65B - PROPOSED CHARTER AMENDMENTS

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Campaign Contribution Limitations Federal, state and local legislative bodies have grappled with regulating campaign financing for decades. The challenge has been to craft regulations that safeguard the democratic process by ensuring that large contributors do not dominate election results and also protect constitutional rights, including the First Amendment right to participate in the electoral process. That challenge has been as difficult as the issues are important. At the federal level, the Federal Election Commission administers the extensive system of restrictions imposed by the Federal Election Campaign Act and the Bipartisan Campaign Reform Act of 2002 and implemented by federal regulations. The federal contribution limit for a contribution to an individual or non - multicandidate committee is $2300 per election. Contributions from federal government contractors, foreign nationals, and the general treasury funds of corporations, labor organizations and national banks are prohibited, as are contributions made in the name of another. Federal laws governing contributions, particularly contributions by and to groups, have been subject to numerous court challenges. In California, the voters have weighed in repeatedly, proposing and adopting four major campaign reform measures in the last twenty years (Propositions 68, 73, 208 and 34). The first three of these were overturned by the courts. At present, Proposition 34 imposes a range of contribution limits for state offices from about $3,600 to $7,000 and allows contributions by corporations and unions as well as natural persons and PACs. Currently, state law expressly does not limit contributions to candidates for local offices, but allows cities to adopt their own limitations. Gov. Code 85703. Many local jurisdictions have chosen to exercise their authority to impose campaign financing limitations, and the local regulations they have adopted vary widely. Santa Ana has established a contribution limit of $1,000 in each election cycle. This limitation was adopted as a Charter amendment in 1992. The City further limits campaign contributions by ordinance. Section 2 -107 of the Municipal Code provides that no council member or committee controlled by a council member may solicit or accept a contribution of $250 or more from any person impacted by a final decision on a license, permit or other entitlement, for a period of three months following the decision. Finally, Charter section 425 disqualifies council members from participating in decisions affecting those who have made campaign contributions of $250.00 or more. The disqualification is for a period of 12 months. Section 425 models the State Political Reform Act and Fair Political Practices Commission regulations concerning disqualification from participating in decisions affecting sources of income and Government Code section 84308 which disqualifies certain "officers" running for elective office from participating in decisions for a period of three months. However, the State law expressly exempts campaign contributions from the definition of income and the State law does not mandate disqualification of city council members, unless they are serving on certain regional boards or commissions. While Charter Section 425 and Section 2 -107 of the Municipal Code appear to be well intentioned they may increase misunderstandings and false accusations by those who don't fully understand the competing local versus state rules. Furthermore, these local provisions were adopted without L• MW