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SR 03-01-2016 7A City Council Report City Council Meeting: March 1, 2016 Agenda Item: 7.A To: Mayor and City Council From: Marsha Moutrie, City Attorney, City Attorney's Office Subject: Proposed Ordinance Regulating Lobbying Recommended Action Staff recommends that the City Council introduce for first reading the attached proposed ordinance which would regulate lobbying of City officials and City staff. Staff also recommends that the Council direct staff to prepare a modification to the Council Rules requiring disclosure of contacts with Lobbyists and to promulgate an Administrative Instruction requiring staff disclosure of contacts with lobbyists. Executive Summary Council has directed staff to prepare an ordinance regulating lobbying activities. The attached proposed ordinance fulfills that direction. It would establish requirements applicable to individuals who receive compensation for communicating with City officials or employees in order to influence legislative or administrative actions. The requirements would include registration and reporting of basic information about the Lobbyists' businesses, their clients, their clients' businesses, the decisions to be influenced, and certain expenditures made by Lobbyists in support of their work. The proposed ordinance would also authorize the City Clerk to adopt implementing rules and regulations, and it would establish remedies for violations. Background At its meeting of December 16, 2014, Council directed staff to prepare a proposed ordinance requiring Lobbyists to register and containing other requirements promoting transparency. Staff reviewed lobbying ordinances adopted by over a dozen other cities and returned to Council on July 14, 2015, with a proposed ordinance containing registration and disclosure requirements and prohibitions against certain deceptive practices, as well as provisions governing administration and establishing remedies. Council considered the proposed ordinance and directed staff to return with a simpler ordinance. Staff returned to Council on October 27, 2015 with a revised proposed ordinance. 1 of 4 Council directed staff to make additional revisions to the proposed ordinance, including new language that would apply the ordinance's requirements to Lobbyists' contacts with all City officials, require reporting updates in order to capture Lobbyists' new clients, and include the reporting of certain expenditures by Lobbyists. Discussion The attached proposed ordinance fulfills Council's directions. It includes the three revisions to the prior version specified by Council during its last consideration of the matter. First, the definition of "Lobbyist" has been expanded to include anyone who receives economic consideration for communicating with any official or employee of the City for the purpose of influencing a legislation or administrative action. This is a change from the prior version, which defined a Lobbyist as an individual who received economic consideration for communicating with "any elected official, officer or employee of the City for the purpose of influencing a legislative or administrative action." The currently proposed wording would ensure that the proposed ordinance covers the activity of lobbying board and commission members. Second, the registration requirement has been supplemented. The registration requirement has been renamed to add the term "reporting". This change is recommended to convey the ongoing responsibilities created by the section. Additionally, language has been added requiring Lobbyists to update their annual registration forms within ten days of changes to the reported information. This new language will, among other things, effectively require Lobbyists to promptly report new clients and new projects for existing clients. Because the proposed ordinance would require updating of registration forms, annual registration could be deemed unnecessary. However, staff recommends requiring both annual registration and timely updates to promote disclosure and safeguard transparency. Third, the registration and reporting requirement has also been supplemented by the addition of a requirement that Lobbyists report gifts and expenditures, exceeding $20 in 2 of 4 amount or value, which are given to or made for the benefit of clients. This requirement could cover activities ranging from, for example, buying a meal for an official to preparing a mailer intended to influence Council's vote on a proposed development project. In addition to these revisions directed by Council, staff also recommends the addition of a provision authorizing the City Clerk to adopt regulations implementing the requirements of the ordinance. Proposed language appears in the proposed ordinance for that purpose. The addition of this language would situate staff to effectuate the ordinance by clarifying its application to a variety of circumstances and new developments. Finally, staff continues to recommend addressing Council disclosures of contacts with Lobbyists through the Council Rules and disclosures of staff's contacts with Lobbyists through an Administrative Instruction. Direction on these matters could be given to staff in conjunction with Council's consideration of the attached ordinance. Additionally, staff continues to recommend selecting an effective date for the ordinance that is at least several months distant to allow time for community education and staff preparation for implementation. Alternatives The Council could, once again, consider modifications to the proposed ordinance. For example, the proposed threshold for reporting Lobbyists' gifts and other expenditures on behalf of clients could be raised (or lowered) from the $20 threshold proposed in the ordinance. Council could also consider requiring Lobbyists to report individual contacts with City officials and staff. The proposed ordinance does not impose that requirement, partly because staff believes that officials' and staffs' disclosures will achieve the same purpose and perhaps better promote transparency. Council could also consider broadening the definition of a Lobbyist to include those advocating their own interests. However, staff recommends against that