SR 03-27-2018 8C
City Council
Report
City Council Meeting: March 27, 2018
Agenda Item: 8.C
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To: Mayor and City Council
From: Lane Dilg, City Attorney, City Attorney's Office
Denise Anderson-Warren, City Clerk, Records & Elections Services
Department
Subject: Potential Enhancements and Improvements to Local Election Laws and
Enforcement Mechanisms
Recommended Action
Staff recommends that the City Council review and comment on potential
enhancements and improvements to local election laws and enforcement mechanisms.
Executive Summary
The City of Santa Monica has long been committed to a democracy that is responsive to
the people and to an electoral process that ensures fair and effective representation.
As a result, Santa Monica has adopted local regulations to promote transparency and
level the playing field for electioneering that go beyond State law. In August 2017, the
California Fair Political Practices Commission (FPPC) announced penalties against the
Huntley Hotel, Richardson Patel, and Pure Pilates, Inc., for violations of the Political
Reform Act relating to campaign contributions made in Santa Monica elections. In
response, on November 28, 2017, Council directed staff to provide information on how
the violations were identified and how local law was circumvented; to provide
recommendations for a process to enforce, receive complaints regarding violations of,
educate the community about, and create transparency on current / past investigations
of violations of local campaign finance laws; and to explore options for campaign
financing, including public financing.
Discussion
The Political Reform Act and the Santa Monica Elections Code
Elections in Santa Monica are governed by the California Elections Code, the Political
Reform Act (PRA), and the Santa Monica Elections Code. The PRA is the state law
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that governs campaign finance, financial conflicts of interest of public officials, lobbyist
registration and reporting, post-governmental employment, mass mailings at public
expense, and gifts to public officials and candidate. Every candidate, candidate’s
campaign committee, general purpose committee, political party committee, slate mailer
organization, major donor, and person or entity making independent expenditures on
candidates or ballot measures in California is subject to the PRA. Information about
PRA campaign finance and disclosure requirements is available at
http://www.fppc.ca.gov/learn/campaign-rules.html.
The FPPC is the state agency with primary responsibility for enforcing the PRA. The
FPPC Enforcement Division regularly brings enforcement actions based on violations of
the PRA in state and local elections including but not limited to:
Laundered campaign contributions;
Gifts and contributions over the state contribution limits;
Improper use of campaign funds, including personal use;
Campaign mass mailings at public expense;
False, inadequate, or inaccurate reporting on campaign statements and
reports;
Non-filing or late filing of campaign statements or reports; and
Anonymous or cash contributions of $100 or more.
Charter cities are not authorized to alter or reduce the requirements of the PRA.
Charter cities may, however, impose additional regulations that are consistent with the
purpose of the PRA and stricter in effect. The Santa Monica Elections Code imposes
further regulations on election activity in order to, among other things, ensure the
credibility and integrity of the local election process; ensure equal opportunity for all
candidates, promote diversity among candidates, and strengthen the community’s trust
that their government is representative; promote participation in government and trust
that the democratic process is not subverted by affluent special interest groups; and
preserve a sense of community, safeguard local democracy, and effectuate a
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commitment to fair public process. For these purposes, the Santa Monica Elections
Code, among other things:
Prohibits any person from making contributions totaling more than $340 to
a candidate or controlled committee of a candidate in each election, as
well as any candidate or committee from receiving such contributions
(SMMC 11.04.050);
Prohibits the Santa Monica City Council, Santa Monica Rent Control
Board, and their administrative officers from circulating any newsletter or
mass mailing within 88 days of an election to approve or disapprove any
ballot measure or to select any Council or Board member (SMMC
11.04.130); and
Requires committees raising or spending funds to support or oppose an
initiative, recall, or referendum to file financial disclosure documents
electronically with the City Clerk in addition to complying with State law
(SMMC 11.04.165).
Additional information about Santa Monica elections, including campaign disclosure
statements, is available at http://www.smvote.org.
Reporting Violations of State and Local Elections Law
The City of Santa Monica takes seriously any complaint or allegation regarding a
potential violation of state or local election laws. Any member of the public who
believes that a violation has occurred is encouraged to file a complaint or report with the
FPPC Enforcement Division, the Santa Monica City Clerk’s Office, or the Santa Monica
Police Department.
Complaints or reports may be submitted electronically or via email to the FPPC
Enforcement Division by following the directions at
http://www.fppc.ca.gov/enforcement/file-a-complaint.html.
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Complaints or reports may be submitted to the City Clerk’s Office in person in
Room 102 of City Hall or by email at clerk@smgov.net.
Upon receiving a complaint, the FPPC Enforcement Division will investigate and pursue
any alleged violation of the PRA.
The Santa Monica City Clerk also receives complaints and reports of election law
violations. The City Clerk does not investigate such complaints or reports but is
required to report any apparent violation of the law to the appropriate enforcement
agency. Per the procedure specified by the PRA and the FPPC, an apparent violation
exists if the City Clerk knows or has reason to believe that a statement contains material
inaccuracies or omissions, or when a filer fails to file all or part of a statement after
reasonable notice has been provided.
Upon receiving a complaint or report of an alleged violation of the PRA or the Santa
Monica Elections Code, the City Clerk will notify a candidate or committee of the
complaint and request a response. Following two such notifications, if the City Clerk
knows or has reason to believe that a campaign statement has inaccuracies or
omissions that constitute an apparent violation of state or local law, or that state or local
law has otherwise been violated, the City Clerk will report the potential violations to
appropriate authorities, including the FPPC and/or the Chief of the Criminal Division of
the City Attorney’s Office. Upon receiving any such report, the Chief of the Criminal
Division of the City Attorney’s Office will determine whether conflict-of-interest concerns
(actual or apparent) require a referral to the Los Angeles County District Attorney’s
Office or another City Attorney’s Office for investigation and potential prosecution. To
avoid any conflict-of-interest concerns (actual or apparent), the Chief of the Criminal
Division will operate independently from and not confer with the City Attorney in
conducting any investigation or prosecution of an alleged or apparent violation of the
Santa Monica Elections Code.
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The FPPC Enforcement Division’s Investigation of The Huntley Hotel, Richardson
Patel, and Pure Pilates, Inc. In August 2017, the FPPC published its meeting agenda
containing two enforcement items relating to activity in Santa Monica.
In the Matter of The Huntley Hotel; FPPC No. 15/246. Staff: Commission
Counsel Michael W. Hamilton, Special Investigator Ann Flaherty, and Special
Investigator Marshall Miller. The Huntley Hotel, a luxury hotel in Santa Monica,
made contributions in the names of others instead of its own legal name to
support candidates for Santa Monica City Council. In 2012, The Huntley Hotel
made the following contributions in the names of others instead of its own legal
name: nine contributions to Terry O’Day for City Council 2012, nine contributions
to Gleam Davis for City Council 2012, eleven contributions to Richard McKinnon
for City Council 2012, eleven contributions to Ted Winterer for City Council 2012,
and four contributions to Santa Monicans for Responsible Growth, totaling
$86,650; in violation of Government Code Section 84301 (44 counts). From 2013
through 2015, The Huntley Hotel made the following contributions in the names
of others instead of its own legal name: one contribution to Santa Monicans for
Renters Rights, one contribution to Santa Monica Coalition for a Livable City and
sixteen contributions to McKinnon for City Council 2014, totaling $10,700; in
violation of Government Code Section 84301 (18 counts). Total Proposed
Penalty: $310,000.
In the Matter of Richardson Patel and Pure Pilates, Inc.; FPPC No.
17/00182. Staff: Commission Counsel Michael W. Hamilton, Special Investigator
Ann Flaherty, and Special Investigator Marshall Miller. Richardson Patel was a
law firm located in Los Angeles, CA until it merged with another law firm in 2015.
Pure Pilates, Inc. is a Pilates studio located in Encino, CA. In 2012, Richardson
Patel acted as an agent for The Huntley Hotel by making a $10,000 contribution
to Santa Monicans for Responsible Growth in the name of Pure Pilates without
disclosing the identity of the true donor, in violation of Government Code Section
84302 (1 count). Pure Pilates acted as an intermediary of The Huntley Hotel and
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failed to disclose the original contributor information for the $10,000 contribution
to Santa Monicans for Responsible Growth, in violation of Government Code
Section 84302 (1 count). Total Proposed Penalty: $10,000.
At the FPPC’s public hearing on August 17, 2017, Enforcement Division staff shared the
following additional information about the investigation that led to these findings and
proposed penalties:
The Enforcement Division’s investigation did not result from a complaint or a tip.
Rather, the investigation resulted from proactive review by the Enforcement
Division of contribution data.
The Enforcement Division has developed its own internal tools for identifying
violations of the Political Reform Act. These tools include gathering contribution
data from jurisdictions across the State that have adopted local campaign
contribution limits. After collecting such data, the Enforcement Division uses a
spreadsheet to identify noteworthy patterns of contributions; these patterns
include multiple contributions from the same employer, from the same address,
and/or from large numbers of unemployed individuals.
The Enforcement Division’s investigation began with the identification of
noteworthy contributions using this technique. The Enforcement Division then
continued its investigation for approximately two years before issuing its findings
and entering stipulated judgments with The Huntley Hotel, Richardson Patel and
Pure Pilates, Inc.
The stipulated agreements included all of the violations that the FPPC had
evidence to prove based on its two-year investigation.
It is the standard practice of the Enforcement Division to automatically refer any
potentially criminal conduct uncovered during an investigation to relevant criminal
authorities, including the District Attorney’s Office, the Attorney General’s Office,
and the U.S. Attorney’s Office.
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A recording of the August 17, 2017, hearing is available at:
http://www.fppc.ca.gov/about-fppc/hearings-meetings-workshops/current-agenda/past-
agendas/2017-agendas/aug-2017-agenda.html.
The FPPC Enforcement Division did not alert the City of Santa Monica regarding its
investigation while the investigation was ongoing. Rather, the City learned about the
investigation and violations through the FPPC August 2017 agenda and related news
reports.
Following approval, the FPPC implemented the proposed penalties, which were among
the largest in its history, through stipulation agreements with The Huntley Hotel,
Richardson Patel and Pure Pilates, Inc. The stipulated judgments are attached.
