Candidate Campaign Disclosure Manual (California)

7/31/2019 Candidate Campaign Disclosure Manual (California)

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California Fair Political

Practices CommissionToll-free advice line: 1 (866) ASK-FPPCWeb site: www.fppc.ca.gov

Campaign Disclosure

Manual 1Information for State Candidates,Their Controlled Committees,and Primarily Formed Committees

for State Candidates

2/2008



Fair Political Practices Commission Checklist-1 Campaign Manual 1, 2/2008

State Candidate Checklist

Important Things to Remember

• File Form 501 (Candidate Intention)You must file Form 501 before soliciting,raising or spending any money inconnection with your election. The onlyexception to this requirement is for personalfunds you will spend for a filing fee or ballotstatement fee. (See Chapter 5.)

• Open a Campaign Bank AccountAll monetary contributions (including all personal and/or business funds you usefor your campaign) must be deposited inthe campaign bank account before beingspent.1 Never deposit campaigncontributions in your personal account.(See Chapter 2.)

• File Form 410 (Statement ofOrganization)Once you receive or spend $1,000 ormore in a calendar year, you must file aForm 410 as a recipient committee within10 days. The name of the committeemust include your last name. You mustdesignate a treasurer. (See Chapter 5.)

• Keep Good Records All candidates and committees are subjectto audit. Detailed records of contributionsand expenditures of $25 or more arerequired and must be retained for at leastfour years. If contributor information(name, address, occupation, andemployer) is not obtained within 60 days,the contribution must be returned. (SeeChapter 2.)

• File Campaign Reports On TimeFiling schedules are posted on the FPPCwebsite at www.fppc.ca.gov. You mustfile regular campaign statements (Form460) disclosing all receipts and

expenditures at least twice each year—

and up to six times during an electionyear. (See Chapter 6.) Late filing feesand other penalties may be assessed ifreports are not filed on time.

• Electronic FilingIf you receive contributions or makeexpenditures totaling $50,000 or more,you are required to file all Form 460campaign statements electronically withthe Secretary of State. In addition to Form460, you must electronically file Form 497:

− Within 10 days if you receive a

contribution of $5,000 or more from asingle source at any time other than the90-day election cycle (including afteryour election); and

− Within 24 hours if you receive acontribution of $1,000 or more from asingle source during the 90-dayelection cycle. (See Chapter 6.)

• Itemize Contributions andExpenditures of $100 or MoreDetailed information must be disclosed for

contributors of $100 or more and forexpenditures of $100 or more. (SeeChapter 7.) If contributor information(name, address, occupation, andemployer) is not obtained within 60 daysof receiving a contribution, the contributionmust be returned. (See Chapter 2.)

• Itemize Payments Made by AgentsIf an agent or independent contractormakes expenditures of $500 or more onyour behalf, you must disclose detailedinformation about the expenditure. (SeeChapter 7.)


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1 There is an exception for candidates who will not receive any monetary contributions from others and who will spend less than$1,000 on their campaign. (See Chapters 2 and 5.)



Fair Political Practices Commission Checklist-2 Campaign Manual 1, 2/2008


• Notify Contributors of $5,000 or More You must notify individuals and businessentities that contribute $5,000 or more to

your campaign that they will havereporting obligations if they contribute$10,000 or more in a calendar year. (SeeChapter 3.)

• Contribution and Expenditure Limits State candidates are subject tocontribution limits (including loans andextensions of credit) and may voluntarilylimit campaign expenditures.Contributions to any committee controlledby another state candidate or officeholder(including ballot measure committees) are

also subject to limits. There arerestrictions on receiving contributions afteran election. (See Chapter 1.)

• Identify Mass MailingsIf more than 200 pieces of mail are sent ina calendar month, your name (or yourcommittee’s name) and address must beprinted on the outside of the mailing in noless than 6-point type and a contrastingcolor. (See Chapter 4.) You must alsoretain a copy of each mailing and recordthe date, the method of postage, and thenumber of pieces. (See Chapter 2.)Note: You are not required to print yourcommittee’s ID Number on any mailing orother advertisement.

• Identify Telephone CallsIf campaign funds are spent for 500 ormore telephone calls supporting yourcandidacy (other than calls made by you,your campaign manager, or volunteers),your committee must be identified aspaying for the calls. (See Chapter 2.)

• Do Not Accept Cash Contributions orMake Cash ExpendituresCash contributions and cash expendituresof $100 or more are prohibited.Anonymous contributions of $100 or moreare also prohibited. (See Chapter 10.)

• Use of Campaign FundsCampaign funds may only be used forpolitical, legislative, or governmental

purposes. They cannot be used to makeindependent expenditures to support oroppose other state or local candidates.Campaign funds become “surplus” if youare defeated or leave office and furtherrestrictions apply. (See Chapter 10.)