approach in order to minimize First Amendment issues. Finally, in order to distinguish between Lobbyists and those who are simply seeking or providing information, the definition of Lobbyist could be narrowed 3 of 4 by specifying that a Lobbyist is one who communicates with City official or staff "primarily" for the purpose of influencing a legislative or administrative action. Staff does not believe that any of these possible modifications needs to be made now. Instead, staff recommends beginning implementation of this new regulatory system based on the proposed ordinance, relying upon the Clerk's ability to facilitate implementation through the adoption of rules and regulations, and directing staff to report back on its experiences and particularly upon any perceived need to amend the ordinance. Financial Impacts and Budget Actions Costs associated with implementing this ordinance would be covered by a registration fee to be set and periodically adjusted by City Council resolution. Prepared By: Marsha Moutrie, City Attorney Approved Forwarded to Council Attachments: A. Lobbying Regulation Ordinance B. July 14, 2015 Staff Report (Web link) C. October 27, 2015 Staff Report (Web Link) D. Written comments 4 of 4 Add to 7-A 03/01/2016 Anne Samartha From:jim gerstley <jimggers@yahoo.com> Sent:Monday, February 29, 2016 12:54 AM To:councilmtgitems Cc:Tony Vazquez; Kevin McKeown; Clerk Mailbox; Ted Winterer; Pam OConnor; Terry OÔDay; Gleam Davis; Sue Himmelrich Subject:Council meeting March 1 item 7 Lobbyists Follow Up Flag:Follow up Flag Status:Flagged 1\] I don't feel a $500 penalty makes much of an impact to a lobbyist. Penalties should increase with succeeding infractions. 2\] Entities being represented by a lobbyist must be true entities: real people and real companies, not 'fronts' and PACS. If PACS, then the 3? largest sponsors in the PAC--again, real people and real companies. 3\] Public recipients of monetary and non-monetary gifts from lobbyists and their employers must be made public within 10 days, and at least 10 days before an election. All donations received by public officials running for election must be publicly summarized not less than 10 days before an election, such summary including all donations/gifts since the last election. 4\] Gifts to city officials must include campaign contributions, as this appears to be a major pathway to funnel donations/gifts to candidates and officials. 5\] For balanced representation, representatives of the neighborhood groups are to be given the same amount of access to the same officials and employees as the lobbyists and their customers. 6\] Lobbyists should be banned from communicating with council members and planning commission members during public meetings and votes. Thanks Jim Gerstley 90403 1 Add to 7-A 03/01/2016 councilmtgitems From:Mary Marlow <m.marlow@verizon.net> Sent:Tuesday, March 01, 2016 8:27 AM To:Council Items Cc:Ted Winterer; Kevin McKeown Fwd; Gleam Davis; Terry OÔDay; Pam OConnor; Tony Vazquez; Sue Himmelrich; Rick Cole; Marsha Moutrie Subject:Council Agenda Item 7A - Lobbying Ordinance Follow Up Flag:Follow up Flag Status:Flagged Dear Mayor Vazquez and Council Members, We are pleased to see a draft ordinance regulating lobbying on the agenda for tomorrow’s council meeting. This ordinance will promote needed disclosure. Especially important are the recommendations that the City Clerk adopt regulations implementing the requirements of the ordinance and act to enforce the ordinance. These implementation provisions are critical to the success of the Lobbying Ordinance. There are, however, two needed additions to improve the ordinance and promote greater transparency and accountability: 1) The lobbyist should disclose WHO they lobbied and do so before a hearing on the matter. As the draft stands, there would be both an administrative instruction and a council rule, though neither would have the force of law and instead require disclosure by a variety of individuals - under different procedures and without real consequences for inadequate disclosures or a failure to disclose. 2) The private right of action from the earlier draft (version 1) should be reinstated. The private right of action would allow any resident to enforce requirements of the law through civil action for injunctive relief, damages, and punitive damages. Additionally, the proposed ordinance should authorize awarding attorney’s fees to a successful plaintiff. Without these provisions, citizens have no recourse if the city takes no action. Thank you for considering our suggestions to improve the ordinance; we share your concern in promoting good governance. Sincerely, Santa Monica Transparency Project Mary Marlow, Chair 1 Add to 7-A 03/01/2016 councilmtgitems From:Council Mailbox Sent:Tuesday, March 01, 2016 1:58 PM To:councilmtgitems Subject:FW: Agenda Item 7A: City Council meeting, March 1, 2016 CƩƚƒʹNomaBoardmember\[mailto:nomaboard@gmail.com\] {ĻƓƷʹTuesday,March01,20161:27PM ƚʹTonyVazquez<Tony.Vazquez@SMGOV.NET>;GleamDavis<gleam.davis@gmail.com>;KevinMcKeownFwd <kevin@mckeown.net>;PamOConnor<Pam.OConnor@SMGOV.NET>;CouncilMailbox <Council.Mailbox@SMGOV.NET>;SueHimmelrich<Sue.Himmelrich@SMGOV.NET>;TedWinterer <Ted.Winterer@SMGOV.NET>;Terryh͸5ğǤ<Terry.Oday@smgov.net>;RickCole<Rick.Cole@SMGOV.NET>;Marsha Moutrie<Marsha.Moutrie@SMGOV.NET>;ClerkMailbox<Clerk.Mailbox@SMGOV.NET> {ǒĬƆĻĭƷʹAgendaItem7A:CityCouncilmeeting,March1,2016 Dear Mayor Vazquez and Council Members, We thank you and staff for enabling this ordinance to regulate lobbying of City officials and City staff and commend you for it. To it we would urge you to add the modification that would also require Lobbyists to register and report individual ing includ but not limited to testimony before an official body such as the contacts with City officials and staff, or a Commission, a Lobbyist being defined to include a Councilnyone paid to perform such duties, We would also urge you to consider whether a law firm, expert witness, or union representative. establishing penalty for a Lobbyist not complying with the requirement, whether it be a prohibition against further representation or possibly even a public listing. Thank you. The NOMA Board smnoma.org NOMAboard@gmail.com 1