(Attachment A and Attachment B)
Local Response to the FPPC Investigation
Council, community groups, and concerned members of the public have asked whether
local enforcement efforts should now be taken in regard to potential related violations of
local election law revealed by the FPPC investigation. Some have suggested that an
independent counsel should be appointed to investigate the matter.
In considering whether local action is necessary following the FPPC’s investigation, one
must keep in mind that enforcement mechanisms are intentionally redundant. Just as
federal and state prosecutors have authority to prosecute the same conduct, but rarely
do, state and local enforcement mechanisms are intentionally redundant to ensure
effective enforcement of the law. Specifically, in deciding the best course for pursuing
an enforcement matter, three considerations arise. First, enforcement investigations
are often undermined when multiple agencies investigate the same matter
simultaneously. Decisions as to which witnesses to interview, when, and with what
information, are strategic considerations that can be undermined when enforcement
work is unnecessarily duplicative. Here, the FPPC may not have alerted local
authorities based on a determination that a simultaneous local investigation would
undermine its efforts. Second, enforcement agencies must consider whether the
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interests of various entities will be vindicated. Here, the FPPC may have determined
that local interests would be vindicated by the substantial fines imposed and public
attention paid to its ultimate findings and penalties. Third, where vigorous, thorough,
and complete, state agency investigation may be preferable to local investigation in
order to avoid conflict-of-interest concerns and/or the appearance of bias.
In light of the seriousness of the violations, members of the public have asked whether
criminal investigation is appropriate. Santa Monica Municipal Code Chapter 11
provides that it is a misdemeanor offense for any person to contribute more than $340
to any candidate for office or to the controlled committee of any candidate in a local
election. Misdemeanor offenses, however, are subject to a one-year statute-of-
limitations; this statute-of-limitations had already passed with respect to the relevant
conduct when the FPPC announced its investigation, findings, and stipulated judgments
in August 2017. The Los Angeles County District Attorney’s Office would be
responsible for investigating and pursuing any potential felony criminal activity. The City
Attorney’s Office has confirmed that the Los Angeles District Attorney’s Office is aware
of the FPPC’s investigation and findings. The FPPC has also stated publicly that it
automatically refers any potential criminal conduct to appropriate authorities, including
district attorneys’ offices. The relevant criminal enforcement authority is therefore
aware of the conduct and capable of conducting further investigation, should such
investigation be appropriate.
Questions have also arisen regarding whether the candidates who received the
contributions described above were aware that the contributions had been made
unlawfully in names other than those of the true contributor. The FPPC stipulations in
this matter give no such indication. The FPPC had authority to investigate and find
violations based on knowing receipt of unlawful contributions if any candidate was so
aware. Specifically, California Government Code Section 84211 requires candidates
and committees to accurately report contributions received. The FPPC has imposed
penalties on candidates and committees for failure to accurately report contributions in
other, similar enforcement matters.
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Potential Enhancements to Enforcement Options
The FPPC investigation described above was a proactive, thorough investigation
conducted by the FPPC independently, without notice to the City of Santa Monica.
Nonetheless, in light of the investigation and violations, Council directed staff to present
options for enhancing enforcement of the Santa Monica Elections Code. Staff offers the
following options for Council’s consideration and direction.
1. Enhance Collaboration with the FPPC for Enforcement of Local Election Laws
In recent years, the FPPC and various local government entities have taken steps to
enhance collaboration in enforcement of election laws. The following options now exist
for seeking further cooperation:
a. The City could seek state legislation expressly authorizing the FPPC to
enforce provisions of the Santa Monica Elections Code. California
Government Code Sections 83123.5, 83123.6, and 83123.7 now expressly
authorize the FPPC to act as the civil prosecutor responsible for enforcing
local campaign reform ordinances adopted by San Bernardino County,
Stockton, and Sacramento. These provisions required enactment by the
California Legislature and come into effect upon mutual agreement between
the FPPC and the local government entity, pursuant to which agreement the
local government entity typically reimburses all costs.
b. Council could authorize the City to support introduction of legislation
amending the FPPC to allow any local entity to contract with the FPPC for
enforcement of local law. Such legislation has been previously introduced in
the Assembly and Senate but has not passed. No such bill is currently
pending.
c. The Council could adopt a resolution authorizing the City Clerk and City
Attorney formally to request that the FPPC communicate and coordinate with
the Los Angeles County District Attorney’s Office and/or the Criminal Division
of the City Attorney’s Office in sufficient time to allow for prosecution
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whenever an FPPC investigation involves potential criminal violations of the
Santa Monica Elections Code as well as the PRA.
2. Establish Reciprocity with a Local City Attorney’s Office to Ensure Effective
Enforcement of Campaign Finance Laws
The Los Angeles County District Attorney’s Office has the resources, ability, and
jurisdiction to prosecute criminal election violations, under state or local law. Concerns
may be raised, however, about whether the District Attorney’s Office will be willing to
prioritize misdemeanor violations of local elections law. To resolve this concern,
Council could direct staff to explore reciprocity arrangements with one or more local
prosecutors for misdemeanor prosecutions of local election law. Such an arrangement
could be established, for example, with the City of Burbank, Long Beach, Los Angeles,
Pasadena, or Torrance, providing a streamlined referral option should a situation arise
where misdemeanor prosecution may be appropriate but investigation within the Santa
Monica City Attorney’s Office may pose conflict-of-interest concerns or create the
appearance of bias.
3. Explore Creation of an Election Law Commission
Council could explore creation of an enforcement commission. Six charter cities
(Berkeley, Los Angeles, Oakland, San Francisco, San Jose, and Simi Valley) have
established local commissions with some authority to enforce local election laws. While
intuitively appealing, such Commissions lack the training and experience of career
prosecutors and require appointment by City officials, reducing the ability to remove any
appearance of bias. In Berkeley, for example, each Councilmember appoints one
member of the independent ethics commission. Staff would not recommend such an
option based on the importance of upholding the reality as well as the perception of
impartiality in administering election law.
Enhancements to Campaign Finance Law
Council directed the City Attorney’s Office to consider potential improvements to Santa
Monica campaign finance law, including public financing of elections. Santa Monica has
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historically adopted strong campaign finance laws and practices, including local
contribution limits, the posting of candidate and committee disclosure statements online,
and public subsidization of election-material fees. Staff nonetheless presents the
following options for consideration:
1. Seek Public Comment on the Costs and Benefits of Public Campaign Financing
Public financing programs typically (a) replace private contributions with public grants,
(b) use public funds to match private contributions made by small donors, or (c) offer
discounted advertising rates or waived election-material fees for qualified candidates.
The California Supreme Court has held that public financing programs in charter cities
are lawful, but the impact of such programs has been limited by United States Supreme
Court decisions holding that such programs can only be adopted on a voluntary basis,
leaving open candidates’ option to fundraise using traditional methods from private
sources. Based on this limitation and expense, contribution limits are the norm, while
public financing programs are the exception.
Four of the ten largest cities in California – Long Beach, Los Angeles, Oakland, and San
Francisco – have some form of a public financing grant or matching program in effect.
In smaller cities, Richmond voters adopted a public matching program in 2012, and
Berkeley voters did so in 2016. Governor Brown signed a law in 2016 that would have
allowed public financing of state and general law city elections. The law has been
invalidated, however, by a court as in conflict with Proposition 73, a 1988 ballot
measure that barred public funding of state and general law city campaigns. Litigation
is ongoing.
The key to effective public campaign financing programs utilizing grants or matching
funds is to appropriately balance qualification thresholds, matching amounts, and
expenditure limits such that multiple candidates opt-in and vigorous public debate over
issues of public concern ensues. In Los Angeles, for example, City Council candidates
must meet significant thresholds of voter signatures or contributions in order to
participate; matching funds are available at a ratio of up to 4:1 in the general election;
and matching funds are only available to candidates who agree to limit expenditures to
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$408,000. Candidates in Los Angeles often participate in the public financing program.
By contrast, matching programs adopted by the voters in Long Beach and Oakland
have been under-utilized and criticized as providing inadequate matching ratios (1:2 and
1:1, respectively, for general elections) to incentivize candidates to participate. In 2016,
Berkeley adopted a public finance program with a 6:1 matching ratio. While options for
funding include a special tax, most cities discussed use general fund resources to fund
a special trust account in order to provide campaign matching funds.
Because public finance grant or matching programs must utilize a certain level of
matching ratio to be potentially effective, the programs require substantial resources
and community input is essential. Should Council wish to receive more information
about public financing programs, staff recommends that Council direct staff to develop a
plan for soliciting public input on anticipated costs and benefits of campaign finance
programs.
Notably, Santa Monica already utilizes the third type of public campaign finance
mentioned above, in that the City does not charge filing fees for voter-initiated petitions,
including initiatives and charter amendments, nor does it charge a filing fee for
candidates running for City office. In addition, the City pays for all candidate election
costs related to the printing, translating, handling and mailing of the candidate statement
which is included in the City’s voter information pamphlet that is mailed to each
registered voter. Because the City of Santa Monica pays for all candidate statement
costs, and has paid them since at least 1974, during every election all
candidates have chosen to file a candidate statement, and to have it translated into
Spanish and printed in the voter information pamphlet.
2. Increasing or Eliminating Campaign Contribution Limits
Staff has previously suggested increasing or eliminating campaign contribution limits.
The majority of local jurisdictions in California do not have campaign contribution limits;
and, as explained in previous reports, the courts invalidate limits that are so low as to
interfere with a candidate's ability to communicate her or his views. In 2011, Council
raised contribution limits to $325, with Consumer Price Indexing every five years on a
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simple basis. The contribution limit is currently $340. According to Common Cause, in
2016, the lowest city contribution limit was $100 (Davis, Del Mar, Galt, Poway, Scotts
Valley), whereas the largest limit was $4,200 (Fresno). The average (median)
contribution limit was $500.