Fair Political Practices Commission Contents-1 Campaign Manual 1, 2/2008

ContentsContents

Introduction Intro-1

Chapter 1—Contribution Limits, Voluntary Expenditure Ceilings, 1-1 and Related Restrictions

State Candidate Contribution Limits 1-1Voluntary Expenditure Ceiling 1-3Transfers from Another Controlled Committee of the Candidate 1-5Raising Campaign Funds After the Election 1-7Officeholder Accounts 1-8Legal Defense Funds 1-10Recall Elections 1-10Contributions that Exceed the Limits 1-11

Chapter 2—Finances/Recordkeeping 2-1

Campaign Bank Account 2-1Recordkeeping 2-3Audits 2-7Treasurer Duties 2-7Candidate Duties 2-8

Chapter 3—Contributions 3-1

What Is a Contribution? 3-1Receiving Contributions 3-3$5,000 Notification to Potential “Major Donors” 3-7

Valuing Nonmonetary Contributions 3-8Returning Contributions 3-11

Chapter 4—Communications 4-1

Contributions and Independent Expenditures 4-1Reporting 4-3Non-Contributions 4-4Identification Requirements for Mailings 4-6Identification Requirements for Telephone Calls and

Other Advertisements 4-8

Chapter 5—Getting Started 5-1

Candidate Intention (Form 501) 5-2Officeholder and Candidate Campaign Statement-Short Form (Form 470) 5-4Form 470 Supplement 5-6Statement of Organization (Form 410) 5-7Candidate Statement of Economic Interests (Form 700) 5-12




Contents

Chapter 6—When and Where to File Reports 6-1

Electronic Reports 6-1When to File 6-2

$5,000 Reports and Election Cycle Reports 6-2Semi-Annual and Preelection Campaign Statements 6-2Recall Committees 6-3Amendments 6-4Where to File 6-4

Chapter 7—Committee Report—Form 460 7-1

Cover Page 7-2Amending Form 460 7-2Summary Page 7-4General Rules for Reporting Contributions Received 7-7Schedule A—Monetary Contributions Received 7-10

Schedule B—Loans Received 7-12Schedule C—Nonmonetary Contributions Received 7-16Schedule D—Expenditures Supporting/Opposing Other Candidates,

Measures, and Committees 7-18Schedule E—Payments Made 7-21Schedule F—Accrued Expenses (Unpaid Bills) 7-21Schedule G—Payments Made by an Agent or Independent Contractor 7-29Schedule H—Loans Made to Others 7-30Schedule I—Miscellaneous Increases to Cash 7-31

Chapter 8—Additional Reports 8-1

Supplemental Independent Expenditure Report (Form 465) 8-2Supplemental Preelection Campaign Statement (Form 495) 8-5496 Independent Expenditure Report (Form 496) 8-7497 Contribution Report (Form 497) 8-10Paid Spokesperson Report (Form 511) 8-15Special Odd-Year Report 8-16Communications Identifying State Candidates (Form E-530) 8-17

Chapter 9—After the Election 9-1

Successful Candidates—Future Filing Obligations 9-1Co-Sponsored (or “Behested”) Payment Reports 9-1Defeated Candidates—Future Filing Obligations 9-2

How to Terminate 9-2Candidate Election Committee Termination Requirements 9-3State Officeholder Committee Termination Requirements 9-4Legal Defense Committee Termination Requirements 9-4




Contents

Chapter 10—Restrictions 10-1

Restrictions on Contributions 10-1Use of Campaign Funds 10-3

Use of Surplus Funds 10-8Disqualification and Campaign Contributions 10-9

Chapter 11—Committees Primarily Formed to Support or Oppose 11-1State Candidates

Appendix—About the Political Reform Act/How to Get Help Appendix-1

What’s New for 2007 and 2008

State Ballot Measure Contributions and Expenditures: Section 84204.5 was added to the

Act by AB 1759 (Chapter 438, Stats. 2006) requiring the filing of online reports by candidatesand committees that make contributions or independent expenditures totaling $5,000 or moreto support or oppose the qualification or passage of a state ballot measure. Regulation 18466was adopted to clarify the disclosure requirements. (See page 8-7 and 8-10.)

Where to File Campaign Statements: Section 84215 was amended by AB 473 (Chapter 54,Stats. 2007) to reduce the number of copies of statements that must be filed with county filingofficers. (See page 6-5.)

Telephone Advertisements: Section 84310 was added by AB 2275 (Chapter 439, Stats.2006) requiring candidates and committees that use campaign funds to make 500 or moretelephone calls to disclose the name of the person or organization that authorized or paid for

the call. A script of the call or a copy of a recorded telephone message must be kept by thecommittee for four years. Certain exceptions apply. FPPC Regulation 18440 was adopted toclarify the disclosure requirements. (See page 4-8.)

