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City Of Clt~/ ~®UiIClI ~\~ip®' Y.
Santa Moniea
16, Zoe 1
City Council Meeting: ~laq-~-394i-
Agenda Item: ~' -D
To: Mayor and City Council
From: Marsha Jones Moutrie, City Attorney
Subject: Proposed Ordinance Amending Municipal Code Provisions Restricting
Campaign Contributions
Recommended Action
Staff recommends that Council introduce for first reading the attached proposed
ordinance amending the City's campaign contribution restrictions in order to conform to
developments in First Amendment case law.
Executive Summary
In recent years, the United States Supreme Court and lower federal and state courts
have issued decisions expanding the First Amendment protection of financial
participation in the political process. The City's law restricting campaign contributions
was adopted in 1992, before these cases were decided. Because of these decisions,
legal staff proposed that Council increase the City's contribution limit and eliminate the
limit as to committees that are not controlled by candidates. Accordingly, and despite
concerns about the impacts of money on the democratic process, Council directed staff
to prepare an ordinance conforming the Municipal Code to the recent court decisions.
The attached ordinance fulfills that direction.
Background
As explained in the March 22. 2011 staff report on election related matters, the
Supreme Court's decision in Citizens United v. Federal Elections Commission, 130
S.Ct. 876 (2010) and other federal decisions establish the rule that cities may not limit
so-called independent expenditures (those made by committees not controlled by a
candidate). And, a line of federal cases establishes that contribution limits cannot be
set so low as to potentially hinder candidates' ability to purchase the advertising
necessary to communicate their views.
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Council considered the information provided by staff, noted that the current City
contribution limit of $250 had not been increased since its adoption in 1992, and
included no escalator to reflect increasing costs. Ultimately, Council directed staff to
return with an ordinance raising the contribution limit to $400 and eliminating the current
restriction on uncontrolled committees.
Discussion
The attached proposed ordinance fulfills Council's directives. It would increase the
contribution limit in Municipal Code Section 11.04.050 from $250 to $400. As Council
noted at its prior meeting, $400 is approximately the amount that the current limit would
have been if an escalator clause had been included in the ordinance at the time of its
adoption.
Additionally, the proposed ordinance-would delete from Section 11.04.050 the language
making the City's contribution limit applicable to uncontrolled committees - a change
necessitated by the Supreme Court's decision in Citizens United. Finally, as to Section
11.04.050, the proposed ordinance would eliminate subsection (c) because it is no
longer necessary, having been added before Citizen's United to try and shield the
ordinance from a challenge to the limit on contributions to uncontrolled committees.
The ordinance would also modify Section 11.04.070, on aggregation of payments, by
eliminating language adopted in 1992 that purports to prohibit persons who serve as
officers of controlled committees from also serving as officers of uncontrolled
committees and to prohibit the two types of committees from undertaking any "act in
concert." Staff proposes elimination of this language because, given the staunch
protection that the courts now afford to political activities, the language would likely be
construed as an unwarranted intrusion on the First Amendment freedom and because
the prohibition against acting "in concert" is vague.
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Alternatives
As previously noted, Council could maintain the current code provisions despite the
changes in case law, which would pose a significant legal risk. Additionally, Council
could establish a new contribution limit different than the limit proposed in the attached
ordinance.
Financial Impacts & Budget Actions
There are no direct financial impacts on the City attendant upon the approval of the
proposed ordinance.
Prepared by: Marsha Jones Moutrie, City Attorney
roved:
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Na e
M sha Jon s Moutrie, City Attorney
Forwarded to Council:
Rod Gould
City Manager
Attachments:
A. Proposed Ordinance
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F:\atty\mu n i\laws\mj m\LimitationsOnContributionsOrd050311
City Council Meeting: 5/3/2011 Santa Monica, California
ORDINANCE NUMBER (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA AMENDING SECTIONS 11.04.050 AND 11.04.070 OF THE SANTA
MONICA MUNICIPAL CODE RELATING TO CONTRIBUTIONS TO CANDIDATES
FOR OFFICE
WHEREAS, the City of Santa Monica is known for its highly participatory local
democracy; and
WHEREAS, the City Council has adopted various laws and policies intended to
encourage broad participation in the local political process; and
WHEREAS, among these laws is a contribution limit established in 1992 in the
amount of $250; and
WHEREAS, the law adopted in 1992 applies this limit to individuals, committees
controlled by candidates, and uncontrolled committees; and
WHEREAS, this limit has not been changed since 1992; and
WHEREAS, the City Council has preserved the 1992 limit in order to curtail the
influence of money and special interests upon the democratic process in Santa Monica;
and
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WHEREAS, in recent years decisions of the United States Supreme Court and
lower courts have invalidated campaign finance restrictions like Santa Monica's on First
Amendment grounds; and
WHEREAS, based on this development in the case law, the City Council has
determined that Santa Monica's contribution limit must be revised, in order to maintain
its constitutionality.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Santa Monica Municipal Code Section 11.04.050 is hereby
amended to read as follows:
11.04.050 Limitations on contributions from persons.
(a) No person shall make to any candidate for
office or to the controlled committee of such acandidate-er
^~~~a;dat~, a contribution or contributions totaling more than
~~d-fiftyfour hundred dollars 400 for each election
in which the candidate was on, is on, or is likely to be on the
ballot or in which the candidate sought or seeks write-in
votes.
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(b) No candidate for office or the controlled
committee of such a candidate ^r °^ ~ ^^^~^~~++°° which
supports or opposes such candidate shall accept from any
person a contribution or contributions totaling more than #wa
#f+ftyfour hundred dollars 400 for each election.
(~.~) Tr,T~` n°r.4:r~ oh.+ll nn+ h° 'n+°rn r°+°rl nr onnl;°r7
4h h ^^rJ'+~~r°c D.++h°r 'i in 'r+°nr7°r7 +n h° °nfl
+^ '^,+',,:.+ ^I^ ^^rt ^^.,,„,I++°°^ (Prior code § 11203; added
by Ord. No. 1630CCS § 1, adopted 6/9/92, amended by Ord.
No. 2270CCS § 2, adopted 9/16/08)
SECTION 2. Santa Monica Municipal Code Section 11.04.070 is hereby
amended to read as follows:
11.04.070 Aggregation of payments.
(a) All contributions made by a person or small
contributor political action committee whose contributions or
expenditure activity is financed, directed or controlled by any
corporation, partnership, committee, labor organization,
association, political party or any other person or committee,
including any parent, subsidiary, branch, division,
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department or local unit of the corporation, labor
organization, partnership, committee, association; political
party or any other person, or by any group of such persons,
shall be considered to be made by the person, organization
or entity financing, directing or controlling the contribution as
well as the person, small contributor or political action
committee making the contribution.
(b) Two or more entities shall be regarded as the
same person or small contributor political action committee
when any of the following apply:
(1) The entities share the majority of
members of their boards of directors;
(2) The entities share two or more officers;
(3) The entities are owned or controlled by
the same majority shareholder or shareholders;
(4) The entities are in aparent-subsidiary
relationship.
(c) An individual and any general partnership in
which the individual is a partner, or an individual and any
corporation in which the individual owns a controlling
interest, shall be regarded as the same person.
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w„d;d^t.; ~..,wnd;d^±ec ,.,~.,;:e ccn+.:"..+:c..... (Prior code §
11205; added by Ord. No. 1630CCS § 1, adopted 6/9/92)
SECTION 3. Any provision of the Santa Monica Municipal Code or appendices
thereto inconsistent with the provisions of this Ordinance, to the extent of such
inconsistencies and no further, is hereby repealed or modified to that extent necessary
to effect the provisions of this Ordinance.
SECTION 4. If any section, subsection, sentence, clause, or phrase of this
Ordinance is for any reason held to be invalid or unconstitutional by a decision of any
court of competent jurisdiction, such decision shall not affect the validity of the
remaining portions of this Ordinance. The City Council hereby declares that it would
have passed this Ordinahce and each and every section, subsection, sentence, clause,
or phrase not declared invalid or unconstitutional without regard to whether any portion
of the ordinance would be subsequently declared invalid or unconstitutional.
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SECTION 5. The Mayor shall sign and the City Clerk shall attest to the passage
of this Ordinance. The City Clerk shall cause the same to be published once in the
official newspaper within 15 days after its adoption. This Ordinance shall become
effective 30 days from its adoption.
APPROVED AS TO FORM:
MA SHA J S MOUT E ~~~~
Ci Attorn
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