3. Community Education Regarding Election Laws
Finally, in connection with the news regarding the FPPC investigation, one member of
the community has raised a concern about candidates in Santa Monica elections
receiving unlawful in-kind contributions from supporters. Most nonmonetary
contributions valued at $25 or more must be reported as campaign contributions. An
FPPC information sheet regarding in-kind contributions is attached to this staff report.
FPPC has made available the attached information sheet regarding contributions.
(Attachment C)
The City Clerk currently invites neighborhood organizations and the general public to its
FPPC Candidate/Treasurer Workshop, where state and local laws are addressed. This
event will take place in August 2018. Council could direct the City Clerk to promote this
event to the public more broadly and to display FPPC guidance materials more
prominently on smvote.org.
Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the
recommended action.
Prepared By: Lane Dilg, City Attorney
Approved
Forwarded to Council
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Attachments:
A. Local Election Laws - Attachment A - Huntley Hotel Stipulated Judgment -
August 2017
B. Local Elections Laws - Attachment B - Richardson Patel and Pure Pilates Inc.
Stipulated Judgment - August 2017
C. Local Elections Laws - Attachment C - FPPC Contributions Information
D. Written Comments
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
GALENA WEST
Chief of Enforcement
MICHAEL W. HAMILTON
Commission Counsel
Fair Political Practices Commission
428 J Street, Suite 620
Sacramento, CA 95814
Telephone: (916) 322-5772
Facsimile: (916) 322-1932
Attorneys for Complainant
BEFORE THE FAIR POLITICAL PRACTICES COMMISSION
STATE OF CALIFORNIA
In the Matter of:
THE HUNTLEY HOTEL,
Respondent.
FPPC Case No. 15/246
STIPULATION, DECISION AND ORDER
INTRODUCTION
Respondent the Huntley Hotel (“The Huntley”) is a luxury hotel located in Santa Monica,
California.
The Political Reform Act (the “Act”)1 prohibits contributions made in the name of another. The
Huntley made 62 campaign contributions totaling $97,350 in the names of other people to various
candidate controlled committees and general purpose committees over the course of two local election
cycles.
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1 The Act is contained in Government Code sections 81000 through 91014. All statutory references are to the
Government Code, unless otherwise indicated. The regulations of the Fair Political Practices Commission are contained in
Sections 18110 through 18997 of Title 2 of the California Code of Regulations. All regulatory references are to Title 2,
Division 6 of the California Code of Regulations, unless otherwise indicated.
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
SUMMARY OF THE LAW
Need for Liberal Construction and Vigorous Enforcement of the Political Reform Act
When enacting the Political Reform Act, the people of California found and declared that
previous laws regulating political practices suffered from inadequate enforcement by state and local
authorities.2 For this reason, the Act is to be construed liberally to accomplish its purposes.3
One purpose of the Act is to promote transparency by ensuring that receipts and expenditures in
election campaigns are fully and truthfully disclosed so that voters are fully informed and improper
practices are inhibited.4 Along these lines, the Act includes a comprehensive campaign reporting
system—and the true sources of campaign contributions may not be concealed.5 Another purpose of the
Act is to provide adequate enforcement mechanisms so that the Act will be “vigorously enforced.”6
Prohibition Against Making Contributions in the Name of Another
No campaign contribution may be made in the name of another person.7 This prohibition helps
keep the public informed as to the actual sources of campaign contributions—and helps to prevent
circumvention of campaign contribution limits. When a person makes a contribution on behalf of
another, that person’s intermediary relationship with the actual contributor must be disclosed to the
recipient of the contribution—and the recipient’s campaign filings must disclose both by the intermediary
and the actual contributor.8
SUMMARY OF THE FACTS
The Huntley is located on 2nd Street in Santa Monica, California, directly behind the Fairmont
Miramar Hotel (the “Miramar”). The Huntley is owned and operated by the 2nd Street Corporation.
Sohrab Sassounian (“Sassounian”) is the co-owner of 2nd Street Corporation and is the President/General
Manager of The Huntley Hotel. Manju Raman (“Raman”) has served as The Huntley’s Assistant
General Manager since 1998. In 2012, the Miramar was actively pursuing plans before the Planning
2 Section 81001, subdivision (h).
3 Section 81003.
4 Section 81002, subdivision (a).
5 Sections 84200, et seq. and 84301.
6 Section 81002, subdivision (f).
7 Section 84301.
8 Section 84302.
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
Commission of Santa Monica that involved a significant expansion and redevelopment of its property,
constructing three new buildings (including a 21-story high-rise tower), adding private condominiums,
affordable housing, and commercial development to the existing hotel facilities, and more than doubling
the Miramar’s above grade floor area. As did many other businesses and residents in the immediate
neighborhood and throughout the city, The Huntley took issue with the Miramar’s proposed expansion,
primarily due to its adverse impacts on local traffic, its blocking of the sunlight and views of adjacent and
nearby buildings, and the disruption to the quality of life that would be caused by its lengthy construction
timetable.
The Huntley had not previously been involved in local land use controversies or governmental
advocacy, so shortly after the Miramar’s expansion plans were announced, The Huntley retained a
prominent Los Angeles law firm with extensive land use and government relations experience, Latham &
Watkins, to advise it with respect to opposing the Miramar’s proposal before the Santa Monica Planning
Commission and City Council. One of the law firm’s initial recommendations was for The Huntley to
select an individual who would serve as a liaison with other interested community members and who
could represent the hotel in helping to organize the community’s opposition to the Miramar project and
in communicating with the relevant governmental personnel. The Huntley selected Raman to be its
liaison with the law firm, the city’s agencies, and the community, even though she had no previous
experience in performing these functions.
Upon the recommendation of the Latham & Watkins attorneys, the Huntley also agreed to hire
Susan Burnside (“Burnside”), a local political consultant, to assist in organizing and coordinating the
community’s opposition to the Miramar project, with Raman also serving as The Huntley’s liaison to
Burnside, even though Raman had no prior political or campaign experience. Burnside planned to
achieve this objective by organizing and advising a coalition of residents that shared The Huntley’s
concerns about the Miramar’s expansion, which was called Santa Monicans Against Miramar Expansion
(the “Coalition”). The Coalition met approximately monthly, generally at The Huntley’s facilities.
In August of 2012, Burnside and two local residents, Ivan Perkins and Susan Scarafia, opened a
political committee named Santa Monicans for Responsible Growth (the “Committee”). The purpose of
the Committee was to provide the Coalition with a vehicle to support candidates in Santa Monica who
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
favored a slow-growth position with respect to development in downtown Santa Monica and who might
be expected to oppose the Miramar’s significant expansion proposal. Raman as The Huntley’s liaison to
Burnside, was aware of the Committee’s activities, but played no active role in its management.
Santa Monica holds its regular municipal elections in November of even-numbered years.
According to Raman, sometime in the late Summer or Fall of 2012, The Huntley’s attorneys suggested to
Raman that the hotel should try to raise approximately $10,000 to support two City Council candidates,
Richard McKinnon and Ted Winterer, who were running on a slow-growth platform. The attorneys also
suggested raising a lesser amount, $5,000, for each of the two incumbent councilmembers who were
running for re-election, Terry O’Day and Gleam Davis. The attorneys explained that The Huntley should
collect checks for the campaign contributions from different individuals and present them together to the
candidates. According to Raman, she had not previously made or raised campaign contributions and was
not personally familiar with all of the applicable campaign finance rules and restrictions. Raman
solicited contributions from various individuals, including Sassounian’s relatives, friends and associates,
but when she realized that she was falling short of the assigned goals, she asked several hotel employees
and their spouses if they could write checks to the candidates and offered to reimburse them for their
contributions. All the contributions made by The Huntley through these intermediaries were either the
maximum contribution limit in Santa Monica of $325, or the maximum of $250 that a person could
contribute to a candidate serving on a planning commission when the person has business before the
planning commission.9 The Huntley, through Raman, reimbursed these intermediaries for making the
contributions. These contributions were reported on campaign statements filed by the candidates.
However, the individual intermediaries were reported as the contributors, and The Huntley was not
identified as the true source of the contributions. In total, The Huntley reimbursed forty contributions
totaling $11,650 to the above-named candidates. Each of those contributions is detailed in the chart
below.
Around this same time period in September of 2012, The Huntley’s attorneys and Burnside
informed Raman that they needed to quickly raise about $75,000 to $100,000 for the Committee, which
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
the Committee planned to use for independent expenditures in the November election. According to
Raman, Burnside and the attorneys suggested that it would be best if the funding could come from a
broader segment of the community, not just from The Huntley, so that it reflected the broader
community’s opposition to Miramar’s development proposal. Raman contends she did not know whom
she could turn to outside of The Huntley in order to raise that amount of money, and she was not
comfortable asking others for large sums of money. Instead, Raman’s immediate reaction was to think of
who, among those who opposed the Miramar’s expansion project, might be willing to put their name on a
check and be reimbursed for their contribution by The Huntley. Raman approached Louretta Walker
(“Walker”), a friend and the owner of Body Z Alive, which is located adjacent to The Huntley. Raman
asked Walker to make a $15,000 campaign contribution in the name of Body Z Alive to the Committee
with the understanding that The Huntley would give her the money to make the contribution. In order to
secure payment from The Huntley, Raman helped to prepare three invoices in the name of Body Z Alive
for $5,000 each. The invoices to The Huntley were dated for September 16, 2012, September 17, 2012,
and September 18, 2012 and were described as for meditation services, even though no services were
actually provided. On October 16, 2012, The Huntley issued three checks of $5,000 apiece to Walker,
and on that same date, Walker wrote a check for $15,000 to the Committee. Walker’s contribution was
reported on campaign statements filed by the Committee with Body Z Alive reported as the contributor.
The Huntley was not identified as the true source of the $15,000 contribution.
