed 24 months. An unsolicited request to receive a regularly published agency newsletter shall be deemed an unsolicited request for each issue of that newsletter. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-58 © 2011 Richards, Watson & Gershon 1342872.1 (C) A previously unsolicited request to receive an agency newsletter or mass mailing on an ongoing basis shall not be deemed to have become solicited by the sole fact that the requestor responds to an agency notice indicating that, in the absence of a response, his or her name will be purged from the mailing list for that newsletter or mass mailing. A notice in the following language shall be deemed to meet this standard: “The law does not permit this office to use public funds to keep you updated on items of interest unless you specifically request that it do so.” Inclusion of a similar notice in other items shall not constitute a solicitation under this regulation. (D) A communication sent in response to an elected officer’s participation at a public forum or press conference, or to his or her issuance of a press release, shall be considered an unsolicited request. (E) A person who subscribes to newspapers or other periodicals published by persons other than elected officers shall be deemed to have made unsolicited requests for materials published in those subscription publications. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-59 © 2011 Richards, Watson & Gershon 1342872.1 CHAPTER 9.5. ETHICS Section 18940. Guide to Gift Regulations (a) Limits on Gifts – Government Code Section 89503 (b) Gift Limit Amount – Section 18940.2 (c) Definition of “Gift” – Government Code Section 82028(a) (1) Receipt, Promise and Acceptance of Gifts – Section 18941 (2) Payments for Food – Section 18941.1 (d) Exclusions and Exceptions (1) Exceptions to Gift and Exceptions to Gift Limits – Section 18942 (2) Definition of “Informational Material” – Section 18942.1 (e) Return, Donation, or Reimbursement of a Gift – Section 18943 (f) Recipient of the Gift (1) Valuation of Gifts to An Official and His or Her Family – Section 18944 (2) Passes or Tickets Given to an Agency – 18944.1 (3) Gifts to an Agency – 18944.2 (g) Source of Gifts – Section 18945 (1) Cumulation of Gifts; “Single” Source – 18945.1 (2) Intermediary of a Gift – 18945.3 (3) A Gift from Multiple Donors – 18945.4 (h) Reporting and Valuation of Gifts: General Rule – Section 18946 (1) Passes and Tickets – Section 18946.1 (2) Testimonial Dinners and Events – Section 18946.2 (3) Wedding Gifts – Section 18946.3 Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-60 © 2011 Richards, Watson & Gershon 1342872.1 (4) Tickets to Nonprofit and Political Fundraisers – Section 18946.4 (5) Prizes and Awards From Bona Fide Competitions – Section 18946.5 (i) Travel – Sections 18950 through 18950.4 Note: Authority: Section 83112, Gov. Code Reference: Sections 82028, 82030, 87100, 87103, 87207, 87302, and 89501 through 89506, Gov. Code Section 18940.2. Gift Limit Amount. (a) For purposes of Government Code section 89503, the adjusted annual gift limitation amount in effect for the period January 1, 2011, to December 31, 2012, is $420. (b) The gift limitation of $250 in Government Code section 89503 shall be adjusted biennially by the Commission to reflect changes in the Consumer Price Index and rounded to the nearest ten dollars ($10). The resulting figure shall be the adjusted gift limitation in effect until January 1 of the next odd-numbered year. (c) The gift limitation adjustment shall be based on the California Consumer Price Index for All Urban Consumers based on Consumer Price Index data obtained from the United States Bureau of Labor Statistics for the calendar year immediately preceding the year in which the adjustment is to take effect. (d) The adjusted gift limitation amount shall be calculated by the Commission as follows: (1) The base dollar amount of $250 shall be increased or decreased by the cumulative percentage change in the annual average California Consumer Price Index from 1990 to the end of the calendar year immediately preceding the year in which the adjustment will take effect. (2) The dollar amount obtained by application of the calculation set forth in subdivision (b) shall be rounded to the nearest ten dollars ($10).8 NOTE: Authority cited: Section 83112, Government Code. 8 For example, the California Consumer Price Index for All Urban Consumers for 1990 is 135.0. In 1992, the California CPI increased to 145.6. Therefore the adjusted gift limitation amount beginning in 1993 would be calculated as follows: ($250 x 145.6) / 135.0 = $269.63 ($270 rounded to the nearest $10.) Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-61 © 2011 Richards, Watson & Gershon 1342872.1 Reference: Sections 87103(e), 89503 and 89506, Government Code. Section 18941. Receipt, Promise and Acceptance of Gifts. (a) Receipt or Acceptance of a Gift. Except as otherwise provided in this section or in California Code of Regulations, Title 2, Section 18943, a gift is “received” or “accepted” when the recipient knows that he or she has either actual possession of the gift or takes any action exercising direction or control over the gift. (1) In the case of a rebate or discount which, based on Government Code Section 82028, would otherwise be a gift, the gift is “received” or “accepted” when the recipient knows that the rebate or discount is not made in the regular course of business to members of the public without regard to official status. (2) Except for passes or tickets as set forth in California Code of Regulations, Title 2, Section 18946.1(a), discarding a gift does not negate receipt or acceptance of a gift. (3) Turning a gift over to another person does not negate receipt or acceptance of a gift. (b) Disqualification: Promise of a Gift. For the purposes of Government Code Sections 87100 and 87103, a gift is “promised” on the date an offer to give the gift is made if the recipient knows that a gift has been offered and ultimately obtains actual possession of the gift or takes any action exercising direction or control over the gift. Note: Authority: Section 83112, Government Code. Reference: Sections 82028, 86204, 87103, and 89501 through 89506, Government Code. Section 18941.1. Payments for Food. Except as provided in Government Code section 82028 and California Code of Regulations, Title 2, sections 18727.5, 18941, 18942, 18943, 18946.2, 18946.5, 18950.3, and 18950.4, a payment made to an elected officer or candidate for his or her food is a gift. Note: Authority: Section 83112, Government Code. Reference: Sections 82028, 87207, and 89501 through 89506, Government Code. Section 18942. Exceptions to Gift and Exceptions to Gift Limits. (a) For purposes of Section 82028, none of the following is a gift and none is subject to any limitation on gifts: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-62 © 2011 Richards, Watson & Gershon 1342872.1 (1) Informational material as defined by Regulation 18942.1. (2) Except for passes and tickets as provided in Regulation 18946.1, a gift that is not used and that, within 30 days after receipt, is returned or donated pursuant to Regulation 18943, or for which reimbursement is paid pursuant to said Regulation 18943. (3) A gift from an individual's spouse, child, parent, grandparent, grandchild, brother, sister, parent-in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or first cousin or the spouse of any such person, unless the donor is acting as an agent or intermediary for any person not identified in this subdivision (a)(3). (4) A campaign contribution required to be reported under Chapter 4 of the Act (commencing with Government Code section 84100). (5) Any devise or inheritance. (6) A personalized plaque or trophy with an individual value of less than $250. (7) (A) The cost of hospitality (including food, beverages, or occasional lodging) provided to an official by an individual in the individual's home when the individual is present, unless one of the following provisions applies: (i) Any part of the cost of the hospitality is paid directly or reimbursed by another person. (ii) Any person deducts any part of the cost of such hospitality as a business expense on any government tax return. (iii) There is an understanding between the individual extending the hospitality and another person that any amount of compensation the individual receives from that person includes a portion to be utilized to provide gifts of hospitality in the individual's home. (B) In determining the applicability of subparagraph (A), the following apply: (i) The cost of providing hospitality does not include any part of the value or rental cost of the home nor does it include any depreciation value on the home where the hospitality is extended. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-63 © 2011 Richards, Watson & Gershon 1342872.1 (ii) An official may presume that the cost of home hospitality is paid by the host unless the host discloses to the official, or it is clear from the surrounding circumstances at the time the hospitality is provided, that a person, other than the host, paid the cost of the hospitality. (8) Gifts exchanged between an individual who is required to file a statement of economic interests and another individual, other than a lobbyist, on holidays, birthdays, or similar occasions to the extent that the gifts exchanged are not substantially disproportionate in value. For purposes of this subdivision, and notwithstanding Regulation 18946.2(b), “gifts exchanged” includes food, beverages, entertainment, and nominal benefits provided at the occasion by the honoree or another individual, other than a lobbyist, hosting the event. (9) Leave credits, including vacation, sick leave, or compensatory time off, donated to an official in accordance with a bona fide catastrophic or similar emergency leave program established by the official's employer and available to all employees in the same job classification or position. This shall not include donations of cash. (10) Payments received under a government agency program or a program established by a bona fide charitable organization exempt from taxation under section 501(c)(3) of the Internal Revenue Code designed to provide disaster relief or food, shelter, or similar assistance to qualified recipients if such payments are available to members of the public without regard to official status. (11) Free admission, and refreshments and similar non-cash nominal benefits provided to a filer at an event at which the filer gives a speech, participates in a panel or seminar, or provides a similar service, and transportation and any necessary lodging and subsistence that is exempt under Regulation 18950.3. These items are not payments and need not be reported by the filer. (12) The transportation, lodging, and subsistence specified by Regulation 18950.4. (13) A ticket or pass, provided to an official for his or her admission to an event at which the official performs a ceremonial role or function on behalf of the agency, so long as the official complies with the posting provisions set forth in subdivision (c) of Regulation 18944.1. (b) The following items, if they are otherwise gifts, are exempt from the limitations on gifts described in Section 89503: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-64 © 2011 Richards, Watson & Gershon 1342872.1 (1) Payments for transportation, lodging, and subsistence that are exempt from limits on gifts by Section 89506 and Regulations 18950, et seq. (2) Wedding gifts. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 82028, 86113, 86203, 87100, 87103, 87207, 87302 and 89503, Government Code. Section 18942.1. Definition of “Informational Material.” “Informational material” means any item which serves primarily to convey information and which is provided for the purpose of assisting the recipient in the performance of his or her official duties or of the elective office he or she seeks. Informational material may include: (a) Books, reports, pamphlets, calendars, periodicals, videotapes, or free or discounted admission to informational conferences or seminars. (b) Scale models, pictorial representations, maps, and other such items, provided that where the item has a fair market value in excess of $420, the burden shall be on the recipient to demonstrate that the item is informational material. (c) On-site demonstrations, tours, or inspections designed specifically for the purpose of assisting the recipient public officials or candidates in the performance of either their official duties or of the elective office they seek. No payment for transportation to an inspection, tour, or demonstration site, nor reimbursement for any expenses in connection therewith, shall be deemed “informational material” except insofar as such transportation is not commercially obtainable. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 82028, 87103(e) and 89503, Government Code. Section 18943. Return, Donation, or Reimbursement of a Gift. (a) General Rule for Return, Donation, or Reimbursement of a Gift. A gift is neither accepted nor received if it is returned, donated, or reimbursed in any manner set forth below: (1) The gift is returned to the donor, or to the donor’s agent or intermediary, unused, within 30 days of receipt or acceptance. In such event, neither the recipient nor the donor shall be required to disclose the receipt or making of a gift or activity expense; or Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-65 © 2011 Richards, Watson & Gershon 1342872.1 (2) The gift is donated, unused, to a charitable organization within 30 days of receipt or acceptance, without being claimed as a charitable contribution for tax purposes. In such event, neither the recipient nor the donor shall be required to disclose the receipt or making of a gift or activity expense; or (3) The gift is donated, unused, to a state, local, or federal government agency, within 30 days of receipt or acceptance, without being claimed as a deduction for tax purposes. In such event, neither the recipient nor the donor shall be required to disclose the receipt or making of a gift or activity expense; or (4) The recipient, within 30 days of receipt or acceptance, reimburses the donor, or the donor’s agent or intermediary, for all or a portion of the gift. In such event the value of the gift is reduced by the amount of the reimbursement, and the amount of any gift or activity expense which must be disclosed is reduced by the amount of the reimbursement. (b) Relief from Disqualification by Return, Donation, or Reimbursement. In order to relieve the recipient of an otherwise disqualifying financial interest based upon the receipt or acceptance of a gift valued at $420 or more pursuant to Government Code section 87100, the return, donation, or reimbursement of the gift pursuant to subdivision (a), above: (1) Must occur within 30 days of receipt or acceptance and prior to the date the recipient makes, participates in making, or uses his or her official position to influence the government decision in question; or, (2) If the return, donation, or reimbursement has not been made prior to the decision, the recipient must publicly disclose the receipt or acceptance of the gift on the public record, disclose its value, and declare that the return, donation, or reimbursement will occur within two working days following the decision. The subsequent return, donation, or reimbursement must be made within two working days, and within 30 days from receipt or acceptance, and must be documented in the public record. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87100, 87103, 87207, 87302 and 89503, Government Code. Section 18944. Gifts to an Official’s or a Candidate’s Immediate Family. (a) Scope of Regulation. This regulation applies when determining whether a gift to a public official's or candidate's family member also constitutes a gift to the public official or candidate for purposes of the Act. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-66 © 2011 Richards, Watson & Gershon 1342872.1 (b) Definitions. For purposes of this regulation, the following definitions apply: (1) "Official" means a public official as defined in Section 82048 or a candidate as defined in Section 82007. (2) "Official's family" or "family member" includes any of the following individuals: (A) An official's spouse. (B) A "dependent child" of the official as defined in Regulation 18229.1. (C) An official's child (including an adoptive child or stepchild) who meets all of the following criteria: (i) Is at least 18 but no more than 23 years old and is a full-time or part-time student. (ii) Has the same principal place of residence as the official. For purposes of this provision, a place, located away from the official's residence, at which the child resides for the purpose of attending school is not the child’s “principal place of residence.” (ii) Does not provide over one-half of his or her own support. (c) A single gift given to both an official and one or more members of the official's family is a gift to the official for the full value of the gift. (d) The following applies to a gift given solely to a member of an official's family. (1) A gift given solely to a member of an official's family is a gift to the official when the gift confers a clear personal benefit on the official. A gift to an official's family member confers a clear personal benefit on the official in any of the following circumstances: (A) It is reasonably foreseeable at the time the gift is made that the official will enjoy a financial benefit from the gift. A "financial benefit" from a gift includes, but is not limited to, a payment, other than occasional meals, lodging, or local transportation, to fulfill a commitment, obligation, or expense of the type normally paid by a family for the ordinary care and support of one of its members. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-67 © 2011 Richards, Watson & Gershon 1342872.1 (B) It is reasonably foreseeable at the time the gift is made that the official will use the gift, except for a minimal use. (C) The official exercises discretion and control over who will use or dispose of the gift. Exercising "discretion and control" includes, but is not limited to, when an official, or his or her agent, requests a gift for, or to be used by, the official's family member. (2) A gift given solely to a member of an official's family and not covered under subdivision (1) is a gift to the official if the gift confers a presumed personal benefit on the official. A gift to an official's family member confers a presumed personal benefit on the official in any of the following circumstances: (A) The gift is made to a family member of a state agency official who is subject to Section 87200 by a donor who is a lobbyist, lobbying firm, lobbyist employer, or other person required to file reports under Chapter 6 (commencing with Section 86100) of the Act. (B) The gift is made to a family member of a local government agency official who is subject to Section 87200 by a donor who is or has been directly involved in a governmental decision, as defined in Regulation 18704.1(a), in which the official will foreseeably participate or has participated in the prior 12-month period. (3) Exceptions (A) There is no gift to an official under paragraph (1) if both of the following circumstances apply: (i) The official can show there is an established working, social, or similar relationship between the donor and the official's family member independent of the relationship between the donor and the official. (ii) The person who made the gift is not a donor identified in paragraphs (2)(A) or (2)(B). (B) The official can rebut the presumption in paragraph (2) if he or she can show there is an established working, social, or similar relationship between the donor and the official's family member independent of the relationship between the donor and the official. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-68 © 2011 Richards, Watson & Gershon 1342872.1 (e) This regulation does not apply to the type of gift that, under the Act or other Commission regulations, would not be considered a gift if given directly to the official. Note: Authority cited: Section 83112, Government Code. Reference: Section 82028, Government Code. Note: Authority cited: Section 83112, Government Code. Reference: Section 82028, Government Code. Section 18944.1. Gifts: Tickets or Passes to Events. For purposes of this regulation “ticket or pass” means admission to a facility, event, show, or performance for an entertainment, amusement, recreational, or similar purpose. (a) Ticket or pass provided to official by official's agency. (1) When an agency provides a ticket or pass to an official of that agency, the ticket or pass is not subject to the provisions of this regulation, provided that the official treats the ticket or pass as income consistent with applicable state and federal income tax laws and the agency reports the distribution of the ticket or pass as income to the official in complying with the provisions of subdivision (c) below. (2) When an agency provides a ticket or pass to a public official that otherwise meets the definition of gift under Section 82028 and is not exempt under applicable Commission regulations, the official will meet the burden under Section 82028 that equal or greater value has been provided in exchange therefor, provided that all of the following requirements are met: (A) With respect to a ticket or pass from an outside source provided to an official by the official's agency: (i) The ticket or pass is not earmarked by the original source for use by the agency official who uses the ticket or pass; (ii) The agency determines, in its sole discretion, which official may use the ticket or pass. (iii) The distribution of the ticket or pass by the agency is made in accordance with a policy adopted by the agency in accordance with subdivision (b) below. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-69 © 2011 Richards, Watson & Gershon 1342872.1 (B) With respect to a ticket or pass provided by the official's agency to an agency official, which ticket or pass the agency obtains (i) pursuant to the terms of a contract for use of public property, (ii) because the agency controls the event (such as a state or county fair), or (iii) that is purchased by the agency at fair market value, the distribution of the ticket or pass is made in accordance with subdivision (b) below. (b) Any distribution of tickets or passes under subdivision (a)(2) by an agency to, or at the behest of, its officials must be made pursuant to a written policy duly adopted by legislative or governing body of the agency that state the public purposes to be accomplished by the agency policy If the agency maintains a website, the written policy shall be posted on the website in a prominent fashion. The written policy shall contain, at a minimum, the following: (1) a provision setting forth the public purposes of the agency to be accomplished by the distribution of tickets or passes; (2) a provision requiring that the distribution of any ticket or pass by the agency to, or at the behest of, an official accomplish a public purpose of the agency; and (3) a provision prohibiting the transfer by any official of any ticket or pass, distributed to such official pursuant to the agency policy, to any other person, except to members of the official's immediate family solely for their personal use. (c) The distribution of a ticket or pass pursuant to this regulation, or Regulation 18942(a)(13), including a ticket or pass that is provided to the official under subdivision (a)(1) above, shall be posted, on a form provided by the Commission, in a prominent fashion on the agency's website, within 30 days after the distribution. If the agency does not maintain a website, the form shall be maintained as a public record, be subject to inspection and copying under Section 81008(a), and be forwarded to the Commission for posting on its website. The posting shall include the following: (1) the name of the person receiving the ticket or pass, except that if the ticket or pass is distributed to an organization outside the agency, the agency may post the name, address, description of the organization, and the number of tickets or passes provided to the organization in lieu of posting the names of each individual from the organization; (2) a description of the event; Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-70 © 2011 Richards, Watson & Gershon 1342872.1 (3) the date of the event; (4) the face value of the ticket or pass; (5) the number of tickets or passes provided to each person; (6) if the ticket or pass is behested, the name of the official who behested the ticket or pass; and (7) a description of the public purpose under which the distribution was made or, alternatively, that the ticket or pass was distributed as income to the official. (d) The Commission recognizes the discretion of the legislative or governing body of an agency to determine whether the distribution of a ticket or pass serves a legitimate public purpose of the agency, provided the determination is consistent with state law. (e) The provisions of subdivision (a) apply only to the benefits the official receives by the admission and are not applicable to any other benefits the official may receive that are not included with the admission, such as food or beverages, or any other item presented to the official at the event. NOTE: Authority cited: Section 83112, Government Code. Reference: Section 82028, Government Code. Section 18944.2. Gifts to an Agency. (a) Applicability. This regulation sets forth circumstances under which a payment made to a state or local government agency, that is controlled by the agency and used for official agency business, is not considered a reportable or limited gift to an individual public official, although the official receives a personal benefit from the payment. (b) Definitions. (1) "Payment" means a payment as defined in Section 82044 and includes a monetary payment to an agency, a loan, gift, or other transfer, and the payment for, or provision of, goods or services to an agency. (2) "Agency head" means an individual in whom the ultimate legal authority of an agency is vested, or who has been delegated authority to make determinations by the agency for purposes of this regulation. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-71 © 2011 Richards, Watson & Gershon 1342872.1 (c) Gift to an Agency. A payment, that is otherwise a gift to a public official, as defined in Section 82028, shall be considered a gift to the public official's agency and not a gift to the public official if all of the following requirements are met: (1) Agency Controls Use of Payment. The agency head, or his or her designee, determines and controls the agency's use of the payment. The donor may identify a purpose for the payment, but the donor may not designate by name, title, class, or otherwise, an official who may use the payment. If the payment will provide a personal benefit to an official, the agency head, or his or her designee, shall select the individual who will use it. The agency official who determines and controls the agency's use of the payment may not select himself or herself as the individual who will use the payment. (2) Official Agency Business. The payment must be used for official agency business. (3) Agency Reports the Gift. Within 30 days after use of the payment, the agency reports the payment on a form prescribed by the Commission that includes the following information: (A) A description of the payment, the date received, the intended purpose, and the amount of the payment (or the actual or estimated value of the goods or services provided). (B) The name and address of the donor. If the donor is not an individual, the report shall also describe the business activity, or the nature and interests of the entity. If the donor has raised funds from other persons for the specific purpose of making the payment to the agency, the report shall contain the names of and amounts given by these persons. (C) The agency's use of the payment, and the name, title, and department of the agency official for whom the payment was used. The report shall include the date(s) and place(s) of travel, and a breakdown of the total expenses for transportation, lodging, meals and other related expenses. (D) The form is signed by the agency head, or his or her designee, and maintained by the agency as a public record subject to inspection and copying under Section 81008(a). (E) A state agency shall provide the completed form to the Commission (or in the case of the Commission to the office of the Attorney General), Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-72 © 2011 Richards, Watson & Gershon 1342872.1 within 30 days after use of the payment, by mail, personal delivery, electronic mail or facsimile. If the state agency maintains a website, the state agency shall also post a copy of the form or the information in the form on its website in a prominent fashion within 30 days after use of the payment. If the state agency does not maintain a website, the Commission shall post a copy of the form or the information in the form on its website. (F) A local agency shall provide the completed form to the filing officer who receives the agency employees' statements of economic interests, within 30 days after use of the payment, by mail, personal delivery, electronic mail or facsimile. The filing officer shall post a copy of the form or the information in the form on its website, or if it does not maintain a website, shall provide a copy of the form to the Commission which shall post the information on its website. (G) The individual in the agency who has official custody of these forms is the filing officer for the forms, keeps a log of the forms under both the name of the agency and official receiving the payment, and maintains the forms for a period of not less than four years. (d) Limitations on Application of this Regulation. The exception provided in subdivision (c) does not apply to the following payments: (1) A payment for travel, including transportation, lodging, and meals, for a state or local elected officer, as defined in Section 82020, or an official specified in Section 87200. (2) A payment for travel to the extent that it exceeds the agency's reimbursement rates for travel, meals, and lodging, and other actual and necessary expenses, or if the agency has no standard policy or practice concerning reimbursement rates, the State per diem rates as set forth in applicable sections of the State Administrative Manual and Department of Personnel Administration regulations, or the Internal Revenue Service rates for reimbursement of these expenses as set forth in the U.S. General Service Administration's website under "Per Diem Rates" and Internal Revenue Service Publications 463 and 1542, or their successors. (3) A payment for travel that the agency head, or his or her designee, has not preapproved in writing in advance of the date of the trip. (4) Passes or tickets, as described in Regulation 18944.1, which shall be governed by that regulation. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-73 © 2011 Richards, Watson & Gershon 1342872.1 (e) Public Colleges and University Research Projects. Notwithstanding this regulation, a donation to a California public college or university for a specific research project that is received consistent with the requirements of Regulation 18702.4(c) or a meal received in the course of the college's or university's official fundraising activity, which qualifies under federal and state law for a deduction as a charitable contribution for educational purposes, will be deemed a gift to the college or university. (f) Payments from the Federal Government. Notwithstanding this regulation, a grant, reimbursement, funding, or other payment received by a state or local government agency from a federal government agency for education, training, or other inter- agency programs, will not be considered a gift to the public official who receives a personal benefit from the payment. Comments: 1. Acceptance of a pass or discount from a transportation company by a public officer, other than a Public Utilities Commissioner, may result in forfeiture of the official's office pursuant to Article XII, Section 7 of the California Constitution. Note: Authority cited: Section 83112, Government Code. Reference: Sections 82028, 82030, 82044, 87100, 87103, 87207, 87302 and 89501-89506, Government Code. Section 18944.3. Gifts from a Government Agency to Officials in That Agency. Except as provided in Regulation 18944.1 and 18944.2, a payment by a government agency from that agency's assets that provides food, beverage, entertainment, goods, or services of more than a nominal value to an official in that agency is a gift to that official unless the payment is a lawful expenditure of public moneys. Note: Authority cited: Section 83112, Government Code. Reference: Section 82028, Government Code. Section 18944.4. Agency Raffles and Gift Exchanges. (a) Applicability. This regulation identifies when a payment made by a state or local government agency in the form of an item awarded to an agency employee in a raffle open to all employees of the agency or the unit of the agency holding the raffle, or in an agency gift exchange, will be treated as a gift to the employee. (b) Agency Raffles. (1) When an agency holds an employee raffle and the item awarded in the raffle has been received by the agency from a source other than an agency Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-74 © 2011 Richards, Watson & Gershon 1342872.1 employee and the agency did not purchase the item from its funds, the payment is a gift to the employee from the source who provided the item to the agency, and the agency is the intermediary of the gift. The value of the gift is the fair market value less any consideration paid by the employee to participate in the raffle. If the value of the gift is $50 or more and the employee is required to report the gift on his or her statement of economic interests, the agency and the employee shall comply with Section 87210 or Section 87313 as applicable. (2) When an agency holds an employee raffle and the item awarded in the raffle has been obtained with agency funds or is otherwise an asset of the agency and not donated to the agency by a non-agency source, the provisions of Regulation 18944.3 apply. (3) When an agency holds an employee raffle and the item awarded in the raffle has been received by the agency from an agency employee who is not acting as an intermediary for another donor, the item is not a gift to the employee who wins the raffle. (c) Agency Gift Exchanges. When an employee of an agency participates in an employee gift exchange, any item received by the employee in the gift exchange is not a gift so long as the item received is provided by another employee of the agency and the gifts are not substantially disproportionate in value. (d) This regulation does not apply to passes or tickets of the type described in Regulation 18944.1, which shall be governed by that regulation. Note: Authority cited: Section 83112, Government Code. Reference: Section 82028, Government Code. Section 18945. Source of Gifts. (a) General Rule. A person is the source of a gift if the person makes a gift to an official and is not acting as an intermediary. (b) Gifts through an Intermediary. (1) A person is the source of a gift, and a third party is an intermediary of the gift under Sections 87210 or 87313, if the person makes a payment to the third party and the payment is used directly or indirectly by the third party to make a gift to an official under any of the following conditions: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-75 © 2011 Richards, Watson & Gershon 1342872.1 (A) The person directs and controls the payment at the time it is used by the third party to make a gift to the official. (B) The person and third party have agreed that the payment will be used by the third party to make a gift to the official. (C) The person identifies the official to the third party as the intended beneficiary of the payment prior to the third party making the payment to the official. (D) The third party identifies the official to the person as the intended beneficiary of the payment prior to the person making the payment to the third party. (E) The person knows or has reason to know that the sole or primary purpose of the payment is to make gifts to officials. (F) The official or the official's agent solicits the payment from the person to the third party for the purpose of making a gift to the official. (2) For purposes of subdivisions (b)(1)(C) and (b)(1)(D), a person or third party “identifies the official” if the person or third party identifies the official by name or any other designation of the official from which it is clear the person or third party is referring to the official, or if the person or third party identifies a group of officials from one or more specific state or local government agencies and the official is part of that group. (c) A person who pays dues or similar payments for membership in a bona fide association, including any federation, confederation, or trade, labor or membership organization is not the source of gifts made by the association to an official unless the sole or primary purpose of the dues or similar payments is to make gifts to officials. (d) Presumption of Source by Officials. An official may presume that the person delivering the gift or, if the gift is offered but has not been delivered, the person offering the gift to him or her is the source of the gift unless either of the following apply: (1) The person delivering or offering the gift discloses to the official the actual source of the gift. (2) It is clear from the surrounding circumstances at the time the gift is delivered or offered that the person delivering or offering the gift is not the actual source of the gift. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-76 © 2011 Richards, Watson & Gershon 1342872.1 (3) The official solicits a payment pursuant to subdivision (b)(1)(F) and receives or is offered a gift responsive to the solicitation within 12 months of making the solicitation. (e) Presumption of Source by Intermediaries. A third party otherwise qualifying as an intermediary as a result of a payment solicited from an official pursuant to subdivision (b)(1)(F) may presume that he or she is the source of the gift, and is not required to disclose the actual source of the gift as required by Regulation 18945.3, when both of the following apply: (1) The third party does not know or have reason to know of the official's solicitation. (2) The third party does not qualify as an intermediary under subdivisions (b)(1)(A)-(b)(1)(E). Note: Authority cited: Section 83112, Government Code. Reference: Sections 82028, 86111, 86201, 86203, 87100, 87103, 87207, 87210, 87302, 87313 and 89503, Government Code. Section 18945.1. Cumulation of Gifts; “Single” Source. For purposes of the limitations in Government Code Sections 89501 through 89506, two or more gifts are cumulated as being from a “single” source if any of the following circumstances apply: (a) Gifts from an individual and an entity in which the individual has an ownership interest of more than 50 percent shall be cumulated as being gifts from a “single” source. (b) Except as provided in subdivision (a), gifts from an individual and an entity shall be cumulated as being gifts from a “single” source if the individual in fact directs and controls the decision of the entity to make the gifts. (c) If the same person or a majority of the same persons in fact directs and controls the decisions of two or more entities to make gifts to one or more public officials or candidates, gifts by those affiliated entities shall be cumulated as being gifts from a “single” source. (d) Business entities in a parent-subsidiary relationship, or business entities with the same controlling (more than 50 percent) owner, shall be considered a “single” source unless the business entities act independently in their decisions to make gifts to one or more public officials or candidates. For purposes of this regulation, a Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-77 © 2011 Richards, Watson & Gershon 1342872.1 parent-subsidiary relationship exists when one business entity owns more than 50 percent of another business entity. Note: Authority: Section 83112, Government Code. Reference: Sections 89501 through 89506, Government Code. Section 18945.3. Intermediary of a Gift. (a) Intermediaries of Gifts to Persons Required to File Under Title 9, Chapter 7, Article 2 of the Government Code - No person shall make a gift totaling fifty dollars ($50) or more in a calendar year to a person described in Article 2 on behalf of another, or while acting as the intermediary or agent of another, without disclosing to the recipient of the gift both his own full name, street address, and business activity, if any, and the full name, street address, and business activity, if any, of the actual donor. The recipient of the gift shall include in his Statement of Economic Interests the full name, street address, and business activity, if any, of the intermediary or agent and the actual donor. (b) Intermediaries of Gifts to Persons Required to File Under Title 9, Chapter 7, Article 3 of the Government Code - No person shall make a gift of fifty dollars ($50) or more in a calendar month on behalf of another, or while acting as the intermediary or agent of another to a person whom he knows or has reason to know may be required to disclose the gift pursuant to a conflict of interest code, without disclosing to the recipient of the gift both his own full name, street address, and business activity, if any, and the full name, street address, and business activity, if any, of the actual donor. The recipient of the gift shall include in his Statement of Economic Interests the full name, street address, and business activity, if any, of the intermediary or agent and the actual donor. (c) Notwithstanding subdivisions (a) or (b) above, it shall be unlawful for a lobbyist or lobbying firm to act as an intermediary in the making of any gift aggregating more than $10 per calendar month to a state candidate, elected state officer, legislative official or agency official of any agency required to be listed on the registration statement of the lobbying firm or the lobbyist employer of the lobbyist. Note: Authority: Section 83112, Government Code. Reference: Sections 86203, 87210, 87313, Government Code. Section 18945.4. A Gift from Multiple Donors. A gift which is received from multiple donors must be reported if the gift’s value equals or exceeds $50. The name of any donor whose share of the gift is less than $50 in value need Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-78 © 2011 Richards, Watson & Gershon 1342872.1 not be separately reported; it is sufficient to describe in general terms those who gave the gift. If, however, the share of any donor or his or her agent or intermediary is $50 or more in value, his or her name must be reported. Note: Authority: Section 83112, Government Code. Reference: Section 82028, Government Code. Section 18946. Reporting and Valuation of Gifts. (a) Scope of Section. Except as specified in 2 Cal. Code Regs. sections 18946.1 through 18946.5, inclusive, gifts shall be valued at fair market value as of the date of receipt or promise. Sections 18946.1 through 18946.5 provide for the valuation of specific types of gifts in the following situations: Passes and Season Tickets – Regulation 18946.1 Testimonial Dinners and Events, Invitation-Only Events, and Ceremonial Functions – Regulation 18946.2 Wedding Gifts – Regulation 18946.3 Tickets to Nonprofit and Political Fundraisers – Regulation 18946.4 Prizes and Awards From Bona Fide Competitions – Regulation 18946.5 (b) General Rule for Valuation of Unique Gifts. Whenever the fair market value cannot readily be ascertained because the gift is unique or unusual, the value shall be the cost to the donor, if known or ascertainable. If the cost to the donor is unknown and unascertainable, the recipient shall make a reasonable approximation. In making such an approximation, the recipient shall take into account the price of similar items. If similar items are not available as a guide, a good faith estimate shall be utilized. (c) Except as specified in 2 Cal. Code Regs. sections 18943, 18944, and 18946.1, a gift must be valued, for purposes of disclosure and disqualification, even if unused, discarded or given to another person. (d) Definitions: For purposes of this section and 2 Cal. Code Regs. sections 18946.1 through 18946.5 and section 18640, the following definitions apply: (1) “Face Value.” The term “face value” means the price indicated on the ticket, or if no price is indicated, the price at which the ticket or similar pass would Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-79 © 2011 Richards, Watson & Gershon 1342872.1 otherwise be offered for sale to the general public by the operator of the venue or host of the event who offers the ticket for public sale. (2) “Ticket/Pass.” A “ticket” or “pass” means anything that provides an admission privilege to an event or function and for which similar tickets or passes are offered for sale to the public. (3) “Invitation.” An “invitation” means a request to attend an event or function by the sponsor of the event or function, that is not a ticket or pass as defined above in subsection (d)(2) of this section and 2 Cal. Code Regs. section 18944.1, and where admission to the event is provided by such invitation only. (4) “Specific Item.” The term “specific item” means a tangible item received by an official or candidate at an event that is not included among the non-cash nominal items presented to all attendees at the event. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 82028, 87207 and 87302, Government Code. Section 18946.1. Reporting and Valuation of Gifts: Passes and Tickets. (a) A pass or ticket that provides one time admission or access to facilities, goods, services, or other incidental tangible or intangible benefits (including a pass to motion picture theaters, amusement parks, parking facilities, country clubs, and similar places or events, and also including a ticket for theater, opera, sporting, or similar event, but not including travel or lodging) shall be valued at the face value of the pass or ticket, provided that the face value is a price that was, or otherwise would have been, offered to the general public. A pass or ticket has no value unless it is ultimately used or transferred to another person. (b) A pass or ticket that provides repeated admission or access to facilities, goods, services, or other incidental tangible or intangible benefits (including a pass to motion picture theaters, amusement parks, parking facilities, country clubs and similar places or events, and also including a season ticket for theater, opera, sporting, or similar season events, but not including travel or lodging) shall be valued as follows: (1) For purposes of disclosure and the gift limits, the value shall be the fair market value of the actual use of the pass or ticket by the recipient, including guests who may accompany the recipient and who are admitted with the pass or ticket, plus the fair market value of any possible use by any person or persons to whom the privilege of use of the pass or ticket is transferred. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-80 © 2011 Richards, Watson & Gershon 1342872.1 (2) For purposes of disqualification, the value shall be the actual use of the pass or ticket by the official, including guests who may accompany the official and who are admitted with the pass or ticket, plus the fair market value of any possible use by any person or persons to whom the official transfers the privilege of use of the pass or ticket, through the date of the governmental decision in question, plus the fair market value of the maximum reasonable use following the date of the decision. If the official returns the pass or any unused ticket prior to the decision, the value shall be determined pursuant to subdivision (b)(1). NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 82028, 87207 and 87302, Government Code. Section 18946.2. Reporting and Valuation of Gifts: Testimonial Dinners and Events, Invitation-Only Events, and Ceremonial Functions. (a) Testimonial Dinners. When an official or candidate is honored at a testimonial dinner or similar event, at which campaign fundraising for the official or candidate does not occur, the value received is the official’s or candidate’s pro rata share of the cost of the event, plus the value of any specific item that is presented to the official or candidate at the event. (b) Invitation-Only Events. Except as provided in subdivisions (d) through (f) of this regulation, when an official or candidate attends an invitation-only event such as a banquet, party, gala, celebration, or other similar function, other than a nonprofit or political fundraiser as set forth in 2 Cal. Code Regs. section 18946.4, the value received is the official’s or candidate’s pro rata share of the cost of the event, plus the value of any specific item that is presented to the official or candidate at the event. (c) “Pro rata share of the cost of the event.” The term “pro rata share of the cost of the event” means the cost of all food and beverages, rent of the facilities, decorations, entertainment, and all other costs associated with the event, divided by the number of acceptances or the number of attendees. (d) Official or Ceremonial Functions. When an official performs an official or ceremonial function at an invitation-only event, as set forth in subdivision (b) of this regulation, in which the official is invited to participate by the event’s sponsor or organizer to perform an official or ceremonial function, the value received is the cost of any food or beverages provided to the official plus the value of any specific item that is presented to the official at the event. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-81 © 2011 Richards, Watson & Gershon 1342872.1 (e) Drop-In Visit. Except as provided in subdivision (f) of this regulation, if an official attends an event referred to in subdivision (a) or (b) of this regulation and does not stay for any meal or entertainment otherwise provided at the event, and receives only minimal appetizers and drinks, the value of the gift received is the cost of the food and beverage consumed by the official and guests accompanying the official, plus the value of any specific item that is presented to the official at the event. For purposes of this subdivision, “entertainment” means a feature show or performance intended for an audience, and does not include music provided for background ambiance. (f) Lobbyists, Lobbying Firms, and Lobbyist Employers. Where an official attends an event referred to in subdivision (a) or (b) of this regulation, sponsored by any person required to file a periodic statement under Article 1 of Chapter 6 of this title, the value of the gift is determined pursuant to the provisions of 2 Cal Code Regs. section 18640. NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 82028, 87207, 87302 and 89501 through 89506, Government Code. Section 18946.3. Reporting and Valuation of Gifts: Wedding Gifts. Notwithstanding the provisions of California Code of Regulations, Title 2, Section 18944, wedding gifts given to an official and his or her spouse or spouse-to-be are considered as gifts to both spouses equally, and the official is deemed to receive one-half of the value as determined pursuant to California Code of Regulations, Title 2, Section 18946, unless the gift is peculiarly adaptable to the personal use and enjoyment of one spouse or specifically and unequivocally intended exclusively for use and enjoyment by one spouse, in which event the full value of the gift is attributed to that spouse. Note: Authority: Section 83112, Government Code. Reference: Sections 82028, 87207, and 87302, Government Code. Section 18946.4. Reporting and Valuation of Gifts: Tickets Provided by Nonprofit and Political Organizations for Their Fundraising Events. This regulation applies to a single ticket or other admission privilege to a specific fundraising event provided to a public official by a nonprofit or political organization holding its own fundraiser and used solely by the public official. (a) Nonprofit Fundraiser. Except as provided in subdivision (b), the value of a gift of a ticket, pass, or other admission privilege to a fundraising event for a nonprofit, tax- Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-82 © 2011 Richards, Watson & Gershon 1342872.1 exempt organization that is not a committee covered by subdivision (c) is determined as follows: (1) Where the ticket clearly states that a portion of the ticket price is a donation to the organization, the value of the gift is the face value of the ticket reduced by the amount of the donation. (2) If there is no ticket indicating a face value or the ticket or other admission privilege has no stated price or no stated donation portion, the value of the gift is the pro rata share of the cost of any food, and beverages, plus any other specific item presented to the attendee at the event. (b) 501(c)(3) Organization Fundraiser. Where the event is a fundraising event for an organization exempt from taxation under Section 501(c)(3) of the Internal Revenue Code, the organization may provide one ticket per event to an official and that ticket shall be deemed to have no value so long as the cumulative value of the nondeductible portion of the ticket(s), as provided in subdivision (a), received by the official from the same organization during a calendar year, does not exceed the gift limits imposed under Section 89503 and Regulation 18940.2. (c) Political Fundraiser. For a gift of a ticket, pass, or other admission privilege to a fundraising event for a committee defined in Section 82013(a), or a comparable committee regulated under federal law holding an event in California, the committee or candidate may provide one ticket per event to an official and that ticket shall be deemed to have no value. Note: Authority: Section 83112, Government Code. Reference: Sections 82028, 87207 and 87302, Government Code. Section 18946.5. Prizes and Awards From Bona Fide Competitions. A prize or an award received shall be reported as a gift unless the prize or award is received in a bona fide competition not related to the recipient’s status as an official or candidate. A prize or award which is not reported as a gift shall be reported as income. Note: Authority: Section 83112, Government Code. Reference: Sections 82028, 82030, 87207, and 87302, Government Code. Section 18946.6. Reporting and Valuation of Gifts: Air Transportation. Air transportation that is a gift to a public official shall be valued as follows: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-83 © 2011 Richards, Watson & Gershon 1342872.1 (a) For transportation on a "commercial aircraft," the value of the ticket or fare the carrier charges to a member of the public for the same transportation provided to the official. For purposes of this regulation, "commercial aircraft" means an aircraft used to transport the general public for compensation or hire on a regular basis, and for which a fare is charged on a per-passenger basis. (b) For all other air transportation, the value of the normal and usual charter fare or rental charge for a comparable airplane of comparable size, divided by the number of all of the following persons that share the same flight: (1) "Designated employees" as defined in Section 82019. (2) Public officials specified in Section 87200. (3) Members of Congress, and officers and employees of the executive, legislative, or judicial branch of the United States government. (c) The actual cost or fair market value of any other personal benefits provided to the official during the air transportation, including food, beverages, or entertainment, shall be treated as a separate gift to the official unless the benefit is included as part of the fare determined in subdivision (a) or (b). Note: Authority: Section 83112, Government Code. Reference: Sections 87207, 87302 and 89501-89506, Government Code. Section 18950. Guide to Travel Regulations. (a) Gifts of Travel: Exceptions: – Section 18950.1 and Government Code Section 89506; (b) Travel in Connection With Speeches, Panels, and Seminars: Exception for All Individuals – Section 18950.3; (c) Payments for Travel in Connection with Campaign Activities – Section 18950.4. Note: Authority: Section 83112, Government Code. Reference: Sections 82015, 82028, 86111, 87207, 87302, and 89501 through 89506, Government Code. Section 18950.1. Gifts of Travel: Exceptions. The following provisions shall apply to payments made for travel pursuant to Government Code Sections 89501 through 89506: Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-84 © 2011 Richards, Watson & Gershon 1342872.1 (a) Travel in Connection with Speeches, Panels, and Seminars. (1) Only a reportable payment is subject to the limitations on gifts specified in Government Code Section 89503. See California Code of Regulations, Title 2, Section 18950.3, to determine whether a payment in connection with a speech, panel, or seminar is reportable. (2) A payment made for travel, including actual transportation and related lodging and subsistence, is not subject to the prohibitions or limitations on honoraria and gifts specified in Government Code Sections 89501, 89502, or 89503 if: (A) The travel is reasonably related to a legislative or governmental purpose, or to an issue of state, national, or international public policy, and (B) The travel, including actual transportation and related lodging and subsistence, is in connection with a speech given by the official or candidate; the lodging and subsistence expenses are limited to the day immediately preceding, the day of, and the day immediately following the speech; and the travel is within the United States. Except as otherwise provided by California Code of Regulations, Title 2, Section 18950.3, any payment made for travel specified in this subdivision (a)(2), shall be reported in accordance with Government Code Section 87207(c). (b) Travel Provided by Governmental Entity or Charity. A payment made for travel, including actual transportation and related lodging and subsistence, is not subject to the prohibitions or limitations on honoraria and gifts specified in Government Code Sections 89501, 89502, or 89503 if: (1) The travel is reasonably related to a legislative or governmental purpose, or to an issue of state, national, or international public policy; and (2) The payment is provided by a government, a governmental agency, a foreign government, a governmental authority, a bona fide public or private educational institution, defined in Section 203 of the Revenue and Taxation Code, or by a nonprofit organization that is exempt from taxation under Section 501(c)(3) of the Internal Revenue Code, or by a person that is domiciled outside the United States and that substantially satisfies the requirements for tax exempt status under Section 501(c)(3) of the Internal Revenue Code. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-85 © 2011 Richards, Watson & Gershon 1342872.1 Except as provided by California Code of Regulations, Title 2, Section 18950.3, any payment made for transportation, lodging, and subsistence, specified by subdivision (b), shall be reported in accordance with Government Code Section 87207(c). (c) Travel Paid from Campaign Funds. A payment made for transportation and necessary lodging and subsistence, which payment is made from campaign funds as permitted by Government Code Section 89513, or which is a contribution, is not an honorarium or a gift. (d) Travel Provided by Official’s Agency. A payment made for transportation and necessary lodging and subsistence, which payment is made by the agency of an official, is not an honorarium or a gift. (e) Travel in Connection with Bona Fide Business. A payment made for transportation, lodging, and subsistence, which payment is reasonably necessary in connection with a bona fide business, trade, or profession, and which satisfies the criteria for federal income tax deductions for business expenses specified in Sections 162 and 274 of the Internal Revenue Code, is not an honorarium or gift unless the sole or predominant activity of the business, trade or profession is making speeches. Note: Authority: Section 83112, Government Code. Reference: Sections 86111, 87207, and 89501 through 89506, Government Code. Section 18950.3. Payments in Connection with Speeches. (a) Definitions: For the purposes of this regulation, the following definitions apply: (1) “Speech” means making a speech, participating on a panel, or making a substantive formal presentation at a seminar or similar event. (2) Lodging, food or beverages are “necessary” only when provided on the day immediately preceding, the day(s) of, and the day immediately following the speech, panel, seminar, or similar service. (b) A payment made for admission to an event at which an official makes a speech, transportation, and necessary lodging, food, or beverages, and nominal non-cash benefits provided to the official in connection with making the speech is not a “payment” as defined in Section 82044 and is not reportable if all of the following apply: (1) The speech is for official agency business and the official is representing his or her government agency in the course and scope of his or her official duties. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-86 © 2011 Richards, Watson & Gershon 1342872.1 (2) The payment is a lawful expenditure made only by a federal, state, or local government agency for purposes related to conducting that agency's official business. For purposes of this subdivision, a payment made to the agency by a nongovernmental source that is earmarked for use by or reimbursement of an official specified by the source is not a “payment by a federal, state, or local government agency.” (3) The official making the speech is not a state or local elected officer, as defined in Section 82020, or an official specified in Section 87200. Note: Authority: Section 83112, Government Code. Reference: Sections 82028, 82030 and 89501-89506, Government Code Section 18950.4. Payments for Travel in Connection with Campaign Activities. (a) Except as provided in Section 18727.5, a payment made to an elected officer or candidate for his or her transportation, lodging, or subsistence is a gift unless the transportation, lodging, or subsistence provided to the elected officer or candidate is in “direct connection” with campaign activities, including attendance at political fundraisers. (1) Any payment made to an elected officer or candidate for his or her transportation, lodging, or subsistence, during the six month period prior to an election in which the elected officer or candidate is to be voted upon shall be considered “in direct” connection with campaign activities if the payment is for necessary transportation, lodging, or subsistence, used specifically for the purpose of the elected officer’s or candidate’s: (A) Participation in candidate forums, debates or similar voter gatherings at which he or she makes a speech; or (B) Attendance at meetings with campaign staff or political consultants to develop or implement campaign strategy. (2) A payment made to an elected officer or candidate for necessary transportation to, or lodging and subsistence at, an event described in subdivision (a)(1)(A) or subdivision (a)(1)(B), but not made within the six month period prior to the election in which the elected officer or candidate is being voted upon, shall be considered a gift unless it is clear from the surrounding circumstances that the payment is made directly in connection with campaign activities. Appendix A - Selected Regulations of The Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations Summary of Principal Conflicts of Interest Laws Page A-87 © 2011 Richards, Watson & Gershon 1342872.1 (3) When a payment is made to an elected officer or candidate for his or her necessary lodging and subsistence or transportation in direct connection with attendance at a political fundraiser or an event listed in subdivision (a)(1)(A) or subdivision (a)(1)(B), which fundraiser event is conducted to benefit another elected officer or candidate, or to benefit a committee as defined in Government Code Section 82013(a), the payment is a contribution to the officer, candidate, or committee benefiting from the fundraiser. Note: Authority: Section 83112, Government Code. Reference: Sections 82015 and 82028, Government Code. Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-1 © 2011 Richards, Watson & Gershon 1342872.1 Appendix B Government Code Sections 1090-1099 Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-2 © 2011 Richards, Watson & Gershon 1342872.1 GOVERNMENT CODE SECTIONS 1090-1099 Section 1090. Conflicts of interest contracts, sales and purchases. Members of the Legislature, state, county, district, judicial district, and city officers or employees shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members. Nor shall state, county, district, judicial district, and city officers or employees be purchasers at any sale or vendors at any purchase made by them in their official capacity. As used in this article, “district” means any agency of the state formed pursuant to general law or special act, for the local performance of governmental or proprietary functions within limited boundaries. Section 1090.1. Acceptance of commissions for placement of insurance. No officer or employee of the State nor any Member of the Legislature shall accept any commission for the placement of insurance on behalf of the State. Section 1091. Remote interest of an officer or member. (a) An officer shall not be deemed to be interested in a contract entered into by a body or board of which the officer is a member within the meaning of this article if the officer has only a remote interest in the contract and if the fact of that interest is disclosed to the body or board of which the officer is a member and noted in its official records, and thereafter the body or board authorizes, approves, or ratifies the contract in good faith by a vote of its membership sufficient for the purpose without counting the vote or votes of the officer or member with the remote interest. (b) As used in this article, “remote interest” means any of the following: (1) That of an officer or employee of a nonprofit entity exempt from taxation pursuant to Section 501(c)(3) of the Internal Revenue Code (26 U.S.C. Sec. 501(c)(3)) or a nonprofit corporation, except as provided in paragraph (8) of subdivision (a) of Section 1091.5. (2) That of an employee or agent of the contracting party, if the contracting party has 10 or more other employees and if the officer was an employee or agent of that contracting party for at least three years prior to the officer initially accepting his or her office and the officer owns less than 3 percent of the shares of stock of the contracting party; and the employee or agent is not an officer or director of the contracting party and did not directly participate in formulating the bid of the contracting party. For purposes of this paragraph, Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-3 © 2011 Richards, Watson & Gershon 1342872.1 time of employment with the contracting party by the officer shall be counted in computing the three-year period specified in this paragraph even though the contracting party has been converted from one form of business organization to a different form of business organization within three years of the initial taking of office by the officer. Time of employment in that case shall be counted only if, after the transfer or change in organization, the real or ultimate ownership of the contracting party is the same or substantially similar to that which existed before the transfer or change in organization. For purposes of this paragraph, stockholders, bondholders, partners, or other persons holding an interest in the contracting party are regarded as having the “real or ultimate ownership” of the contracting party. (3) That of an employee or agent of the contracting party, if all of the following conditions are met: (A) The agency of which the person is an officer is a local public agency located in a county with a population of less than 4,000,000. (B) The contract is competitively bid and is not for personal services. (C) The employee or agent is not in a primary management capacity with the contracting party, is not an officer or director of the contracting party, and holds no ownership interest in the contracting party. (D) The contracting party has 10 or more other employees. (E) The employee or agent did not directly participate in formulating the bid of the contracting party. (F) The contracting party is the lowest responsible bidder. (4) That of a parent in the earnings of his or her minor child for personal services. (5) That of a landlord or tenant of the contracting party. (6) That of an attorney of the contracting party or that of an owner, officer, employee, or agent of a firm that renders, or has rendered, service to the contracting party in the capacity of stockbroker, insurance agent, insurance broker, real estate agent, or real estate broker, if these individuals have not received and will not receive remuneration, consideration, or a commission as a result of the contract and if these individuals have an ownership interest of 10 percent or more in the law practice or firm, stock brokerage firm, insurance firm, or real estate firm. Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-4 © 2011 Richards, Watson & Gershon 1342872.1 (7) That of a member of a nonprofit corporation formed under the Food and Agricultural Code or a nonprofit corporation formed under the Corporations Code for the sole purpose of engaging in the merchandising of agricultural products or the supplying of water. (8) That of a supplier of goods or services when those goods or services have been supplied to the contracting party by the officer for at least five years prior to his or her election or appointment to office. (9) That of a person subject to the provisions of Section 1090 in any contract or agreement entered into pursuant to the provisions of the California Land Conservation Act of 1965. (10) Except as provided in subdivision (b) of Section 1091.5, that of a director of or a person having an ownership interest of 10 percent or more in a bank, bank holding company, or savings and loan association with which a party to the contract has a relationship of borrower or depositor, debtor or creditor. (11) That of an engineer, geologist, or architect employed by a consulting engineering or architectural firm. This paragraph applies only to an employee of a consulting firm who does not serve in a primary management capacity, and does not apply to an officer or director of a consulting firm. (12) That of an elected officer otherwise subject to Section 1090, in any housing assistance payment contract entered into pursuant to Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f) as amended, provided that the housing assistance payment contract was in existence before Section 1090 became applicable to the officer and will be renewed or extended only as to the existing tenant, or, in a jurisdiction in which the rental vacancy rate is less than 5 percent, as to new tenants in a unit previously under a Section 8 contract. This section applies to any person who became a public official on or after November 1, 1986. (13) That of a person receiving salary, per diem, or reimbursement for expenses from a government entity. (14) That of a person owning less than 3 percent of the shares of a contracting party that is a for-profit corporation, provided that the ownership of the shares derived from the person’s employment with that corporation. (15) That of a party to litigation involving the body or board of which the officer is a member in connection with an agreement in which all of the following apply: Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-5 © 2011 Richards, Watson & Gershon 1342872.1 (A) The agreement is entered into as part of a settlement of litigation in which the body or board is represented by legal counsel. (B) After a review of the merits of the agreement and other relevant facts and circumstances, a court of competent jurisdiction finds that the agreement serves the public interest. (C) The interested member has recused himself or herself from all participation, direct or indirect, in the making of the agreement on behalf of the body or board. (16) That of a person who is an officer or employee of an investor-owned utility that is regulated by the Public Utilities Commission with respect to a contract between the investor-owned utility and a state, county, district, judicial district, or city body or board of which the person is a member, if the contract requires the investor-owned utility to provide energy efficiency rebates or other type of program to encourage energy efficiency that benefits the public when all of the following apply: (A) The contract is funded by utility consumers pursuant to regulations of the Public Utilities Commission. (B) The contract provides no individual benefit to the person that is not also provided to the public, and the investor-owned utility receives no direct financial profit from the contract. (C) The person has recused himself or herself from all participation in making the contract on behalf of the state, county, district, judicial district, or city body or board of which he or she is a member. (D) The contract implements a program authorized by the Public Utilities Commission. (c) This section is not applicable to any officer interested in a contract who influences or attempts to influence another member of the body or board of which he or she is a member to enter into the contract. (d) The willful failure of an officer to disclose the fact of his or her interest in a contract pursuant to this section is punishable as provided in Section 1097. That violation does not void the contract unless the contracting party had knowledge of the fact of the remote interest of the officer at the time the contract was executed. Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-6 © 2011 Richards, Watson & Gershon 1342872.1 Section 1091.1. Interest in contracts; subdivided lands. The prohibition against an interest in contracts provided by this article or any other provision of law shall not be deemed to prohibit any public officer or member of any public board or commission from subdividing lands owned by him or in which he has an interest and which subdivision of lands is effected under the provisions of Division 2 (commencing with Section 66410) of Title 7 of the Government Code or any local ordinance concerning subdivisions; provided, that (a) said officer or member of such board or commission shall first fully disclose the nature of his interest in any such lands to the legislative body having jurisdiction over the subdivision thereof, and (b) said officer or member of such board or commission shall not cast his vote upon any matter or contract concerning said subdivision in any manner whatever. Section 1091.2. Local workforce investment boards; contracts or grants; application of § 1090. Section 1090 shall not apply to any contract or grant made by local workforce investment boards created pursuant to the federal Workforce Investment Act of 1998 except where both of the following conditions are met: (a) The contract or grant directly relates to services to be provided by any member of a local workforce investment board or the entity the member represents or financially benefits the member or the entity he or she represents. (b) The member fails to recuse himself or herself from making, participating in making, or in any way attempting to use his or her official position to influence a decision on the grant or grants. Section 1091.3. Inapplicability of conflict of interest contract provisions to grants or contracts made by County Children and Families Commission; exceptions. Section 1090 shall not apply to any contract or grant made by a county children and families commission created pursuant to the California Children and Families Act of 1998 (Division 108 (commencing with Section 130100) of the Health and Safety Code), except where both of the following conditions are met: (a) The contract or grant directly relates to services to be provided by any member of a county children and families commission or the entity the member represents or financially benefits the member or the entity he or she represents. (b) The member fails to recuse himself or herself from making, participating in making, or in any way attempting to use his or her official position to influence a decision on the grant or grants. Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-7 © 2011 Richards, Watson & Gershon 1342872.1 Section 1091.4. Conditions giving rise to a remote interest by an officer or member who has a financial interest in a contract. (a) As used in Section 1091, “remote interest” also includes a person who has a financial interest in a contract, if all of the following conditions are met: (1) The agency of which the person is a board member is a special district serving a population of less than 5,000 that is a landowner voter district, as defined in Section 56050, that does not distribute water for any domestic use. (2) The contract is for either of the following: (A) The maintenance or repair of the district’s property or facilities provided that the need for maintenance or repair services has been widely advertised. The contract will result in materially less expense to the district than the expense that would have resulted under reasonably available alternatives and review of those alternatives is documented in records available for public inspection. (B) The acquisition of property that the governing board of the district has determined is necessary for the district to carry out its functions at a price not exceeding the value of the property, as determined in a record available for public inspection by an appraiser who is a member of a recognized organization of appraisers. (3) The person did not participate in the formulation of the contract on behalf of the district. (4) At a public meeting, the governing body of the district, after review of written documentation, determines that the property acquisition or maintenance and repair services cannot otherwise be obtained at a reasonable price and that the contract is in the best interests of the district, and adopts a resolution stating why the contract is necessary and in the best interests of the district. (b) If a party to any proceeding challenges any fact or matter required by paragraph (2), (3), or (4) of subdivision (a) to qualify as a remote interest under subdivision (a), the district shall bear the burden of proving this fact or matter. Section 1091.5. Interests not constituting an interest in a contract. (a) An officer or employee shall not be deemed to be interested in a contract if his or her interest is any of the following: Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-8 © 2011 Richards, Watson & Gershon 1342872.1 (1) The ownership of less than 3 percent of the shares of a corporation for profit, provided that the total annual income to him or her from dividends, including the value of stock dividends, from the corporation does not exceed 5 percent of his or her total annual income, and any other payments made to him or her by the corporation do not exceed 5 percent of his or her total annual income. (2) That of an officer in being reimbursed for his or her actual and necessary expenses incurred in the performance of official duties. (3) That of a recipient of public services generally provided by the public body or board of which he or she is a member, on the same terms and conditions as if he or she were not a member of the body or board. (4) That of a landlord or tenant of the contracting party if the contracting party is the federal government or any federal department or agency, this state or an adjoining state, any department or agency of this state or an adjoining state, any county or city of this state or an adjoining state, or any public corporation or special, judicial, or other public district of this state or an adjoining state unless the subject matter of the contract is the property in which the officer or employee has the interest as landlord or tenant in which event his or her interest shall be deemed a remote interest within the meaning of, and subject to, the provisions of Section 1091. (5) That of a tenant in a public housing authority created pursuant to Part 2 (commencing with Section 34200) of Division 24 of the Health and Safety Code in which he or she serves as a member of the board of commissioners of the authority or of a community development commission created pursuant to Part 1.7 (commencing with Section 34100) of Division 24 of the Health and Safety Code. (6) That of a spouse of an officer or employee of a public agency in his or her spouse’s employment or officeholding if his or her spouse’s employment or officeholding has existed for at least one year prior to his or her election or appointment. (7) That of a nonsalaried member of a nonprofit corporation, provided that this interest is disclosed to the body or board at the time of the first consideration of the contract, and provided further that this interest is noted in its official records. (8) That of a noncompensated officer of a nonprofit, tax-exempt corporation, which, as one of its primary purposes, supports the functions of the body or board or to which the body or board has a legal obligation to give particular Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-9 © 2011 Richards, Watson & Gershon 1342872.1 consideration, and provided further that this interest is noted in its official records. For purposes of this paragraph, an officer is “noncompensated” even though he or she receives reimbursement from the nonprofit, tax- exempt corporation for necessary travel and other actual expenses incurred in performing the duties of his or her office. (9) That of a person receiving salary, per diem, or reimbursement for expenses from a government entity, unless the contract directly involves the department of the government entity that employs the officer or employee, provided that the interest is disclosed to the body or board at the time of consideration of the contract, and provided further that the interest is noted in its official record. (10) That of an attorney of the contracting party or that of an owner, officer, employee, or agent of a firm which renders, or has rendered, service to the contracting party in the capacity of stockbroker, insurance agent, insurance broker, real estate agent, or real estate broker, if these individuals have not received and will not receive remuneration, consideration, or a commission as a result of the contract and if these individuals have an ownership interest of less than 10 percent in the law practice or firm, stock brokerage firm, insurance firm, or real estate firm. (11) Except as provided in subdivision (b), that of an officer or employee of, or a person having less than a 10-percent ownership interest in, a bank, bank holding company, or savings and loan association with which a party to the contract has a relationship of borrower, depositor, debtor, or creditor. (12) That of (A) a bona fide nonprofit, tax-exempt corporation having among its primary purposes the conservation, preservation, or restoration of park and natural lands or historical resources for public benefit, which corporation enters into an agreement with a public agency to provide services related to park and natural lands or historical resources and which services are found by the public agency, prior to entering into the agreement or as part of the agreement, to be necessary to the public interest to plan for, acquire, protect, conserve, improve, or restore park and natural lands or historical resources for public purposes and (B) any officer, director, or employee acting pursuant to the agreement on behalf of the nonprofit corporation. For purposes of this paragraph, “agreement” includes contracts and grants, and “park,” “natural lands,” and “historical resources” shall have the meanings set forth in subdivisions (d), (g), and (i) of Section 5902 of the Public Resources Code. Services to be provided to the public agency may include those studies and related services, acquisitions of property and property interests, and any activities related to those studies and acquisitions necessary for the Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-10 © 2011 Richards, Watson & Gershon 1342872.1 conservation, preservation, improvement, or restoration of park and natural lands or historical resources. (13) That of an officer, employee, or member of the Board of Directors of the California Housing Finance Agency with respect to a loan product or programs if the officer, employee, or member participated in the planning, discussions, development, or approval of the loan product or program and both of the following two conditions exist: (A) The loan product or program is or may be originated by any lender approved by the agency. (B) The loan product or program is generally available to qualifying borrowers on terms and conditions that are substantially the same for all qualifying borrowers at the time the loan is made. (b) An officer or employee shall not be deemed to be interested in a contract made pursuant to competitive bidding under a procedure established by law if his or her sole interest is that of an officer, director, or employee of a bank or savings and loan association with which a party to the contract has the relationship of borrower or depositor, debtor or creditor. Section 1091.6. Self-interest in matters of eminent domain; prohibited voting by officer. An officer who is also a member of the governing body of an organization that has an interest in, or to which the public agency may transfer an interest in, property that the public agency may acquire by eminent domain shall not vote on any matter affecting that organization. Section 1092. Avoidance of contracts. (a) Every contract made in violation of any of the provisions of Section 1090 may be avoided at the instance of any party except the officer interested therein. No such contract may be avoided because of the interest of an officer therein unless the contract is made in the official capacity of the officer, or by a board or body of which he or she is a member. (b) An action under this section shall be commenced within four years after the plaintiff has discovered, or in the exercise of reasonable care should have discovered, a violation described in subdivision (a). Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-11 © 2011 Richards, Watson & Gershon 1342872.1 Section 1092.5. Lease, purchase or encumbrance of real property; avoidance. Notwithstanding Section 1092, no lease or purchase of, or encumbrance on, real property may be avoided, under the terms of Section 1092, in derogation of the interest of a good faith lessee, purchaser, or encumbrancer where the lessee, purchaser, or encumbrancer paid value and acquired the interest without actual knowledge of a violation of any of the provisions of Section 1090. Section 1093. Warrants and other evidences of indebtedness, private use or benefit. The State Treasurer and Controller, county and city officers, and their deputies and clerks shall not purchase or sell, or in any manner receive for their own or any other person’s use or benefit any State, county or city warrants, scrip, orders, demands, claims, or other evidences of indebtedness against the State, or any county or city thereof. This section does not apply to evidences of indebtedness issued to or held by such an officer, deputy or clerk for services rendered by them, nor to evidences of the funded indebtedness of the State, county, or city. Section 1094. Accounts; certificate as prerequisite to allowance. Every officer whose duty it is to audit and allow the accounts of other state, county, or city officers shall, before allowing such accounts, require each of such officers to make and file with him an affidavit or certificate under penalty of perjury that he has not violated any of the provisions of this article, and any individual who willfully makes and subscribes such certificate to an account which he knows to be false as to any material matter shall be guilty of a felony and upon conviction thereof shall be subject to the penalties prescribed for perjury by the Penal Code of this State. Section 1095. Warrants and other evidences of indebtedness; restrictions on payment. Officers charged with the disbursement of public moneys shall not pay any warrant or other evidence of indebtedness against the State, county, or city when it has been purchased, sold, received, or transferred contrary to any of the provisions of this article. Section 1096. Accounts; suspension of settlement or payment; prosecutions. Upon the officer charged with the disbursement of public moneys being informed by affidavit that any officer, whose account is about to be settled, audited, or paid by him, has violated any of the provisions of this article, the disbursing officer shall suspend such settlement or payment, and cause the district attorney to prosecute the officer for such violation. If judgment is rendered for the defendant upon such prosecution, the disbursing officer may proceed to settle, audit, or pay the account as if no affidavit had been filed. Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-12 © 2011 Richards, Watson & Gershon 1342872.1 Section 1097. Penalty for violations. Every officer or person prohibited by the laws of this state from making or being interested in contracts, or from becoming a vendor or purchaser at sales, or from purchasing script, or other evidences of indebtedness, including any member of the governing board of a school district, who willfully violates any of the provisions of such laws, is punishable by a fine of not more than one thousand dollars ($1,000), or by imprisonment in the state prison, and is forever disqualified from holding any office in this state. Section 1098. Confidential information; use or disclosure for pecuniary gain; misdemeanor; application. (a) Any current public officer or employee who willfully and knowingly discloses for pecuniary gain, to any other person, confidential information acquired by him or her in the course of his or her official duties, or uses any such information for the purpose of pecuniary gain, is guilty of a misdemeanor. (b) As used in this section: (1) “Confidential information” means information to which all of the following apply: (A) At the time of the use or disclosure of the information, the information is not a public record subject to disclosure under the Public Records Act. (B) At the time of the use or disclosure of the information, the disclosure is prohibited by (i) a statute, regulation, or rule which applies to the agency in which the officer or employee serves; (ii) the statement of incompatible activities adopted pursuant to Section 19990 by the agency in which the officer or employee serves; or (iii) a provision in a document similar to a statement of incompatible activities if the agency in which the officer or employee serves is a local agency. (C) The use or disclosure of the information will have, or could reasonably be expected to have, a material financial effect on any investment or interest in real property which the officer or employee, or any person who provides pecuniary gain to the officer or employee in return for the Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-13 © 2011 Richards, Watson & Gershon 1342872.1 information, has at the time of the use or disclosure of the information or acquires within 90 days following the use or disclosure of the information. (2) For purposes of paragraph (1): (A) “Interest in real property” has the definition prescribed by Section 82033. (B) “Investment” has the definition prescribed by Section 82034. (C) “Material financial effect” has the definition prescribed by Sections 18702 and 18702.2 of Title 2 of the California Administrative Code, as those sections read on September 1, 1987. (3) “Pecuniary gain” does not include salary or other similar compensation from the officer’s or the employee’s agency. (c) This section shall not apply to any disclosure made to any law enforcement agency, nor to any disclosure made pursuant to Sections 10542 and 10543. (d) This section is not intended to supersede, amend, or add to subdivision (b) of Section 8920 regarding prohibited conduct of Members of the Legislature. Section 1099. Simultaneous occupation of incompatible public offices; effect; enforcement of prohibition; exceptions. (a) A public officer, including, but not limited to, an appointed or elected member of a governmental board, commission, committee, or other body, shall not simultaneously hold two public offices that are incompatible. Offices are incompatible when any of the following circumstances are present, unless simultaneous holding of the particular offices is compelled or expressly authorized by law: (1) Either of the offices may audit, overrule, remove members of, dismiss employees of, or exercise supervisory powers over the other office or body. (2) Based on the powers and jurisdiction of the offices, there is a possibility of a significant clash of duties or loyalties between the offices. (3) Public policy considerations make it improper for one person to hold both offices. Appendix B - Government Code Sections 1090-1099 Summary of Principal Conflicts of Interest Laws Page B-14 © 2011 Richards, Watson & Gershon 1342872.1 (b) When two public offices are incompatible, a public officer shall be deemed to have forfeited the first office upon acceding to the second. This provision is enforceable pursuant to Section 803 of the Code of Civil Procedure. (c) This section does not apply to a position of employment, including a civil service position. (d) This section shall not apply to a governmental body that has only advisory powers. (e) For purposes of paragraph (1) of subdivision (a), a member of a multimember body holds an office that may audit, overrule, remove members of, dismiss employees of, or exercise supervisory powers over another office when the body has any of these powers over the other office or over a multimember body that includes that other office. (f) This section codifies the common law rule prohibiting an individual from holding incompatible public offices. Richards,Watson &Gershon (RW&G)is widely recognized as one of the premier full service law firms to local governments,providing the highest quality legal services in a cost-effective manner.Local governments rely on RW&G because it has assembled a number of the leading attorneys in the state and dedicated them to creatively solving the problems of local governments. RW&G was established in 1954,and the Firm has been providing public entity legal services for over 50 years. We have a statewide practice with offices in Los Angeles,Orange County,Temecula,and San Francisco. We serve as City/Town Attorney,Special Counsel,and General Counsel,to public entities throughout California. Our representation of public entities includes cities,towns,counties,redevelopment agencies,water districts, school districts,community services districts,airports,other special districts,and joint powers authorities. Core practice areas include public agency and municipal law,public finance,redevelopment,water rights and water law,real estate,litigation,appellate,environmental and energy,e-documents and public records,climate change,labor and employment,eminent domain,public works,telecommunications,and transportation. Table of Contents Public Records Act Page i © 2011 Richards, Watson & Gershon 1342886.1 Table of Contents INTRODUCTION ................................................................................................................ iii PART ONE. COMPLIANCE WITH THE PUBLIC RECORDS ACT ................................................... 1 I. What is the Public Records Act? .............................................................................. 2 II. What Rights does the Public Records Act Afford to the Public? ................................. 3 III. Is the Public Records Act Related to the Freedom of Information Act? ....................... 3 IV. To Which Local Agencies does the Public Records Act Apply? ................................... 4 V. What are “Public Records?” .................................................................................... 4 VI. Can a Local Agency Relinquish its Public Records Act Obligations to Someone Else? 5 VII. Must a Public Records Act Request be made in Writing or may it be made Orally? ..... 6 VIII. What Public Records are Exempt from Disclosure Under the Public Records Act? ...... 6 IX. What is the Proper Procedure for Complying with a Public Records Act Request? ..... 18 X. What are the Penalties for Failure to Comply with the Public Records Act? ............... 21 XI. Conclusion........................................................................................................... 22 PART TWO. ELECTRONIC RECORDS................................................................................... 23 I. Email ....................................................................................................................25 A. Is the Email a Public Record? ......................................................................25 B. Some Email may be Protected by the Deliberative Process Privilege or Mental Process Principle ............................................................................27 C. Exception for Notes, Drafts and Interagency/Intra-agency Memoranda ......... 31 D. The Problem with Threads .......................................................................... 32 E. Risk of Serial Meetings ...............................................................................33 F. Disclosure Requirements for Documents at Meetings ................................. 34 Table of Contents Public Records Act Page ii © 2011 Richards, Watson & Gershon 1342886.1 II. Documents Created Using Word Processors, GIS and Other Software ...................... 35 A. Disclosure Requirements ............................................................................ 35 B. Metadata .................................................................................................. 39 III. City Websites ....................................................................................................... 43 A. Websites and the “Mass Mailing” Prohibitions ........................................... 43 B. Avoiding Express Advocacy ......................................................................... 45 C. Public Forum ............................................................................................. 48 D. Putnam Pit, Inc. v. City of Cookeville ........................................................... 49 E. Vargas v. City of Salinas ............................................................................. 50 F. Public Forum Analysis ................................................................................. 51 G. Chat Rooms and Forums ............................................................................. 53 H. ADA Implications ........................................................................................ 54 IV. Conclusions .......................................................................................................... 55 PART THREE. THE TEXT OF THE CALIFORNIA PUBLIC RECORDS ACT ...................................... 57 Introduction Public Records Act Page iii © 2011 Richards, Watson & Gershon 1342886.1 INTRODUCTION This Handbook, designed for City officials and staff, provides a summary of the major provisions of California’s Public Records Act and related topics. Part One of the Handbook summarizes the basic provisions of the Public Records Act, including documents that are exempt from disclosure and the proper procedure for complying with the Act. Part Two highlights the unique issues raised by electronic records. Part Three contains the complete text of the Public Records Act. We hope you find this Handbook useful. Should you have any questions about the information included in this Handbook, please do not hesitate to contact us. LOS ANGELES 355 South Grand Avenue, 40th Floor Los Angeles, California 90071-3101 Telephone: 213.626.8484 Facsimile: 213.626.0078 E-mail: la@rwglaw.com ORANGE COUNTY 1 Civic Center Circle, PO Box 1059 Brea, California 92822-1059 Telephone: 714.990.0901 Facsimile: 714.990.6230 E-mail: oc@rwglaw.com SAN FRANCISCO 44 Montgomery Street, Suite 3800 San Francisco, California 94104-4811 Telephone: 415.421.8484 Facsimile: 415.421.8486 E-mail: sf@rwglaw.com www.rwglaw.com Part One. Compliance with the Public Records Act Public Records Act Page 1 © 2011 Richards, Watson & Gershon 1342886.1 Part One Compliance with the Public Records Act Part One. Compliance with the Public Records Act Public Records Act Page 2 © 2011 Richards, Watson & Gershon 1342886.1 COMPLIANCE WITH THE PUBLIC RECORDS ACT: KEY QUESTIONS AND ANSWERS The people have the right of access to information concerning the conduct of the people’s business, and, therefore, the meetings of public bodies and the writings of public officials and agencies shall be open to public scrutiny. CAL. CONST. art. I, § 3(b). In enacting this chapter, the Legislature, mindful of the right of individuals to privacy, finds and declares that access to information concerning the conduct of the people’s business is a fundamental and necessary right of every person in this state. Gov’t Code § 6250. California’s Public Records Act is a key part of the philosophy that government at all levels in this State must be open and accessible to all.1 Under the Public Records Act, a local government agency must disclose virtually any public document; only a statutory exemption or a need for confidentiality that clearly outweighs the public’s right to access will legally justify withholding a public document. The purpose of this Handbook is to provide a general overview of the Public Records Act and recent amendments to it, along with a general road map for compliance. This Handbook addresses the questions most frequently asked of us by our local government clients. I. WHAT IS THE PUBLIC RECORDS ACT? The Public Records Act is a California statute that affords the public the right to inspect, and obtain a copy of, most of the information retained by State and local agencies in the course of business. The Public Records Act regulates the public’s access to records and sets out the specific statutory circumstances under which particular records need not be disclosed. The Public Records Act states that public records are open to inspection at all times during the office hours of a local agency.2 The California Constitution also guarantees that public records are open to public scrutiny.3 It provides that a law, such as the Public Records Act, should be “broadly construed” if it furthers the people’s right of access to public records, and “narrowly construed” if it limits the right of access. 1 Rogers v. Superior Ct. (City of Burbank), 19 Cal. App. 4th 469 (1993). 2 Gov’t Code § 6253(a). 3 CAL. CONST. art. I, § 3(b). Part One. Compliance with the Public Records Act Public Records Act Page 3 © 2011 Richards, Watson & Gershon 1342886.1 II. WHAT RIGHTS DOES THE PUBLIC RECORDS ACT AFFORD TO THE PUBLIC? Under the Public Records Act, every person has the right to inspect and to obtain a copy of any identifiable public record.4 The term “person” includes individuals, and various types of business entities.5 A “person” need not be a citizen of California or of the United States to make use of the Public Records Act.6 A local agency must supply an exact copy of the record on request, unless it is “impracticable” to make an exact copy.7 The word “impracticable” in the Public Records Act does not necessarily refer to situations where a copying request would be “inconvenient” or time consuming to the agency. Rather, the term “impracticable” modifies the requirement that the agency provide an “exact” copy. If a requested document is subject to the Public Records Act, the agency must provide the best or most complete copy of that document reasonably possible.8 Any reasonably segregable portion must be made available after deletion of any portion exempt from disclosure.9 The requirements of the Public Records Act are the minimum standards which must be met by local agencies. The Public Records Act specifically provides that agencies may adopt procedures to allow greater access to records, except where the law otherwise prohibits access.10 The person who is the subject of a particular record does not have a specific right under the Public Records Act to prevent disclosure of any particular record.11 Even in cases where the subject of a particular record has argued that disclosure would violate the individual right to privacy guaranteed by the California Constitution, disclosure has been compelled.12 III. IS THE PUBLIC RECORDS ACT RELATED TO THE FREEDOM OF INFORMATION ACT? Persons who request access to public records frequently reference the Freedom of Information Act (“FOIA”) as the basis for their request. The FOIA is a federal statute that does not apply to local government agencies. However, the Public Records Act was 4 Gov’t Code § 6253(a), (b). 5 Both cities and city attorneys have been deemed “persons” under the Act. Los Angeles Unified School Dist. v. Superior Ct. (City of Long Beach), 151 Cal. App. 4th 759 (2 Dist. 2007) (holding that city, as well as the city attorney, were entitled to obtain records of school district relating to school construction project). 6 Gov’t Code § 6252(c); Connell v. Superior Ct. (Intersource, Inc.), 56 Cal. App. 4th 601 (1997). 7 Gov’t Code § 6253(b). 8 See Rosenthal v. Hansen, 34 Cal. App. 3d 754 (1973) (holding that under the former Section 6256, an agency need not provide exact copies if doing so would be impracticable, but that this does not excuse a public entity from producing the records at all). 9 Gov’t Code § 6253(a). 10 Gov’t Code § 6253(e). 11 LAPD v. Superior Ct. (Church of Scientology), 65 Cal. App. 3d 661, 668 (1977). 12 Poway Unified Sch. Dist. v. Superior Ct. (Copley Press), 62 Cal. App. 4th 1496 (1998). Part One. Compliance with the Public Records Act Public Records Act Page 4 © 2011 Richards, Watson & Gershon 1342886.1 modeled after the FOIA, and we recommend that agencies respond to otherwise valid records requests even if the requester cites the FOIA instead of the Public Records Act.13 IV. TO WHICH LOCAL AGENCIES DOES THE PUBLIC RECORDS ACT APPLY? The Public Records Act applies to all local government agencies. Under the Public Records Act, a “local agency” includes a county; city, whether general law or chartered; city and county; school district; municipal corporation; district; political subdivision; any board, commission or agency of any of these; and certain non-profit organizations of local agencies which are supported by public funds.14 V. WHAT ARE “PUBLIC RECORDS?” The Public Records Act defines “public records” as follows: ‘Public records’ includes any writing containing information relating to the conduct of the public’s business prepared, owned, used, or retained by any state or local agency regardless of physical form or characteristics. The term “writing” means: any handwriting, typewriting, printing, photostating, photographing, photocopying, transmitting by electronic mail or facsimile, and every other means of recording upon any tangible thing any form of communication or representation, including letters, words, pictures, sounds, or symbols, or combinations thereof, and any record thereby created, regardless of the manner in which the record has been stored.15 These definitions encompass much more than written or printed documents. Public records include computer data, and an agency must provide computer records in any electronic format in which the agency holds the information. If a requester asks for the records in a particular format, the agency must provide the records in that format, if it is a format used by the agency to create copies for its own use or for provision to other agencies unless an 13 See ACLU v. Deukmejian, 32 Cal. 3d 440, 447 (1982) (Public Records Act modeled on FOIA, judicial construction and legislative history of federal act illuminate the interpretation of its California counterpart); Cook v. Craig, 55 Cal. App. 3d 773, 781 (1976) (noting the similarity between the provisions of state and federal law). 14 Gov’t Code § 6252(a). 15 Gov’t Code § 6252(e), (g). Part One. Compliance with the Public Records Act Public Records Act Page 5 © 2011 Richards, Watson & Gershon 1342886.1 exception applies.16 Note, however, that computer software developed by a local agency is not a “public record” subject to the Public Records Act.17 On the other hand, a requester’s rights under the Public Records Act are not unlimited. A local agency is not required to create a document or compile a list in response to a request under the Public Records Act.18 While these definitions are general, over the years the courts have both broadened and limited the scope of the definition of “public record.” First, it is clear that the term “public records” encompasses more than simply those documents that public officials are required by law to keep as official records. Rather, courts have held that a public record is one that is kept because it is “necessary or convenient to the discharge of [an] official duty.”19 Second, courts have observed that merely because the writing is in the possession of the local agency, it is not automatically a public record. It must relate to the conduct of the public’s business.20 Thus, personal notes and personal records, such as shopping lists or letters from friends that are totally void of public business, are not public records.21 In addition, it is important to note that a record need not be a “document” to fall within the ambit of the Public Records Act. A public record is subject to disclosure under the Public Records Act “regardless of its physical form or characteristics.”22 VI. CAN A LOCAL AGENCY RELINQUISH ITS PUBLIC RECORDS ACT OBLIGATIONS TO SOMEONE ELSE? A local agency cannot sell or provide a public record subject to disclosure under the Public Records Act to a private entity in a manner that prevents the local agency from providing the record directly.23 For example, the county recorder cannot transfer all birth and death records to a private company and insist that the public obtain birth certificates from the private entity. Similarly, a local agency may not enter into a contract that allows another party to control the disclosure of information that is subject to the Public Records Act.24 For example, a contract provision that requires the consent of a contractor before a local agency may release a public record prepared by the contractor violates the Public Records Act. 16 Gov’t Code § 6253.9. For further discussion of the exception to this rule, see Part Two. Electronic Records, Section II.B. “Metadata” of this Handbook. 17 Gov’t Code § 6254.9. 18 Based upon the definition of “writing,” Gov’t Code § 6252(g), and the requirement that a requested record be “identifiable,” Gov’t Code § 6253(b). 19 Braun v. City of Taft, 154 Cal. App. 3d 332, 340 (1984); San Gabriel Tribune v. Superior Ct. (City of West Covina), 143 Cal. App. 3d 762, 774 (1983); People v. Tomalty, 14 Cal. App. 224, 231 (1910). 20 Braun, 154 Cal. App. 3d at 340; San Gabriel Tribune, 143 Cal. App. 3d at 774; Gov’t Code § 6252(e). 21 San Gabriel Tribune v. Superior Court, 143 Cal. App. 3d 762, 774 (1983). 22 Gov’t Code § 6252(e). 23 Gov’t Code § 6270(a). 24 Gov’t Code § 6253.3. Part One. Compliance with the Public Records Act Public Records Act Page 6 © 2011 Richards, Watson & Gershon 1342886.1 Additionally, if a local agency enters into a contract that requires a private entity to review, audit, or report on any aspect of the local agency, that contract must be made available to the public upon request, unless the contract is exempt from disclosure pursuant to another exemption in the Public Records Act.25 VII. MUST A PUBLIC RECORDS ACT REQUEST BE MADE IN WRITING, OR MAY IT BE MADE ORALLY? Nothing in the Public Records Act requires a member of the public to place his or her request for public records in writing.26 While many local agencies provide forms on their website or at their offices for making a written Public Records Act request, a requester is not required to use the form offered. An oral request is sufficient to trigger the requirements of the Public Records Act. Additionally, an argumentative or disruptive requester cannot be permanently banned from the premises by a local agency or forced to make their requests in writing.27 However, the right to inspect public records is subject to the implied rule of reason that enables the custodian of public records to formulate regulations necessary to prevent interference with the orderly functioning of the agency’s office.28 If faced with a loud or angry person who is making an oral request, and the records are not immediately available, it is advisable for staff to write down the request and tell the requester the agency will respond in writing within the time limits specified in the Public Records Act. Your City Attorney can provide additional guidance in the event a member of the public is repeatedly abusive towards staff. VIII. WHAT PUBLIC RECORDS ARE EXEMPT FROM DISCLOSURE UNDER THE PUBLIC RECORDS ACT? The Public Records Act specifically exempts a number of categories of records from the disclosure requirements. If documents are exempt from disclosure, it is important that confidentiality be maintained. Once an otherwise exempt record is released to any member of the public, disclosure constitutes a waiver of the exemption for the document.29 However, this does not apply to disclosures: i Through discovery procedures associated with lawsuits or in court proceedings; i Pursuant to a statute that limits disclosure for specified purposes; 25 Gov’t Code § 6253.31. 26 Los Angeles Times v. Alameda Corridor Transp. Authority, 88 Cal. App. 4th 1381, 1392 (2 Dist. 2001). 27 Galbiso v. Orosi Public Utility District, 167 Cal. App. 4th 1063, 1089 (5th Dist. 2008). 28 Bruce v. Gregory, 65 Cal. 2d 666, 676 (1967); Rosenthal v. Hansen, 34 Cal. App. 3d 754, 761 (1973); 64 Ops. Cal. Atty. Gen. 317 (1981). 29 Gov’t Code § 6254.5. Part One. Compliance with the Public Records Act Public Records Act Page 7 © 2011 Richards, Watson & Gershon 1342886.1 i Not required by law and prohibited by formal action of the elected legislative body of the local agency; or i To another government agency that agrees to treat the records as confidential.30 The following is a list of the statutory exemptions. This list is not exhaustive. 1. Referendum, recall and initiative petitions and related material. Gov’t Code § 6253.5. Election-related petitions and all memoranda prepared by the county elections officials in their examination of the petitions indicating which registered voters signed the petitions are strictly confidential. These materials may be viewed only by elections officials and their deputies. Other officials, including agency attorneys, must obtain a court order to view petitions. If the elections officials determine that a petition is legally insufficient, petition proponents and their representatives designated in writing must be permitted to review these materials. 2. The identity of persons who have requested bilingual ballots or ballot pamphlets. Gov’t Code § 6253.6. 3. Preliminary drafts, notes, or interagency or intra-agency memoranda. Gov’t Code § 6254(a). Public officials should be aware that preliminary drafts, notes, along with interagency and intra-agency memoranda, are exempt from disclosure as public records if those documents are not customarily retained by the local agency in the ordinary course of business and the public interest in withholding those records clearly outweighs the public interest in disclosure.31 In considering whether to use this exemption, agencies should determine whether the disclosure of a preliminary draft, notes, or interagency or intra-agency memoranda would further the interest of the Act in open government. The fact that the document is merely a step in the process and does not provide important information about the public’s business probably weighs in favor of nondisclosure. The key questions in this area generally may be boiled down to whether a draft, note, or interagency or intra-agency memorandum is one which: i Is not normally kept by the agency in the ordinary course of business; 30 Id. Additional exceptions apply to specific state agencies. 31 Gov’t Code § 6254(a). Part One. Compliance with the Public Records Act Public Records Act Page 8 © 2011 Richards, Watson & Gershon 1342886.1 i Is not prepared or kept to document or memorialize the day-to-day transaction of the public’s business; i Is merely a temporary step in the process of preparing a final document, reaching a final decision, or determining a course of action; and i Disclosure of the document would expose the agency’s decision-making process,32 and the public interest in nondisclosure clearly outweighs the public interest in disclosure. If the document qualifies under all four categories above, the document probably is exempt from disclosure under the Public Records Act. Documents that do not satisfy one or more of the categories above probably are public records that must be disclosed unless another exemption applies. You should keep in mind, however, that any doubt or question in this regard likely will be decided in favor of disclosure of the record. In discussing whether a record has not been retained in the ordinary course of business, one court observed, “[i]f preliminary materials are not customarily discarded or have not in fact been discarded as is customary they must be disclosed.”33 One of the purposes of this condition is to prevent “secret law,” that is, an undisclosed collection of written rules guiding the agency’s decisions.34 Consequently, a record that must be retained pursuant to a local agency’s records retention schedule, policies or customs does not fall within this exemption. For example, if a policy decision is made to retain drafts in order to document the bargaining history after an agreement is negotiated, those drafts likely are not exempt under Section 6254(a). Also, if it is permissible under an agency’s records retention schedule to destroy preliminary documents, but the agency retained such a document after the final report is prepared, the preliminary document arguably is not exempt under Section 6254(a). 4. Records pertaining to pending litigation to which the agency is a party. Gov’t Code § 6254(b). Under this exemption, records actually created by an agency for its own use in litigation are exempt from disclosure under the Public Records Act.35 Previously created or disclosed records may not be retroactively re-classified as being exempt under this Section.36 32 Citizens for a Better Environment v. California Dep’t of Food and Agriculture, 171 Cal. App. 3d 704, 715 (3 Dist. 1985) (concluding that “[t]he interest in fostering robust agency debate” is the only public interest that can justify nondisclosure under Section 6254(a)). 33 Id. at 714. 34 Id. at 714n.7. 35 Fairley v. Superior Ct. (City of Long Beach), 66 Cal. App. 4th 1414, 1421-22 (2 Dist. 1998). 36 City of Hemet v. Superior Ct. (Press-Enterprise Co.), 37 Cal. App. 4th 1411, 1420 & n.11 (1995). Part One. Compliance with the Public Records Act Public Records Act Page 9 © 2011 Richards, Watson & Gershon 1342886.1 Generally, courts will examine the “dominant purpose” behind the document’s creation.37 Documents prepared “by a public entity for its own use in anticipation of litigation, which documents it reasonably has an interest in keeping to itself until litigation is finalized” are protected by the exemption.38 Thus, while documents created prior to the commencement of litigation appear to receive greater scrutiny to determine their dominant purpose, the exemption can apply to documents created before litigation has commenced, that is, before a claim has been made with the local agency under the Government Claims Act or a complaint filed with a court. Once litigation is concluded, however, the exemption will no longer apply.39 This exemption also applies to litigation-related documents, even if not created by an agency, when sought by persons or entities not a party to the litigation and which the parties to the litigation do not intend to be revealed outside the litigation. This exemption does not cover deposition transcripts because they are available to the public under another statute.40 And where a plaintiff generally is required to file a claim under the Government Claims Act to initiate litigation against a local agency, the actual claim form filed with the local agency is not exempt under this Section as “[t]here is no unfair disadvantage [in the pending litigation] to the public entity from disclosure of the mere claim form.”41 5. Personnel, medical or similar records. Gov’t Code § 6254(c). When the disclosure of personnel, medical or similar files would constitute an unwarranted invasion of personal privacy, this exemption applies. Most city attorneys advise that personal information about employees, such as home addresses, social security numbers, and medical information, should not be disclosed. Beginning in 2008, the state legislature has mandated that local agencies must redact social security numbers from records before disclosing the records to the public in response to a Public Records Act request.42 In determining whether personnel records should be disclosed, courts first decide whether disclosure would compromise the individual’s substantial privacy interest. If it does, the court determines whether the potential harm to those interests caused by disclosure outweighs the public interest in disclosure.43 As will be discussed below, the California Supreme Court has concluded that public employees in general have a significantly reduced expectation of privacy in their salaries, and that the strong public interest in knowing how 37 Fairley v. Superior Ct. (City of Long Beach), 66 Cal. App. 4th 1414, 1420 (2 Dist. 1998). 38 Id. at 1421 (1998) (emphasis added). 39 City of Los Angeles v. Superior Ct. (Axelrad), 41 Cal. App. 4th 1083, 1089 (1996). 40 Board of Trustees of California State Univ. v. Superior Ct. (Copley Press, Inc.), 132 Cal. App. 4th 889 (2005). 41 Poway Unified Sch. Dist. v. Superior Ct. (Copley Press), 62 Cal. App. 4th 1496, 1505 (1998). 42 Gov’t Code § 6254.29. 43 Versaci v. Superior Court (Palomar Cmty. Coll. Dist.), 127 Cal. App. 4th 805, 818-820 (2005). Part One. Compliance with the Public Records Act Public Records Act Page 10 © 2011 Richards, Watson & Gershon 1342886.1 the government spends its money justifies disclosure of salary information.44 And at least one appellate court has found that where the public employee is in a position of authority, such as a superintendent of a school district, the individual has “a significantly reduced expectation of privacy in the matters of his [or her] public employment.”45 This exemption for personnel, medical or similar records does not justify withholding employment agreements. By statute, employment agreements between a local agency and any public official or public employee is a public record not subject to the exemptions of Sections 6254 or 6255 of the Government Code.46 a. Disclosure of Public Employee Salaries Recent decisions by the California Supreme Court have held that salaries and peace officers’ employing departments are not exempt from disclosure. In International Federation of Professional and Technical Engineers v. Superior Court, (Contra Costa Newspapers, Inc.),47 the California Supreme Court held that individually identifiable salary information is not exempt from disclosure under the Public Records Act, the California Constitution or the Penal Code. In this case, a newspaper sought disclosure from the City of Oakland of names, job titles and gross salaries of City employees earning $100,000 or more each year, including overtime. The City provided salary and overtime information for each job classification but refused to provide salary information linked to individual employees. The newspapers sued to obtain disclosure of the records under the Public Records Act. The Supreme Court held that a public entity’s payroll expenditures are public records, and that disclosure of salary records for city employees earning $100,000 or more each year is not an unwarranted invasion of personal privacy.48 With regard to peace officers, the Supreme Court rejected the police union’s argument that Penal Code Sections 832.7 and 832.8 bar disclosure of the amount of a peace officer’s salary. The Supreme Court ruled that salary information of peace officers does not 44 International Federation of Professional and Technical Engineers v. Superior Court, (Contra Costa Newspapers, Inc.), 42 Cal. 4th 319, 329-333 (2007). 45 BRV, Inc. v. Superior Court (Dunsmuir Joint Union High School District), 143 Cal. App. 4th 742, 758 (2006) (ordering reports investigating allegations of misconduct disclosed, as the public’s interest in why the district entered into a termination agreement with the superintendent that appeared to the public to be a “sweetheart deal” outweighed the superintendent’s interest in preventing disclosure of the reports). 46 Gov’t Code § 6254.8. 47 42 Cal. 4th 319 (2007). 48 The Supreme Court also narrowed the precedential value of Teamsters Local 856 v. Priceless, LLC., 112 Cal. App. 4th 1500 (2003), review denied (Jan. 22, 2004). The appellate court in Priceless held that names, job titles, and W-2 information of city employees was confidential information and not subject to disclosure under the Public Records Act because the city in question had a prior practice of treating that information as confidential. To the extent that Priceless could be read as holding that a city’s practice of refusing to disclose certain information had created a privacy interest in those records, the California Supreme Court disagreed and refused to adopt that holding. International Federation of Professional and Technical Engineers v. Superior Court, 42 Cal. 4th at 336. Part One. Compliance with the Public Records Act Public Records Act Page 11 © 2011 Richards, Watson & Gershon 1342886.1 constitute “personnel records” under Penal Code Sections 832.7 or 832.8, and is not information obtained from personnel records. As such, the Penal Code does not mandate that peace officer salary information be excluded from disclosure under the Public Records Act. The Supreme Court also rejected the argument that each public records request must be evaluated on a case-by-case basis to evaluate the individual employee’s privacy interests and the particular public interest at issue. The Court stated that this would reverse the presumption of openness of public records mandated by the Public Records Act, and the public entity bears the burden of demonstrating that particular records are exempt. The Court, however, left open the possibility that a public entity may, on a case-by-case basis, decline to release records pertaining to individual employees where anonymity is essential to their safety, such as undercover narcotics officers. Although this decision arose in the context of a public records request for the names and salaries of city employees earning more than $100,000 per year, the Supreme Court’s reasoning may have general application to salary information for all city employees, regardless of level of salary. In a companion case, Commission on Peace Officer Standards and Training v. Superior Court,49 the Supreme Court addressed the confidentiality of certain non-salary information. In this case, the Commission refused to provide the names, employing departments, and hiring and termination dates of peace officers from its database. The Commission maintains the database to monitor participating law enforcement departments’ compliance with Peace Officer Standards and Training (“POST”) regulations. The Supreme Court held that these records are not confidential under Penal Code Sections 832.7 and 832.8, and are not exempt from disclosure under the Public Records Act. The Supreme Court, however, remanded the case to the lower courts to allow the Commission the opportunity to establish that information regarding particular officers or categories of officers should be excised from the disclosed records in order to protect the safety or efficacy of those peace officers. 6. Arrest records, complaint reports, investigatory and security files. Gov’t Code § 6254(f). This exemption strictly limits the information required to be disclosed about arrests, complaints and investigations. Records of complaints to or investigations conducted by police agencies generally may be withheld. Investigatory or security files compiled by a local agency for law enforcement or licensing purposes are also covered by the exemption, provided “there is a concrete and definite prospect of criminal law enforcement proceedings.”50 This exemption extends indefinitely, even after investigations are 49 42 Cal. 4th 278 (2007). 50 Dixon v. Superior Ct. (Neves), 170 Cal. App. 4th 1271, 1277 (2009) (internal quotation omitted). Part One. Compliance with the Public Records Act Public Records Act Page 12 © 2011 Richards, Watson & Gershon 1342886.1 concluded.51 In most cases, agencies are required to disclose to the public52 the full name, current address and occupation of every person arrested by the agency, including a general physical description, along with the date and time of arrest. This disclosure, however, is not required where it would endanger the safety of a person involved in an investigation or jeopardize the successful completion of the pending investigation or a related investigation. In addition, local agencies are required to disclose to the public the time, substance and general location of all complaints and requests for assistance, and the time and nature of the agency’s response. However, no disclosure may be made to any arrested person or defendant in a criminal action of the address and telephone number of any person who is a victim or witness in an alleged offense.53 Further, this disclosure is not required where it would endanger the safety of a person involved in an investigation or jeopardize the successful completion of the pending investigation or a related investigation. In all cases, the address of a victim of an alleged sex offense must be withheld.54 Additionally, the name of the victim of an alleged sex offense must be withheld if the victim or a minor victim’s parent or guardian requests it be withheld. While the law refers to “sex offenses,” the crimes listed in Section 6254(f) include sexual assault, child molestation, child abuse, hate crimes and stalking. The Public Records Act prohibits the commercial use of arrest and arrestee information, and requires that persons requesting such information sign a declaration, under penalty of perjury, that the request is made for a scholarly, journalistic, political, or governmental purpose, or for investigation by a licensed private investigator.55 This requirement, however, may have limited applicability given the outcome of litigation by United Reporting Publishing Corporation against the California Highway Patrol.56 Subsequent to that case, the Attorney General issued an opinion that a law enforcement agency may not require that a requester present subscriber lists, copies of publications or other verification of a journalistic purpose and the requester is not required to monitor subscribers to prohibit them from using the information for commercial purposes.57 51 Rackauckas v. Superior Ct. (Los Angeles Times Communications), 104 Cal. App. 4th 169, 174-178 (2002). 52 Section 6254(f) also authorizes release of certain limited information to the victim of a crime and other interested parties, above and beyond that information released to the public generally. 53 Pen. Code § 841.5. 54 Pen. Code § 293. 55 Gov’t Code § 6254(f)(3). A commercial publisher of criminal records challenged the constitutionality of this limitation on disclosure, but the United States Supreme Court held that the statute did not violate the First Amendment to the U.S. Constitution. Los Angeles Police Dep’t v. United Reporting Publ’g Corp., 528 U.S. 32 (1999). 56 United Reporting Publ’g Corp. v. California Highway Patrol, No. 96-CV-888 (S.D. Cal. Aug. 13, 2001) (final judgment on consent) (“As applied to United Reporting, Government Code Section 6254(f)(3) is unconstitutional in that it violates United Reporting’s rights under the First and Fourteenth Amendments to the United States Constitution.”). 57 89 Ops. Cal. Att’y Gen. 97 (2006). Part One. Compliance with the Public Records Act Public Records Act Page 13 © 2011 Richards, Watson & Gershon 1342886.1 The foregoing is a brief overview of this detailed and complex exemption. Police and code enforcement staff should familiarize themselves with the complete requirements of this Section prior to responding to requests for arrest and complaint information. 7. Information required from any taxpayer in connection with the collection of local taxes. Gov’t Code § 6254(i). This exemption applies to information that a city or other local agency requires from any taxpayer in connection with the collection of local taxes if that information is received in confidence and the disclosure of the information to other persons would result in unfair competitive disadvantage to the person supplying the information. One frequent example of this is the submittal of sales or income information under a business license tax requirement where the city has indicated in its business license tax ordinance that the financial information provided will be kept confidential. If the business license is required by ordinance to list the amount of tax paid and be posted at the place of business, however, the amount of tax paid arguably is not confidential. 8. Library circulation records. Gov’t Code § 6254(j). While this exemption protects from disclosure library circulation records kept for the purpose of identifying the borrower of items available in libraries, it is not applicable to records of fines imposed on the borrowers. 9. Records exempt from disclosure under other laws including, but not limited to, the Evidence Code sections relating to privilege. Gov’t Code § 6254(k). This provision of the Public Records Act exempts from disclosure every document held by a local agency that is legally privileged or confidential under some law outside the Public Records Act. The most common example of this exemption protects documents subject to the attorney-client privilege or the attorney work-product doctrine. It is important to note that neither the Public Records Act nor the Brown Act abrogate those important privileges for communications between a local agency and its legal counsel.58 Thus, local agencies should carefully file privileged documents separately from non-privileged material, so that exempt documents are not accidentally disclosed. Determining which documents fit within this exemption has always been difficult and time- consuming. In 1998, the Legislature attempted to address this problem by enacting a statute that lists most of the exemptions found in other laws.59 The list begins at Government Code Section 6276 and continues for more than 20 pages. Although the Public Records Act cautions that this list may not be complete, it is a helpful list. 58 Roberts v. City of Palmdale, 5 Cal. 4th 363, 377 (1993). 59 Stats. 1997, c. 620 (S.B. 143 – Kopp). Part One. Compliance with the Public Records Act Public Records Act Page 14 © 2011 Richards, Watson & Gershon 1342886.1 Two 1995 Court of Appeal decisions60 illustrate how documents made confidential by another law are exempt from disclosure under the Public Records Act. Both courts found that information relating to complaints against police officers is confidential under Penal Code Section 832.7, and therefore exempt from disclosure under the Public Records Act. 10. Personal financial information required of licensees. Gov’t Code § 6254(n). When a local agency requires that applicants for licenses, certificates or permits submit personal financial data, that information is confidential. This exemption, however, does not apply to financial information filed by a franchisee to justify a rate increase, presumably because those affected by a rate increase have a right to know its basis.61 The term “license” was narrowly construed by the court in San Gabriel Tribune v. Superior Ct. to exempt financial information of applicants whose business with the agency is only public because they must comply with licensing requirements and regulations. To give effect to the Public Records Act policy that favors disclosure over secrecy in government, the court concluded that a franchisee is akin to a contractual relationship and is not an applicant for a license under Section 6254(n). 