AMENDMENTS TO THE FPPC'S PUBLIC GENERALLY REGULATIONS

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1®1® BEST BEST & KRIEGER ATTORNEYS AT LAW public generally. There are no bright line rules establishing whether a particular decision will have a unique effect. However, the FPPC regulation provides some examples, which are discussed in more detail below. The gist of the rule is that before a public official can invoke the public generally exception, he or she will have to ask whether the decision will provide a benefit or detriment that differs from the benefit or detriment affecting the rest of the community. When determining whether there is a unique effect, keep in mind that it is necessary to consider the effect on the public official's financial interests. A financial interest includes an official's personal finances, as well as interests in real property, business entities, sources of income, and sources of gifts.2 For example, if a local hotel is a source of income to a public official, the question will be whether the governmental decision has a unique effect on the hotel. If so, the official will have to disqualify because the "public generally" exception will not apply. KEY CHANGES MADE TO THE RULE The most significant change made by the amended regulation is a substantial increase to the percentage constituting a significant segment. Under the prior FPPC regulation, a decision affected the public generally if it affected 10% of residents or residential property owners, or if it affected at least 5,000 residents or residential property owners or 2,000 business entities. Under the new rule, the threshold has increased to 25% in all situations. There is no longer any exception if the decision affects a certain number of residents, properties, or businesses. The new regulation also makes a slight change to the manner in which the effect on the official's financial interest is compared to the effect on the rest of the public. The term "unique effect" was not a part of the prior regulation. Instead, the prior regulation required that the decision affect the public official's economic interest in "substantially the same manner." There are subtle differences, but the concept is generally the same; a public official cannot invoke the public generally exception if the public official's economic interest stands to benefit from or fall detriment to the decision differently from the rest of the public. The biggest difference is in how the new rule treats interests in real property. Under the prior rule, the effect on an official's real property interest was measured against the overall dollar amount of any increase or decrease to the property value. Meaning, if an official had a more valuable property than others, he or she would be unable to invoke the exception. The new rule allows consideration of the proportional impact provided that the impact is not unique. However, as explained below, even this "proportional impact" might be undermined if the official's financial interests are significantly greater than the public generally. z See 2 Cal, Code Regs. §§ 18702.1 — 18702.5. -2- 09991.00005M46033.6