In October of 2012, Raman approached Nimish Patel (“Patel”), a friend and long-time business
counsel for The Huntley, to ask if Patel’s firm, Richardson Patel, could make a $10,000 campaign
contribution to the Committee in the name of Richardson Patel with the understanding that The Huntley
would give it the money to make the contribution. On October 15, 2012, Richardson Patel invoiced The
Huntley $20,000, of which $10,000 was for the firm’s monthly retainer and the additional $10,000 was to
constitute payment for the contribution. On October 16, 2012, The Huntley issued a check for $10,000 to
Richardson Patel for the contribution to the Committee. On October 18, 2012, Doug Gold, Chief
Financial Officer of the law firm, wrote a check for $10,000 to the Committee. Gold wrote the check
from a checking account belonging to Pure Pilates, a business owned by Gold’s wife, Amanda Gold. On
October 19, 2012, Richardson Patel wire transferred $10,000 to Pure Pilates with the description reading,
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
“expense reimbursement.” The $10,000 contribution was reported on campaign statements filed by the
Committee with Pure Pilates reported as the contributor. The Huntley was not identified as the true
source of the $10,000 contribution, nor was Richardson Patel identified as an intermediary. Neither
Raman nor anyone else at The Huntley was aware at the time how Richardson Patel intended to make the
contribution to the Committee.
Around the same time Raman secured the contributions from Body Z Alive and Richardson Patel,
Raman also asked Chris Sennings (“Sennings”), a friend and the owner of Playground Consulting, The
Huntley’s long-time Information Technology consultant, to make a campaign contribution of $50,000 to
the Committee with the understanding that The Huntley would give Sennings the money to make the
contribution. Sennings sent four invoices to The Huntley for a total of $50,025 worth of work he did not
perform. On October 12, 2012, The Huntley issued a check to Playground Consulting for $50,025. On
that same date, Sennings signed a check for $25,000 on behalf of Playground Consulting to the
Committee. On October 24, 2012, Sennings signed a second $25,000 check on behalf of Playground
Consulting to the Committee. The Committee reported receiving the contributions from Sennings with
Playground Consulting as the contributor for both contributions. The Huntley was not identified as the
true source of the two contributions totaling $50,000.
The Huntley’s contributions to the Committee were used to make expenditures in support of
Richard McKinnon’s and Ted Winterer’s bids for the Santa Monica City Council. Burnside as the
political consultant for the Committee designed four mailers to support these candidates. On the semi-
annual campaign statement covering the reporting period of October 21, 2012 – December 31, 2012, the
Committee reported making approximately $71,875 in expenditures in support of Winterer and
McKinnon. In 2013, The Huntley also contributed $23,927.36 to Committee in its own name, effectively
paying off the Committee’s debt from the 2012 election.
In total in 2012, The Huntley made 44 contributions that totaled $86,650 in the names of others
rather than its own name.
The Huntley was also involved in making campaign contributions in the name of another during
the 2014 election cycle. The largest such contribution again went through Body Z Alive. Raman asked
Walker if she would make a $5,000 contribution to the Santa Monica Coalition for a Livable City
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
(“SMCLC”), explaining that The Huntley would give her the money to make the contribution. On
September 19, 2014, Walker invoiced The Huntley for $5,000 for services that she did not perform. On
October 16, 2014, The Huntley wrote a check to Body Z Alive for $5,000, and on October 21, 2014,
Walker wrote a check from Body Z Alive’s checking account to SMCLC for $5,000. SMCLC reported
Body Z Alive as the contributor. The Huntley was not identified as the true source of the $5,000
contribution.
In 2015, Raman was asked if she and the Huntley could raise $10,000 to help pay down the
campaign debt of Richard McKinnon, who had run unsuccessfully for election to the Santa Monica City
Council in 2014. According to Raman, as before, she raised what she could from others, but when she
fell short of her goal, she once again offered to reimburse various hotel employees and friends for their
contributions. Those 16 contributions, totaling $5,200, are detailed in the chart below. McKinnon’s
committee reported the intermediaries as the contributors. The Huntley was not identified as the true
source of these contributions.
VIOLATIONS
Counts 1- 62
Counts 1 – 62: Making a Contribution in the Name of Another
The Huntley made the following contributions in the names of other persons in violation of
Government Code section 84301:
COUNT
NAME
DATE CHECK
RECEIVED BY
RECIPIENT
AMOUNT
RECIPIENT
1
Rochelli
Fernandez (Silver)
9/16/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
2 Michelle Sennings 9/18/2012 $325.00 Gleam Davis for City
Council 2012
3 Diane Nomura 9/18/2012 $325.00 Gleam Davis for City
Council 2012
4 Rochelli
Fernandez (Silver)
9/18/2012 $325.00 Gleam Davis for City
Council 2012
5 Manju Raman 9/18/2012 $325.00 Gleam Davis for City
Council 2012
6 Elisa A. Dadian 9/18/2012 $325.00 Gleam Davis for City
Council 2012
7 Mandana Amini 9/18/2012 $325.00 Gleam Davis for City
Council 2012
8 Helal El-Sherif 9/18/2012 $325.00 Gleam Davis for City
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
Council 2012
9
Diane Nomura 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
10 Douglas F. Ewer 9/23/2012 $325.00 Gleam Davis for City
Council 2015
11
Douglas F. Ewer 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
12
Manju Raman 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
13
Elisa A. Dadian 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
14
Jessica E. Perahia, 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
15
Mandana Amini 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
16
Helal El-Sherif 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
17
Michelle Sennings 9/23/2012 $325.00 Re-Elect City
Councilmember Terry
O'Day 2012
18 Jessica E. Perahia, 9/24/2012 $325.00 Gleam Davis for City
Council 2012
19 David Cohen 10/12/2012 $250.00 McKinnon for City
Council 2012
20
Body Z Alive,
Attn Louretta
Walker
10/18/2012 $15,000.00 Santa Monicans for
Responsible Growth
21 Adriana Moreno 10/19/2012 $250.00 McKinnon for City
Council 2012
22 Michelle Sennings 10/19/2012 $325.00 McKinnon for City
Council 2012
23 Rochelli
Fernandez (Silver)
10/19/2012 $250.00 McKinnon for City
Council 2012
24 Elisa A. Dadian 10/19/2012 $250.00 McKinnon for City
Council 2012
25 Rodney Prechel 10/19/2012 $250.00 McKinnon for City
Council 2012
26 Playground
Consulting, Inc.
10/19/2012 $25,000.00 Santa Monicans for
Responsible Growth
27 Manju Raman 10/19/2012 $250.00 McKinnon for City
Council 2012
28 Dillon M Silver
DBA Silver Ent
10/19/2012 $325.00 McKinnon for City
Council 2012
29 Helal M. El-Sherif 10/19/2012 $250.00 McKinnon for City
Council 2012
30 Adrian Perez 10/19/2012 $250.00 McKinnon for City
Council 2012
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STIPULATION, DECISION AND ORDER
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31 Elizabeth Sanchez 10/23/2012 $250.00 McKinnon for City
Council 2012
32 Richardson &
Patel
10/24/2012 $10,000.00 Santa Monicans for
Responsible Growth
33 Michelle Sennings 10/25/2012 $325.00 Ted Winterer for City
Council 2012
34 David Cohen 10/25/2012 $250.00 Ted Winterer for City
Council 2012
35 Rochelli
Fernandez (Silver)
10/25/2012 $250.00 Ted Winterer for City
Council 2012
36 Elisa A. Dadian 10/25/2012 $250.00 Ted Winterer for City
Council 2012
37 Rodney Prechel 10/25/2012 $250.00 Ted Winterer for City
Council 2012
38 Manju Raman 10/25/2012 $250.00 Ted Winterer for City
Council 2012
39 Dillon M Silver
DBA Silver Ent
10/25/2012 $325.00 Ted Winterer for City
Council 2012
40 Helal M. El-Sherif 10/25/2012 $250.00 Ted Winterer for City
Council 2012
41 Adrian Perez 10/27/2012 $250.00 Ted Winterer for City
Council 2012
42 Elizabeth Sanchez 10/29/2012 $250.00 Ted Winterer for City
Council 2012
43 Adriana Moreno 10/30/2012 $250.00 Ted Winterer for City
Council 2012
44 Playground
Consulting, Inc.
11/5/2012 $25,000.00 Santa Monicans for
Responsible Growth
45 Manju Raman 6/29/2013 $500.00 Santa Monicans for
Renters' Rights
46
Body Z Alive,
Attn Louretta
Walker
10/21/2014 $5,000.00 SMCLC – PAC
47 Marschinda Felix 11/18/2015 $325.00 McKinnon for City
Council 2014
48 Linda Jane Miller 11/23/2015 $325.00 McKinnon for City
Council 2014
49 Elisa A. Dadian 11/23/2015 $325.00 McKinnon for City
Council 2014
50 Elizabeth Sanchez 11/23/2015 $325.00 McKinnon for City
Council 2014
51 Manju Raman 11/23/2015 $325.00 McKinnon for City
Council 2014
52 Francisco
Carbajal
11/23/2015 $325.00 McKinnon for City
Council 2014
53 Guillermo R De
La Torre
11/23/2015 $325.00 McKinnon for City
Council 2014
54 Donald W.
Ehehalt
11/23/2015 $325.00 McKinnon for City
Council 2014
55 Akemi S.
Nakamoto
11/23/2015 $325.00 McKinnon for City
Council 2014
56 Jason Zucker 11/23/2015 $325.00 McKinnon for City
Council 2014
57 Diane Nomura 11/23/2015 $325.00 McKinnon for City
Council 2014
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
58 Shemaa Masry 11/23/2015 $325.00 McKinnon for City
Council 2014
59 Asa Nomura,
Allan C. Nomura
11/23/2015 $325.00 McKinnon for City
Council 2014
60 Staci Nakamoto 11/24/2015 $325.00 McKinnon for City
Council 2014
61 Rochelli Silver,
Dillon Silver
11/25/2015 $325.00 McKinnon for City
Council 2014
62 David Cohen 12/23/2015 $325.00 McKinnon for City
Council 2014
TOTAL: $97,350
PROPOSED PENALTY
This matter consists of 62 counts. The maximum penalty that may be imposed is $5,000 per
count. Thus, the maximum penalty that may be imposed is $310,000.10
In determining the appropriate penalty for a particular violation of the Act, the Commission
considers the facts of the case, the public harm involved, and the purposes of the Act. Also, the
Commission considers factors such as: (a) the seriousness of the violation; (b) the presence or absence of
any intention to conceal, deceive or mislead; (c) whether the violation was deliberate, negligent or
inadvertent; (d) whether the violation was isolated or part of a pattern; (e) whether corrective
amendments voluntarily were filed to provide full disclosure; and (f) whether the violator has a prior
record of violations.11 Additionally, the Commission considers penalties in prior cases with comparable
violations.