11. Terrorist assessment reports. Gov’t Code § 6254(aa). A document prepared that assesses a local government’s vulnerability to terrorist attacks or other criminal acts intended to disrupt the local agency’s operations is exempt from disclosure if the document is prepared for distribution or consideration in a closed session of the local agency. 12. Voter registration information. Gov’t Code § 6254.4. The home address, telephone number, email address, precinct number and prior registration information shown on voter registration cards is confidential. Disclosure of that information is permitted only to candidates and campaigns, and to any person for election, scholarly, journalistic, or political purposes pursuant to Section 2194(a)(3) of the Elections Code. The driver’s license number, social security number, and signature of the voter shown on the voter registration card are confidential and cannot be disclosed to any person. 60 City of Richmond v. Superior Ct. (San Francisco Bay Guardian), 32 Cal. App. 4th 1430 (1995); City of Hemet v. Superior Ct. (Press-Enterprise Co.), 37 Cal. App. 4th 1411 (1995); see also, Copley Press, Inc. v. Superior Court (County of San Diego), 39 Cal. 4th 1272 (2006) (holding that records of a civil service commission, relating to a peace officer’s administrative appeal of a disciplinary matter, were not subject to disclosure pursuant to the Public Records Act and Penal Code Section 832.7). 61 San Gabriel Tribune v. Superior Ct. (City of West Covina), 143 Cal. App. 3d 762, 779-780 (1983). Part One. Compliance with the Public Records Act Public Records Act Page 15 © 2011 Richards, Watson & Gershon 1342886.1 We believe that this exemption extends to any document that by law must include the information made confidential by this Section, including applications for absentee ballots and returned absentee ballot packages. 13. Utility customer information. Gov’t Code § 6254.16. The name, credit history, utility usage data, home address, and telephone number of utility customers of local agencies are exempt from disclosure, except in certain circumstances. This information may be disclosed to authorized family members of the person to whom the information pertains or his or her agent, to an officer or employee of another governmental agency when necessary to perform official duties, or upon court order or the request of law enforcement for an ongoing investigation. In addition, the information may be disclosed if the utility customer has used the utility services in a manner inconsistent with applicable local utility usage policies. If the utility customer is a public official with authority to determine utility usage policies, the information may be disclosed except that the home address of an appointed official may not be disclosed without the official’s consent. Lastly, the information may be disclosed if the public interest in disclosure of the information clearly outweighs the public interest in nondisclosure. 14. Unauthorized Internet posting of officials’ addresses and telephone numbers. Gov’t Code § 6254.21. The posting of the home address or telephone number of any elected or appointed official on the internet by a local agency without that individual’s written permission is prohibited. The definition of “elected or appointed officials” includes, but is not limited to, members of a city council, members of a board of supervisors, mayors, city attorneys, police chiefs and sheriffs. It is a misdemeanor for any person to post such information with the intent to cause bodily injury to the official, his or her spouse or child. The official may bring an action for damages under certain circumstances. If bodily injury occurs as a result of the posting, then the posting could become a felony. If a person, business, or association publicly posts on the internet the home address or telephone number of any elected or appointed official, the official may make a written demand to have the information removed. An official may bring an action in court to seek injunctive relief in the event the posting is not removed or is posted again during the four years that the written demand is in effect. 15. Social Security Numbers. Gov’t Code § 6254.29. Local agencies must redact social security numbers from records before disclosing them to the public. Part One. Compliance with the Public Records Act Public Records Act Page 16 © 2011 Richards, Watson & Gershon 1342886.1 16. General public interest exemption. Gov’t Code § 6255. In cases where a specific statutory exemption does not apply, a record still might be exempt from disclosure if: on the facts of the particular case the public interest served by not disclosing the record clearly outweighs the public interest served by disclosure of the record.62 The numerous cases examining this “balancing test” make it clear that the burden is on the local agency to show that the public interest in confidentiality outweighs the public interest in disclosure. In fact, given the public policy involved, courts demand a demonstration of “clear overbalance” to justify non-disclosure.63 In practice, very few local agencies have been able to convince reviewing courts that the public interest in confidentiality outweighs the interest in disclosure. In the absence of a specific statutory exemption, this “catch-all” distinction rarely has been successfully relied upon to justify nondisclosure. Thus, local agencies must in good faith find a relatively rare “clear overbalance” to justify confidentiality on this ground.64 Two areas in which a public interest in nondisclosure have been upheld involve public records disclosure that would adversely affect the deliberative process of a local agency, or the personal security of a public official. In Times Mirror Co. v. Superior Court,65 for example, the State’s refusal to release the Governor’s schedule and appointment calendar out of concern for the Governor’s personal safety was upheld. Additionally, the State asserted that the disclosure of appointment calendars and schedules would “chill the flow of information” to the Governor and inhibit the free exchange of ideas in private meetings. The breadth of the request, however, may affect the balancing of interests. The public interest in nondisclosure may be less where the request is carefully focused and confined to a few documents.66 The Governor’s office won another Public Records Act case on the “deliberative process privilege” and the exemption for “correspondence of and to the Governor”67 justifications in 62 Gov’t Code § 6255. 63 City of Hemet v. Superior Ct. (Press-Enterprise Co.), 37 Cal. App. 4th 1411, 1421 (1995); see also Black Panther Party v. Kehoe, 42 Cal. App. 3d 645, 657 (1974). 64 See, e.g., Michaelis, Montanari & Johnson v. Superior Ct. (City of Los Angeles Dept. of Airports), 38 Cal. 4th 1065 (2006) (holding under “catch-all” exemption that proposals for lease and development of hangar facility at public airport were exempt from disclosure until city had completed negotiations where negotiations were part of the competitive process). 65 53 Cal. 3d 1325 (1991). For further discussion of the deliberative process, see the “Electronic Records” section of this Handbook. 66 Id. at 1344-46. 67 Gov’t Code § 6254(l). Part One. Compliance with the Public Records Act Public Records Act Page 17 © 2011 Richards, Watson & Gershon 1342886.1 1998 when the office refused to disclose applications submitted to the Governor for an appointment to a vacancy on a Board of Supervisors.68 On the local level, a city’s refusal to disclose the telephone records of council members was upheld to protect the same “deliberative process privilege.”69 Far more often, however, courts have found the public interest in disclosure outweighs the interest in confidentiality. Similarly, the Attorney General has issued several opinions favoring disclosure. Some illustrative cases and Attorney General opinions in this area include the following: i Connell v. Superior Court (Intersource, Inc.) 70 Records relating to unpaid state warrants are public records and must be disclosed. The public interest in disclosure outweighs the public interest in preventing possible fraud that could be assisted through the release of too much information about the State’s warrant system. The fact that the request was made solely for commercial purposes and profit did not affect the balancing test.71 i Copley Press, Inc. v. Superior Court (M.P.R. - a minor) 72 As a matter of law, no compelling reason exists to seal the court records of a settlement reached between the insurer for a school district and a minor student who was sexually assaulted at school. The amount of settlement is a matter of public record. i CBS, Inc. v. Block 73 The possibility that public disclosure of applications for concealed weapons permits would discourage the filing of new applications, or that such disclosure might increase applicants’ vulnerability to attack, did not justify nondisclosure. 68 California First Amendment Coalition v. Superior Ct. (Wilson), 67 Cal. App. 4th 159 (1998); see also Wilson v. Superior Ct. (Los Angeles Times), 51 Cal. App. 4th 1136 (1997), as modified. 69 Rogers v. Superior Ct. (City of Burbank), 19 Cal. App. 4th 469 (1993). 70 56 Cal. App. 4th 601 (1997). 71 Government Code Section 6257.5 states that the Public Records Act “does not allow limitations on access to a public record based upon the purpose for which the record is being requested, if the record is otherwise subject to disclosure.” 72 63 Cal. App. 4th 367 (1998). 73 42 Cal. 3d 646 (1986). Part One. Compliance with the Public Records Act Public Records Act Page 18 © 2011 Richards, Watson & Gershon 1342886.1 i Braun v. City of Taft 74 A city’s nondisclosure of personnel records and letters appointing an employee and then rescinding the appointment was not justified by the theory that future applicants would not be candid if they knew personal information would be made public. i 90 Ops. Cal. Att’y Gen. 40 (2007) County recorder’s accounting records that include a payment receipt showing the documentary transfer tax amount is subject to inspection under the Public Records Act. While the statutory scheme allows the documentary transfer tax to appear on a separate paper rather than on the recorded property conveyance document, that procedure provides only limited privacy protection for property owners and does not make the documentary transfer tax amount confidential. i 81 Ops. Cal. Att’y Gen. 383 (1998) Claims for senior citizens’ exemptions from assessment of a parcel tax levied by a school district are subject to inspection by members of the general public. The concern that the residents’ privacy would be compromised by solicitors targeting senior citizens was insufficient to overcome the public interest in disclosure. IX. WHAT IS THE PROPER PROCEDURE FOR COMPLYING WITH A PUBLIC RECORDS ACT REQUEST? The following is a brief outline of the proper response procedure, as required by Government Code Section 6253. A. The agency has ten calendar days to determine whether to grant the request. Grounds for refusing a request include: i The request does not seek records which are “reasonably segregable” from records which are exempt from disclosure;75 i The request does not reasonably describe an identifiable record;76 i The request would require the agency to create new records not currently in existence;77 or 74 154 Cal. App. 3d 332 (1984). 75 Gov’t Code § 6253(a). 76 Gov’t Code § 6253(b). Part One. Compliance with the Public Records Act Public Records Act Page 19 © 2011 Richards, Watson & Gershon 1342886.1 i The request seeks records which are exempt from disclosure.78 Note, however, that the Public Records Act requires the disclosure of “reasonably segregable” portions of records. This means that if portions of a record are exempt and other parts of the same record are not, the non-exempt portions of the document must be disclosed.79 B. In “unusual circumstances” the agency may take up to an additional 14 calendar days to make the determination whether to grant the request. “Unusual circumstances” must be one of the following: i The need to search for and collect the requested records from field facilities or other locations separate from the office processing the request;80 i The need to search for, collect and examine a voluminous amount of separate and distinct records demanded in a single request;81 i The need for consultation with another agency having a substantial interest in the request or among two or more components of the agency having an interest in the subject matter of the request;82 or i The need to compile data, to write programming language or a computer program, or to construct a computer report to extract data.83 If the agency intends to use this additional time to respond, the agency must provide written notification to the requester that the additional time is required, the reason for the delay and the date on which a determination will be given.84 C. When the agency has made a determination, the requester must be promptly notified of the agency’s determination. This notification should be in writing and should include the following information: __________________________________ 77 Based upon the definition of “writing,” Gov’t Code § 6252(g), and the requirement that a requested record be “identifiable,” Gov’t Code § 6253(b). 78 Gov’t Code § 6253(b). 79 Gov’t Code § 6253(a). 80 Gov’t Code § 6253(c)(1). 81 Gov’t Code § 6253(c)(2). 82 Gov’t Code § 6253(c)(3). 83 Gov’t Code § 6253(c)(4). 84 Gov’t Code § 6253(c). Part One. Compliance with the Public Records Act Public Records Act Page 20 © 2011 Richards, Watson & Gershon 1342886.1 i Whether the request is being granted or denied;85 i If the request is being granted, the estimated date and time when the records will be made available;86 i If the request was made in writing and is being denied, in whole or in part, the response must be in writing and include the extent and the reasons for the denial;87 i The name and title or position of the person responsible for the denial;88 i The cost or an estimate of the cost of copying the records and a request for pre-payment. Note that this is only the direct cost of duplication, or a statutory fee, if applicable, and does not include staff time to research, retrieve or compile the records.89 However, if the document requested is in electronic form, the agency may charge the full cost of reproducing the document when the record is one that is produced only at otherwise regularly scheduled intervals, or the request would require data compilation, extraction, or programming to produce the record.90 i The option to inspect the requested records at a mutually convenient time during office hours.91 D. In addition to the above requirements, if the local agency determines that the request should be denied and the reason for the denial is not solely because of a statutory exemption, the agency must also: i Assist the member of the public to identify records and information that are responsive to the request or to the purpose of the request, if stated;92 i Describe the information technology and physical location in which the records exist;93 85 Gov’t Code § 6253(c). 86 Gov’t Code § 6253(c). 87 Gov’t Code §§ 6255, 6253(c). 88 Gov’t Code § 6253(d). 89 Gov’t Code § 6253(b); North County Parents Organization v. Dep’t of Education, 23 Cal. App. 4th 144 (1994). 90 Gov’t Code § 6253.9(b). 91 Gov’t Code § 6253(a). 92 Gov’t Code § 6253.1(a)(1). 93 Gov’t Code § 6253.1(a)(2). Part One. Compliance with the Public Records Act Public Records Act Page 21 © 2011 Richards, Watson & Gershon 1342886.1 i Provide suggestions for overcoming any practical basis for denying access to the records or the information sought.94 Alternatively, a local agency may forego these requirements if it instead makes available an index of the record.95 E. Upon payment of the cost of duplication, the agency must make the records “promptly available.”96 F. Please note that the agency may not use this procedure to “obstruct the inspection or copying” of public records.97 This provision previously read “delay access for the purposes of inspecting.” The newer language appears to create slightly more flexibility for local agencies as a delay may naturally result from following the required procedures. G. The local agency may provide guidelines for “faster, more efficient, or greater” access to records than provided by the Act.98 X. WHAT ARE THE PENALTIES FOR FAILURE TO COMPLY WITH THE PUBLIC RECORDS ACT? Unlike other open government laws, the Public Records Act does not criminally penalize a local agency for its failure to comply with the Act. However, if a person requesting public records believes records have been improperly withheld, he or she may ask a court to compel a local agency to disclose the records.99 Any person who prevails in enforcing his or her rights under the Act in court is entitled to receive court costs and reasonable attorney fees.100 Courts have deemed a person to be the “prevailing party” for purposes of awarding costs and fees if filing of the lawsuit motivated the local agency to produce any documents.101 The production of just one document can be sufficient to trigger an award of costs and fees.102 In the past, where the court determined the litigation was not what ultimately motivated the release of records, costs and fees were denied.103 Recently, however, a court held that an award of attorney’s fees was appropriate even though no additional records were produced 94 Gov’t Code § 6253.1(a)(3). 95 Gov’t Code § 6253.1(d)(3). 96 Gov’t Code § 6253(b). 97 Gov’t Code § 6253(d). 98 Gov’t Code § 6253(e). 99 Gov’t Code § 6258. 100 Gov’t Code § 6259(d). 101 Los Angeles Times v. Alameda Corridor Transportation Authority, 88 Cal. App. 4th 1381, 1391 (2001); Rogers v. Superior Court, 19 Cal App. 4th 469, 482 (1993). 102 Los Angeles Times v. Alameda Corridor Transportation Authority, 88 Cal. App. 4th at 1392. 103 Id. at 1391. Part One. Compliance with the Public Records Act Public Records Act Page 22 © 2011 Richards, Watson & Gershon 1342886.1 as a result of the lawsuit.104 The local agency in that case had repeatedly refused to accept a requester’s oral request to inspect public records and forced the requester to make her request in writing, constituting a general denial of access to all public records and justifying an award of attorney’s fees under the circumstances. XI. CONCLUSION This Handbook provides a brief overview of some of the most important provisions of the Public Records Act that frequently arise for local government agencies. There are, however, many other provisions not covered by the scope of this Handbook. Additionally, each factual situation contains nuances specific to the particular situation that may impact the analysis. Because it is important to comply with the Public Records Act within a relatively short time frame, it is critical to seek the advice of counsel if there is any question as to the appropriate course of action. 104 Galbiso v. Orosi Public Utility District, 167 Cal. App. 4th 1063, 1086-1089 (5th Dist. 2008). Part Two. Electronic Records Public Records Act Page 23 © 2010 Richards, Watson & Gershon 1302734.1 Part Two Electronic Records Part Two. Electronic Records Public Records Act Page 24 © 2011 Richards, Watson & Gershon 1342886.1 ELECTRONIC RECORDS Advances in computer technology have significantly altered the method of communication with and between public officials and employees, but technological developments have outpaced the legislation. Email, electronic documents created on word processors, and webpages do not readily fit into the categories of disclosure under decades-old laws. The courts have had to fit the round peg of electronic documents into the square hole of state law on several occasions. In Aguimatang v. California State Lottery,105 a court of appeal rejected a defendant’s argument that the plaintiff’s computer records “were not made at or near the time of the event” and therefore did not qualify as an admissible “writing” under the evidentiary rules for business records. The records were recorded on magnetic tape on the day the events of the case took place, but were not printed out until twenty-two months later. The court concluded that the magnetic tape, not just the printout, constituted a “writing” under the Evidence Code: Chanquin cites no authority holding that the retrieval, rather than the entry, of computer data must be made at or near the time of the event. Thus, although to qualify as a business record the “writing” must be made at or near the time of the event, “writing” is not limited to the commonly understood forms of writing but is defined very broadly to include all “means of recording upon any tangible thing any form of communication or representation, including letters, words, pictures, sounds, or symbols, or combinations thereof.” Evid. Code § 250. Here, the “writing” is the magnetic tape. The data entries on the magnetic tapes are made contemporaneously with the Lotto transactions, hence qualify as business records. The computer printout does not violate the best evidence rule, because a computer printout is considered an “original.” Evid. Code § 255.106 Similarly, in People v. Martinez,107 the California Supreme Court held that records from a state computer system of a defendant’s prior criminal convictions were admissible as “official records” under the Evidence Code. In an attempt to catch up, in 2002 the Legislature enacted Assembly Bill 1962, modifying the definition of “writing” under the Public Records Act and the Evidence Code to include “photographing, photocopying, transmitting by electronic mail or facsimile, and every other means of recording upon any tangible thing any form of communication or representation, including letters, words, pictures, sounds, or symbols, or combinations thereof,” and 105 234 Cal. App. 3d 769 (1991). 106 234 Cal. App. 3d at 798 (emphasis added). 107 22 Cal. 4th 106 (2000). Part Two. Electronic Records Public Records Act Page 25 © 2011 Richards, Watson & Gershon 1342886.1 clarified that the definition applied “regardless of the manner in which the record has been stored.”108 The legislative reports cited to Aguimatang and Martinez to establish that the amendment was declaratory of existing law. The reports also observed that in an early case, a court of appeal stated that the definition of writing in the Public Records Act was “intended to cover every conceivable kind of record that is involved in the governmental process and will pertain to any new form of record-keeping instrument as it is developed.”109 Under the 2002 legislation, emails and other electronic documents are records subject to disclosure and present their own unique issues for local governments. More recently, in 2009, the State Legislature enacted rules relating to the discovery of electronically stored information, similar to the rules enacted by the Federal Government in 2006. In 2006, the Federal Rules of Civil Procedure were revised to require parties in federal lawsuits to address the production and preservation of electronic records.110 Under the 2006 Rules, a public entity should have an electronic retention practice and policy that ensures that electronic documents relevant to federal litigation are appropriately preserved. City websites, in turn, raise questions about public rights of access. Websites are an important means of providing residents with access to information. An improperly framed policy on website use, however, could result in violations of the Brown Act, infringe upon residents’ First Amendment rights, and even violate disability access laws. Consequently, it is important to establish clear policies governing website design and use. I. EMAIL Given that email can be a public record under Government Code Section 6252, in most circumstances a public entity is under an obligation to disclose email upon request. However, there are a number of complications, and despite AB 1962’s attempt to respond to the changed method of communication, the bill provided nothing in the way of specifics. A. Is the Email a Public Record? Under the Public Records Act, certain exemptions might apply to justify withholding an email. But a fundamental question – one that must be considered before determining whether an exemption applies – is whether the document qualifies as a “public record” of the local agency. 108 Stats. 2002, c. 945 (A.B. 1962—Hollingsworth) (amending Gov’t Code § 6252 and Evid. Code § 250). 109 Assembly Committee on Judiciary, Report on AB 1962, May 14, 2002 (citing San Gabriel Tribune v. Superior Ct., 143 Cal. App. 3d 762, 774 (1983)). 110 F.R.C.P. 26. Part Two. Electronic Records Public Records Act Page 26 © 2011 Richards, Watson & Gershon 1342886.1 1. Personal Messages Documents discloseable under the Public Records Act must be “prepared, owned, used, or retained by any state or local agency,” and must contain information “relating to the conduct of the public’s business.”111 Although this covers a very broad range of documents, it does not cover every document. Personal emails, for example, potentially would fall outside the scope of documents subject to disclosure. Staff frequently asks whether emails sent or received by a home email account (such as Gmail, Yahoo Mail, or Hotmail) from a home computer, that pertain to city business, would qualify as a public record. It can be argued that because the emails would not be “prepared, owned, used or retained” by the city, they are not public records. On the other hand, no court has yet ruled on this issue. It is possible such emails sent by staff would be deemed “prepared” by the city because the employee is an agent of the city, and if retained by a staff person, they would be subject to disclosure. To avoid having home email accounts belonging to staff become subject to a public records act request, it is advisable for city staff to avoid use of home email accounts for city business. Emails on entirely personal subjects unrelated to city business would not be “relating to the conduct of the public’s business,” and therefore would not constitute “public records” under Section 6252. A harder determination is whether a personal email that only mentions a city issue in passing, or is just about the day that a city official had at the office, would relate to the conduct of the public’s business. Given the dearth of case law on the topic, it is not possible to provide definitive answers to these questions. Nevertheless, based on the language of Section 6252, the more an email falls into the category of “prepared, owned, used or retained” by the city, and the more content about city business that the email contains, the more likely it is to be discloseable. 2. Emails of Council Members or other Legislative Body Members It remains uncertain whether emails of council members or other legislative body members are public records under all circumstances. A recent case, Tracy Press, Inc. v. Superior Court, highlights the continuing uncertainty whether the emails of legislative body members sent or received through a private email address using a home, business, or other non-city computer, are subject to the Public Records Act even if the email contains information relating to the conduct of the public’s business. At issue in Tracy Press was whether a city council member’s email discussing city business must be produced by a city in response to a Public Records Act request when that email is sent or received without using city resources. 111 Gov’t Code § 6252. Part Two. Electronic Records Public Records Act Page 27 © 2011 Richards, Watson & Gershon 1342886.1 In Tracy Press, the council member’s email had been sent through a private email account using a non-city computer and was not in the city’s possession. The city refused to produce the email in response to a request by Tracy Press. The newspaper brought a lawsuit claiming that the emails must be disclosed pursuant to the Public Records Act. The trial court ruled against the newspaper. The trial court decided that the council member was not a “local agency” as defined in the Public Records Act and the writings of an individual council member that were not prepared, owned, used or retained by the city are not “public records” subject to the Public Records Act. Unfortunately the appellate court decided the case on a procedural basis, and did not decide the key issue. The newspaper failed to name the council member in its writ of mandate filed with the court. The court dismissed the case on the basis that the council member was an indispensable party because her email was at issue. Local agencies, council members, and members of other legislative bodies are well advised to keep this ongoing uncertainty in mind as they use email for communications with staff, the public, and other public agencies. While it is not without doubt, we view it as likely that the private email accounts of city council members would not be subject to disclosure under the Public Records Act. Even if an email is prepared by a city council member, that individual council member is arguably not the “city,” as in most cases it takes a majority of the city council to act on behalf of a city. Thus, such email is not “prepared” by the city, but as evidenced by the Tracy case, this has yet to be decided by a court of law. On the other hand, if the city provided the email account, it is more likely that the email would be construed as a record, because the email account and the emails sent or received to it arguably are “owned” or “retained” by the city. B. Some Email may be Protected by the Deliberative Process Privilege or Mental Process Principle Emails differ from traditional printed documents: they may be prepared quickly and sent without proofreading, they may be conversational, or they may substitute for face-to-face or telephone communications. As a result, they often reflect preliminary ideas and concepts, and may be subject to the deliberative process privilege, which was mentioned earlier in the discussion on the Public Records Act.112 Alternatively, the mental process principle may provide a basis for withholding emails. Before applying the deliberative process privilege to emails sent to a legislative body member, you should familiarize yourself with the Brown Act requirements regarding disclosure, discussed below in Section E. The deliberative process privilege and the mental process principle are very similar, and sometimes courts blur the distinction. Generally speaking, the deliberative process privilege is targeted at protecting from disclosure the decision making process of 112 See pages 15-18 of this Handbook. Part Two. Electronic Records Public Records Act Page 28 © 2011 Richards, Watson & Gershon 1342886.1 governmental agencies. Without that protection, candid discussion may be discouraged within an agency, thus undermining its ability to perform its functions.113 It is sometimes referred to as the “executive privilege,”114 but has been applied to records of both the executive branch (e.g., the governor) and the legislative branch (e.g., a city council).115 The mental process principle, on the other hand, appears to apply only to the members of an agency’s legislative body when those members are enacting legislation, protecting from disclosure those records that would allow an inquiry into the “subjective motives or mental processes of legislators.”116 The deliberative process privilege uses a balancing test, whereas the mental process principle does not, making the mental process principle exemption less subjective.117 1. Deliberative Process Privilege Although the Public Records Act does not expressly contain a deliberative process exemption, the California Supreme Court held in 1991 that public records may be withheld on deliberative process grounds.118 The deliberative process privilege arises under the “catch-all” exemption contained in Section 6255 of the Government Code. Under the “catch-all” exemption, a public agency may justify nondisclosure by showing “that on the facts of the particular case the public interest served by not disclosing the record clearly outweighs the public interest served by disclosure of the record.” To apply the deliberative process privilege: i First, consider whether the record falls within the scope of the privilege. Generally, records that are predecisional and deliberative (opinion) fall within the scope, but some courts have not strictly applied a predecisional requirement and have permitted purely factual material that exposes the deliberative process to fall within the privilege.119 i Second, identify the public interest served by nondisclosure of the record. Four public interests that have been identified by the courts are: (1) Protection of the agency’s decisionmaking process so that candid discussion within the agency is not discouraged;120 (2) Protection of certain limited communications with members of the public to ensure that the local 113 Times Mirror Co. v. Superior Court, 53 Cal. 3d 1325, 1342 (1991) 114 Sutter’s Place v. Superior Court, 161 Cal. App. 4th 1370, 1378 (6th Dist. 2008). 115 Times Mirror Co. v. Superior Court, 53 Cal. 3d 1325 (1991) (governor’s calendars and schedule); Rogers v. Superior Court, 19 Cal. App. 4th 469 (2 Dist. 1993) (city council phone records). 116 Sutter’s Place v. Superior Court, 161 Cal. App. 4th 1370, 1377 (6th Dist. 2008). 117 Sutter’s Place v. Superior Court, 161 Cal. App. 4th at 1377. 118 Times Mirror Co. v. Superior Court, 53 Cal. 3d 1325 (1991). 119 Rogers v. Superior Court, 19 Cal. App. 4th 469, 478 (2 Dist. 1993) (rejecting a predecisional requirement and withholding from disclosure pure facts, that is, telephone numbers called by staff and city council members). 120 Times Mirror Co. v. Superior Court, 53 Cal. 3d 1325, 1342 (1991). Part Two. Electronic Records Public Records Act Page 29 © 2011 Richards, Watson & Gershon 1342886.1 agency receives the information it needs to make decisions and otherwise function;121 (3) Protection against confusion caused by premature exposure of the public to internal agency discussions before a policy is finalized;122 (4) Protection of the integrity of the decision-making process itself by confirming that “officials should be judged by what they decided(,) not for matters they considered before making up their minds.”123 i Third, identify the public interest served by disclosure of the record. Courts have emphasized that a primary benefit of disclosing a local agency’s records to the public is to promote government accountability. The public and the media have a legitimate need to know whether government officials are performing their duties in a responsible and diligent manner.124 “Such access permits checks against the arbitrary exercise of official power and secrecy in the political process.”125 i Fourth, balance the two, and withhold the record from disclosure only if the identified public interest justifying nondisclosure “clearly outweighs” the public interest justifying disclosure. In balancing the scales, the weight of an identified public interest in disclosure is “proportionate to the gravity of the governmental tasks sought to be illuminated and the directness with which the disclosure will serve to illuminate.”126 Because the public interest in nondisclosure must “clearly outweigh” the public interest in disclosure, if the interests are just about equal, the scales tip in favor of disclosure. In California First Amendment Coalition v. Superior Court (Wilson),127 the plaintiffs sought disclosure of records containing the names and qualifications of applicants for a temporary appointment to a local board of supervisors. The Governor’s office looked extensively into the applicants’ backgrounds to determine whether they were qualified for the position. The court upheld nondisclosure of the records under the deliberative process privilege. It reasoned that if the deliberative process privilege did not apply, the Governor would never be able to perform background checks, which is an essential part of selecting an applicant for a government position.128 In balancing the interests, the court concluded that the public’s interest in disclosure of background information revealed in confidence by 121 Id. at 1344 (disclosure of Governor’s schedule and appoint calendar would “chill the flow of information” to the Governor and inhibit the free exchange of ideas in private meetings). 122 California First Amendment Coalition v. Superior Court, 67 Cal. App. 4th 159, 170 (3 Dist. 1998). 123 Id. (internal quotations and citations omitted). 124 Times Mirror Co. v. Superior Court, 53 Cal. 3d 1325, 1344 (1991). 125 CBS v. Block, 42 Cal. 3d 646, 651 (1986). 126 Citizens for a Better Environment v. Department of Food & Agriculture, 171 Cal. App. 3d 704, 715 (3 Dist. 1985). 127 67 Cal. App. 4th 159 (1998). 128 Id. at 171-72 (quoting Times Mirror Co. v. Superior Ct., 53 Cal. 3d 1325, 1345 (1991)). Part Two. Electronic Records Public Records Act Page 30 © 2011 Richards, Watson & Gershon 1342886.1 unsuccessful applicants was not significant and that the public interest in learning about the successful applicant’s background would be satisfied after the appointment.129 The First Amendment Coalition case shows that the deliberative process privilege can apply to communications where the public interest in disclosure of deliberations prior to a decision is not significant and the outcome of those deliberations is a matter of public knowledge. For instance, the public could ultimately learn a council member’s views about an item the city council is deliberating by attending the public meeting on the item. In such a case, emails discussing preliminary ideas and concepts about the item may be subject to the deliberative process privilege. Another example is provided by Times Mirror Co. v. Superior Court.130 In that case, the Los Angeles Times sought copies of the governor’s appointment calendars and argued that “in a democratic society, the public is entitled to know how [the Governor] performs his duties.”131 Disclosure of who the Governor meets with reveals who is influencing his decisions. The Governor argued disclosure of his calendar would reveal his deliberative process, and could discourage certain people from meeting with him. In balancing these interests, the California Supreme Court concluded that nondisclosure was justified, reasoning that “if the public and the Governor were entitled to precisely the same information, neither would likely receive it.”132 The court added that the “massive weight” of the request (five years worth of calendars), outweighed whatever merit there was in favor of disclosure. The court noted, however, that there may be circumstances under which the public interest in specific information is more compelling, and such a specific, focused request might tip the scales in favor of disclosure.133 Given the pervasiveness of email today in the legislative process, the deliberative process privilege seems well-suited to protect predecisional communications from disclosure. Nevertheless, California courts have approved the use of the deliberative process privilege sparingly. Prior to invoking this privilege, it is advisable to consult your legal counsel. 2. Mental Process Principle The Public Records Act exempts from disclosure those records that are exempted or prohibited from disclosure pursuant to federal or state law.134 Under California state common law, a court is prohibited from inquiring into the motives or subjective mental processes of legislators in enacting a particular piece of legislation except as those motives 129 Id. at 173-74. 130 53 Cal. 3d 1325, 1344 (1991). 131 Id. at 1344. 132 Id. at 1345. 133 Id. at 1345-1346. 134 Gov’t Code § 6254(k). Part Two. Electronic Records Public Records Act Page 31 © 2011 Richards, Watson & Gershon 1342886.1 may be disclosed on the face of the legislative acts, or inferred from their operation.135 This “mental process principle” permits a local agency to withhold public records that would reveal the mental processes or subjective motives of its legislative body members when they are acting in a legislative capacity. Unlike the deliberative process privilege, which relies on a balancing test,136 records reflecting the “mental processes” of legislators are not subject to a balancing test.137 Under applicable circumstances, the mental process principle may be used to justify nondisclosure of emails of legislative body members, such as city council members. For example, emails sent or received by a city council member could arguable be withheld under the mental process principle when they: (1) discuss the reason the member voted for or against a particular ordinance, (2) involve the gathering of information on which the member based their legislative decision, or (3) expose the motives for member’s vote on a legislative matter. C. Exception for Notes, Drafts and Interagency/Intra-agency Memoranda The deliberative process privilege may help a local agency keep sensitive emails from public disclosure, but a far more effective tool is to simply have a policy in place to regularly purge old emails. Under the PRA, “[p]reliminary drafts, notes, or interagency or intra-agency memoranda that are not retained by the public agency in the ordinary course of business” are not subject to disclosure.138 A written policy of deleting emails more than 120 days old (or some similar duration) would help establish that emails are not retained “in the ordinary course of business.” A software modification that automatically deletes older emails would ensure that they are not retained. There are a few caveats, however. First, note that deleting an email is not the end of the story. Popular email programs such as Microsoft Outlook have “deleted items” folders that retain messages for a time after “deletion,” in order to give the user an opportunity to “undo” an accidental deletion. If a city received a request for an email that had been deleted, but was still on the computer in the “deleted items” folder, it technically would still be in the possession of the agency and may be subject to disclosure. On the other hand, it can be argued that since an agency is not required to rummage through unemptied trashcans to look for responsive records, an agency should not be required to rummage through each computer’s trashcan (provided the records were disposed of prior to receipt of the request). To eliminate this potential issue from arising, an agency must ensure that the deletion that takes place at some point becomes final and irreversible. If the agency 135 Sutter’s Place v. Superior Court, 161 Cal. App. 4th at 1375. 136 Gov’t Code § 6255. 137 See Times Mirror Co. v. Superior Court, 53 Cal. 3d at 1339nn.9-10 (noting that these records are exempt under the mental process principle through operation of Section 6254(k)). 