Making a campaign contribution in the name of another is one of the most serious violations of
the Act. It deceives the public as to the true source of contributions, and as occurred with certain of the
contributions in this case, it allows for the circumvention of local contribution limits. Recent stipulations
show that the Commission views these types of cases as warranting the maximum penalty of $5,000 per
count. For example:
In the Matter of AB&I Foundry, A Division of McWane, Inc., FPPC Case No. 15/74 (approved
on July 21, 2016), the Commission imposed a penalty of $100,000 against AB&I Foundry for laundering
37 contributions through employees and their spouses, totaling $23,900 from 2012 - 2014. For purposes
10 See Section 83116, subdivision (c).
11 Regulation 18361.5, subdivision (d).
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
of settlement and in consideration of mitigating factors, only 20 counts were charged. One of the
mitigating circumstances in this case was that AB&I Foundry cooperated with the Enforcement Division.
This included an immediate admission that the violations occurred – and the disclosure of other
violations that were not yet discovered. Additionally, the respondents did not have a history of violating
the Act.
In the Matter of Moo Han Bae, FPPC Case No. 13/203 (approved on Aug. 20, 2015), the
Commission imposed a penalty of $45,000 against Moo Han Bae for laundering nine contributions that
totaled $10,550. The respondent in this case initially refused to cooperate with the investigation and there
was evidence that the respondent was intimidating witnesses and pressured them to lie about the facts.
In the current case, The Huntley cooperated with the Enforcement Division after retaining
counsel, has conducted its own internal review of the events, and has admitted that the violations
occurred, while disclosing other violations that were not yet discovered. Respondent also has no history
of any prior violations of the Act. Moreover, Raman — who was responsible for making the
reimbursements at issue — contends she had no prior involvement with political campaigns or
fundraising and insists that she did not appreciate the illegality of the reimbursements. While she is now
aware of the law and accepts full responsibility for her prior actions, Raman contends that neither the
attorneys nor the political consultant she worked with had suggested that she was doing anything illegal
at the time, and that her own attorneys participated in one of the reimbursements without objection,
leading her to believe that her actions in reimbursing others’ contributions were not unlawful or
inappropriate.
In other respects, however, there are fewer mitigating circumstances in the current case. The
violations in this case were part of a pattern that took place over two election cycles from 2012 through
2015. The contributions reimbursed by The Huntley concealed the full extent of The Huntley’s financial
support for the Committee and created an impression that the Committee enjoyed broader financial
support. In addition, the number of reimbursements and the amount of money involved is greater here
than in each of these prior cases.
Based on the totality of the circumstances in this matter, the mitigating factors in AB&I Foundry
that justified the consolidation of some counts are overcome by the other circumstances present in this
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
case so that a maximum fine for each count is justified to deter this type of conduct in the future. For the
foregoing reasons, a penalty in the amount of $5,000 per count is recommended for Counts 1 through 62
— for a total administrative penalty in the amount of $310,000.
CONCLUSION
Complainant, the Enforcement Division of the Fair Political Practices Commission, and
Respondent The Huntley hereby agree as follows:
1. Respondent violated the Act as described in the foregoing pages, which are a true and
accurate summary of the facts in this matter.
2. This stipulation will be submitted for consideration by the Fair Political Practices
Commission at its next regularly scheduled meeting—or as soon thereafter as the matter may be heard.
3. This stipulation resolves all factual and legal issues raised in this matter—for the purpose
of reaching a final disposition without the necessity of holding an administrative hearing to determine the
liability of Respondent pursuant to Section 83116.
4. Respondent understands, and hereby knowingly and voluntarily waives, any and all
procedural rights set forth in Sections 83115.5, 11503, 11523, and Regulations 18361.1 through 18361.9.
This includes, but is not limited to the right to appear personally at any administrative hearing held in this
matter, to be represented by an attorney at Respondent’s own expense, to confront and cross-examine all
witnesses testifying at the hearing, to subpoena witnesses to testify at the hearing, to have an impartial
administrative law judge preside over the hearing as a hearing officer, and to have the matter judicially
reviewed.
5. Respondent agrees to the issuance of the decision and order set forth below. Also,
Respondent agrees to the Commission imposing against it an administrative penalty in the amount of
$310,000. One or more cashier’s checks or money orders totaling said amount—to be paid to the
General Fund of the State of California—is/are submitted with this stipulation as full payment of the
administrative penalty described above, and same shall be held by the State of California until the
Commission issues its decision and order regarding this matter.
6. If the Commission refuses to approve this stipulation—then this stipulation shall become
null and void, and within fifteen business days after the Commission meeting at which the stipulation is
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
rejected, all payments tendered by Respondent in connection with this stipulation shall be reimbursed to
Respondent. If this stipulation is not approved by the Commission, and if a full evidentiary hearing
before the Commission becomes necessary, neither any member of the Commission, nor the Executive
Director, shall be disqualified because of prior consideration of this Stipulation.
7. The parties to this agreement may execute their respective signature pages separately. A
copy of any party’s executed signature page including a hardcopy of a signature page transmitted via fax
or as a PDF email attachment is as effective and binding as the original.
Dated: _______________________ ________________________________________
Galena West, Chief of Enforcement
Fair Political Practices Commission
Dated: _______________________
________________________________________
Manju Raman, Assistant General Manager, on behalf of
Respondent The Huntley Hotel.
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STIPULATION, DECISION AND ORDER
FPPC Case No. 15/246
The foregoing stipulation of the parties “In the Matter of The Huntley Hotel,” FPPC Case No.
15/246 is hereby accepted as the final decision and order of the Fair Political Practices Commission,
effective upon execution below by the Chair.
IT IS SO ORDERED.
Dated: ___________________ ________________________________________
Joann Remke, Chair
Fair Political Practices Commission
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STIPULATION, DECISION AND ORDER
FPPC Case No. 17/00182
GALENA WEST
Chief of Enforcement
MICHAEL W. HAMILTON
Commission Counsel
Fair Political Practices Commission
428 J Street, Suite 620
Sacramento, CA 95814
Telephone: (916) 322-5772
Facsimile: (916) 322-1932
Attorneys for Complainant
BEFORE THE FAIR POLITICAL PRACTICES COMMISSION
STATE OF CALIFORNIA
In the Matter of:
RICHARDSON PATEL AND PURE
PILATES, INC,
Respondents.
FPPC Case No. 17/00182
STIPULATION, DECISION AND ORDER
INTRODUCTION
Respondent Richardson Patel (the “law firm”) was a law firm located in Los Angeles until it
merged with another law firm in 2015. Pure Pilates, Inc. is a Pilates studio located in Encino. The
Political Reform Act (the “Act”)1 requires an intermediary of a campaign contribution to disclose the true
source of the contribution. The law firm and Pure Pilates acted as intermediaries of a contribution
without disclosing the true source of the contribution to the recipient.
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1 The Act is contained in Government Code sections 81000 through 91014. All statutory references are to the
Government Code, unless otherwise indicated. The regulations of the Fair Political Practices Commission are contained in
Sections 18110 through 18997 of Title 2 of the California Code of Regulations. All regulatory references are to Title 2,
Division 6 of the California Code of Regulations, unless otherwise indicated.
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STIPULATION, DECISION AND ORDER
FPPC Case No. 17/00182
SUMMARY OF THE LAW
Need for Liberal Construction and Vigorous Enforcement of the Political Reform Act
When enacting the Political Reform Act, the people of California found and declared that
previous laws regulating political practices suffered from inadequate enforcement by state and local
authorities.2 For this reason, the Act is to be construed liberally to accomplish its purposes.3
One purpose of the Act is to promote transparency by ensuring that receipts and expenditures in
election campaigns are fully and truthfully disclosed so that voters are fully informed and improper
practices are inhibited.4 Along these lines, the Act includes a comprehensive campaign reporting
system—and the true sources of campaign contributions may not be concealed.5 Another purpose of the
Act is to provide adequate enforcement mechanisms so that the Act will be “vigorously enforced.”6
Contributions by an Intermediary or Agent
No person may make a contribution on behalf of another, or while acting as the intermediary or
agent of another, without disclosing to the recipient of the contribution both the identity of the
contributor and the intermediary.7
SUMMARY OF THE FACTS
The Huntley Hotel (“The Huntley”) is located on 2nd Street in Santa Monica directly behind the
Fairmont Miramar (the “Miramar”). In 2012, The Huntley, along with many other businesses and
residents in the neighborhood and in the City of Santa Monica, took issue with the plans that were
submitted by the Miramar to the Santa Monica Planning Commission, which contained proposals that
would significantly expand the existing structure of the Miramar hotel. The Huntley took issue with the
expansion primarily due to its adverse impacts on local traffic, its blocking of the sunlight and views of
adjacent or nearby buildings, and the disruption to the quality of life that would be caused by its lengthy
construction timetable.
2 Section 81001, subdivision (h).
3 Section 81003.
4 Section 81002, subdivision (a).
5 Sections 84200, et seq. and 84301.
6 Section 81002, subdivision (f).
7 Section 84302.
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STIPULATION, DECISION AND ORDER
FPPC Case No. 17/00182
In October 2012, Manju Raman (“Raman”), Assistant General Manager of The Huntley,
approached Nimish Patel (“Patel”), a partner at the law firm which was serving as The Huntley’s
business counsel, to ask that the law firm to make a $10,000 campaign contribution to a political
committee, Santa Monicans for Responsible Growth (“SMRG”), with the understanding that The
Huntley would give it the money to make the contribution. On October 12, 2012, the law firm invoiced
The Huntley $20,000, of which $10,000 represented a retainer for the month of October and $10,000 for
the reimbursement of the contribution. On October 16, 2012, Sohrab Sassounian, President/General
Manager of The Huntley, signed a check for $10,000 to the law firm for the reimbursement of the
contribution. On October 18, 2012, Doug Gold, Chief Financial Officer (“CFO”) of the law firm and
husband of Pure Pilates owner Amanda Gold, wrote a check for $10,000 from Pure Pilates to SMRG. On
October 19, 2012, the law firm made a $10,000 wire transfer to Pure Pilates to reimburse Pure Pilates for
writing the contribution check to SMRG. SMRG reported receiving the contribution from Pure Pilates on
October 24, 2012. The Huntley was never reported by the intermediaries as being the true source of the
contribution.