138 Gov’t Code § 6254(a). For a discussion on the conditions that must be met to utilize Section 6254(a), see pages 7-8 of this Handbook. Part Two. Electronic Records Public Records Act Page 32 © 2011 Richards, Watson & Gershon 1342886.1 desires or is required to save a copy of the email, then it should print the email and file it appropriately, or store it online in a separate location than the regular emails. Second, note that the Section 6254(a) exemption is not absolute. The full text of the exemption provides that drafts, notes, and inter/intra-agency memoranda are nondiscloseable “provided that the public interest in withholding those records clearly outweighs the public interest in disclosure.” Accordingly, even emails “that are not retained by the public agency in the ordinary course of business” may be subject to disclosure, if the records were not deleted prior to receipt of the Public Records Act request, and a reviewing court concludes that the public interest in disclosure is not “clearly outweighed” by the interest in nondisclosure. This is a significant hurdle for a public agency to overcome. D. The Problem with Threads Emails elicit a response. The response typically elicits another response. If multiple people received the message, responses from all of the recipients are common. And, in all of those responses, the original message is typically quoted, either in part or in full, generating a “thread” of messages. The question necessarily arises, when there is a thread of 20 messages, and one of them is responsive to a public records request, must the other 19 messages also be produced? For example, a resident makes a request for all emails discussing the possible construction of a new library and locates the following thread: Original Message From:City Clerk To:Joe Employee, Jane Employee, City Manager Date:April 2, 2007 12:15 p.m. Subject:RE: Question More money and lots more money. Original Message From:City Manager To:Joe Employee, Jane Employee, City Clerk Date:April 2, 2007 12:10 p.m. Subject:RE: Question I didn’t know we were discussing compensation. What are the proposals? Original Message From:City Clerk To:Joe Employee, Jane Employee, City Manager Date:April 2, 2007 12:05 p.m. Subject:RE: Question I think the study session on the new library is next month. It will be at the same meeting as we discuss Council compensation. Original Message From:Joe Employee To:Jane Employee, City Clerk, City Manager Date:April 2, 2007 12:00 p.m. Subject:Question Do you know when the Council is going to have a study session on possibly constructing a new library? Part Two. Electronic Records Public Records Act Page 33 © 2011 Richards, Watson & Gershon 1342886.1 Only the oldest two messages (sent at 12:00 and 12:05) refer to the study session on the library construction. The rest of the messages are on a different topic, a topic that may be politically sensitive. Nevertheless, all of the responses to the original message included a copy of the original message and every message that followed it, and so they all contain a reference to the library construction. As a result, it would be difficult to argue that only the 12:00 and 12:05 messages should be disclosed if this is the only copy of the email available. On the other hand, if an earlier version of the email containing only the oldest two messages is available, a local agency could argue that the thread containing all five messages may be withheld. So long as the earlier version of the two responsive emails is disclosed, the email discussing employee compensation is only a duplicate of the oldest two messages. The subsequent messages are not responsive to the request. The Public Records Act does not require disclosure of all duplicates of a responsive record. Keep in mind, however, two important considerations. First, no court has ruled on the issues of threads within the context of the Public Records Act, so this course of action is not without risks. Second, in litigation, a different standard may apply and all versions of the email might have to be disclosed. One way to avoid the problem is to configure email so previous messages are not quoted in replies sent by staff. Under the example above, if the local agency did not allow quoted messages in replies, the first two messages mentioning the library construction would be disclosed as “stand-alone” emails, but the later messages regarding compensation would not because they would no longer be integrated into the prior emails. Accordingly, a city should balance its concern in avoiding unwanted disclosures against the usefulness of having an entire thread available, and may wish to consider configuring email programs to eliminate quoting emails in replies. E. Risk of Serial Meetings Beyond the Public Records Act concerns, the use of email presents a significant opportunity for “serial meetings” prohibited by the Brown Act. A serial meeting is a series of meetings or communications not held at a noticed, public meeting in which ideas are exchanged among a majority of a legislative body directly or through intermediaries to “discuss, deliberate, or take action on any item of business that is within the subject matter jurisdiction of the legislative body.”139 In the past, the Brown Act specifically forbade the use of technological devices to conduct those communications. In interpreting the prior version of this Brown Act provision, the California Attorney General opined that email is one of these “technological devices.”140 The Brown Act provisions regarding serial meetings was amended effective January 1, 2009, and the phrase “technological devices” was removed 139 Gov’t Code § 54952.2(b)(1). 140 84 Ops. Cal. Att’y Gen. 30 (2001). Part Two. Electronic Records Public Records Act Page 34 © 2011 Richards, Watson & Gershon 1342886.1 when the provision was revised. It is unlikely that the legislature, in omitting the phrase “technological devices,” intended to exclude email. The primary mechanism for creating serial meetings via email is through the use of “reply all.” For example, if a public employee sends an email to an entire city council, and then one of those council members replies to the entire list of recipients, then a communication would have taken place between a majority of the city council. If the purpose of the council member’s reply was to “discuss, deliberate, or take action on any item of business that is within the subject matter jurisdiction of the legislative body,” the communication would constitute a serial meeting in violation of the Brown Act.141 Accordingly, public officials must endeavor to use “reply all” sparingly, if at all. A “reply all” congratulating a council member for receiving an award would be permissible; a “reply all” expressing an opinion about an issue within the subject matter jurisdiction of the city council would not. F. Disclosure Requirements for Documents at Meetings Although the deliberative process privilege may apply to many emails, note that even that privilege is unlikely to apply if an email concerns an issue under consideration by a legislative body and a majority of the body receive the email. The Brown Act states that notwithstanding the “catch-all” exception in the Public Records Act, “or any other provisions of law,” any writings distributed to a majority of a legislative body in connection with a matter subject to discussion or consideration at an open meeting of the body are discloseable.142 The statute goes on to clarify that it does not overrule the exceptions for drafts, documents related to pending litigation, personnel files, medical files, and a number of other exceptions, but it does expressly overrule the “catch-all” provision on which the deliberative process privilege is based. Note that Section 6254(k), under which the mental process principle is applied, is not overruled by the Brown Act, and still would be applicable. Unlike records discloseable under the Public Records Act, which gives public entities ten days to respond to a request and additional time to produce the documents, a public agency must produce documents under this section of the Brown Act “without delay.”143 In addition, if the email is created by the public agency or a member of the legislative body, it must be made available for inspection at the meeting.144 Emails not drafted by the public agency or its legislative body must be made available after the meeting. This is particularly relevant to emails sent to council members on BlackBerries and similar PDAs, given that a council member could potentially send an email to other council members while a meeting is going on. Under this section of the Brown Act, an attentive 141 Gov’t Code § 54952.2(b). 142 Gov’t Code § 54957.5. 143 Gov’t Code § 54957.5(a). 144 Gov’t Code § 54957.5(b). Part Two. Electronic Records Public Records Act Page 35 © 2011 Richards, Watson & Gershon 1342886.1 member of the public could insist that they be provided a copy of that email, at the meeting, if the council member sent it to a majority of the other council members. Accordingly, members of a legislative body should consider carefully the consequences of sending an email via Blackberry or PDA at a public meeting prior to doing so. The informality of emails make them particularly prone to statements that would not be put into conventional written documents. The only certain means of avoiding unwanted disclosure, of course, is simply not to write the email in the first place. II. DOCUMENTS CREATED USING WORD PROCESSORS, GIS AND OTHER SOFTWARE A. Disclosure Requirements 1. Public Records Act Since the enactment of AB 1962, there is little question that electronic documents are subject to disclosure under the Public Records Act. A statute added to the Public Records Act in 2000 provides that a public agency that has information constituting a public record in an electronic format must make that information available in electronic form upon request.145 The statute does not require an agency to reconstruct an electronic record if it is no longer available in that format.146 An agency may inform a requester that a document he or she requested is available in electronic format, but the agency is prohibited from adopting a policy of only making information available in electronic format.147 On the other hand, not every piece of data stored on a computer readily fits the definition of “record.” Unlike word processing documents, information stored in a database or a spreadsheet, for example, may only be displayed in response to the user’s entering a formula or query. For such data, there are special statutory provisions. With conventional (printed) documents, the public agency may only charge for the direct cost of duplication, not including staff time to research, retrieve or compile the records.148 For electronic records, however, the agency may charge the full cost of reproducing the document, if the record is one that is produced only at otherwise regularly scheduled intervals, or the request would require data compilation, extraction, or programming to produce the record.149 Given the recent enactment of the statute, there is currently only one reported opinion interpreting Section 6253.9. In that opinion, the California Attorney General (the “AG”) concluded, not surprisingly, that parcel boundary map data maintained in an electronic 145 Gov’t Code § 6253.9(a). 146 Gov’t Code § 6253.9(c). 147 Gov’t Code § 6253.9(d), (e). 148 Gov’t Code § 6253(b). 149 Gov’t Code § 6253.9(b). Part Two. Electronic Records Public Records Act Page 36 © 2011 Richards, Watson & Gershon 1342886.1 format was subject to public inspection and copying under the Public Records Act.150 Many public agencies now possess Geographic Information Systems (“GIS”) that allow them to collect, manage and analyze large volumes of geographically referenced information. The AG’s analysis was relatively simple; the AG simply cited to 6253.9 and then stated that “[i]t is apparent from the[se] provisions” that the GIS records were discloseable. Note, however, that the AG was careful to distinguish the maps from the software – the mapping system itself was exempt from disclosure under another provision in the Public Records Act.151 The statute expressly exempts computer mapping systems, computer programs, and computer graphic systems, and states that nothing in the statute is intended to limit any copyright protections. Accordingly, a requester may not seek to obtain the software that creates the records, only the records themselves. 2. Rule 26 In 2006, revisions to Rule 26 of the Federal Rules of Civil Procedure took effect that require parties in federal court to address the production and preservation of electronic records. These rule changes do not require a local agency to alter its routine management or storage of electronic information. They do, however, illustrate the importance of having formal written rules for document retention and purging when litigation occurs. Discovery is the process by which parties involved in litigation in either state or federal courts obtain information from other parties. Under revised Rule 26, parties in a federal lawsuit may obtain discovery regarding any matter that is relevant to a claim or defense, so long as it is not privileged. According to Rule 26(a) what can be discovered includes “documents,” “tangible things,” and “electronically stored information,” which is broadly defined as “any type of information that is stored electronically.” The rule changes alter discovery in four major ways: (1) Penalties (sanctions) on parties are now limited for electronic information lost as a result of the routine operation of computer systems; (2) Parties must address electronic discovery issues at the beginning of litigation, including the form in which electronic information will be produced to the other party, the preservation of electronic information, and claims of privilege for electronic information; 150 88 Ops. Cal. Att’y Gen. 153 (2005). 151 Gov’t Code § 6254.9 (“Computer software developed by a state or local agency is not itself a public record under this chapter.”). Part Two. Electronic Records Public Records Act Page 37 © 2011 Richards, Watson & Gershon 1342886.1 (3) Parties must produce relevant information from electronic sources that are “reasonably accessible” but may not have to produce information from older or backup systems if it imposes an “undue cost” or if “good cause” is shown; and (4) Privileges are retained for documents inadvertently disclosed. The discovery rule changes do not require a local agency to alter its routine handling of electronically stored information prior to litigation. The drafters of the new rules recognized that electronic information might be routinely altered, purged or overwritten as part of a system’s operation. Under new Rule 37(f) the routine purging of outdated electronic information, including the “alteration or overwriting of information” “to meet the party’s technical and business needs” continues to be permissible, so long as it is done in accordance with other laws, such as the records retention laws in Government Code Sections 34090-34090.8. These sections permit a city, for example, to destroy certain city records that are “no longer required” and are more than two years old if authorized by a city council resolution and the written consent of the city attorney. Records that may not be destroyed include: real property title records, court records, records required to be kept by statute, records less than two years old, and the minutes, ordinances, or resolutions of the legislative body, city board, or commissions. Once federal court litigation begins, however, a local agency may have a duty to preserve information for discovery. In some cases, the local agency may have to suspend the routine operation of its information systems in order to preserve information relevant to the litigation. In such cases, it must act in good faith and not sit idly by while relevant information is purged from its systems; “[t]he good faith requirement of Rule 37(f) means that a party is not permitted to exploit the routine operation of an information system to thwart discovery obligations by allowing that operation to continue in order to destroy specific stored information that it is required to preserve.” These new rules on document preservation highlight the importance of having a written document retention policy. A written policy will show what operations are routine. This will help protect a local agency from sanctions if litigation occurs and allow its attorneys to discuss its routine computer operations with the court and other parties. Such a policy should set specific limits for how long information is retained and specific procedures for the routine destruction of electronic data. These limits should be in accordance with Government Code Sections 34090-34090.8 and any other applicable laws governing the preservation of City records. The other discovery rule changes further illustrate how a written policy will aid a local agency in litigation. When litigation begins in federal court new Rule 26(f) requires the parties to confer about “issues relating to disclosure or discovery of electronically stored information.” Rule 26(f) explicitly directs the parties to discuss the form in which electronic Part Two. Electronic Records Public Records Act Page 38 © 2011 Richards, Watson & Gershon 1342886.1 information will be produced, how it will be preserved, and how to address claims that certain information is privileged. In order for a local agency’s counsel to be prepared to discuss these issues, the rules note that it is “important for counsel to become familiar with those systems before the conference.” In some cases, counsel may have to identify and depose individuals with special knowledge of the agency’s computer systems. New Rule 26(b) requires the parties to identify whether “reasonably accessible” electronic sources can provide all of the relevant, non-privileged, information. Parties will need to distinguish these “reasonably accessible” sources from those that are not “reasonably accessible” because of undue burden or cost. Examples of information that might not be reasonably accessible include: i deleted items, i fragmented or damaged data, i information kept on some back-up tape systems for disaster recovery purposes, and i legacy data remaining from systems no longer in use. Under Rule 26(a), the parties must produce all of the relevant, non-privileged, information from the “reasonably accessible” sources within 14 days of the initial conference. Discovery from sources that a party deems not “reasonably accessible” can still occur if the requesting party can show that there is no undue burden or cost or upon a showing of “good cause.” Once discovery begins in federal court a local agency must now be prepared to explain how their electronic information systems work, which systems contain information relevant to the litigation, how those systems are accessed, and the costs of accessing archival or older systems. The agency will also have to be prepared to produce all relevant, non-privileged information from all reasonably accessible sources. Having a written policy in place will reduce the costs and staff time associated with complying with these discovery rules. It will also aid staff in familiarizing themselves with the operations of the agency’s computer data and storage systems as well as any external storage and backup systems, and in explaining these operations to agency counsel and opposing parties. Taken together, the changes to the federal discovery rules make it advisable for a local agency to put in writing its procedures for managing electronic information. They do not, however, require the agency to change those procedures in advance of federal litigation. Part Two. Electronic Records Public Records Act Page 39 © 2011 Richards, Watson & Gershon 1342886.1 3. AB 5 Amends the Civil Discovery Act to Establish a Process for Electronic Discovery in State Court In 2009, the California Legislature adopted federal-style procedural rules to permit the discovery of electronically stored information in state court cases. Electronically stored information is any information that is stored in an electronic medium including, e-mails, documents, spread sheets and any other information stored in computers and other electronic devices.152 AB 5 was modeled after the federal rules pertaining to civil discovery. The implementation of AB 5 may produce a dramatic increase in electronic discovery in civil cases as well as an overall increase in the cost of litigating cases. Public agencies should therefore review their operating systems to ensure they understand how electronic information is currently stored and retained. In addition, public agencies should examine their data recovery systems and archival data to determine the type of information contained in these systems. AB 5 specifically provides that a court shall not impose sanctions on a party for failing to provide electronically stored information that has been lost, damaged, altered or overwritten as the result of the routine, good faith operation of an electronic information system.153 Accordingly, public agencies should review how their document retention policies and practices are applied to electronically stored information to ensure it is retained or deleted in accordance with the adopted policy. They should also train employees to make sure the document retention policies are appropriately followed.154 Further, once litigation is reasonably anticipated, public agencies have a duty to preserve relevant electronically stored information in the format in which it currently exists, notwithstanding the normal document retention policy that might otherwise permit destruction. In the event litigation is reasonably anticipated, public agencies should ensure that “litigation holds” are applied to electronically stored information potentially relevant to specific claims or litigation, so that it is not deleted, whether intentionally or by automatic computer processes. B. Metadata Word processing documents most readily fit the definition of “record,” and they also present the greatest potential for inadvertent disclosures. A modern word processing document is comprised of far more than simple words on a page. Corel WordPerfect and Microsoft Word documents typically contain information about the author or editor, the author’s organization, the time the document was created, modified or accessed, the amount of time spent editing the document, and even what earlier versions of the document 152 Code of Civil Procedure § 2016.020(e). 153 Code of Civil Procedure § 2031.060(i)(1). 154 Code of Civil Procedure § 2031.060(i)(2). Part Two. Electronic Records Public Records Act Page 40 © 2011 Richards, Watson & Gershon 1342886.1 looked like. This “metadata,” which literally means data about data, is automatically attached to documents by modern word processors. For instance, some metadata appears in Microsoft Word under the “File” menu, by selecting “Properties.” Although metadata can be useful information, it can also result in unwanted disclosures. For instance, as the dialog box above shows, Microsoft Word automatically inserts the name and company of the author of the document, and there are numerous other fields that can be filled in. If a city does not want this sort of information disclosed as a general rule, the word processor should be configured to not record this information. For example, in Microsoft Word 2007, click Microsoft Office Button, point to Prepare and then click Inspect Document. This opens up the Document Inspector dialog box where you can review and remove different types of metadata. In Microsoft Word 2002 and 2003, click Tools, then Options, and click the Security tab. Under Privacy options, select “Remove personal information from file properties on save” and click OK. More significantly, many word processors have a “tracked changes” function. When public officials and employees work with multiple drafts of a document, especially when multiple people work on the same document, they frequently make use of a feature that highlights Part Two. Electronic Records Public Records Act Page 41 © 2011 Richards, Watson & Gershon 1342886.1 every change made to the document. That way, when a party to a proposed contract wants to delete a provision or insert a line, it is easy for the other party to see the change. It is simple to turn this feature on and off, but it is also simple to turn the display of tracked changes on and off, while still having the word processor keep track of the changes. As a result, it is not uncommon for documents to be transmitted electronically with changes tracked, without the knowledge of the author. If the author deleted a paragraph, the person reviewing the tracked changes could restore that paragraph. The implications become particularly significant if the author had deleted the text because it was deemed inaccurate or sensitive. Moreover, recall that drafts are only nondiscloseable if it is the public agency’s policy to not retain them in the course of business. If a city routinely saves documents with changes tracked, then arguably it has preserved the earlier drafts of the document. This could thwart a city’s policy to avoid preserving drafts. Consequently, it should be common practice to remove any tracking from a document upon finalization, or better yet, to not use tracking in the first place. To turn off tracked changes, in Word 2007, click on the Track Changes icon on the Review tab in the tracking group. In Word 2002 and 2003, click Tools, then Track Changes. Note that Track Changes must be disabled before writing the document. Otherwise, any changes made will be recorded by Track Changes and preserved. In Word 2007, you can ensure that all tracked changes are gone by going to the Document Inspector dialog box and clicking Remove All next to Comments, Revisions, Versions, and Annotations. Similarly, most word processors have an “undo” button, which is useful for correcting typos or to recover inadvertently deleted text. Many word processors can “undo” a string of actions, and can even “undo” actions repeatedly until the document is a blank page. Corel WordPerfect can save this undo trail, so that when a document is opened at a later date, the author can still “undo” his or her changes. But if a city official sends that document to someone making a public records request, the individual could click on “undo” repeatedly to see every step that the author took in drafting the document. This presents the same problems as with “tracked changes” – sensitive or inaccurate information that the author meant to delete could be included in the metadata. Accordingly, in using word processors, public agencies should ensure that they are configured to eliminate the “undo” trail when a document is saved. This is typically a simple configuration; in WordPerfect, you select the Edit menu, then select Undo/Redo History, then click the “Options” button, and then uncheck “Save Undo/Redo Items with Document.” In addition to all of the above strategies, there are several programs available that can remove metadata after a document has been completed, or at the time it is emailed. However, the use of such programs on documents that are subject to a public records request would be of questionable legality. Under the Public Records Act, a request for a public document must include the exact document, and on the face of it, stripping metadata Part Two. Electronic Records Public Records Act Page 42 © 2011 Richards, Watson & Gershon 1342886.1 from a document that is requested in electronic form potentially would violate this requirement.155 Depending on your document retention schedule, you may be able to strip metadata from some older documents upon archiving them, but deleting metadata from documents that the city is required to retain may violate document retention requirements. Of course, the simplest method of avoiding any of the pitfalls of metadata is to simply provide all documents in printed form, and to refrain from providing the documents on disk or emailing the documents. This may not be an option, however. As mentioned before, under Government Code Section 6253.9, a public agency that possesses an electronic document subject to disclosure “shall make that information available in an electronic format when requested by any person.” A city could ask a requester whether he or she would accept the documents as Adobe Portable Document Format (pdf) files, because converting the documents into pdf format would strip the metadata. There is one other alternative. On the one hand, the statute provides that the agency “shall provide a copy of an electronic record in the format requested,”156 and so if a requester insists on receiving the document in its original form, a city must comply with that request. On the other hand, a more recent provision in the Public Records Act provides that a public agency need not release a record in electronic form when doing so “would jeopardize or compromise the security or integrity of the original record.”157 The Senate Floor Analysis for this subsection explained that in certain formats, “the electronic record when transmitted or provided to a requester, could be altered and then retransmitted, thus rendering the original record vulnerable,” and when this is a concern, the city “may refuse to provide the information in electronic format.”158 For example, releasing a copy of a city letter in Word would permit someone to insert and delete text and then distribute the altered letter, thereby misrepresenting the city’s statements and actions. Consequently, when a requester asks for the letter in Word format or similar alterable form, we recommend only releasing it in a format that is more difficult to alter, such as Portable Document Format (pdf). Staff should check with the city attorney when the issue arises. If the requester does not expressly ask that the document be provided in electronic format, the statute does not prohibit the agency from supplying it in printed form. Accordingly, the city may wish to adopt a policy of providing electronic records in printed form unless a requester expressly asks for an electronic version, and providing them in pdf format when requesters ask for electronic versions. If the requester expressly asks for the original document format, the city attorney should be consulted. 155 See Gov’t Code § 6253 (b) (“Upon request, an exact copy shall be provided unless impracticable to do so.”); Rosenthal v. Hansen, 34 Cal. App. 3d 754 (1973). 156 This Section further provides that the format requested must be “one that has been used by the agency to create copies for its own use or for providing to other agencies.” Gov’t Code § 6253.9(a)(2). 157 Gov’t Code §§ 6253.9(f), 6255. 158 AB 2799 Senate Floor Analysis (Aug. 16, 2000). Part Two. Electronic Records Public Records Act Page 43 © 2011 Richards, Watson & Gershon 1342886.1 It is unclear how the new federal electronic document discovery rules would apply to metadata. Rule 26 does not specifically address metadata, but the comment to the revision mentions metadata and states that “[w]hether this information should be produced may be among the topics discussed in the Rule 26(f) conference.” Consequently, there is the potential for the disclosure of metadata in litigation, which further highlights the importance of establishing standard practices for creating and handling metadata. III. CITY WEBSITES With the rapid integration of the internet into American culture, a significant percentage of California cities now provide at least basic information about their government on city-run websites. Posting certain commonly requested information on a webpage is a way to reduce the staff time necessary to respond to public records requests. In addition, it allows elected officials to provide information to the electorate in a manner that avoids the prohibitions of the mass mailing restrictions. A city must draft a policy on the permitted uses of the website, however, in order to avoid violating the prohibitions on using public funds for “express advocacy,” and also to avoid creating a “public forum” on which anyone could post information. A. Websites and the “Mass Mailing” Prohibitions The Political Reform Act prohibits the sending of newsletters and other so-called “mass mailings” at public expense.159 A “mass mailing” is defined as the mailing or distribution at public expense of 200 or more items within a calendar month featuring the name, office, photograph or other reference to an elected officer of the agency. 160 The underlying intent is to preclude elected officials from using newsletters as indirect campaign flyers for themselves. In brief, the California Fair Political Practices Commission (the “FPPC”) Regulations provide a four-prong test to determine the legality of mass mailings. A mass mailing is prohibited if each of the following elements are present: a. A delivery of a tangible item, b. that “features” or includes reference to, an elected official, c. distributed at public expense regardless of the cost, or produced at public expense where the cost of production exceeds $50.00, 159 Gov’t Code § 89001. 160 2 C.C.R. § 18901 Part Two. Electronic Records Public Records Act Page 44 © 2011 Richards, Watson & Gershon 1342886.1 d. in a quantity of 200 or more.161 On the face of it, the regulation would not apply to webpages, because they would not constitute “a delivery of a tangible item.” The FPPC, which interprets the Political Reform Act, has yet to render an official opinion on the applicability of the mass mailing rule to websites. However, several advice letters issued by the FPPC have concluded that the prohibitions on publicly funded mass mailings contained in Government Code Section 89001 and FPPC Regulation 18901 do not apply to websites or webpages. In 1998, the FPPC responded to an inquiry as to whether a committee, advocating the passage of a bond measure expected to be placed on the ballot by a school board, may obtain a link from a “school district web site to a web page” advocating the passage of the bond measure. The FPPC advised that, According to Regulation 18901(a)(1), a publicly-funded mailing is a prohibited mass mailing if it is delivered as a tangible item to the recipient at his or her residence, place of employment or business, or post office box. Consistent with Regulation 18901, the ban is applicable to tangible items only. Since distribution over the Internet is not a distribution of a tangible item, Internet pages are not prohibited mass mailings under the [Political Reform] Act.162 Even though providing a link to an express advocacy website may not qualify as a “mass mailing,” it could violate other laws, as will be discussed below in Section B. A second advice letter similarly concluded that webpages are not covered under the mass mailing prohibitions of the Political Reform Act. That advice letter was issued by the FPPC in 1998 in response to a request for advice by the West Contra Costa Unified School District. The inquiry was whether the school district could put all of the following on its webpage: a board member’s name, address, photograph, biography, curriculum vitae and/or other background information. The inquiry also included the question of whether “a board member’s web page [could] be hyperlinked to the district’s web page, so that by clicking a button on the district’s web page, a user would have immediate access to the board member’s web page.” The FPPC letter stated that FPPC Regulation 18901 did not apply to any of the actions listed above because a “web page on the internet is not currently considered a mass mailing.” The letter further reasoned that, “[s]ince distribution over the Internet is not the distribution of a tangible item, Internet pages are not prohibited mass mailings under the [Political Reform] Act.”163 161 2 C.C.R. § 18901. 162 Foote Advice Letter, No. A-98-114, 1998 WL 289895 (1998) (citation omitted). 163 Lovely Advice Letter, No. A-98-017, 1998 WL 75447 (1998). Part Two. Electronic Records Public Records Act Page 45 © 2011 Richards, Watson & Gershon 1342886.1 Nevertheless, both of the FPPC advice letters previously mentioned cautioned that when FPPC Regulation 18901 was adopted by the FPPC, the FPPC did not consider the internet. The FPPC further stated that, “We expect that the Internet and other advances in technology may necessitate amendments to the Act and/or its regulations in the future.”164 Given the foregoing, city webpages provide a unique opportunity for elected officials to communicate with their constituents. Council members could each maintain their own page on the website, drawing attention to issues of interest to the community. There are, however, some limitations on what the webpages can contain, as discussed below. B. Avoiding Express Advocacy Although websites and webpages are not currently covered under the mass mailing restrictions of FPPC Regulation Section 18901, public agencies must still be mindful of other regulations and laws that might be violated by its decisions to permit links from official websites. For example, the Political Reform Act prohibits the use of public moneys for election campaigns.165 Although the FPPC has indicated that Section 85300 “was not intended to prohibit every activity that might indirectly benefit a candidate for elective office,” it does nevertheless “prohibit public financing of election campaigns.” (citation omitted).166 If the city’s website is used to promote an incumbent’s reelection campaign, for example, this would constitute public financing of a campaign: [A]ll monies held by the city are public monies, including any funds used for the operation of the city’s web page. Accordingly, any expenditure of the city’s funds related to its website used to advocate or promote a candidate’s election would constitute a violation of the Act.167 Consequently, a city’s webpage must not indicate support or approval of, or advocate for, a candidate for elective office. The leading California case setting forth the basic rule with respect to government involvement in political campaigns is Stanson v. Mott.168 In Stanson, the California Supreme Court addressed the question of whether the State Director of Beaches and Parks was authorized to expend public funds in support of certain state bond measures for the enhancement of state and local recreational facilities. The court concluded that the Director of Beaches and Parks lacked such authority and set forth the basic rule that “in the absence of clear and explicit legislative authorization, a public agency may not expend public funds 164 Foote Advice Letter, No. A-98-114 (1998). 165 Gov’t Code § 85300. 166 Lovely Advice Letter, No. A-98-017 (1998). 167 Id. (citations omitted). 168 17 Cal. 3d 206 (1976). Part Two. Electronic Records Public Records Act Page 46 © 2011 Richards, Watson & Gershon 1342886.1 to promote a partisan position in an election campaign.”169 Only impartial “informational” communications would be permissible, such as a fair presentation of the facts in response to a citizen’s request for information.170 The Stanson Court also recognized that the line between improper “campaign” expenditures and proper “informational” activities is not always clear. “[T]he determination of the propriety or impropriety of the expenditure depends upon a careful consideration of such factors as the style, tenor and timing of the publication; no hard and fast rule governs every case.”171 The Stanson test was recently reaffirmed by the California Supreme Court in Vargas v. City of Salinas.172 Prior to Vargas, courts attempting to interpret and apply Stanson used varying tests to determine the permissibility of expenditures. For example, in California Common Cause v. Duffy, an appellate court held that a local sheriff’s use of public facilities and personnel to distribute postcards critical of then-Supreme Court Justice Rose Bird was “political” and not “informational” as permitted by Stanson because the cards presented only one side of Justice Bird’s fitness to be retained in office.173 In another appellate decision, Schroeder v. City Council of Irvine, another court of appeal upheld Irvine’s “Vote 2000” Program.174 The program encouraged voter registration, without specifically advocating a particular position on any measure. Although the city had taken a public position in favor of the proposed ballot measure, the materials it distributed did not advocate any particular vote on the measure and rarely mentioned the measure at all. The Schroeder court held that the funds spent on the Vote 2000 program would be political expenditures and unlawful under Stanson only if the communications expressly advocated, or taken as a whole unambiguously urged, the passage or defeat of the measure.175 Because the city presented a neutral position on “Measure F,” at least in the campaign materials, the court upheld the program as valid. However, in Vargas v. City of Salinas, the California Supreme Court decided that “express advocacy” is an insufficient standard. In Vargas, proponents of a local ballot initiative to repeal the city’s utility user’s tax (“Measure O”) sued the city alleging improper government expenditures, the court held that even if a communication does not expressly advocate for either side of an issue, a Stanson analysis must nonetheless be conducted to determine whether the activity was for informational or campaigning purposes based on its style, 169 Id. at 209-10. 170 Id. at 221; see also Gov’t Code § 54964 (codifying the holding in Stanson, by prohibiting the expenditure of public funds “to support or oppose the approval or rejection of a ballot measure, or the election or defeat of a candidate, by the voters”). 171 Id. at 221-22 (citations omitted). 172 46 Cal. 4th 1 (2009). 173 200 Cal. App. 3d 730, 746-747 (1987). 174 97 Cal. App. 4th 174 (2002). Part Two. Electronic Records Public Records Act Page 47 © 2011 Richards, Watson & Gershon 1342886.1 tenor, and timing.176 Although the court did not specifically refer to the Schroeder analysis in its opinion, the court clearly stated that the “express advocacy” standard does not meaningfully address potential constitutional problems arising from the use of public funds for campaign activities that were identified in Stanson. Thus, local governments must look to Vargas rather than Schroeder for the proper standard to evaluate whether an expenditure is permissible. A variety of factors led to the Vargas court’s conclusion that the communications were informational, including the fact that the publications avoided argumentative or inflammatory rhetoric and did not urge citizens to vote in a particular manner. The challenged expenditures were made pursuant to general appropriations in the city’s regular annual budget pertaining to the maintenance of the city’s website, the publication of the city’s regular quarterly newsletter, and the ordinary provision of information to the public regarding the city’s operations. The Supreme Court found that in posting on the city’s website the minutes of city council meetings relating to the council’s action along with reports prepared by various municipal departments and presented by officials at city council meetings, the city engaged in informational rather than campaign activity.177 Similarly, the city did not engage in campaign activity in producing a one-page document listing the program reductions that the city council voted to implement should Measure O be approved, or in making copies of the document available to the public at the city clerk’s office and public libraries.178 The court reasoned that viewed from the perspective of an objective observer, the document clearly constituted an informational statement that merely advised the public of specific plans that the city council voted to implement should Measure O be approved. Finally, the court found that the city engaged in permissible informational activity by mailing to city residents the fall 2002 “City Round-Up” newsletter containing articles describing proposed reductions in city services. Although under some circumstances the mailing of material relating to a ballot measure to a large number of voters shortly before an upcoming election would constitute campaign activity, a number of factors supported the court’s conclusion that the mailing of the newsletter constituted informational rather than campaign activity: it was a regular edition of the newsletter that was mailed to all city residents as a general practice, the style and tenor of the publication was entirely consistent with an ordinary municipal newsletter and readily distinguishable from traditional campaign material, and the article provided residents with important information about the tax in an objective and nonpartisan manner. 176 Vargas, 46 Cal. 4th 1. 177 Id. at 37. 178 Id. (stating, “not only [did] the document not advocate or recommend how the electorate should vote on the ballot measure, but its style and tenor [was] not at all comparable to traditional campaign material”). The fact that the city only made the document available at the city clerk’s office and in public libraries to people who sought it out reinforced the document’s informational nature. Id. Part Two. Electronic Records Public Records Act Page 48 © 2011 Richards, Watson & Gershon 1342886.1 The Supreme Court illustrated the insufficiency of the “express advocacy” standard by suggesting that if the City of Salinas were to post billboards throughout the city prior to an election stating, “IF MEASURE O IS APPROVED, SIX RECREATION CENTERS, THE MUNICIPAL POOL, AND TWO LIBRARIES WILL CLOSE,” it would defy common sense to suggest that the city had not engaged in campaign activity even though such advertisements would not have violated the express advocacy standard. Vargas and Stanson reflect that local agencies must exercise caution when communicating to voters about local measures. The same prohibitions on the use of public moneys to support or oppose a ballot measure or a candidate for political office would likely also apply to public agency websites. This is because the time and expense of maintaining a website and adding links to other websites may result in a form of “in kind” contribution from the public agency to the particular candidate or campaign committee. “Professional services, including the creation and maintenance of a website for a candidate, could conceivably result in a contribution from the county to the candidate.”179 Public officials must ensure that there is no inclusion of information or links on their websites that contain words of express advocacy or that unambiguously suggest a particular position in a campaign. In addition, public officials must also avoid any actions which, based on their “style, tenor and timing”, may lead to a determination that a city website contains impermissible advocacy. Unfortunately, there is no hard and fast rule to assist public officials in distinguishing improper partisan campaign expenditures from permissible expenditures for “informational activities.” Whether a communication is permissible will be based on a combination of these factors, and public officials should therefore seek the advice of the city attorney on a case-by-case basis. Assistance may also be obtained from the FPPC. Note also that public officials could potentially face personal liability if a court concluded that they used public funds for a partisan campaign. The Stanson opinion concluded that public officials “may properly be held to a higher standard than simply the avoidance of “fraud, corruption or actual malice” in their handling of public funds.”180 Instead, public officials must exercise “‘due care,’ i.e., reasonable diligence, in authorizing the expenditure of public funds, and may be subject to personal liability for improper expenditures made in the absence of such due care.”181 If public officials published a webpage that conveyed a partisan slant, a court could conclude that the officials failed to exercise this due care. C. Public Forum In addition to the mass mailing and express advocacy considerations, the existence of city websites also raises the issue of whether a website creates a “public forum” in which any 179 Peterson Advice Letter, No. A-99-013. 180 17 Cal. 3d at 226. 181 Id. at 226-27. Part Two. Electronic Records Public Records Act Page 49 © 2011 Richards, Watson & Gershon 1342886.1 member of the public would have a right to post information and links. The decisions of public agencies on what sort of content to include on webpages, whether to allow external links to be posted, and what type of links to permit, have the potential to infringe upon rights guaranteed by the First Amendment of the United States Constitution, the California Constitution’s “Liberty of Speech Clause,” and other legal principles. In relevant part, the First Amendment provides that, “Congress shall make no law… abridging the freedom of speech.”182 Similarly, the “Liberty of Speech Clause” provides that, “A law may not restrain or abridge liberty of speech or press.”183 The United States Supreme Court uses the “public forum” doctrine to evaluate the constitutionality of government regulation of private speech on public property. This doctrine classifies public property according to three categories of public forum status: (i) traditional public forums - areas traditionally used for expressive activity such as streets, sidewalks and parks; (ii) designated public forums - areas dedicated by the government for expressive activity, either generally or for limited purposes; and (iii) nonpublic forums. “Public forum” status directly impacts the degree to which a public agency may regulate private expression on public property. For example, if a public agency’s website were deemed a “nonpublic forum,” then the agency would have considerable discretion in determining which applications for website links to accept. By contrast, if a public agency’s website was deemed a “traditional public forum” or a “designated public forum,” then the agency’s discretion would be substantially diminished. Two cases addressing whether city websites constitute public forums are discussed below. D. Putnam Pit, Inc. v. City of Cookeville The case of Putnam Pit, Inc. v. City of Cookeville184 provides guidance on how the First Amendment limits a public agency’s authority to control external links on its website. Putnam Pit is a federal case discussing the validity of a website link policy under the First Amendment. This case involved a free speech claim by a small, free website newspaper publisher, against the City of Cookeville, Tennessee. The case arose from Cookeville’s refusal to establish a link from its website to the website of the publisher’s on-line newspaper, the “Putnam Pit.” The “Putnam Pit” website focused on commentary critical of the City of Cookeville and its officials and staff. At the time that the publisher initially requested and was denied the link, “several for-profit and non-profit entities were linked to the . . . [Cookeville] Web site, including a local technical college, two Internet service providers, a law firm, a local computer club, a truck product manufacturer 182 U.S. CONST. amend I. 183 CAL. CONST. art. 1, § 2(a). 184 221 F.3d 834 (6th Cir. 2000). Part Two. Electronic Records Public Records Act Page 50 © 2011 Richards, Watson & Gershon 1342886.1 and distributor, and a site with information about Cookeville.”185 However, prior to the publisher’s request, Cookeville “had no stated policy” on who could be linked to the city’s website.186 Upon learning of the publisher’s request, the city manager decided to permit links only “from the Cookeville Web site to other sites, which would promote the economic welfare, tourism, and industry of the city.”187 Pursuant to this policy, the city manager subsequently denied the publisher’s request for a link from the Cookeville website to the “Putnam Pit” website and then removed several links to other websites from the Cookeville website.188 The Sixth Circuit Court of Appeals ruled that based on the facts presented, the publisher was entitled to a trial regarding whether Cookeville discriminated against him based upon viewpoint when the city manager denied him a link on the website. Facts that could potentially constitute viewpoint discrimination included statements by the city manager that he thought the “Putnam Pit” consisted only of the publisher’s “opinions,” “which he didn’t care for” and actions by the city manager who indicated to the publisher that he would not be permitted a link even if the “Putnam Pit” were a non-profit entity.189 E. Vargas v. City of Salinas In Vargas v. City of Salinas, the California Supreme Court also considered whether a city website constituted a public forum.190 In Vargas, city residents placed an initiative on the ballot to repeal the city’s long-standing utility user’s tax. The city staff prepared a series of reports addressing the impact the loss of the tax would have on the city’s budget, including the reduction and elimination of services and programs, and posted those reports on the city’s webpage. The initiative supporters contended that they had a right to provide their own information on the webpage, which the city rejected. The Supreme Court concluded that the city’s webpage was not a public forum because the city had not opened its web site to permit others to post material of their choice.191 185 Id. at 841. 186 Id. 187 Id. 188 Id. at 845-46. 189 The court further concluded that, “[t]he city’s actions, some of which appear to be tied to the city’s interests, and others which appear less clearly relevant to the purpose of the city’s Web site, lead us to REVERSE the district court’s grant of summary judgment because [the publisher] has raised a material issue of fact regarding whether the city discriminated against him and his Web site based upon viewpoint.” 221 F.3d at 846. 19046 Cal. 4th 1. 191 Id. at 37, fn. 18. Part Two. Electronic Records Public Records Act Page 51 © 2011 Richards, Watson & Gershon 1342886.1 F. Public Forum Analysis The Putnam Pit and Vargas courts applied the public forum analysis of the First Amendment to the city’s action with respect to the website, treating the website as analogous to physical public property. As previously mentioned, the United States Supreme Court has established that, for such analyses, the extent of permissible government restrictions on expressive activity are governed by whether the activity occurs in (i) a traditional public forum; (ii) a designated public forum; or (iii) a nonpublic forum.192 1. Traditional public forum Traditional public forums are “places which by long tradition or by government fiat have been devoted to assembly and debate.” Typically such places have included public streets, sidewalks and parks.193 Government regulations that restrict the “content” of expressive activity in such forums “must withstand strict scrutiny.”194 This means that if the government wishes to restrict expressive activity based on content, such restrictions must serve a “compelling state interest” and must be “narrowly tailored” to serve that interest. However, if the government imposes content-neutral restrictions on the “time, place and manner” of expressive activity in public forums, then such restrictions must serve a “significant public interest,” must be “narrowly tailored” to that interest and must leave open “alternative avenues of communication.”195 2. Designated public forum The Supreme Court has held that “[i]n a designated public forum, the government ‘intentionally opens a nontraditional public forum for public discourse.’”196 An example of a designated public forum is the public comment session at a city council meeting. In a designated public forum, the government may restrict the content of the expressive activity to that which is within the scope of the public forum. For example, in the case of a city council meeting, the government may restrict speech to only permit discussion of city business.197 Once the government opens a nontraditional public forum to a class of persons, the restrictions applicable to those to whom the forum is opened must also withstand strict scrutiny. Thus, as in the case of public forums, regulations governing designated speakers in designated public forums must serve a “compelling state interest” and must be “narrowly 192 Perry Ed. Ass’n v. Perry Local Ed. Ass’n, 460 U.S. 37 (1983). 193 Putnam Pit, 221 F.3d at 842 (citing Perry, 460 U.S. at 45). 194 Id. 195 Id. at 842-43 (citing Perry, 460 U.S. at 45). 196 Putnam Pit, 221 F.3d at 843 (citing Cornelius v. NAACP Legal Defense & Educ. Fund, Inc., 473 U.S. 788, 802 (1985)). 197 See White v. City of Norwalk, 900 F.2d 1421, 1425 (1990) (concluding that city councils have authority to limit speech through the imposition of agendas and rules of order and decorum). Part Two. Electronic Records Public Records Act Page 52 © 2011 Richards, Watson & Gershon 1342886.1 tailored” to serve that interest.198 Accordingly, it is important for a city to avoid creating a designated public forum on its website so as not to establish rights where none previously existed, or at least to have a clear policy on who may post on the city’s website. 3. Nonpublic forum Nonpublic forums are those places that are not typically used for public debate or the free exchange of ideas. Accordingly, “the First Amendment does not forbid a viewpoint-neutral exclusion of speakers who would disrupt a nonpublic forum and hinder its effectiveness for its intended purpose.”199 Examples of nonpublic forums include highway rest areas and advertising on a municipal bus.200 In a nonpublic forum government may prohibit speech or expressive activity, so long as such restrictions are reasonable in light of the government’s interest and do not attempt to suppress the speaker’s activity based on disagreement with the speaker’s views.201 4. Public entity websites as nonpublic forums The Sixth Circuit Court of Appeals in Putnam Pit concluded that the City of Cookeville’s website was a “nonpublic” forum under the First Amendment because the website was not open to the public, and before and after the city adopted a website link policy, links had been established on an individualized basis.202 This determination is significant because a government entity, as previously discussed, has more discretion to regulate public expression in a nonpublic forum than it does in a “traditional public forum” (such as a park) or in a “designated public forum” (a place expressly opened for free speech by the public). The court also emphasized that the city had legitimate interests “in keeping links that are consistent with the purpose of the site—providing information about city services, attractions and officials.”203 Despite the fact that the court in Putnam Pit determined that the city’s website was a nonpublic forum, giving the city broad discretion to limit access to its website links, the court stated that the city could not deny links “solely based on the controversial views” the publisher espouses.204 The court concluded that the city’s “requirement that Web sites eligible to be linked to the city’s site promote the city’s tourism, industry and economic welfare gives broad discretion to city officials, raising the possibility of discriminatory 198 Perry, 460 U.S. at 46. 199 Putnam Pit, 221 F.3d at 845 (citing Cornelius, 473 U.S. at 811). 200 Jacobson v. Bonine, 123 F.3d 1272 (9th Cir. 1997); Children of the Rosary v. City of Phoenix, 154 F.3d 972 (9th Cir. 1998). 201 Perry, 460 U.S. at 46. 202 Putnam Pit, 221 F.3d at 844. 203 Id. at 845. 204 Id. Part Two. Electronic Records Public Records Act Page 53 © 2011 Richards, Watson & Gershon 1342886.1 application of the policy based on viewpoint.”205 Accordingly, the court remanded the case to the district court for further proceedings on the issue of whether the city improperly exercised its authority to restrict access to links on its website in a discriminatory manner in violation of the publisher’s First Amendment rights. The Vargas court also concluded that the city’s website was a nonpublic forum, and the city could exclude the initiative proponents from posting information on the site.206 In contrast to Putnam Pit, in Vargas the city did not permit access to the webpage by either proponents or opponents of the ballot initiative.207 Accordingly, in drafting website link policies, public agencies should be mindful that “nonpublic forum status ‘does not mean that the government can restrict speech in whatever way it likes’.”208 Public agencies may not deny requests to post information and links simply because they do not agree with a requesting party’s views or the views espoused on the requesting party’s website, but an across-the- board policy that does not discriminate on the basis of viewpoint should withstand judicial scrutiny. G. Chat Rooms and Forums Note that the conclusion would have likely been different in Vargas if the website had contained a chat room. The term “chat room” generally refers to an area of a website that allows for a real-time interactive discussion between whoever wishes to participate, with every participant seeing what every other participant types in. Chat rooms allow visitors to webpages to state their views on a subject of discussion, and in unmoderated chat rooms, to say anything about any subject. In Vargas, the California Supreme Court did not address chat rooms. However, in the prior appellate court decision, which was superseded on other grounds by the California Supreme Court, the appellate court had little trouble concluding that a chat room would convert a city webpage into a public forum: As noted above, “electronic communication media may constitute public forums. Web sites that are accessible free of charge to any member of the public where members of the public may read the views and information posted, and post their own opinions, meet the definition of a public forum . . . .”209 Ampex Corp. v. Cargle and ComputerXpress, Inc. v. Jackson, were “anti-SLAPP” motions brought by defendants in defamation and libel actions, which are motions to strike a “strategic lawsuit against public participation.” In order to have a viable anti-SLAPP motion, 205 Id. at 845-46 (citations omitted). 206 Vargas, 46 Cal. 4th 1, 37, fn. 18. 207 See Vargas, 46 Cal. 4th at 37, fn. 18. 208 Putnam Pit, 211 F.3d at 846 (citations omitted). 209 Vargas v. City of Salinas, 37 Cal. Rptr. 3d 506, 527 (2005) (citing Ampex Corp. v. Cargle, 128 Cal. App. 4th 1569, 1576 (2005), and ComputerXpress, Inc. v. Jackson, 93 Cal. App. 4th 993, 1006-07 (2001)). Part Two. Electronic Records Public Records Act Page 54 © 2011 Richards, Watson & Gershon 1342886.1 the statements at issue must be made in a public forum, and both opinions concluded that chat rooms on the websites were public forums. A similar effect would be presented by “forums” or “message boards” on webpages, which are similar to chat rooms but do not occur in real-time; instead, people post messages one at a time that are typically grouped by topic and preserved on the webpage in chronological order, for anyone to read. As their name suggests, “forums” on webpages would likely constitute another “public forum.” H. ADA Implications One other concern in designing a website is whether it provides sufficient access to disabled persons. Under the Americans with Disabilities Act (the “ADA”), local governments must ensure that they provide qualified individuals with disabilities equal access to their programs and services, unless doing so would fundamentally alter the nature of their programs or services, or would impose an undue burden.210 Websites are a public service, and in reviewing an agency’s webpage to ensure compliance with First Amendment and Brown Act requirements, an agency should review it for compliance with accessibility requirements as well. There are a number of regulations and guidelines prescribing accessibility requirements for public websites. These include: i The Federal Electronic and Information Technology Accessibility Standards, set forth at 36 C.F.R. part 1194; i The World Wide Web Consortium (W3C) Web Content Accessibility Guidelines; and i The Final FAR Rule for Implementing Section 508 of the Rehabilitation Act for Electronic and Information Technology Accessibility for Persons with Disabilities. These regulations and guidelines specify various methods of ensuring that a webpage is accessible, including providing text equivalents for graphics, ensuring that information conveyed with color is also available without color, and using high contrast color choices. 210 42 U.S.C. § 12131 et seq. Part Two. Electronic Records Public Records Act Page 55 © 2011 Richards, Watson & Gershon 1342886.1 None of these accommodations are particularly onerous; in fact, the Department of Justice has stated that “implementing accessibility features is not difficult and will seldom change the layout or appearance of web pages.”211 IV. CONCLUSIONS The law related to electronic documents continues to evolve as computer technology advances and public officials respond and adapt to those advances. The advent of email has expanded the opportunities for collaboration greatly, but has simultaneously expanded the potential for inadvertent Brown Act violations, as well as unwanted disclosure of preliminary or sensitive information when emails are required to be disclosed in response to a Public Records Act request. Public officials should refrain from using “reply all” to avoid serial meetings, and should be aware of the particular requirements of the Brown Act for documents related to items to be discussed at a meeting. Public officials should also be sensitive to the risk that the Public Records Act may require disclosure of emails, and not treat them as casual conversation. While the deliberative process privilege may apply to protect some such emails, the doctrine has been applied sparingly by California courts. A clear policy regarding the deletion of emails will also help to reduce unwanted exposure, although an agency must be able to suspend its usual deletion procedures if required as a part of federal litigation. Electronic documents other than emails are also generally subject to disclosure, under the California Public Records Act, California discovery rules, and Federal Rule of Civil Procedure 26(a), though software programs used to create the documents are exempt. An agency must make electronic documents available in an electronic format if requested, although the agency need not do so without a specific request. Given the hazards of metadata, a general preference of responding to Public Records Act requests with printed documents is warranted. An agency may also have to disclose electronic documents in litigation, and even metadata may be discoverable, and so it is important to avoid the automatic creation of metadata, to the extent possible. Public officials should also consult with their information technology departments to ensure that metadata is not inadvertently inserted into electronic documents when they are created. With respect to websites, caution must be taken to ensure a public agency’s website does not indicate support or approval of, or advocate for, a candidate for elective office. Likewise, a public agency website cannot be used to advocate for or against an initiative election. In addition to avoiding express advocacy that unambiguously suggests a particular position in a campaign, public officials must also avoid any actions which, based on their “style, tenor and timing”, may lead to a determination that a public agency website contains impermissible advocacy. 211 U.S. Dep’t of Justice, Accessibility of State & Local Government Websites to People with Disabilities, www.usdoj.gov/crt/ada/ websites2_prnt.pdf.’ Part Two. Electronic Records Public Records Act Page 56 © 2011 Richards, Watson & Gershon 1342886.1 The content of a website link policy, and the manner in which such a policy is implemented, are critical in a public agency’s ability to regulate the information and links that will be permitted on its website. It is important that public agencies do not arbitrarily discriminate in denying requests for website links. The establishment and adherence to a specific written policy regarding website links would likely assist public agencies in avoiding the litigation challenges faced by the City of Cookeville in the Putnam Pit case, and should assist generally in avoiding violations of the First Amendment. A uniform policy, such as that upheld in the Vargas opinion, may serve as a viable defense to such challenges. We have two recommendations for drafting website policies. First, the website link policy should contain a “statement of purpose” indicating that neither the public agency’s website nor its links list are “forums” for expressive activity by the public. The following is our suggested language for that portion of the policy, for the hypothetical City of Anytown: This policy governs the establishment of external links on the City of Anytown’s official website. For purposes of this policy, an ‘external link’ is a hyperlink from the City of Anytown’s website to a website maintained by another party. Neither the City of Anytown’s website nor the external links list on such website constitute a forum for expressive activity by members of the public. Rather, the purpose of the City of Anytown’s website and the external links list is to provide information about officials, services and attractions related to City of Anytown. This policy is declaratory of the City of Anytown’s existing administrative practice regarding the establishment of external links on its website. Second, the website link policy should specifically designate the types of organizations that are eligible to have a link established to their website. We think eligibility may be limited to non-profit entities (as Cookeville chose to do), but it does not have to be so restricted. We also recommend that it specifically exclude links to sites that have as their purpose the election or defeat of specific candidates or the passage or defeat of specific ballot measures, regardless of political position. In our opinion, implementation of these suggestions will strengthen a public agency’s position if it ever becomes necessary to defend a decision to deny a request for a link from a public agency’s website. Finally, the agency should ensure that its webpage complies with the accessibility requirements of the ADA, such as providing text equivalents for graphics, ensuring that information conveyed with color is also available without color, and using high contrast color choices. Part Three. The California Public Records Act Public Records Act Page 57 © 2011 Richards, Watson & Gershon 1342886.1 Part Three The California Public Records Act (Selected Portions) Government Code §§ 6250-6270 Part Three. The California Public Records Act Public Records Act Page 58 © 2011 Richards, Watson & Gershon 1342886.1 The California Public Records Act (Selected Portions) Government Code §§ 6250-6270 Section 6250. Legislative findings and declarations In enacting this chapter, the Legislature, mindful of the right of individuals to privacy, finds and declares that access to information concerning the conduct of the people’s business is a fundamental and necessary right of every person in this state. Section 6251. Short title This chapter shall be known and may be cited as the California Public Records Act. Section 6252. Definitions As used in this chapter: (a) “Local agency” includes a county; city, whether general law or chartered; city and county; school district; municipal corporation; district; political subdivision; or any board, commission or agency thereof; other local public agency; or entities that are legislative bodies of a local agency pursuant to subdivisions (c) and (d) of Section 54952. (b) “Member of the public” means any person, except a member, agent, officer, or employee of a federal, state, or local agency acting within the scope of his or her membership, agency, office, or employment. (c) “Person” includes any natural person, corporation, partnership, limited liability company, firm, or association. (d) “Public agency” means any state or local agency. (e) “Public records” includes any writing containing information relating to the conduct of the public’s business prepared, owned, used, or retained by any state or local agency regardless of physical form or characteristics. “Public records” in the custody of, or maintained by, the Governor’s office means any writing prepared on or after January 6, 1975. (f) “State agency” means every state office, officer, department, division, bureau, board, and commission or other state body or agency, except those agencies Part Three. The California Public Records Act Public Records Act Page 59 © 2011 Richards, Watson & Gershon 1342886.1 provided for in Article IV (except Section 20 thereof) or Article VI of the California Constitution. (g) “Writing” means any handwriting, typewriting, printing, photostating, photographing, photocopying, transmitting by electronic mail or facsimile, and every other means of recording upon any tangible thing any form of communication or representation, including letters, words, pictures, sounds, or symbols, or combinations thereof, and any record thereby created, regardless of the manner in which the record has been stored. Section 6252.5. Elected member or officer of state or local agency Notwithstanding the definition of “member of the public” in Section 6252, an elected member or officer of any state or local agency is entitled to access to public records of that agency on the same basis as any other person. Nothing in this section shall limit the ability of elected members or officers to access public records permitted by law in the administration of their duties. This section does not constitute a change in, but is declaratory of, existing law. Section 6252.6. Disclosure of name, date of birth, and date of death of foster child to county child welfare agency Notwithstanding paragraph (2) of subdivision (a) of Section 827 of the Welfare and Institutions Code, after the death of a foster child who is a minor, the name, date of birth, and date of death of the child shall be subject to disclosure by the county child welfare agency pursuant to this chapter. Section 6252.7. Authority of legislative body or local agency members to access a writing of the body or agency Notwithstanding Section 6252.5 or any other provision of law, when the members of a legislative body of a local agency are authorized to access a writing of the body or of the agency as permitted by law in the administration of their duties, the local agency, as defined in Section 54951, shall not discriminate between or among any of those members as to which writing or portion thereof is made available or when it is made available. Section 6253. Public records open to inspection; agency duties; time limits (a) Public records are open to inspection at all times during the office hours of the state or local agency and every person has a right to inspect any public record, except as hereafter provided. Any reasonably segregable portion of a record shall be available for inspection by any person requesting the record after deletion of the portions that are exempted by law. Part Three. The California Public Records Act Public Records Act Page 60 © 2011 Richards, Watson & Gershon 1342886.1 (b) Except with respect to public records exempt from disclosure by express provisions of law, each state or local agency, upon a request for a copy of records that reasonably describes an identifiable record or records, shall make the records promptly available to any person upon payment of fees covering direct costs of duplication, or a statutory fee if applicable. Upon request, an exact copy shall be provided unless impracticable to do so. (c) Each agency, upon a request for a copy of records, shall, within 10 days from receipt of the request, determine whether the request, in whole or in part, seeks copies of disclosable public records in the possession of the agency and shall promptly notify the person making the request of the determination and the reasons therefor. In unusual circumstances, the time limit prescribed in this section may be extended by written notice by the head of the agency or his or her designee to the person making the request, setting forth the reasons for the extension and the date on which a determination is expected to be dispatched. No notice shall specify a date that would result in an extension for more than 14 days. When the agency dispatches the determination, and if the agency determines that the request seeks disclosable public records, the agency shall state the estimated date and time when the records will be made available. As used in this section, “unusual circumstances” means the following, but only to the extent reasonably necessary to the proper processing of the particular request: (1) The need to search for and collect the requested records from field facilities or other establishments that are separate from the office processing the request. (2) The need to search for, collect, and appropriately examine a voluminous amount of separate and distinct records that are demanded in a single request. (3) The need for consultation, which shall be conducted with all practicable speed, with another agency having substantial interest in the determination of the request or among two or more components of the agency having substantial subject matter interest therein. (4) The need to compile data, to write programming language or a computer program, or to construct a computer report to extract data. (d) Nothing in this chapter shall be construed to permit an agency to delay or obstruct the inspection or copying of public records. The notification of denial of any request for records required by Section 6255 shall set forth the names and titles or positions of each person responsible for the denial. Part Three. The California Public Records Act Public Records Act Page 61 © 2011 Richards, Watson & Gershon 1342886.1 (e) Except as otherwise prohibited by law, a state or local agency may adopt requirements for itself that allow for faster, more efficient, or greater access to records than prescribed by the minimum standards set forth in this chapter. Section 6253.1. Assistance to members of the public regarding requests to inspect a public record or obtain a copy; duties of the public agency (a) When a member of the public requests to inspect a public record or obtain a copy of a public record, the public agency, in order to assist the member of the public make a focused and effective request that reasonably describes an identifiable record or records, shall do all of the following, to the extent reasonable under the circumstances: (1) Assist the member of the public to identify records and information that are responsive to the request or to the purpose of the request, if stated. (2) Describe the information technology and physical location in which the records exist. (3) Provide suggestions for overcoming any practical basis for denying access to the records or information sought. (b) The requirements of paragraph (1) of subdivision (a) shall be deemed to have been satisfied if the public agency is unable to identify the requested information after making a reasonable effort to elicit additional clarifying information from the requester that will help identify the record or records. (c) The requirements of subdivision (a) are in addition to any action required of a public agency by Section 6253. (d) This section shall not apply to a request for public records if any of the following applies: (1) The public agency makes available the requested records pursuant to Section 6253. (2) The public agency determines that the request should be denied and bases that determination solely on an exemption listed in Section 6254. (3) The public agency makes available an index of its records. Section 6253.2. In-home supportive services; personal care services (a) Notwithstanding any other provision of this chapter to the contrary, information regarding persons paid by the state to provide in-home supportive services pursuant Part Three. The California Public Records Act Public Records Act Page 62 © 2011 Richards, Watson & Gershon 1342886.1 to Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of the Welfare and Institutions Code or personal care services pursuant to Section 14132.95 of the Welfare and Institutions Code, shall not be subject to public disclosure pursuant to this chapter, except as provided in subdivision (b). (b) Copies of names, addresses, and telephone numbers of persons described in subdivision (a) shall be made available, upon request, to an exclusive bargaining agent and to any labor organization seeking representation rights pursuant to subdivision (c) of Section 12301.6 or Section 12302 of the Welfare and Institutions Code or Chapter 10 (commencing with Section 3500) of Division 4 of Title 1. This information shall not be used by the receiving entity for any purpose other than the employee organizing, representation, and assistance activities of the labor organization. (c) This section shall apply solely to individuals who provide services under the In-Home Supportive Services Program (Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of the Welfare and Institutions Code) or the Personal Care Services Program pursuant to Section 14132.95 of the Welfare and Institutions Code. (d) Nothing in this section is intended to alter or shall be interpreted to alter the rights of parties under the Meyers-Milias-Brown Act (Chapter 10 (commencing with Section 3500) of Division 4) or any other labor relations law. Section 6253.3. Disclosure of information; control A state or local agency may not allow another party to control the disclosure of information that is otherwise subject to disclosure pursuant to this chapter. Section 6253.31. Contract requirements; public disclosure Notwithstanding any contract term to the contrary, a contract entered into by a state or local agency subject to this chapter, including the University of California, that requires a private entity to review, audit, or report on any aspect of that agency shall be public to the extent the contract is otherwise subject to disclosure under this chapter. Section 6253.4. Agency regulations and guidelines (a) Every agency may adopt regulations stating the procedures to be followed when making its records available in accordance with this section. The following state and local bodies shall establish written guidelines for accessibility of records. A copy of these guidelines shall be posted in a conspicuous public place at the offices of these bodies, and a copy of the guidelines shall be available upon request free of charge to any person requesting that body’s records: Part Three. The California Public Records Act Public Records Act Page 63 © 2011 Richards, Watson & Gershon 1342886.1 Department of Motor Vehicles Department of Consumer Affairs Department of Transportation Department of Real Estate Department of Corrections Department of the Youth Authority Department of Justice Department of Insurance Department of Corporations Department of Managed Health Care Secretary of State State Air Resources Board Department of Water Resources Department of Parks and Recreation San Francisco Bay Conservation and Development Commission State Board of Equalization State Department of Health Care Services Employment Development Department State Department of Public Health State Department of Social Services State Department of Mental Health State Department of Developmental Services State Department of Alcohol and Drug Abuse Office of Statewide Health Planning and Development Public Employees’ Retirement System Teachers’ Retirement Board Department of Industrial Relations Department of General Services Department of Veterans Affairs Public Utilities Commission California Coastal Commission State Water Resources Control Board San Francisco Bay Area Rapid Transit District All regional water quality control boards Los Angeles County Air Pollution Control District Bay Area Air Pollution Control District Golden Gate Bridge, Highway and Transportation District Department of Toxic Substances Control Office of Environmental Health Hazard Assessment (b) Guidelines and regulations adopted pursuant to this section shall be consistent with all other sections of this chapter and shall reflect the intention of the Legislature to make the records accessible to the public. The guidelines and regulations adopted Part Three. The California Public Records Act Public Records Act Page 64 © 2011 Richards, Watson & Gershon 1342886.1 pursuant to this section shall not operate to limit the hours public records are open for inspection as prescribed in Section 6253. Section 6253.5. Initiative, referendum, recall petitions, and petitions for reorganization of school districts or community college districts deemed not public records; examination by proponents Notwithstanding Sections 6252 and 6253, statewide, county, city, and district initiative, referendum, and recall petitions, petitions circulated pursuant to Section 5091 of the Education Code, petitions for the reorganization of school districts submitted pursuant to Article 1 (commencing with Section 35700) of Chapter 4 of Part 21 of the Education Code, petitions for the reorganization of community college districts submitted pursuant to Part 46 (commencing with Section 74000) of the Education Code and all memoranda prepared by the county elections officials in the examination of the petitions indicating which registered voters have signed particular petitions shall not be deemed to be public records and shall not be open to inspection except by the public officer or public employees who have the duty of receiving, examining or preserving the petitions or who are responsible for the preparation of that memoranda and, if the petition is found to be insufficient, by the proponents of the petition and the representatives of the proponents as may be designated by the proponents in writing in order to determine which signatures were disqualified and the reasons therefor. However, the Attorney General, the Secretary of State, the Fair Political Practices Commission, a district attorney, a school district or a community college district attorney, and a city attorney shall be permitted to examine the material upon approval of the appropriate superior court. If the proponents of a petition are permitted to examine the petition and memoranda, the examination shall commence not later than 21 days after certification of insufficiency. (a) As used in this section, “petition” shall mean any petition to which a registered voter has affixed his or her signature. (b) As used in this section “proponents of the petition” means the following: (1) For statewide initiative and referendum measures, the person or persons who submit a draft of a petition proposing the measure to the Attorney General with a request that he or she prepare a title and summary of the chief purpose and points of the proposed measure. (2) For other initiative and referenda on measures, the person or persons who publish a notice of intention to circulate petitions, or, where publication is not required, who file petitions with the elections official. (3) For recall measures, the person or persons defined in Section 343 of the Elections Code. Part Three. The California Public Records Act Public Records Act Page 65 © 2011 Richards, Watson & Gershon 1342886.1 (4) For petitions circulated pursuant to Section 5091 of the Education Code, the person or persons having charge of the petition who submit the petition to the county superintendent of schools. (5) For petitions circulated pursuant to Article 1 (commencing with Section 35700) of Chapter 4 of Part 21 of the Education Code, the person or persons designated as chief petitioners under Section 35701 of the Education Code. (6) For petitions circulated pursuant to Part 46 (commencing with Section 74000) of the Education Code, the person or persons designated as chief petitioners under Sections 74102, 74133, and 74152 of the Education Code. Section 6253.6. Bilingual ballot or ballot pamphlet requests not deemed public records (a) Notwithstanding the provisions of Sections 6252 and 6253, information compiled by public officers or public employees revealing the identity of persons who have requested bilingual ballots or ballot pamphlets, made in accordance with any federal or state law, or other data that would reveal the identity of the requester, shall not be deemed to be public records and shall not be provided to any person other than public officers or public employees who are responsible for receiving those requests and processing the same. (b) Nothing contained in subdivision (a) shall be construed as prohibiting any person who is otherwise authorized by law from examining election materials, including, but not limited to, affidavits of registration, provided that requests for bilingual ballots or ballot pamphlets shall be subject to the restrictions contained in subdivision (a). Section 6253.8. Enforcement orders; Internet website (a) Every final enforcement order issued by an agency listed in subdivision (b) under any provision of law that is administered by an entity listed in subdivision (b), shall be displayed on the entity’s Internet website, if the final enforcement order is a public record that is not exempt from disclosure pursuant to this chapter. (b) This section applies to the California Environmental Protection Agency and to all of the following entities within the agency: (1) The State Air Resources Board. (2) The California Integrated Waste Management Board. (3) The State Water Resources Control Board, and each California regional water quality control board. Part Three. The California Public Records Act Public Records Act Page 66 © 2011 Richards, Watson & Gershon 1342886.1 (4) The Department of Pesticide Regulation. (5) The Department of Toxic Substances Control. (c) (1) Except as provided in paragraph (2), for purposes of this section, an enforcement order is final when the time for judicial review has expired on or after January 1, 2001, or when all means of judicial review have been exhausted on or after January 1, 2001. (2) In addition to the requirements of paragraph (1), with regard to a final enforcement order issued by the State Water Resources Control Board or a California regional water quality control board, this section shall apply only to a final enforcement order adopted by that board or a regional board at a public meeting. (d) An order posted pursuant to this section shall be posted for not less than one year. (e) The California Environmental Protection Agency shall oversee the implementation of this section. (f) This section shall become operative April 1, 2001. Section 6253.9. Information in an electronic format; costs; application; availability (a) Unless otherwise prohibited by law, any agency that has information that constitutes an identifiable public record not exempt from disclosure pursuant to this chapter that is in an electronic format shall make that information available in an electronic format when requested by any person and, when applicable, shall comply with the following: (1) The agency shall make the information available in any electronic format in which it holds the information. (2) Each agency shall provide a copy of an electronic record in the format requested if the requested format is one that has been used by the agency to create copies for its own use or for provision to other agencies. The cost of duplication shall be limited to the direct cost of producing a copy of a record in an electronic format. (b) Notwithstanding paragraph (2) of subdivision (a), the requester shall bear the cost of producing a copy of the record, including the cost to construct a record, and the cost of programming and computer services necessary to produce a copy of the record when either of the following applies: Part Three. The California Public Records Act Public Records Act Page 67 © 2011 Richards, Watson & Gershon 1342886.1 (1) In order to comply with the provisions of subdivision (a), the public agency would be required to produce a copy of an electronic record and the record is one that is produced only at otherwise regularly scheduled intervals. (2) The request would require data compilation, extraction, or programming to produce the record. (c) Nothing in this section shall be construed to require the public agency to reconstruct a record in an electronic format if the agency no longer has the record available in an electronic format. (d) If the request is for information in other than electronic format, and the information also is in electronic format, the agency may inform the requester that the information is available in electronic format. (e) Nothing in this section shall be construed to permit an agency to make information available only in an electronic format. (f) Nothing in this section shall be construed to require the public agency to release an electronic record in the electronic form in which it is held by the agency if its release would jeopardize or compromise the security or integrity of the original record or of any proprietary software in which it is maintained. (g) Nothing in this section shall be construed to permit public access to records held by any agency to which access is otherwise restricted by statute. Section 6254. Exemption of particular records Except as provided in Sections 6254.7 and 6254.13, nothing in this chapter shall be construed to