VIOLATIONS
Count 1 – Failure to Disclose Original Contributor Information
The law firm, in October 2012, while acting as an agent for The Huntley Hotel, made a $10,000
contribution to Santa Monicans for Responsible Growth in the name of Pure Pilates and did not disclose
the identity of the true donor, The Huntley, to Santa Monicans for Responsible Growth, in violation of
Government Code section 84302.
Count 2 – Failure to Disclose Original Contributor Information
Pure Pilates, in October 2012, while acting as an intermediary of The Huntley Hotel, failed to
disclose the original contributor information for a $10,000 contribution from The Huntley Hotel to Santa
Monicans for Responsible Growth, in violation of Government Code section 84302.
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STIPULATION, DECISION AND ORDER
FPPC Case No. 17/00182
PROPOSED PENALTY
This matter consists of 2 counts of violating the Act. The maximum penalty that may be imposed
is $5,000 per count. Thus, the maximum penalty that may be imposed is $10,000.8
In determining the appropriate penalty for a particular violation of the Act, the Commission
considers the facts of the case, the public harm involved, and the purposes of the Act. Also, the
Commission considers factors such as: (a) the seriousness of the violation; (b) the presence or absence of
any intention to conceal, deceive or mislead; (c) whether the violation was deliberate, negligent or
inadvertent; (d) whether the violation was isolated or part of a pattern; (e) whether corrective
amendments voluntarily were filed to provide full disclosure; and (f) whether the violator has a prior
record of violations.9 Additionally, the Commission considers penalties in prior cases with comparable
violations.
Recent stipulations show that the Commission views these types of cases as warranting the
maximum penalty.
In the Matter of Stanislaus Republican Central Committee and Gary McKinsey, FPPC Case No.
16/178 (approved Mar. 17, 2016), the Commission imposed a penalty of $5,000 against the respondents
because it failed to disclose its intermediary information as well as the original contributor information.
Failing to report intermediary and original contributor information is one of the most serious
violations of the Act because such conduct deceives the public as to the true source of the funds. In this
case, The Huntley deprived the public of the opportunity to learn the true source of the contribution by
using the law firm as the intermediary. The law firm took this a step further by using Pure Pilates as the
second intermediary, effectively creating two layers to separate the contribution from its true source.
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8 See Section 83116, subdivision (c).
9 Regulation 18361.5, subdivision (d).
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STIPULATION, DECISION AND ORDER
FPPC Case No. 17/00182
CONCLUSION
Complainant, the Enforcement Division of the Fair Political Practices Commission, and
Respondents Richardson Patel and Pure Pilates hereby agree as follows:
1. Respondents violated the Act as described in the foregoing pages, which are a true and
accurate summary of the facts in this matter.
2. This stipulation will be submitted for consideration by the Fair Political Practices
Commission at its next regularly scheduled meeting—or as soon thereafter as the matter may be heard.
3. This stipulation resolves all factual and legal issues raised in this matter—for the purpose
of reaching a final disposition without the necessity of holding an administrative hearing to determine the
liability of Respondent pursuant to Section 83116.
4. Respondents understand, and hereby knowingly and voluntarily waives, any and all
procedural rights set forth in Sections 83115.5, 11503, 11523, and Regulations 18361.1 through 18361.9.
This includes, but is not limited to the right to appear personally at any administrative hearing held in this
matter, to be represented by an attorney at Respondent’s own expense, to confront and cross-examine all
witnesses testifying at the hearing, to subpoena witnesses to testify at the hearing, to have an impartial
administrative law judge preside over the hearing as a hearing officer, and to have the matter judicially
reviewed.
5. Respondents agree to the issuance of the decision and order set forth below. Also,
Respondents agrees to the Commission imposing against it an administrative penalty in the amount of
$10,000. One or more cashier’s checks or money orders totaling said amount—to be paid to the General
Fund of the State of California—is/are submitted with this stipulation as full payment of the
administrative penalty described above, and same shall be held by the State of California until the
Commission issues its decision and order regarding this matter.
6. If the Commission refuses to approve this stipulation—then this stipulation shall become
null and void, and within fifteen business days after the Commission meeting at which the stipulation is
rejected, all payments tendered by Respondents in connection with this stipulation shall be reimbursed to
Respondents. If this stipulation is not approved by the Commission, and if a full evidentiary hearing
before the Commission becomes necessary, neither any member of the Commission, nor the Executive
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STIPULATION, DECISION AND ORDER
FPPC Case No. 17/00182
Director, shall be disqualified because of prior consideration of this Stipulation.
7. The parties to this agreement may execute their respective signature pages separately. A
copy of any party’s executed signature page including a hardcopy of a signature page transmitted via fax
or as a PDF email attachment is as effective and binding as the original.
Dated: _______________________ ________________________________________
Galena West, Chief of Enforcement
Fair Political Practices Commission
Dated: _______________________
________________________________________
Nimish Patel, on behalf of Richardson & Patel.
Dated: _______________________
________________________________________
Doug Gold, on behalf of Pure Pilates.
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STIPULATION, DECISION AND ORDER
FPPC Case No. 17/00182
The foregoing stipulation of the parties “In the Matter of Richardson Patel and Pure Pilates, Inc.,”
FPPC Case No. 17/00182 is hereby accepted as the final decision and order of the Fair Political Practices
Commission, effective upon execution below by the Chair.
IT IS SO ORDERED.
Dated: ___________________ ________________________________________
Joann Remke, Chair
Fair Political Practices Commission
Fair Political Practices Commission
advice@fppc.ca.gov
Chapter 2. 1 Campaign Manual 5
June 2016
Contributions
This chapter begins with a discussion of common types of
contributions and includes information on the state contribution limits.
A . What is a Contribution?
A contribution is a monetary or nonmonetary payment made to a
candidate or committee for which the candidate or committee has not
provided full and adequate consideration in return. A contribution may
take any of the following forms:
• Money (cash, check, credit card, wire transfers)
• Loans (including loan guarantees, co-signing, lines of credit,
and forgiveness of a loan)
• Tickets to political fundraisers (full value of the ticket)
• Nonmonetary items (donated goods or services)
• Enforceable promises
Common types of nonmonetary contributions include:
Staff: If a business donates the use of an employee to work on
a campaign, the amount the individual is paid for working on the
campaign is a nonmonetary contribution if the employee spends
more than 10 percent of his or her compensated time in a calendar
month working on campaign activity for any number of candidates or
committees. The amount is the pro-rata portion of the gross salary
attributed to political activity. The names, addresses, and specific
salaries of the employees are not required to be reported.
Discounts: If an entity provides a discount on goods or services to a
committee and the discount is not offered to the public in the regular
course of business, the discount is a nonmonetary contribution.
Chapter 2
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Chapter 2. 2 Campaign Manual 5
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Enforceable Promises: A legally enforceable promise to pay for
goods or services is a contribution. A pledge card is not considered
an enforceable promise to make a contribution. “Enforceable promise”
also does not include a contributor’s agreement to make future
installment payments through wire transfer, credit card transaction,
debit account transaction, or similar electronic payment.
Phone Banks: Businesses and other entities will sometimes allow
a committee to use their phones to call prospective voters during
non-business hours. The fair market value of the use of the phones
is calculated to determine the amount reported as a nonmonetary
contribution, even if only local calls are made. One method to
determine the fair market value is to contact organizations that provide
phone banks as a business.
Joint Fundraisers: Major donors will sometimes pay for a fundraising
event for multiple candidates. The fair market value of the contribution
for each candidate may be allocated based on the amount of
expenditures and the number of candidates at the event. Also see
page 2.5.
Polls: A person or entity that provides data from a privately purchased
public opinion poll or survey to a candidate or committee is making a
nonmonetary contribution if the candidate or committee requests the
data or the data are used for political purposes. A formula utilized by
the Federal Election Commission may be used for valuing polling or
survey data, as long as the formula is used in a reasonable manner
to provide a fair estimate. The formula calculates the value based on
the age of the data. The chart below illustrates the fair market value
of data based on the number of days that pass from the date the entity
originally received the data to the date the data were provided to the
candidate or committee.
Age of Data Value
0 -15 days Full Value
16 - 60 days 50%
61 - 180 days 5%
More than 180 days No Value
Office Space: The
value of donated office
space may be computed
based on comparable rental
rates for office space in the
area.
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Chapter 2. 3 Campaign Manual 5
June 2016
When only a portion of a survey is provided to or for the benefit of a
candidate or committee, the nonmonetary contribution is the prorated
portion of the total value of the survey.
B . Reporting Contributions Made
In general, a monetary contribution is made on the date that the
contribution is mailed, delivered, or otherwise transmitted to the
candidate or committee. Alternatively, the date of the check may be
used provided it is no later than the date the contribution is mailed,
delivered, or otherwise transmitted. For example, a check dated July
10 and delivered June 10 is made on June 10. Whereas, a check
dated May 5 but delivered June 10 may be reported as made on either
May 5 or June 10.
A nonmonetary contribution is made on the earlier of the following:
• The date funds were expended by the contributor for the goods
or services; or
• The date the committee or an agent of the committee obtained
possession or control or otherwise receives the benefit of the
goods or services.
Services of salaried personnel are considered made on the payroll
date.
When a nonmonetary contribution is made, the fair market value must
be reported. The value of all nonmonetary contributions of $100 or
more must be reported in writing to the recipient upon the recipient’s
written request.
Joint Checking Accounts: Individuals (including spouses) may make
separate contributions from a joint checking account. For reporting
purposes, the full amount of the contribution is reported as made from
the individual who signs the check. If two or more individuals sign
the check, the contribution is divided equally between or among the
signers, unless there is an accompanying document signed by each
individual whose name is printed on the check that clearly indicates a
different apportionment.