require disclosure of records that are any of the following: (a) Preliminary drafts, notes, or interagency or intra-agency memoranda that are not retained by the public agency in the ordinary course of business, if the public interest in withholding those records clearly outweighs the public interest in disclosure. (b) Records pertaining to pending litigation to which the public agency is a party, or to claims made pursuant to Division 3.6 (commencing with Section 810), until the pending litigation or claim has been finally adjudicated or otherwise settled. (c) Personnel, medical, or similar files, the disclosure of which would constitute an unwarranted invasion of personal privacy. (d) Contained in or related to any of the following: Part Three. The California Public Records Act Public Records Act Page 68 © 2011 Richards, Watson & Gershon 1342886.1 (1) Applications filed with any state agency responsible for the regulation or supervision of the issuance of securities or of financial institutions, including, but not limited to, banks, savings and loan associations, industrial loan companies, credit unions, and insurance companies. (2) Examination, operating, or condition reports prepared by, on behalf of, or for the use of, any state agency referred to in paragraph (1). (3) Preliminary drafts, notes, or interagency or intra-agency communications prepared by, on behalf of, or for the use of, any state agency referred to in paragraph (1). (4) Information received in confidence by any state agency referred to in paragraph (1). (e) Geological and geophysical data, plant production data, and similar information relating to utility systems development, or market or crop reports, that are obtained in confidence from any person. (f) Records of complaints to, or investigations conducted by, or records of intelligence information or security procedures of, the office of the Attorney General and the Department of Justice, the California Emergency Management Agency, and any state or local police agency, or any investigatory or security files compiled by any other state or local police agency, or any investigatory or security files compiled by any other state or local agency for correctional, law enforcement, or licensing purposes. However, state and local law enforcement agencies shall disclose the names and addresses of persons involved in, or witnesses other than confidential informants to, the incident, the description of any property involved, the date, time, and location of the incident, all diagrams, statements of the parties involved in the incident, the statements of all witnesses, other than confidential informants, to the victims of an incident, or an authorized representative thereof, an insurance carrier against which a claim has been or might be made, and any person suffering bodily injury or property damage or loss, as the result of the incident caused by arson, burglary, fire, explosion, larceny, robbery, carjacking, vandalism, vehicle theft, or a crime as defined by subdivision (b) of Section 13951, unless the disclosure would endanger the safety of a witness or other person involved in the investigation, or unless disclosure would endanger the successful completion of the investigation or a related investigation. However, nothing in this division shall require the disclosure of that portion of those investigative files that reflects the analysis or conclusions of the investigating officer. Customer lists provided to a state or local police agency by an alarm or security company at the request of the agency shall be construed to be records subject to this subdivision. Part Three. The California Public Records Act Public Records Act Page 69 © 2011 Richards, Watson & Gershon 1342886.1 Notwithstanding any other provision of this subdivision, state and local law enforcement agencies shall make public the following information, except to the extent that disclosure of a particular item of information would endanger the safety of a person involved in an investigation or would endanger the successful completion of the investigation or a related investigation: (1) The full name and occupation of every individual arrested by the agency, the individual’s physical description including date of birth, color of eyes and hair, sex, height and weight, the time and date of arrest, the time and date of booking, the location of the arrest, the factual circumstances surrounding the arrest, the amount of bail set, the time and manner of release or the location where the individual is currently being held, and all charges the individual is being held upon, including any outstanding warrants from other jurisdictions and parole or probation holds. (2) Subject to the restrictions imposed by Section 841.5 of the Penal Code, the time, substance, and location of all complaints or requests for assistance received by the agency and the time and nature of the response thereto, including, to the extent the information regarding crimes alleged or committed or any other incident investigated is recorded, the time, date, and location of occurrence, the time and date of the report, the name and age of the victim, the factual circumstances surrounding the crime or incident, and a general description of any injuries, property, or weapons involved. The name of a victim of any crime defined by Section 220, 236.1, 261, 261.5, 262, 264, 264.1, 265, 266, 266a, 266b, 266c, 266e, 266f, 266j, 267, 269, 273a, 273d, 273.5, 285, 286, 288, 288a, 288.2, 288.3 (as added by Chapter 337 of the Statutes of 2006), 288.3 (as added by Section 6 of Proposition 83 of the November 7, 2006, statewide general election), 288.5, 288.7, 289, 422.6, 422.7, 422.75, 646.9 or 647.6 of the Penal Code may be withheld at the victim’s request, or at the request of the victim’s parent or guardian if the victim is a minor. When a person is the victim of more than one crime, information disclosing that the person is a victim of a crime defined in any of the sections of the Penal Code set forth in this subdivision may be deleted at the request of the victim, or the victim’s parent or guardian if the victim is a minor, in making the report of the crime, or of any crime or incident accompanying the crime, available to the public in compliance with the requirements of this paragraph. (3) Subject to the restrictions of Section 841.5 of the Penal Code and this subdivision, the current address of every individual arrested by the agency and the current address of the victim of a crime, where the requester declares under penalty of perjury that the request is made for a scholarly, journalistic, political, or governmental purpose, or that the request is made for Part Three. The California Public Records Act Public Records Act Page 70 © 2011 Richards, Watson & Gershon 1342886.1 investigation purposes by a licensed private investigator as described in Chapter 11.3 (commencing with Section 7512) of Division 3 of the Business and Professions Code. However, the address of the victim of any crime defined by Section 220, 236.1, 261, 261.5, 262, 264, 264.1, 265, 266, 266a, 266b, 266c, 266e, 266f, 266j, 267, 269, 273a, 273d, 273.5, 285, 286, 288, 288a, 288.2, 288.3 (as added by Chapter 337 of the Statutes of 2006), 288.3 (as added by Section 6 of Proposition 83 of the November 7, 2006, statewide general election), 288.5, 288.7, 289, 422.6, 422.7, 422.75, 646.9, or 647.6 of the Penal Code shall remain confidential. Address information obtained pursuant to this paragraph may not be used directly or indirectly, or furnished to another, to sell a product or service to any individual or group of individuals, and the requester shall execute a declaration to that effect under penalty of perjury. Nothing in this paragraph shall be construed to prohibit or limit a scholarly, journalistic, political, or government use of address information obtained pursuant to this paragraph. (g) Test questions, scoring keys, and other examination data used to administer a licensing examination, examination for employment, or academic examination, except as provided for in Chapter 3 (commencing with Section 99150) of Part 65 of Division 14 of Title 3 of the Education Code. (h) The contents of real estate appraisals or engineering or feasibility estimates and evaluations made for or by the state or local agency relative to the acquisition of property, or to prospective public supply and construction contracts, until all of the property has been acquired or all of the contract agreement obtained. However, the law of eminent domain shall not be affected by this provision. (i) Information required from any taxpayer in connection with the collection of local taxes that is received in confidence and the disclosure of the information to other persons would result in unfair competitive disadvantage to the person supplying the information. (j) Library circulation records kept for the purpose of identifying the borrower of items available in libraries, and library and museum materials made or acquired and presented solely for reference or exhibition purposes. The exemption in this subdivision shall not apply to records of fines imposed on the borrowers. (k) Records, the disclosure of which is exempted or prohibited pursuant to federal or state law, including, but not limited to, provisions of the Evidence Code relating to privilege. (l) Correspondence of and to the Governor or employees of the Governor’s office or in the custody of or maintained by the Governor’s Legal Affairs Secretary. However, Part Three. The California Public Records Act Public Records Act Page 71 © 2011 Richards, Watson & Gershon 1342886.1 public records shall not be transferred to the custody of the Governor’s Legal Affairs Secretary to evade the disclosure provisions of this chapter. (m) In the custody of or maintained by the Legislative Counsel, except those records in the public database maintained by the Legislative Counsel that are described in Section 10248. (n) Statements of personal worth or personal financial data required by a licensing agency and filed by an applicant with the licensing agency to establish his or her personal qualification for the license, certificate, or permit applied for. (o) Financial data contained in applications for financing under Division 27 (commencing with Section 44500) of the Health and Safety Code, where an authorized officer of the California Pollution Control Financing Authority determines that disclosure of the financial data would be competitively injurious to the applicant and the data is required in order to obtain guarantees from the United States Small Business Administration. The California Pollution Control Financing Authority shall adopt rules for review of individual requests for confidentiality under this section and for making available to the public those portions of an application that are subject to disclosure under this chapter. (p) Records of state agencies related to activities governed by Chapter 10.3 (commencing with Section 3512), Chapter 10.5 (commencing with Section 3525), and Chapter 12 (commencing with Section 3560) of Division 4, that reveal a state agency’s deliberative processes, impressions, evaluations, opinions, recommendations, meeting minutes, research, work products, theories, or strategy, or that provide instruction, advice, or training to employees who do not have full collective bargaining and representation rights under these chapters. Nothing in this subdivision shall be construed to limit the disclosure duties of a state agency with respect to any other records relating to the activities governed by the employee relations acts referred to in this subdivision. (q) Records of state agencies related to activities governed by Article 2.6 (commencing with Section 14081), Article 2.8 (commencing with Section 14087.5), and Article 2.91 (commencing with Section 14089) of Chapter 7 of Part 3 of Division 9 of the Welfare and Institutions Code, that reveal the special negotiator’s deliberative processes, discussions, communications, or any other portion of the negotiations with providers of health care services, impressions, opinions, recommendations, meeting minutes, research, work product, theories, or strategy, or that provide instruction, advice, or training to employees. Except for the portion of a contract containing the rates of payment, contracts for inpatient services entered into pursuant to these articles, on or after April 1, 1984, shall be open to inspection one year after they are fully executed. If a contract for Part Three. The California Public Records Act Public Records Act Page 72 © 2011 Richards, Watson & Gershon 1342886.1 inpatient services that is entered into prior to April 1, 1984, is amended on or after April 1, 1984, the amendment, except for any portion containing the rates of payment, shall be open to inspection one year after it is fully executed. If the California Medical Assistance Commission enters into contracts with health care providers for other than inpatient hospital services, those contracts shall be open to inspection one year after they are fully executed. Three years after a contract or amendment is open to inspection under this subdivision, the portion of the contract or amendment containing the rates of payment shall be open to inspection. Notwithstanding any other provision of law, the entire contract or amendment shall be open to inspection by the Joint Legislative Audit Committee and the Legislative Analyst’s Office. The committee and that office shall maintain the confidentiality of the contracts and amendments until the time a contract or amendment is fully open to inspection by the public. (r) Records of Native American graves, cemeteries, and sacred places and records of Native American places, features, and objects described in Sections 5097.9 and 5097.993 of the Public Resources Code maintained by, or in the possession of, the Native American Heritage Commission, another state agency, or a local agency. (s) A final accreditation report of the Joint Commission on Accreditation of Hospitals that has been transmitted to the State Department of Health Care Services pursuant to subdivision (b) of Section 1282 of the Health and Safety Code. (t) Records of a local hospital district, formed pursuant to Division 23 (commencing with Section 32000) of the Health and Safety Code, or the records of a municipal hospital, formed pursuant to Article 7 (commencing with Section 37600) or Article 8 (commencing with Section 37650) of Chapter 5 of Part 2 of Division 3 of Title 4 of this code, that relate to any contract with an insurer or nonprofit hospital service plan for inpatient or outpatient services for alternative rates pursuant to Section 10133 of the Insurance Code. However, the record shall be open to inspection within one year after the contract is fully executed. (u) (1) Information contained in applications for licenses to carry firearms issued pursuant to Section 12050 of the Penal Code by the sheriff of a county or the chief or other head of a municipal police department that indicates when or where the applicant is vulnerable to attack or that concerns the applicant’s medical or psychological history or that of members of his or her family. (2) The home address and telephone number of peace officers, judges, court commissioners, and magistrates that are set forth in applications for licenses to carry firearms issued pursuant to Section 12050 of the Penal Code by the Part Three. The California Public Records Act Public Records Act Page 73 © 2011 Richards, Watson & Gershon 1342886.1 sheriff of a county or the chief or other head of a municipal police department. (3) The home address and telephone number of peace officers, judges, court commissioners, and magistrates that are set forth in licenses to carry firearms issued pursuant to Section 12050 of the Penal Code by the sheriff of a county or the chief or other head of a municipal police department. (v) (1) Records of the Managed Risk Medical Insurance Board related to activities governed by Part 6.3 (commencing with Section 12695), Part 6.5 (commencing with Section 12700), Part 6.6 (commencing with Section 12739.5), and Part 6.7 (commencing with Section 12739.70) of Division 2 of the Insurance Code, and that reveal any of the following: (A) The deliberative processes, discussions, communications, or any other portion of the negotiations with entities contracting or seeking to contract with the board, entities with which the board is considering a contract, or entities with which the board is considering or enters into any other arrangement under which the board provides, receives, or arranges services or reimbursement. (B) The impressions, opinions, recommendations, meeting minutes, research, work product, theories, or strategy of the board or its staff, or records that provide instructions, advice, or training to employees. (2) (A) Except for the portion of a contract that contains the rates of payment, contracts entered into pursuant to Part 6.3 (commencing with Section 12695), Part 6.5 (commencing with Section 12700), Part 6.6 (commencing with Section 12739.5), or Part 6.7 (commencing with Section 12739.70) of Division 2 of the Insurance Code, on or after July 1, 1991, shall be open to inspection one year after their effective dates. (B) If a contract that is entered into prior to July 1, 1991, is amended on or after July 1, 1991, the amendment, except for any portion containing the rates of payment, shall be open to inspection one year after the effective date of the amendment. (3) Three years after a contract or amendment is open to inspection pursuant to this subdivision, the portion of the contract or amendment containing the rates of payment shall be open to inspection. (4) Notwithstanding any other provision of law, the entire contract or amendments to a contract shall be open to inspection by the Joint Legislative Part Three. The California Public Records Act Public Records Act Page 74 © 2011 Richards, Watson & Gershon 1342886.1 Audit Committee. The committee shall maintain the confidentiality of the contracts and amendments thereto, until the contracts or amendments to the contracts are open to inspection pursuant to paragraph (3). (w) (1) Records of the Managed Risk Medical Insurance Board related to activities governed by Chapter 8 (commencing with Section 10700) of Part 2 of Division 2 of the Insurance Code, and that reveal the deliberative processes, discussions, communications, or any other portion of the negotiations with health plans, or the impressions, opinions, recommendations, meeting minutes, research, work product, theories, or strategy of the board or its staff, or records that provide instructions, advice, or training to employees. (2) Except for the portion of a contract that contains the rates of payment, contracts for health coverage entered into pursuant to Chapter 8 (commencing with Section 10700) of Part 2 of Division 2 of the Insurance Code, on or after January 1, 1993, shall be open to inspection one year after they have been fully executed. (3) Notwithstanding any other provision of law, the entire contract or amendments to a contract shall be open to inspection by the Joint Legislative Audit Committee. The committee shall maintain the confidentiality of the contracts and amendments thereto, until the contracts or amendments to the contracts are open to inspection pursuant to paragraph (2). (x) Financial data contained in applications for registration, or registration renewal, as a service contractor filed with the Director of Consumer Affairs pursuant to Chapter 20 (commencing with Section 9800) of Division 3 of the Business and Professions Code, for the purpose of establishing the service contractor’s net worth, or financial data regarding the funded accounts held in escrow for service contracts held in force in this state by a service contractor. (y) (1) Records of the Managed Risk Medical Insurance Board related to activities governed by Part 6.2 (commencing with Section 12693) or Part 6.4 (commencing with Section 12699.50) of Division 2 of the Insurance Code, and that reveal any of the following: (A) The deliberative processes, discussions, communications, or any other portion of the negotiations with entities contracting or seeking to contract with the board, entities with which the board is considering a contract, or entities with which the board is considering or enters into any other arrangement under which the board provides, receives, or arranges services or reimbursement. Part Three. The California Public Records Act Public Records Act Page 75 © 2011 Richards, Watson & Gershon 1342886.1 (B) The impressions, opinions, recommendations, meeting minutes, research, work product, theories, or strategy of the board or its staff, or records that provide instructions, advice, or training to employees. (2) (A) Except for the portion of a contract that contains the rates of payment, contracts entered into pursuant to Part 6.2 (commencing with Section 12693) or Part 6.4 (commencing with Section 12699.50) of Division 2 of the Insurance Code, on or after January 1, 1998, shall be open to inspection one year after their effective dates. (B) If a contract entered into pursuant to Part 6.2 (commencing with Section 12693) or Part 6.4 (commencing with Section 12699.50) of Division 2 of the Insurance Code is amended, the amendment shall be open to inspection one year after the effective date of the amendment. (3) Three years after a contract or amendment is open to inspection pursuant to this subdivision, the portion of the contract or amendment containing the rates of payment shall be open to inspection. (4) Notwithstanding any other provision of law, the entire contract or amendments to a contract shall be open to inspection by the Joint Legislative Audit Committee. The committee shall maintain the confidentiality of the contracts and amendments thereto until the contract or amendments to a contract are open to inspection pursuant to paragraph (2) or (3). (5) The exemption from disclosure provided pursuant to this subdivision for the contracts, deliberative processes, discussions, communications, negotiations, impressions, opinions, recommendations, meeting minutes, research, work product, theories, or strategy of the board or its staff shall also apply to the contracts, deliberative processes, discussions, communications, negotiations, impressions, opinions, recommendations, meeting minutes, research, work product, theories, or strategy of applicants pursuant to Part 6.4 (commencing with Section 12699.50) of Division 2 of the Insurance Code. (z) Records obtained pursuant to paragraph (2) of subdivision (c) of Section 2891.1 of the Public Utilities Code. (aa) A document prepared by or for a state or local agency that assesses its vulnerability to terrorist attack or other criminal acts intended to disrupt the public agency’s operations and that is for distribution or consideration in a closed session. (ab) Critical infrastructure information, as defined in Section 131(3) of Title 6 of the United States Code, that is voluntarily submitted to the California Emergency Management Agency for use by that office, including the identity of the person who or entity that Part Three. The California Public Records Act Public Records Act Page 76 © 2011 Richards, Watson & Gershon 1342886.1 voluntarily submitted the information. As used in this subdivision, “voluntarily submitted” means submitted in the absence of the office exercising any legal authority to compel access to or submission of critical infrastructure information. This subdivision shall not affect the status of information in the possession of any other state or local governmental agency. (ac) All information provided to the Secretary of State by a person for the purpose of registration in the Advance Health Care Directive Registry, except that those records shall be released at the request of a health care provider, a public guardian, or the registrant’s legal representative. (ad) The following records of the State Compensation Insurance Fund: (1) Records related to claims pursuant to Chapter 1 (commencing with Section 3200) of Division 4 of the Labor Code, to the extent that confidential medical information or other individually identifiable information would be disclosed. (2) Records related to the discussions, communications, or any other portion of the negotiations with entities contracting or seeking to contract with the fund, and any related deliberations. (3) Records related to the impressions, opinions, recommendations, meeting minutes of meetings or sessions that are lawfully closed to the public, research, work product, theories, or strategy of the fund or its staff, on the development of rates, contracting strategy, underwriting, or competitive strategy pursuant to the powers granted to the fund in Chapter 4 (commencing with Section 11770) of Part 3 of Division 2 of the Insurance Code. (4) Records obtained to provide workers’ compensation insurance under Chapter 4 (commencing with Section 11770) of Part 3 of Division 2 of the Insurance Code, including, but not limited, to, any medical claims information, policyholder information provided that nothing in this paragraph shall be interpreted to prevent an insurance agent or broker from obtaining proprietary information or other information authorized by law to be obtained by the agent or broker, and information on rates, pricing, and claims handling received from brokers. (5) (A) Records that are trade secrets pursuant to Section 6276.44, or Article 11 (commencing with Section 1060) of Chapter 4 of Division 8 of the Evidence Code, including without limitation, instructions, advice, or training provided by the State Compensation Insurance Fund to its board members, officers, and employees regarding the fund’s special investigation unit, internal audit unit, and informational security, Part Three. The California Public Records Act Public Records Act Page 77 © 2011 Richards, Watson & Gershon 1342886.1 marketing, rating, pricing, underwriting, claims handling, audits, and collections. (B) Notwithstanding subparagraph (A), the portions of records containing trade secrets shall be available for review by the Joint Legislative Audit Committee, the Bureau of State Audits, Division of Workers’ Compensation, and the Department of Insurance to ensure compliance with applicable law. (6) (A) Internal audits containing proprietary information and the following records that are related to an internal audit: (i) Personal papers and correspondence of any person providing assistance to the fund when that person has requested in writing that his or her papers and correspondence be kept private and confidential. Those papers and correspondence shall become public records if the written request is withdrawn, or upon order of the fund. (ii) Papers, correspondence, memoranda, or any substantive information pertaining to any audit not completed or an internal audit that contains proprietary information. (B) Notwithstanding subparagraph (A), the portions of records containing proprietary information, or any information specified in subparagraph (A) shall be available for review by the Joint Legislative Audit Committee, the Bureau of State Audits, Division of Workers’ Compensation, and the Department of Insurance to ensure compliance with applicable law. (7) (A) Except as provided in subparagraph (C), contracts entered into pursuant to Chapter 4 (commencing with Section 11770) of Part 3 of Division 2 of the Insurance Code shall be open to inspection one year after the contract has been fully executed. (B) If a contract entered into pursuant to Chapter 4 (commencing with Section 11770) of Part 3 of Division 2 of the Insurance Code is amended, the amendment shall be open to inspection one year after the amendment has been fully executed. (C) Three years after a contract or amendment is open to inspection pursuant to this subdivision, the portion of the contract or amendment containing the rates of payment shall be open to inspection. Part Three. The California Public Records Act Public Records Act Page 78 © 2011 Richards, Watson & Gershon 1342886.1 (D) Notwithstanding any other provision of law, the entire contract or amendments to a contract shall be open to inspection by the Joint Legislative Audit Committee. The committee shall maintain the confidentiality of the contracts and amendments thereto until the contract or amendments to a contract are open to inspection pursuant to this paragraph. (E) Nothing in this paragraph is intended to apply to documents related to contracts with public entities that are not otherwise expressly confidential as to that public entity. (F) For purposes of this paragraph, “fully executed” means the point in time when all of the necessary parties to the contract have signed the contract. Nothing in this section prevents any agency from opening its records concerning the administration of the agency to public inspection, unless disclosure is otherwise prohibited by law. Nothing in this section prevents any health facility from disclosing to a certified bargaining agent relevant financing information pursuant to Section 8 of the National Labor Relations Act (29 U.S.C. Sec. 158). Section 6254.1. Disclosure of residence, mailing address or results of test for competency to safely operate motor vehicle (a) Except as provided in Section 6254.7, nothing in this chapter requires disclosure of records that are the residence address of any person contained in the records of the Department of Housing and Community Development, if the person has requested confidentiality of that information, in accordance with Section 18081 of the Health and Safety Code. (b) Nothing in this chapter requires the disclosure of the residence or mailing address of any person in any record of the Department of Motor Vehicles except in accordance with Section 1808.21 of the Vehicle Code. (c) Nothing in this chapter requires the disclosure of the results of a test undertaken pursuant to Section 12804.8 of the Vehicle Code. Section 6254.2. Pesticide safety and efficacy information; public disclosure; limitations; procedures (a) Nothing in this chapter exempts from public disclosure the same categories of pesticide safety and efficacy information that are disclosable under paragraph (1) of subsection (d) of Section 10 of the federal Insecticide, Fungicide, and Rodenticide Part Three. The California Public Records Act Public Records Act Page 79 © 2011 Richards, Watson & Gershon 1342886.1 Act (7 U.S.C. Sec. 136h(d)(1)), if the individual requesting the information is not an officer, employee, or agent specified in subdivision (h) and signs the affirmation specified in subdivision (h). (b) The Director of Pesticide Regulation, upon his or her initiative, or upon receipt of a request pursuant to this chapter for the release of data submitted and designated as a trade secret by a registrant or applicant, shall determine whether any or all of the data so submitted is a properly designated trade secret. In order to assure that the interested public has an opportunity to obtain and review pesticide safety and efficacy data and to comment prior to the expiration of the public comment period on a proposed pesticide registration, the director shall provide notice to interested persons when an application for registration enters the registration evaluation process. (c) If the director determines that the data is not a trade secret, the director shall notify the registrant or applicant by certified mail. (d) The registrant or applicant shall have 30 days after receipt of this notification to provide the director with a complete justification and statement of the grounds on which the trade secret privilege is claimed. This justification and statement shall be submitted by certified mail. (e) The director shall determine whether the data is protected as a trade secret within 15 days after receipt of the justification and statement or, if no justification and statement is filed, within 45 days of the original notice. The director shall notify the registrant or applicant and any party who has requested the data pursuant to this chapter of that determination by certified mail. If the director determines that the data is not protected as a trade secret, the final notice shall also specify a date, not sooner than 15 days after the date of mailing of the final notice, when the data shall be available to any person requesting information pursuant to subdivision (a). (f) “Trade secret” means data that is nondisclosable under paragraph (1) of subsection (d) of Section 10 of the federal Insecticide, Fungicide, and Rodenticide Act. (g) This section shall be operative only so long as, and to the extent that, enforcement of paragraph (1) of subsection (d) of Section 10 of the federal Insecticide, Fungicide, and Rodenticide Act has not been enjoined by federal court order, and shall become inoperative if an unappealable federal court judgment or decision becomes final that holds that paragraph invalid, to the extent of the invalidity. (h) The director shall not knowingly disclose information submitted to the state by an applicant or registrant pursuant to Article 4 (commencing with Section 12811) of Chapter 2 of Division 7 of the Food and Agricultural Code to any officer, employee, or agent of any business or other entity engaged in the production, sale, or distribution Part Three. The California Public Records Act Public Records Act Page 80 © 2011 Richards, Watson & Gershon 1342886.1 of pesticides in countries other than the United States or in countries in addition to the United States, or to any other person who intends to deliver this information to any foreign or multi-national business or entity, unless the applicant or registrant consents to the disclosure. To implement this subdivision, the director shall require the following affirmation to be signed by the person who requests such information: AFFIRMATION OF STATUS This affirmation is required by Section 6254.2 of the Government Code. I have requested access to information submitted to the Department of Pesticide Regulation (or previously submitted to the Department of Food and Agriculture) by a pesticide applicant or registrant pursuant to the California Food and Agricultural Code. I hereby affirm all of the following statements: (1) I do not seek access to the information for purposes of delivering it or offering it for sale to any business or other entity, including the business or entity of which I am an officer, employee, or agent engaged in the production, sale, or distribution of pesticides in countries other than the United States or in countries in addition to the United States, or to the officers, employees, or agents of such a business or entity. (2) I will not purposefully deliver or negligently cause the data to be delivered to a business or entity specified in paragraph (1) or its officers, employees, or agents. I am aware that I may be subject to criminal penalties under Section 118 of the Penal Code if I make any statement of material facts knowing that the statement is false or if I willfully conceal any material fact. _____________________________________________________________ Name of RequesterName of Requester’s Organization _____________________________________________________________ Signature of RequesterAddress of Requester ______________________________________________________ DateRequest No.Telephone Number of Requester Name, Address, and Telephone Number of Requester’s Client, if the requester has requested access to the information on behalf of someone other than the requester or the requester’s organization listed above. (i) Notwithstanding any other provision of this section, the director may disclose information submitted by an applicant or registrant to any person in connection with Part Three. The California Public Records Act Public Records Act Page 81 © 2011 Richards, Watson & Gershon 1342886.1 a public proceeding conducted under law or regulation, if the director determines that the information is needed to determine whether a pesticide, or any ingredient of any pesticide, causes unreasonable adverse effects on health or the environment. (j) The director shall maintain records of the names of persons to whom data is disclosed pursuant to this section and the persons or organizations they represent and shall inform the applicant or registrant of the names and the affiliation of these persons. (k) Section 118 of the Penal Code applies to any affirmation made pursuant to this section. (l) Any officer or employee of the state or former officer or employee of the state who, because of this employment or official position, obtains possession of, or has access to, material which is prohibited from disclosure by this section, and who, knowing that disclosure of this material is prohibited by this section, willfully discloses the material in any manner to any person not entitled to receive it, shall, upon conviction, be punished by a fine of not more than ten thousand dollars ($10,000), or by imprisonment in the county jail for not more than one year, or by both fine and imprisonment. For purposes of this subdivision, any contractor with the state who is furnished information pursuant to this section, or any employee of any contractor, shall be considered an employee of the state. (m) This section does not prohibit any person from maintaining a civil action for wrongful disclosure of trade secrets. (n) The director may limit an individual to one request per month pursuant to this section if the director determines that a person has made a frivolous request within the past 12-month period. Section 6254.3. State, school district and county office of education employees; home address and phone number as public records; disclosure (a) The home addresses and home telephone numbers of state employees and employees of a school district or county office of education shall not be deemed to be public records and shall not be open to public inspection, except that disclosure of that information may be made as follows: (1) To an agent, or a family member of the individual to whom the information pertains. (2) To an officer or employee of another state agency, school district, or county office of education when necessary for the performance of its official duties. Part Three. The California Public Records Act Public Records Act Page 82 © 2011 Richards, Watson & Gershon 1342886.1 (3) To an employee organization pursuant to regulations and decisions of the Public Employment Relations Board, except that the home addresses and home telephone numbers of employees performing law enforcement-related functions shall not be disclosed. (4) To an agent or employee of a health benefit plan providing health services or administering claims for health services to state, school districts, and county office of education employees and their enrolled dependents, for the purpose of providing the health services or administering claims for employees and their enrolled dependents. (b) Upon written request of any employee, a state agency, school district, or county office of education shall not disclose the employee’s home address or home telephone number pursuant to paragraph (3) of subdivision (a) and an agency shall remove the employee’s home address and home telephone number from any mailing list maintained by the agency, except if the list is used exclusively by the agency to contact the employee. Section 6254.4. Voter registration information; confidentiality (a) The home address, telephone number, e-mail address, precinct number, or other number specified by the Secretary of State for voter registration purposes, and prior registration information shown on the voter registration card for all registered voters, are confidential and shall not be disclosed to any person, except pursuant to Section 2194 of the Elections Code. (b) For purposes of this section, “home address” means street address only, and does not include an individual’s city or post office address. (c) The California driver’s license number, the California identification card number, the social security number, and any other unique identifier used by the State of California for purposes of voter identification shown on a voter registration card of a registered voter, or added to the voter registration records to comply with the requirements of the Help America Vote Act of 2002 (42 U.S.C. Sec. 15301 et seq.), are confidential and shall not be disclosed to any person. (d) The signature of the voter that is shown on the voter registration card is confidential and shall not be disclosed to any person. Section 6254.5. Disclosures of public records; waiver of exemptions; application of section Notwithstanding any other provisions of the law, whenever a state or local agency discloses a public record which is otherwise exempt from this chapter, to any member of the public, Part Three. The California Public Records Act Public Records Act Page 83 © 2011 Richards, Watson & Gershon 1342886.1 this disclosure shall constitute a waiver of the exemptions specified in Sections 6254, 6254.7, or other similar provisions of law. For purposes of this section, “agency” includes a member, agent, officer, or employee of the agency acting within the scope of his or her membership, agency, office, or employment. This section, however, shall not apply to disclosures: (a) Made pursuant to the Information Practices Act (commencing with Section 1798 of the Civil Code) or discovery proceedings. (b) Made through other legal proceedings or as otherwise required by law. (c) Within the scope of disclosure of a statute which limits disclosure of specified writings to certain purposes. (d) Not required by law, and prohibited by formal action of an elected legislative body of the local agency which retains the writings. (e) Made to any governmental agency which agrees to treat the disclosed material as confidential. Only persons authorized in writing by the person in charge of the agency shall be permitted to obtain the information. Any information obtained by the agency shall only be used for purposes which are consistent with existing law. (f) Of records relating to a financial institution or an affiliate thereof, if the disclosures are made to the financial institution or affiliate by a state agency responsible for the regulation or supervision of the financial institution or affiliate. (g) Of records relating to any person that is subject to the jurisdiction of the Department of Corporations, if the disclosures are made to the person that is the subject of the records for the purpose of corrective action by that person, or if a corporation, to an officer, director, or other key personnel of the corporation for the purpose of corrective action, or to any other person to the extent necessary to obtain information from that person for the purpose of an investigation by the Department of Corporations. (h) Made by the Commissioner of Financial Institutions under Section 280, 282, 8009, or 18396 of the Financial Code. (i) Of records relating to any person that is subject to the jurisdiction of the Department of Managed Health Care, if the disclosures are made to the person that is the subject of the records for the purpose of corrective action by that person, or if a corporation, to an officer, director, or other key personnel of the corporation for the purpose of corrective action, or to any other person to the extent necessary to obtain Part Three. The California Public Records Act Public Records Act Page 84 © 2011 Richards, Watson & Gershon 1342886.1 information from that person for the purpose of an investigation by the Department of Managed Health Care. Section 6254.6. Private industry wage data from federal bureau of labor statistics; identity of employers; confidentiality Whenever a city and county or a joint powers agency, pursuant to a mandatory statute or charter provision to collect private industry wage data for salary setting purposes, or a contract entered to implement that mandate, is provided this data by the federal Bureau of Labor Statistics on the basis that the identity of private industry employers shall remain confidential, the identity of the employers shall not be open to the public or be admitted as evidence in any action or special proceeding. Section 6254.7. Air pollution data; public records; notices and orders to building owners; trade secrets; data used to calculate costs of obtaining emission offsets (a) All information, analyses, plans, or specifications that disclose the nature, extent, quantity, or degree of air contaminants or other pollution which any article, machine, equipment, or other contrivance will produce, which any air pollution control district or air quality management district, or any other state or local agency or district, requires any applicant to provide before the applicant builds, erects, alters, replaces, operates, sells, rents, or uses the article, machine, equipment, or other contrivance, are public records. (b) All air or other pollution monitoring data, including data compiled from stationary sources, are public records. (c) All records of notices and orders directed to the owner of any building of violations of housing or building codes, ordinances, statutes, or regulations which constitute violations of standards provided in Section 1941.1 of the Civil Code, and records of subsequent action with respect to those notices and orders, are public records. (d) Except as otherwise provided in subdivision (e) and Chapter 3 (commencing with Section 99150) of Part 65 of the Education Code, trade secrets are not public records under this section. “Trade secrets,” as used in this section, may include, but are not limited to, any formula, plan, pattern, process, tool, mechanism, compound, procedure, production data, or compilation of information which is not patented, which is known only to certain individuals within a commercial concern who are using it to fabricate, produce, or compound an article of trade or a service having commercial value and which gives its user an opportunity to obtain a business advantage over competitors who do not know or use it. Part Three. The California Public Records Act Public Records Act Page 85 © 2011 Richards, Watson & Gershon 1342886.1 (e) Notwithstanding any other provision of law, all air pollution emission data, including those emission data which constitute trade secrets as defined in subdivision (d), are public records. Data used to calculate emission data are not emission data for the purposes of this subdivision and data which constitute trade secrets and which are used to calculate emission data are not public records. (f) Data used to calculate the costs of obtaining emissions offsets are not public records. At the time that an air pollution control district or air quality management district issues a permit to construct to an applicant who is required to obtain offsets pursuant to district rules and regulations, data obtained from the applicant consisting of the year the offset transaction occurred, the amount of offsets purchased, by pollutant, and the total cost, by pollutant, of the offsets purchased is a public record. If an application is denied, the data shall not be a public record. Section 6254.8. Employment contracts between state or local agency and public official or employee; public record Every employment contract between a state or local agency and any public official or public employee is a public record which is not subject to the provisions of Sections 6254 and 6255. Section 6254.9. Computer software; status as public record; sale, lease, or license authorized; limitations (a) Computer software developed by a state or local agency is not itself a public record under this chapter. The agency may sell, lease, or license the software for commercial or noncommercial use. (b) As used in this section, “computer software” includes computer mapping systems, computer programs, and computer graphics systems. (c) This section shall not be construed to create an implied warranty on the part of the State of California or any local agency for errors, omissions, or other defects in any computer software as provided pursuant to this section. (d) Nothing in this section is intended to affect the public record status of information merely because it is stored in a computer. Public records stored in a computer shall be disclosed as required by this chapter. (e) Nothing in this section is intended to limit any copyright protections. Part Three. The California Public Records Act Public Records Act Page 86 © 2011 Richards, Watson & Gershon 1342886.1 Section 6254.10. Disclosure of records relating to archaeological site information and specified reports not required Nothing in this chapter requires disclosure of records that relate to archaeological site information and reports maintained by, or in the possession of, the Department of Parks and Recreation, the State Historical Resources Commission, the State Lands Commission, the Native American Heritage Commission, another state agency, or a local agency, including the records that the agency obtains through a consultation process between a California Native American tribe and a state or local agency. Section 6254.11. Volatile organic compounds or chemical substances information Nothing in this chapter requires the disclosure of records that relate to volatile organic compounds or chemical substances information received or compiled by an air pollution control officer pursuant to Section 42303.2 of the Health and Safety Code. Section 6254.12. Broker-dealer license information; disciplinary records Any information reported to the North American Securities Administrators Association/National Association of Securities Dealers’ Central Registration Depository and compiled as disciplinary records which are made available to the Department of Corporations through a computer system, shall constitute a public record. Notwithstanding any other provision of law, the Department of Corporations may disclose that information and the current license status and the year of issuance of the license of a broker-dealer upon written or oral request pursuant to Section 25247 of the Corporations Code. Section 6254.13. Statewide testing program; test questions or materials; disclosure to Member of Legislature or Governor; confidentiality Notwithstanding Section 6254, upon the request of any Member of the Legislature or upon request of the Governor or his or her designee, test questions or materials that would be used to administer an examination and are provided by the State Department of Education and administered as part of a statewide testing program of pupils enrolled in the public schools shall be disclosed to the requester. These questions or materials may not include an individual examination that has been administered to a pupil and scored. The requester may not take physical possession of the questions or materials, but may view the questions or materials at a location selected by the department. Upon viewing this information, the requester shall keep the materials that he or she has seen confidential. Section 6254.14. Health care services contract records of the Department of Corrections and Rehabilitation or the California Medical Assistance Commission (a) Except as provided in Sections 6254 and 6254.7, nothing in this chapter shall be construed to require disclosure of records of the Department of Corrections and Part Three. The California Public Records Act Public Records Act Page 87 © 2011 Richards, Watson & Gershon 1342886.1 Rehabilitation that relate to health care services contract negotiations, and that reveal the deliberative processes, discussions, communications, or any other portion of the negotiations, including, but not limited to, records related to those negotiations such as meeting minutes, research, work product, theories, or strategy of the department, or its staff, or members of the California Medical Assistance Commission, or its staff, who act in consultation with, or on behalf of, the department. Except for the portion of a contract that contains the rates of payment, contracts for health services entered into by the Department of Corrections and Rehabilitation or the California Medical Assistance Commission on or after July 1, 1993, shall be open to inspection one year after they are fully executed. In the event that a contract for health services that is entered into prior to July 1, 1993, is amended on or after July 1, 1993, the amendment, except for any portion containing rates of payment, shall be open to inspection one year after it is fully executed. Three years after a contract or amendment is open to inspection under this subdivision, the portion of the contract or amendment containing the rates of payment shall be open to inspection. Notwithstanding any other provision of law, the entire contract or amendment shall be open to inspection by the Joint Legislative Audit Committee and the Bureau of State Audits. The Joint Legislative Audit Committee and the Bureau of State Audits shall maintain the confidentiality of the contracts and amendments until the contract or amendment is fully open to inspection by the public. It is the intent of the Legislature that confidentiality of health care provider contracts, and of the contracting process as provided in this subdivision, is intended to protect the competitive nature of the negotiation process, and shall not affect public access to other information relating to the delivery of health care services. (b) The inspection authority and confidentiality requirements established in subdivisions (q), (v), and (y) of Section 6254 for the Legislative Audit Committee shall also apply to the Bureau of State Audits. Section 6254.15. Information relating to retention, location, or expansion of corporate facility within the state; redaction Nothing in this chapter shall be construed to require the disclosure of records that are any of the following: corporate financial records, corporate proprietary information including trade secrets, and information relating to siting within the state furnished to a government agency by a private company for the purpose of permitting the agency to work with the company in retaining, locating, or expanding a facility within California. Except as provided below, incentives offered by state or local government agencies, if any, shall be disclosed Part Three. The California Public Records Act Public Records Act Page 88 © 2011 Richards, Watson & Gershon 1342886.1 upon communication to the agency or the public of a decision to stay, locate, relocate, or expand, by a company, or upon application by that company to a governmental agency for a general plan amendment, rezone, use permit, building permit, or any other permit, whichever occurs first. The agency shall delete, prior to disclosure to the public, information that is exempt pursuant to this section from any record describing state or local incentives offered by an agency to a private business to retain, locate, relocate, or expand the business within California. Section 6254.16. Utility customers; disclosure of names, credit histories, usage data, addresses, or telephone numbers Nothing in this chapter shall be construed to require the disclosure of the name, credit history, utility usage data, home address, or telephone number of utility customers of local agencies, except that disclosure of name, utility usage data, and the home address of utility customers of local agencies shall be made available upon request as follows: (a) To an agent or authorized family member of the person to whom the information pertains. (b) To an officer or employee of another governmental agency when necessary for the performance of its official duties. (c) Upon court order or the request of a law enforcement agency relative to an ongoing investigation. (d) Upon determination by the local agency that the utility customer who is the subject of the request has used utility services in a manner inconsistent with applicable local utility usage policies. (e) Upon determination by the local agency that the utility customer who is the subject of the request is an elected or appointed official with authority to determine the utility usage policies of the local agency, provided that the home address of an appointed official shall not be disclosed without his or her consent. (f) Upon determination by the local agency that the public interest in disclosure of the information clearly outweighs the public interest in nondisclosure. Section 6254.17. Requests for assistance by crime victims (a) Nothing in this chapter shall be construed to require disclosure of records of the California Victim Compensation and Government Claims Board that relate to a request for assistance under Article 1 (commencing with Section 13950) of Chapter 5 of Part 4 of Division 3 of Title 2. Part Three. The California Public Records Act Public Records Act Page 89 © 2011 Richards, Watson & Gershon 1342886.1 (b) This section shall not apply to a disclosure of the following information, if no information is disclosed that connects the information to a specific victim, derivative victim, or applicant under Article 1 (commencing with Section 13950) of Chapter 5 of Part 4 of Division 3 of Title 2: (1) The amount of money paid to a specific provider of services. (2) Summary data concerning the types of crimes for which assistance is provided. Section 6254.18. Exemption of personal information received, collected, or compiled by public agency regarding employees, volunteers, board members, owners, etc. of reproductive health services facilities; definitions; injunctive relief; notification of application; term of protection; notice of separation (a) Nothing in this chapter shall be construed to require disclosure of any personal information received, collected, or compiled by a public agency regarding the employees, volunteers, board members, owners, partners, officers, or contractors of a reproductive health services facility who have notified the public agency pursuant to subdivision (d) if the personal information is contained in a document that relates to the facility. (b) For purposes of this section, the following terms have the following meanings: (1) “Contractor” means an individual or entity that contracts with a reproductive health services facility for services related to patient care. (2) “Personal information” means the following information related to an individual that is maintained by a public agency: social security number, physical description, home address, home telephone number, statements of personal worth or personal financial data filed pursuant to subdivision (n) of Section 6254, personal medical history, employment history, electronic mail address, and information that reveals any electronic network location or identity. (3) “Public agency” means all of the following: (A) The State Department of Health Care Services. (B) The Department of Consumer Affairs. (C) The Department of Managed Health Care. (D) The State Department of Public Health. Part Three. The California Public Records Act Public Records Act Page 90 © 2011 Richards, Watson & Gershon 1342886.1 (4) “Reproductive health services facility” means the office of a licensed physician and surgeon whose specialty is family practice, obstetrics, or gynecology, or a licensed clinic, where at least 50 percent of the patients of the physician or the clinic are provided with family planning or abortion services. (c) Any person may institute proceedings for injunctive or declarative relief or writ of mandate in any court of competent jurisdiction to obtain access to employment history information pursuant to Sections 6258 and 6259. If the court finds, based on the facts of a particular case, that the public interest served by disclosure of employment history information clearly outweighs the public interest served by not disclosing the information, the court shall order the officer or person charged with withholding the information to disclose employment history information or show cause why he or she should not do so pursuant to Section 6259. (d) In order for this section to apply to an individual who is an employee, volunteer, board member, officer, or contractor of a reproductive health services facility, the individual shall notify the public agency to which his or her personal information is being submitted or has been submitted that he or she falls within the application of this section. The reproductive health services facility shall retain a copy of all notifications submitted pursuant to this section. This notification shall be valid if it complies with all of the following: (1) Is on the official letterhead of the facility. (2) Is clearly separate from any other language present on the same page and is executed by a signature that serves no other purpose than to execute the notification. (3) Is signed and dated by both of the following: (A) The individual whose information is being submitted. (B) The executive officer or his or her designee of the reproductive health services facility. (e) The privacy protections for personal information authorized pursuant to this section shall be effective from the time of notification pursuant to subdivision (d) until either one of the following occurs: (1) Six months after the date of separation from a reproductive health services facility for an individual who has served for not more than one year as an employee, contractor, volunteer, board member, or officer of the reproductive health services facility. Part Three. The California Public Records Act Public Records Act Page 91 © 2011 Richards, Watson & Gershon 1342886.1 (2) One year after the date of separation from a reproductive health services facility for an individual who has served for more than one year as an employee, contractor, volunteer, board member, or officer of the reproductive health services facility. (f) Within 90 days of separation of an employee, contractor, volunteer, board member, or officer of the reproductive health services facility who has provided notice to a public agency pursuant to subdivision (c), the facility shall provide notice of the separation to the relevant agency or agencies. (g) Nothing in this section shall prevent the disclosure by a government agency of data regarding age, race, ethnicity, national origin, or gender of individuals whose personal information is protected pursuant to this section, so long as the data contains no individually identifiable information. Section 6254.19. Information security records; records stored within information technology systems Nothing in this chapter shall be construed to require the disclosure of an information security record of a public agency, if, on the facts of the particular case, disclosure of that record would reveal vulnerabilities to, or otherwise increase the potential for an attack on, an information technology system of a public agency. Nothing in this section shall be construed to limit public disclosure of records stored within an information technology system of a public agency that are not otherwise exempt from disclosure. Section 6254.20. Electronically collected personal information Nothing in this chapter shall be construed to require the disclosure of records that relate to electronically collected personal information, as defined by Section 11015.5, received, collected, or compiled by a state agency. Section 6254.21. Posting or sale of elected or appointed official’s personal information on Internet; remedies for violation; liability of computer service or software provider (a) No state or local agency shall post the home address or telephone number of any elected or appointed official on the Internet without first obtaining the written permission of that individual. (b) No person shall knowingly post the home address or telephone number of any elected or appointed official, or of the official’s residing spouse or child on the Internet knowing that person is an elected or appointed official and intending to cause imminent great bodily harm that is likely to occur or threatening to cause imminent great bodily harm to that individual. A violation of this subdivision is a Part Three. The California Public Records Act Public Records Act Page 92 © 2011 Richards, Watson & Gershon 1342886.1 misdemeanor. A violation of this subdivision that leads to the bodily injury of the official, or his or her residing spouse or child, is a misdemeanor or a felony. (c) (1) (A) No person, business, or association shall publicly post or publicly display on the Internet the home address or telephone number of any elected or appointed official if that official has made a written demand of that person, business, or association to not disclose his or her home address or telephone number. (B) A written demand made under this paragraph by a state constitutional officer, a mayor, or a Member of the Legislature, a city council, or a board of supervisors shall include a statement describing a threat or fear for the safety of that official or of any person residing at the official’s home address. (C) A written demand made under this paragraph by an elected official shall be effective for four years, regardless of whether or not the official’s term has expired prior to the end of the four-year period. (D) (i) A person, business, or association that receives the written demand of an elected or appointed official pursuant to this paragraph shall remove the official’s home address or telephone number from public display on the Internet within 48 hours of delivery of the written demand, and shall continue to ensure that this information is not reposted on the same Internet Web site, subsidiary site, or any other Internet Web site maintained by the recipient of the written demand. (ii) After receiving the elected or appointed official's written demand, the person, business, or association shall not transfer the appointed or elected official's home address or telephone number to any other person, business, or association through any other medium. (iii) Clause (ii) shall not be deemed to prohibit a telephone corporation, as defined in Section 234 of the Public Utilities Code, or its affiliate, from transferring the elected or appointed official’s home address or telephone number to any person, business, or association, if the transfer is authorized by federal or state law, regulation, order, or tariff, or necessary in the event of an emergency, or to collect a debt owed by the elected or appointed official to the telephone corporation or its affiliate. (E) (1) For purposes of this paragraph, “publicly post” or “publicly display” means to intentionally communicate or otherwise make available to the general public. Part Three. The California Public Records Act Public Records Act Page 93 © 2011 Richards, Watson & Gershon 1342886.1 (2) An official whose home address or telephone number is made public as a result of a violation of paragraph (1) may bring an action seeking injunctive or declarative relief in any court of competent jurisdiction. If a court finds that a violation has occurred, it may grant injunctive or declarative relief and shall award the official court costs and reasonable attorney’s fees. A fine not exceeding one thousand dollars ($1,000) may be imposed for a violation of the court’s order for an injunction or declarative relief obtained pursuant to this paragraph. (3) An elected or appointed official may designate in writing the official’s employer, a related governmental entity, or any voluntary professional association of similar officials to act, on behalf of that official, as that official’s agent with regard to making a written demand pursuant to this section. A written demand made by an agent pursuant to this paragraph shall include a statement describing a threat or fear for the safety of that official or of any person residing at the official’s home address. (d) (1) No person, business, or association shall solicit, sell, or trade on the Internet the home address or telephone number of an elected or appointed official with the intent to cause imminent great bodily harm to the official or to any person residing at the official’s home address. (2) Notwithstanding any other law, an official whose home address or telephone number is solicited, sold, or traded in violation of paragraph (1) may bring an action in any court of competent jurisdiction. If a jury or court finds that a violation has occurred, it shall award damages to that official in an amount up to a maximum of three times the actual damages but in no case less than four thousand dollars ($4,000). (e) An interactive computer service or access software provider, as defined in Section 230(f) of Title 47 of the United States Code, shall not be liable under this section unless the service or provider intends to abet or cause imminent great bodily harm that is likely to occur or threatens to cause imminent great bodily harm to an elected or appointed official. (f) (For purposes of this section, “elected or appointed official” includes, but is not limited to, all of the following: (1) State constitutional officers. (2) Members of the Legislature. (3) Judges and court commissioners. Part Three. The California Public Records Act Public Records Act Page 94 © 2011 Richards, Watson & Gershon 1342886.1 (4) District attorneys. (5) Public defenders. (6) Members of a city council. (7) Members of a board of supervisors. (8) Appointees of the Governor. (9) Appointees of the Legislature. (10) Mayors. (11) City attorneys. (12) Police chiefs and sheriffs. (13) A public safety official as defined in Section 6254.24. (14) State administrative law judges. (15) Federal judges and federal defenders. (16) Members of the United States Congress and appointees of the President. (g) Nothing in this section is intended to preclude punishment instead under Sections 69, 76, or 422 of the Penal Code, or any other provision of law. Section 6254.22. Records of certain health plans Nothing in this chapter or any other provision of law shall require the disclosure of records of a health plan that is licensed pursuant to the Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code) and that is governed by a county board of supervisors, whether paper records, records maintained in the management information system, or records in any other form, that relate to provider rate or payment determinations, allocation or distribution methodologies for provider payments, formulae or calculations for these payments, and contract negotiations with providers of health care for alternative rates for a period of three years after the contract is fully executed. The transmission of the records, or the information contained therein in an alternative form, to the board of supervisors shall not constitute a waiver of exemption from disclosure, and the records and information once transmitted to the board of supervisors shall be subject to this same exemption. The provisions of this section shall not prevent access to any records by the Joint Legislative Audit Committee in the exercise of its powers pursuant to Article 1 (commencing with Part Three. The California Public Records Act Public Records Act Page 95 © 2011 Richards, Watson & Gershon 1342886.1 Section 10500) of Chapter 4 of Part 2 of Division 2 of Title 2. The provisions of this section also shall not prevent access to any records by the Department of Corporations in the exercise of its powers pursuant to Article 1 (commencing with Section 1340) of Chapter 2.2 of Division 2 of the Health and Safety Code. Section 6254.23. Disclosure of risk assessment or railroad infrastructure protections program Nothing in this chapter or any other provision of law shall require the disclosure of a risk assessment or railroad infrastructure protection program filed with the Public Utilities Commission, the Director of Homeland Security, and the Office of Emergency Services pursuant to Article 7.3 (commencing with Section 7665) of Chapter 1 of Division 4 of the Public Utilities Code. Section 6254.24. “Public safety official” defined As used in this chapter, “public safety official” means the following: (a) An active or retired peace officer as defined in Sections 830 and 830. 1 of the Penal Code. (b) An active or retired public officer or other person listed in Sections 1808.2 and 1808.6 of the Vehicle Code. (c) An “elected or appointed official” as defined in subdivision (f) of Section 6254.21. (d) An attorney employed by the Department of Justice, the State Public Defender, or a county office of the district attorney or public defender, the United States Attorney, or the Federal Public Defender. (e) A city attorney and an attorney who represent cities in criminal matters. (f) A specified employee of the Department of Corrections and Rehabilitation who supervises inmates or is required to have a prisoner in his or her care or custody. (g) A sworn or nonsworn employee who supervises inmates in a city police department, a county sheriff’s office, the Department of the California Highway Patrol, federal, state, or a local detention facility, and a local juvenile hall, camp, ranch, or home, and a probation officer as defined in Section 830.5 of the Penal Code. (h) A federal prosecutor, a federal criminal investigator, and a National Park Service Ranger working in California. (i) The surviving spouse or child of a peace officer defined in Section 830 of the Penal Code, if the peace officer died in the line of duty. Part Three. The California Public Records Act Public Records Act Page 96 © 2011 Richards, Watson & Gershon 1342886.1 (j) State and federal judges and court commissioners. (k) An employee of the Attorney General, a district attorney, or a public defender who submits verification from the Attorney General, district attorney, or public defender that the employee represents the Attorney General, district attorney, or public defender in matters that routinely place that employee in personal contact with persons under investigation for, charged with, or convicted of, committing criminal acts. (l) A nonsworn employee of the Department of Justice or a police department or sheriff’s office that, in the course of his or her employment, is responsible for collecting, documenting, and preserving physical evidence at crime scenes, testifying in court as an expert witness, and other technical duties, and a nonsworn employee that, in the course of his or her employment, performs a variety of standardized and advanced laboratory procedures in the examination of physical crime evidence, determines their results, and provides expert testimony in court. Section 6254.25. Memorandum from legal counsel to state body or local agency; pending litigation Nothing in this chapter or any other provision of law shall require the disclosure of a memorandum submitted to a state body or to the legislative body of a local agency by its legal counsel pursuant to subdivision (q) of Section 11126 or Section 54956.9 until the pending litigation has been finally adjudicated or otherwise settled. The memorandum shall be protected by the attorney work-product privilege until the pending litigation has been finally adjudicated or otherwise settled. Section 6254.26. Alternative investments of public investment funds; records exempt from disclosure (a) Notwithstanding any provision of this chapter or other law, the following records regarding alternative investments in which public investment funds invest shall not be subject to disclosure pursuant to this chapter, unless the information has already been publicly released by the keeper of the information: (1) Due diligence materials that are proprietary to the public investment fund or the alternative investment vehicle. (2) Quarterly and annual financial statements of alternative investment vehicles. (3) Meeting materials of alternative investment vehicles. (4) Records containing information regarding the portfolio positions in which alternative investment funds invest. Part Three. The California Public Records Act Public Records Act Page 97 © 2011 Richards, Watson & Gershon 1342886.1 (5) Capital call and distribution notices. (6) Alternative investment agreements and all related documents. (b) Notwithstanding subdivision (a), the following information contained in records described in subdivision (a) regarding alternative investments in which public investment funds invest shall be subject to disclosure pursuant to this chapter and shall not be considered a trade secret exempt from disclosure: (1) The name, address, and vintage year of each alternative investment vehicle. (2) The dollar amount of the commitment made to each alternative investment vehicle by the public investment fund since inception. (3) The dollar amount of cash contributions made by the public investment fund to each alternative investment vehicle since inception. (4) The dollar amount, on a fiscal yearend basis, of cash distributions received by the public investment fund from each alternative investment vehicle. (5) The dollar amount, on a fiscal yearend basis, of cash distributions received by the public investment fund plus remaining value of partnership assets attributable to the public investment fund’s investment in each alternative investment vehicle. (6) The net internal rate of return of each alternative investment vehicle since inception. (7) The investment multiple of each alternative investment vehicle since inception. (8) The dollar amount of the total management fees and costs paid on an annual fiscal yearend basis, by the public investment fund to each alternative investment vehicle. (9) The dollar amount of cash profit received by public investment funds from each alternative investment vehicle on a fiscal year-end basis. (c) For purposes of this section, the following definitions shall apply: (1) “Alternative investment” means an investment in a private equity fund, venture fund, hedge fund, or absolute return fund. Part Three. The California Public Records Act Public Records Act Page 98 © 2011 Richards, Watson & Gershon 1342886.1 (2) “Alternative investment vehicle” means the limited partnership, limited liability company, or similar legal structure through which the public investment fund invests in portfolio companies. (3) “Portfolio positions” means individual portfolio investments made by the alternative investment vehicles. (4) “Public investment fund” means any public pension or retirement system, and any public endowment or foundation. Section 6254.27. Disclosure of official records not required if public record available; county recorder Nothing in this chapter shall be construed to require the disclosure by a county recorder of any “official record” if a “public record” version of that record is available pursuant to Article 3.5 (commencing with Section 27300) of Chapter 6 of Part 3 of Division 2 of Title 3. Section 6254.28. Disclosure of official records not required if public record available; filing office Nothing in this chapter shall be construed to require the disclosure by a filing office of any “official record” if a “public record” version of that record is available pursuant to Section 9526.5 of the Commercial Code. Section 6254.29. Legislative intent; protection of social security numbers (a) It is the intent of the Legislature that, in order to protect against the risk of identity theft, local agencies shall redact social security numbers from records before disclosing them to the public pursuant to this chapter. (b) Nothing in this chapter shall be construed to require a local agency to disclose a social security number. (c) This section shall not apply to records maintained by a county recorder. Section 6255. Justification for withholding of records (a) The agency shall justify withholding any record by demonstrating that the record in question is exempt under express provisions of this chapter or that on the facts of the particular case the public interest served by not disclosing the record clearly outweighs the public interest served by disclosure of the record. (b) A response to a written request for inspection or copies of public records that includes a determination that the request is denied, in whole or in part, shall be in writing. Part Three. The California Public Records Act Public Records Act Page 99 © 2011 Richards, Watson & Gershon 1342886.1 Section 6257.5. Purpose of request for disclosure; effect This chapter does not allow limitations on access to a public record based upon the purpose for which the record is being requested, if the record is otherwise subject to disclosure. Section 6258. Proceedings to enforce right to inspect or to receive copy of record Any person may institute proceedings for injunctive or declarative relief or writ of mandate in any court of competent jurisdiction to enforce his or her right to inspect or to receive a copy of any public record or class of public records under this chapter. The times for responsive pleadings and for hearings in these proceedings shall be set by the judge of the court with the object of securing a decision as to these matters at the earliest possible time. Section 6259. Order of court; review; contempt; court costs and attorney fees (a) Whenever it is made to appear by verified petition to the superior court of the county where the records or some part thereof are situated that certain public records are being improperly withheld from a member of the public, the court shall order the officer or person charged with withholding the records to disclose the public record or show cause why he or she should not do so. The court shall decide the case after examining the record in camera, if permitted by subdivision (b) of Section 915 of the Evidence Code, papers filed by the parties and any oral argument and additional evidence as the court may allow. (b) If the court finds that the public official’s decision to refuse disclosure is not justified under Section 6254 or 6255, he or she shall order the public official to make the record public. If the judge determines that the public official was justified in refusing to make the record public, he or she shall return the item to the public official without disclosing its content with an order supporting the decision refusing disclosure. (c) In an action filed on or after January 1, 1991, an order of the court, either directing disclosure by a public official or supporting the decision of the public official refusing disclosure, is not a final judgment or order within the meaning of Section 904.1 of the Code of Civil Procedure from which an appeal may be taken, but shall be immediately reviewable by petition to the appellate court for the issuance of an extraordinary writ. Upon entry of any order pursuant to this section, a party shall, in order to obtain review of the order, file a petition within 20 days after service upon him or her of a written notice of entry of the order, or within such further time not exceeding an additional 20 days as the trial court may for good cause allow. If the notice is served by mail, the period within which to file the petition shall be increased by five days. A stay of an order or judgment shall not be granted unless the petitioning party demonstrates it will otherwise sustain irreparable damage and Part Three. The California Public Records Act Public Records Act Page 100 © 2011 Richards, Watson & Gershon 1342886.1 probable success on the merits. Any person who fails to obey the order of the court shall be cited to show cause why he or she is not in contempt of court. (d) The court shall award court costs and reasonable attorney fees to the plaintiff should the plaintiff prevail in litigation filed pursuant to this section. The costs and fees shall be paid by the public agency of which the public official is a member or employee and shall not become a personal liability of the public official. If the court finds that the plaintiff’s case is clearly frivolous, it shall award court costs and reasonable attorney fees to the public agency. Section 6260. Effect of chapter on prior rights and proceedings The provisions of this chapter shall not be deemed in any manner to affect the status of judicial records as it existed immediately prior to the effective date of this section, nor to affect the rights of litigants, including parties to administrative proceedings, under the laws of discovery of this state, nor to limit or impair any rights of discovery in a criminal case. Section 6261. Itemized statement of total expenditures and disbursement of any agency Notwithstanding Section 6252, an itemized statement of the total expenditures and disbursement of any agency provided for in Article VI of the California Constitution shall be open for inspection. Section 6262. Exemption of records of complaints to, or investigations by, any state or local agency for licensing purposes; application to district attorney The exemption of records of complaints to, or investigations conducted by, any state or local agency for licensing purposes under subdivision (f) of Section 6254 shall not apply when a request for inspection of such records is made by a district attorney. Section 6263. District attorney; inspection or copying of nonexempt public records A state or local agency shall allow an inspection or copying of any public record or class of public records not exempted by this chapter when requested by a district attorney. Section 6264. Order to allow district attorney to inspect or copy records The district attorney may petition a court of competent jurisdiction to require a state or local agency to allow him to inspect or receive a copy of any public record or class of public records not exempted by this chapter when the agency fails or refuses to allow inspection or copying within 10 working days of a request. The court may require a public agency to permit inspection or copying by the district attorney unless the public interest or good cause in withholding such records clearly outweighs the public interest in disclosure. Part Three. The California Public Records Act Public Records Act Page 101 © 2011 Richards, Watson & Gershon 1342886.1 Section 6265. Disclosure of records to district attorney; status of records Disclosure of records to a district attorney under the provisions of this chapter shall effect no change in the status of the records under any other provision of law. Section 6267. Libraries supported by public funds; registration and circulation records; confidentiality; exceptions All registration and circulation records of any library which is in whole or in part supported by public funds shall remain confidential and shall not be disclosed to any person, local agency, or state agency except as follows: (a) By a person acting within the scope of his or her duties within the administration of the library. (b) By a person authorized, in writing, by the individual to whom the records pertain, to inspect the records. (c) By order of the appropriate superior court. As used in this section, the term “registration records” includes any information which a library requires a patron to provide in order to become eligible to borrow books and other materials, and the term “circulation records” includes any information which identifies the patrons borrowing particular books and other material. This section shall not apply to statistical reports of registration and circulation nor to records of fines collected by the library. Section 6268. Public records in custody or control of governor leaving office; transfer to state archives; restriction on public access; conditions Public records, as defined in Section 6252, in the custody or control of the Governor when he or she leaves office, either voluntarily or involuntarily, shall, as soon as is practical, be transferred to the State Archives. Notwithstanding any other provision of law, the Governor, by written instrument, the terms of which shall be made public, may restrict public access to any of the transferred public records, or any other writings he or she may transfer, which have not already been made accessible to the public. With respect to public records, public access, as otherwise provided for by this chapter, shall not be restricted for a period greater than 50 years or the death of the Governor, whichever is later, nor shall there be any restriction whatsoever with respect to enrolled bill files, press releases, speech files, or writings relating to applications for clemency or extradition in cases which have been closed for a period of at least 25 years. Subject to any restrictions permitted by this section, the Secretary of State, as custodian of the State Archives, shall make all such public records and other writings available to the public as otherwise provided for in this chapter. Part Three. The California Public Records Act Public Records Act Page 102 © 2011 Richards, Watson & Gershon 1342886.1 Except as to enrolled bill files, press releases, speech files, or writings relating to applications for clemency or extradition, this section shall not apply to public records or other writings in the direct custody or control of any Governor who held office between 1974 and 1988 at the time of leaving office, except to the extent that that Governor may voluntarily transfer those records or other writings to the State Archives. Notwithstanding any other provision of law, the public records and other writings of any Governor who held office between 1974 and 1988 may be transferred to any educational or research institution in California provided that with respect to public records, public access, as otherwise provided for by this chapter, shall not be restricted for a period greater than 50 years or the death of the Governor, whichever is later. No records or writings may be transferred pursuant to this paragraph unless the institution receiving them agrees to maintain, and does maintain, the materials according to commonly accepted archival standards. No public records transferred shall be destroyed by that institution without first receiving the written approval of the Secretary of State, as custodian of the State Archives, who may require that the records be placed in the State Archives rather than being destroyed. An institution receiving those records or writings shall allow the Secretary of State, as custodian of the State Archives, to copy, at state expense, and to make available to the public, any and all public records, and inventories, indices, or finding aids relating to those records, which the institution makes available to the public generally. Copies of those records in the custody of the State Archives shall be given the same legal effect as is given to the originals. Section 6270. Sale, exchange or otherwise providing records subject to disclosure to private entities; prohibition; exception (a) Notwithstanding any other provision of law, no state or local agency shall sell, exchange, furnish, or otherwise provide a public record subject to disclosure pursuant to this chapter to a private entity in a manner that prevents a state or local agency from providing the record directly pursuant to this chapter. Nothing in this section requires a state or local agency to use the State Printer to print public records. Nothing in this section prevents the destruction of records pursuant to law. (b) This section shall not apply to contracts entered into prior to January 1, 1996, between the County of Santa Clara and a private entity for the provision of public records subject to disclosure under this chapter. 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