Ex 2.1 – Linda and Jerry
Nelson are both listed
names on a joint checking
account. From this account,
Linda signed a $15,000
check payable to Citizens
Against Street Crime, Yes
on Measure D. Linda is
the contributor of the full
$15,000.
Fair Political Practices Commission
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Chapter 2. 4 Campaign Manual 5
June 2016
A check drawn on a joint checking account that is signed by an
individual not listed on the check (e.g., an accountant) must be
accompanied by a document signed by at least one of the individuals
listed on the check stating to whom the check is to be attributed.
Generally, if a check is drawn on the account of a business entity, the
contributor is the business entity, not the individual who signed the
check.
A contribution made by a child under the age of 18 is presumed to be
a contribution from his or her parent or guardian, unless the facts show
otherwise (i.e., that the child actually chose to make the contribution).
Affiliated Committees: A major donor committee that files campaign
statements disclosing contributions made by affiliates must notify the
recipients of its contributions of the name used on the major donor
campaign statement under the “name of filer.”
C . Contribution Exceptions
There are many exceptions to the definition of “contribution.” Four
common exceptions include:
Volunteer Personal Services: If an individual donates his or her
personal or professional services to a campaign, no contribution has
been made or received. However, if an employer donates employee
services to a campaign, and any employee spends more than 10
percent of his or her compensated time in a calendar month providing
the services, the employer has made a nonmonetary contribution.
“Volunteer personal services” does not include any tangible items.
Donated goods are contributions. A volunteer’s travel expenses are
not nonmonetary contributions as long as there is no understanding
that the expenses will be repaid.
Ex 2.2 – Global Software
made a $13,000 contribution
to a ballot measure
committee. Global
Software’s contributions are
reported on the major donor
statement filed under the
name of Pace Computers,
Global Software’s parent.
Global Software must
notify the ballot measure
committee that the
contribution is disclosed on
the campaign statement
filed by Pace Computers.
The ballot measure
committee will identify both
Global Software and Pace
Computers on its campaign
statement.
Fair Political Practices Commission
advice@fppc.ca.gov
Chapter 2. 5 Campaign Manual 5
June 2016
Home/Office Fundraisers: If someone holds a fundraiser or
other campaign event in his or her home or office for one or more
candidates, the costs incurred by the occupant of the home or office
need not be reported as long as the total cost of the event is $500 or
less. However, if someone else donates food, beverages, or anything
else of value for the event, the fair market value of those donated
goods is a nonmonetary contribution. In addition, the donated goods
must be counted to determine whether the total cost of the event
is $500 or less. This exception does not apply to a lobbyist (or a
cohabitant of a lobbyist) or a lobbying firm.
Member Communications: Payments made by an entity (including
a business entity) for a communication that supports or opposes a
candidate or ballot measure are not contributions or expenditures as
long as the communication is sent only to the organization’s members,
employees, shareholders, or their families. The payments may not be
for general public advertising, such as billboards, newspaper, radio, or
television ads.
Ex 2.3 – Shannon sponsors
an event for a candidate
after work in her business’
office. She spends $450. A
friend supplies decorations
worth $75. Since the total
cost of the event exceeds
$500, the candidate
must report receiving
contributions of $450 from
Shannon and $75 from the
friend.
The total cost of
a home or office
fundraiser must be $500 or
less. This is true no matter
how many committees or
candidates benefit from the
event.
QuickTip
Ex 2.4 – A corporation sends
a mailing supporting a ballot
measure to the corporation’s
shareholders. The mailing
is not a contribution to the
ballot measure committee
whose position is supported
or an independent
expenditure.
At the behest of a ballot
measure committee, the
corporation sends a mailing
supporting Measure A to
all registered voters in the
district where the measure
will appear on the ballot.
The mailing to the voters is a
nonmonetary contribution.
Consult Regulation
18215 for a complete
list of exceptions to the
definition of a contribution.
QuickTip
Fair Political Practices Commission
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Chapter 2. 6 Campaign Manual 5
June 2016
Payments for Governmental, Legislative, or Charitable Purposes:
Payments made in connection with a governmental, legislative, or
charitable event, such as a job or health fair, a charity fundraiser, or a
conference on educational issues, that are coordinated or requested
by an elected official from a source other than the official’s agency,
such as a business, are generally not considered gifts or contributions
to the elected official who is co-sponsoring the event. This includes
payments behested by the official or by his or her agent or employee
on the official’s behalf. These payments (sometimes referred to as
“behested payments”) are not for personal or campaign purposes.
However, the official may be required to report such payments on the
Form 803 if they total $5,000 or more. A major donor is not required to
report such payments on Form 461.
The official must file Form 803 within 30 days following the date on
which the payment(s) meets or exceeds $5,000 in the aggregate from
a single source in a calendar year. The FPPC posts on its website
payments made at the behest of state elected officials and members
of the Public Utilities Commission.
Ex 2.5 – At Councilmember
Stark’s request, Diamond
Dairy made a $10,000
donation to the Boys’ and
Girls’ Club. Councilmember
Stark will file Form 803 with
the city clerk disclosing the
donation and donor’s name
and address. Diamond Dairy
is not required to report the
payment.
Merely inviting an
elected official to
speak at an event is not a
behested payment.
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Chapter 2. 7 Campaign Manual 5
June 2016
D . Contribution Restrictions
The True Source of Contributions Must Be Disclosed: One of
the prohibitions in the Act states that no contribution shall be made,
directly or indirectly, by any person in a name other than the name by
which the person is identified for legal purposes. Failure to disclose
the true source of a contribution is a serious violation of the law. For
example, reimbursing employees or others so that the original source
of the contribution is hidden from the candidate or committee is
unlawful.
Ex 2.6 – Build Right Homes is a housing company located in Sun City, California.
Sun City has a $1,000 per election contribution limit for local officials. The City
Council is considering a contentious slow-growth plan for Sun City. Concerned
about the plan, the president of Build Right Homes makes a maximum
contribution to a council candidate who opposes it. He asks the employees of
Build Right Homes to do the same, and plans to reimburse them. Reimbursing
employees or others to get around contribution limits is called campaign
money laundering and is illegal.
Ex 2.7 – In the weeks before an election, an out-of-state nonprofit organization
for citizen rights made a $5 million contribution to a California state ballot
measure committee, without reporting the source of the funds. The $5 million
contribution originated with another out-of-state nonprofit organization and
was transferred through two other nonprofit groups before it was contributed
to the ballot measure committee. Failing to report the true source of the
contribution is campaign money laundering. Under Sections 84301 and 84302,
the true source of the contribution must be reported, and the nonprofit
organizations through which the funds were transferred must be identified as
intermediaries for the contribution.
Reimbursing
contributions of
employees or others, in
attempts to avoid or to
get around state or local
contribution limits, is a
violation of Section 84301.
QuickTip
An intermediary of
a contribution also
has a duty to disclose to a
candidate or committee the
true source of the funds.
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Chapter 2. 8 Campaign Manual 5
June 2016
Contributions of $100 or More: Monetary contributions of $100
or more must be made by written instrument (such as a check)
containing the name of the donor and drawn from the account of the
donor or intermediary. Contributions may also be made by credit card
or electronic transmission (e.g., wire transfer).
Contributions of $100 or more made by money order, cashier’s check,
or traveler’s check are prohibited. A cash contribution of $100 or
more is prohibited and an anonymous contribution of $100 or more is
prohibited.
In addition, a candidate or committee must return a contribution of
$100 or more from an individual if the individual’s name, address,
occupation, and employer are not obtained within 60 days of receipt
of the contribution. All contributions to a candidate or committee must
be made in the name by which the contributor is identified for legal
purposes.
Intermediary: An intermediary is a person or entity that makes a
contribution on behalf of another person and has been or will be
reimbursed for the contribution. For each contribution of $100 or
more from an intermediary, the name, address, and, if applicable, the
occupation and employer information must be disclosed for both the
true source of the contribution and the intermediary.
Contributions in State Office Buildings Prohibited: Contributions
may not be delivered, personally or through an agent, in the State
Capitol or other state office building if the State of California pays the
majority of the rent for that building. “Personally delivered” includes
the delivery of a copy or facsimile of a contribution, and the original
or a copy of a contribution transmittal letter. This prohibition does
not apply to contributions received or delivered in a legislative district
office, or those sent by mail.
Fair Political Practices Commission
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Chapter 2. 9 Campaign Manual 5
June 2016
Contributions from Foreign Governments or Principals
Prohibited: A foreign government or foreign principal may not make
contributions or expenditures in connection with the qualification or
support of, or opposition to, any state or local ballot measure. The
term “foreign principal” as defined in 22 U.S.C.A. Section 611(b)
includes:
• A foreign political party;
• A person outside the United States, unless the person is a U.S.
citizen or a U.S. corporation whose principal place of business
is in the United States;
• A foreign partnership, association, corporation, or organization;
and
• A domestic subsidiary of a foreign corporation if the decision
to contribute or expend funds is made by an officer, director, or
management employee of the foreign corporation who is not a
U.S. citizen or lawful permanent resident.
Contributions from Foreign Nationals, National Banks, or
Corporations Prohibited: Foreign nationals, national banks, and
federally-chartered corporations may not make contributions in
connection with any local, state, or federal election. (The Federal
Election Campaign Act (52 USCS section 30118).) Contact the
Federal Election Commission for more information at (800) 424-9530.
Pay-to-Play Laws: Some localities in California have pay-to-play
ordinances that prohibit city contractors from making campaign
contributions to candidates for public office in that jurisdiction.
Disqualification and Campaign Contributions: Government Code
section 84308 disqualifies certain appointed board members and
commissioners from participating in governmental decisions affecting
campaign contributors (including the parent, subsidiary, or affiliate of
a campaign contributor) who have given more than $250 within 12
months before the decision. Section 84308 applies to proceedings
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Chapter 2. 10 Campaign Manual 5
June 2016
on licenses, permits, and other entitlements for use pending before
certain state and local agencies, boards, and commissions. In
addition, the official is prohibited from accepting or soliciting
contributions of $250 or more from the parties and other participants
during the proceeding. Contact the FPPC for more information.
E . State Contribution Limits
Candidate Election Committees: Candidates for state office have
limits on how much they may accept from a single source per election.
For purposes of contribution limits, the primary, general, special,
and special runoff elections are considered separate elections.
Contribution limits may increase or decrease every two years based
on changes in the Consumer Price Index.
Candidates may raise contributions for a general or special general
election prior to a primary or special primary election. If the candidate
loses or withdraws from the general or special general election,
contributions received for the general or special general election must
be returned to the contributors on a pro rata basis, less the cost of
raising and administering the funds. The chart on the next page lists
the current contribution limits.
Ex 2.8 – Assemblymember
Jones opens an officeholder
committee in November. In
June of the following year,
Jones opens a committee
to run for Senate. A
$3,000 contribution to the
officeholder committee
counts toward the
2015-2016 contribution limit
of $4,200 from the same
contributor to the Senate
committee. The donor may
only contribute $1,200 to the
Senate committee.
Contributions from
affiliated committees
are aggregated for purposes
of the limits on contributions
to state candidates. (See
Chapter 1.)
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Chapter 2. 11 Campaign Manual 5
June 2016
California Fair Political Practices Commission
California State Contribution Limits
(Effective January 1, 2015 - December 31, 2016)
Candidates seeking a state office and committees that make contributions to state candidates are subject to contribution limits
from a single source. (Sections 85301 - 85303.) Contributions from affiliated entities are aggregated for purposes of the limits.
(Regulation 18215.1.) The chart below shows the current limits per contributor for state offices. The primary, general, special,
and special run-off elections are considered separate elections. Contribution limits to candidates apply to each election.
Contribution limits to officeholder and other committees apply on a calendar year basis. Contact your city or county about
contribution limits for local offices.
Contribution Limits to State Candidates Per Election
Contributions to Other State Committees Per Calendar Year
Contributor Sources
Candidate or Officeholder Person (individual, business
entity, committee/PAC)
Small Contributor Committee
(see definition on page 2)Political Party
Senate and Assembly $4,200 $8,500 No Limit
CalPERS/CalSTRS $4,200 $8,500 No Limit
Lt. Governor, Secretary of State, Attorney
General, Treasurer, Controller, Supt. of Public
Instruction, Insurance Commissioner, and Board
of Equalization
$7,000 $14,100 No Limit
Governor $28,200 $28,200 No Limit
Contributor Sources
Committee Person (individual, business entity,
committee/PAC)
Committee (Not Political Party) that Contributes to State Candidates (PAC)$7,000
Political Party Account for State Candidates $35,200
Small Contributor Committee $200
Committee Account NOT for State Candidates (Ballot Measure, PAC, Political Party)No Limit*
Contributions to State Officeholder Committees Per Calendar Year
Contributor Sources
Committee
Any Source (Person, Small
Contributor Committee or
Political Party)
Aggregate From All Sources
Senate and Assembly $3,500 $58,500
CalPERS/CalSTRS $3,500 $58,500
Lt. Governor, Secretary of State, Attorney General,
Treasurer, Controller, Supt. of Public Instruction,
Insurance Commissioner, and Board of Equalization
$5,900 $117,100
Governor $23,400 $234,200
*State committees (including political parties and PACs) may receive contributions in excess of the limits identified above as long
as the contributions are NOT used for state candidate contributions. (Regulation 18534.)
Fair Political Practices Commission
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Chapter 2. 12 Campaign Manual 5
June 2016
F . Campaign Rules
Extensions of Credit: When there is an agreement with the provider
of goods or services that a state candidate or committee will pay
for goods or services on credit, the goods or services may become
a contribution to the candidate or committee and be subject to
contribution limits if it remains unpaid after 45 days.
Contributions that Exceed the Limits: A violation of the Act does
not occur if a contribution to a state candidate that exceeds the limit is
not deposited into the candidate’s bank account and is returned within
14 days of receipt. For nonmonetary contributions, either the item
itself, its monetary value, or the monetary amount by which the value
of the nonmonetary contribution exceeds the limits must be returned
within 14 days of receipt.
Legal Defense Funds: State and local candidates and officeholders
may establish a legal defense fund to defray attorney’s fees and other
related legal costs incurred for the candidate’s or officeholder’s legal
defense. The candidate or officeholder must be subject to a civil or
criminal proceeding or administrative proceeding arising directly out
of the conduct of an election campaign, the electoral process, or the
performance of the officeholder’s governmental activities and duties.
Contributions made to a legal defense committee are reportable but
are not subject to contribution limits. Legal defense committees are
required to have the candidate’s or officeholder’s last name and the
words “legal defense” in the name of the committee.
Recall Elections: A state officeholder who is the subject of a recall
may set up a separate committee to oppose the qualification of the
recall measure and, if the recall petition qualifies, the recall election.
Contributions to this committee are reportable but are not subject to
limits.
Ballot Measure Committees: A primarily formed or general purpose
ballot measure committee is not subject to state contribution limits,
including those committees controlled by a state candidate or
officeholder, unless the contribution is made by a state candidate or
officeholder. However, funds from a ballot measure committee may
not be used for the state candidate’s election.
Fair Political Practices Commission
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Chapter 2. 13 Campaign Manual 5
June 2016
Contribution Limits and Repaid Loans: Loans are contributions
subject to contribution limits. However, if a loan has been repaid, the
lender may make additional contributions to the same candidate or
committee up to the contribution limit.
Authority
The following Government Code sections and Title 2 regulations
provide authority for the information in this chapter:
Government Code Sections
82015 Contribution.
82025 Expenditure.
82031 Independent Expenditure.
82044 Payment.
82047 Person.
84211 Contents of Campaign Statement.
84300 Cash and In-Kind Contributions; Cash Expenditures.
84302 Contributions by Intermediary or Agent.
84304 Anonymous Contributions; Prohibition.
84308 Contributions to Officers; Disqualification.
84309 Transmittal of Campaign Contributions in State Office
Buildings; Prohibition.
85301 Limits on Contributions from Persons.
85303 Limits on Contributions to Committees and Political
Parties.
85304 Legal Defense Fund.
85306 Transfers Between a Candidate’s Own Committees; Use
of Funds Raised Prior to Effective Date.
85307 Loans.
85308 Family Contributions.
85312 Communications to Members of an Organization.
85320 Foreign Entities.
85700 Donor Information Requirements; Return of
Contributions.
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Chapter 2. 14 Campaign Manual 5
June 2016
Title 2 Regulations
18215 Contribution.
18215.1 Contributions; When Aggregated.
18216 Enforceable Promise to Make a Payment.
18225 Expenditure.
18225.7 Made at the Behest of.
18421.1 Disclosure of the Making and Receipt of Contributions.
18423 Payments for Personal Services as Contributions and
Expenditures.
18428 Reporting of Contributions and Independent
Expenditures Required to be Aggregated.
18432.5 Intermediary.
18439 Definition of “Personally Deliver.”
18530.4 Legal Defense Funds - State Candidates and Officers.
18530.45 Legal Defense Funds - Local Candidates and Officers.
18530.7 Extensions of Credit.
18531 Return of Excessive Contributions.
18531.5 Recall Elections.
18531.62 Elected State Officeholder Bank Accounts.
18531.7 Payments for Communications—Section 85312.
18533 Contributions from Joint Checking Accounts.
18537 Contributions Limits and Application to Repaid Loans.
18545 Contribution Limits and Voluntary Expenditure Ceiling
Amounts.
1
Vernice Hankins
From:Mary MARLOW <m.marlow@verizon.net>
Sent:Tuesday, March 27, 2018 4:32 PM
To:councilmtgitems
Cc:Mary Marlow; Terry O’Day; Pam OConnor; Gleam Davis; Kevin McKeown Fwd; Ted
Winterer; Tony Vazquez; Sue Himmelrich
Subject:Agenda item 8C Enhancements to Election Laws and Enforcement
Mayor Winterer and Councilmembers,
We write to support and comment on proposed enhancements and improvements to local election laws and
enforcement mechanisms offered by the City Attorney and City Clerk. These enhancements are offered to
improve enforcement and enhance election laws:
Enforcement
We support option 2, Establish reciprocity with a local city attorney’s office. In the recent past, complaints
based on violations of Article XXVI of the City Charter were filed with the City Attorney with no resolution
due to stated conflicts of interest within the city. A reciprocity agreement with a nearby city would resolve such
conflicts and uphold the perception of impartially in administering election and anti corruption laws.
Campaign Finance
We think increasing or eliminating campaign contribution limits is the best option since the Citizens United
Supreme Court decision has resulted in unlimited contributions to PACs. Public financing simply can’t
compete with union and corporate donors with deep pockets. Unless most candidates opt into public financing,
the option becomes a liability for candidates competing against better-funded opponents and/or incumbents.
Currently, the cost of competing for City Council is $150,000 to $200,000. PACs contribute over half with
unlimited contribution limits. A candidate committee is limited to $340. This gap in contribution allowances
makes PACs and their special interests contributors a primary factor in who gets elected. This dynamic needs
to be changed. Increasing the cap on contributions to candidates to $4200 would match the limits on state
legislators and empower candidate committees.
Community Education
Undocumented in-kind contributions in the form of campaign events held around the city have been going on
for years due to the difficulty of tracking events and the people behind them. There seems to be no awareness
that campaign events are reportable in-kind campaign expenses. Lack of any consequences for non-reporting of
in-kind contributions exacerbates the problem. Education on in-kind contributions and related penalties for
non-reporting would certainly encourage reporting such contributions. I support and encourage more robust
education of both candidates and the public on campaign finance laws and related penalties as a deterrent.
We enthusiastically support changes to improve enforcement, increase campaign contribution limits, and
improve education recommended in this letter and thank the City Attorney and City Clerk for their thoughtful
and timely report.
Item 8-C
03/27/18
Item 8-C
03/27/18
2
Mary Marlow, Chair
Santa Monica Transparency Project
Item 8-C
03/27/18
Item 8-C
03/27/18