Officeholder Accounts: Section 85316 was amended by SB 145 (Chapter 624, Stats. 2006)to allow elected state officers to raise funds for officeholder expenses into a separateofficeholder account, subject to certain restrictions and limitations. FPPC Regulation 18531.62was adopted to specify disclosure and other committee requirements. (See Chapters 1, 5, and6.)

Recordkeeping—Copies of Canceled Checks: Regulation 18401 was amended to allowcommittees to retain copies of canceled checks (rather than the original documents) if the

copies contain a legible image of the front and back of the canceled check and the copies areobtained from the financial institution. (See page 2-6.)

Committee Names: Regulation 18402 was amended to require the last name of thecandidate to be included in the name of any election committee controlled by the candidate.The new requirement applies to committees formed on or after July 1, 2007. (See page 5-9.)




Contents

Installment Payments: Regulations 18216 and 18421.1 were amended to clarify thatcontributions received via “installment” payments charged to a credit card or deducted from acontributor’s account are reported when each installment payment is received and that such

arrangements do not constitute an “enforceable promise” to make a contribution. (See page 3-2.)

Street Address: Regulation 18421.2 was amended to include Army and Air Force Post Officeand Fleet Post Office addresses in the definition of “street address.”

Bank Accounts: Regulation 18421.3 was adopted to allow candidates to contract with avendor or collecting agent to collect contributions prior to transferring to the campaign bankaccount without violating the “one bank account” rule. (See page 2-1.)

Reporting Expenditures for Gifts, Meals, and Out-of-State Travel: New Regulation18421.7 and amendments to Regulation 18401, as adopted at the Commission’s February

meeting, will require additional detailed disclosure and recordkeeping for expenditures relatedto gifts, meals, and out-of-state travel. Copies of the regulations are available on the FPPCwebsite.

Legal Defense Committees: Regulation 18530.4 was amended to impose additionalrestrictions and disclosure requirements on legal defense committees. (See Chapters 1, 5,and 6.)

Refunding General Election Contributions: Regulation 18531.2 was adopted to assistcandidates who are defeated in a primary election or who withdraw from a general election indetermining which expenses may be deducted from the amount that must be refunded togeneral election contributors under Section 85318.



Fair Political Practices Commission Intro-1 Campaign Manual 1, 2/2008

Introduction

This manual provides important information

on campaign disclosure rules for:

• State candidates and officeholders who donot have a controlled committee; and

• State candidates and officeholders whohave a controlled committee.

Local candidates and officeholders, theircontrolled committees, and committeesprimarily formed to support or oppose localcandidates may refer to FPPC’s Information Manual 2 for Local Candidates, Their

Controlled Committees, and Primarily Formed Committees for Local Candidates.

Candidates for elective seats on the CalPERSBoard of Administration should contact theFPPC for campaign filing information.

How to Use this Manual

California’s Political Reform Act (the “Act”)requires receipts and expenditures inelection campaigns to be fully and truthfullydisclosed. Since 1974, there have been over200 amendments to the Act’s campaign

disclosure provisions. Most recently, the Actwas amended by Proposition 34, whichprovides, among other things, contributionlimits for certain state committees andexpenditure restrictions for state candidateswho accept the voluntary expenditure ceilingestablished for the election they are seeking.This manual has been prepared to assistcandidates to comply with the Act’snumerous and often detailed rules. Themanual is written in a “user friendly” formatso that candidates and committees,

especially those with small budgets, have aresource guide. It is organized by subjectmatter and addresses the most commonissues of campaign disclosure for stateelections.

In addition, federal and state tax laws and

other rules are applicable to Californiacampaign committees. Telephone numbersand website addresses for the FederalElection Commission, Internal RevenueService, California Franchise Tax Board, andthe Federal Communications Commissionare listed in the Appendix.

Controlling Law

This manual summarizes key campaigndisclosure laws, regulations, andCommission opinions, and draws from years

of FPPC staff advice interpreting them toassist candidates and committees incomplying with the provisions of the Act’scampaign disclosure laws. Each campaignis different, however, and may raise issuesnot discussed in this manual. If there areany discrepancies between the manual andthe Act or its corresponding regulations andopinions, the Act and its regulations andopinions will control.

Need Help?

If you need assistance, the Fair PoliticalPractices Commission has a toll-free adviceline:

1-866-ASK FPPC(1-866-275-3772)

FPPC employees are available Mondaythrough Friday to help you. In addition, theFPPC website (www.fppc.ca.gov ) containsforms, manuals, and a wealth of other helpfulinformation.

See the Appendix for more details.

Introduction

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Fair Political Practices Commission 1-1 Campaign Manual 1, 2/2008

Chapter 1 — State Restrictions

The following chapter contains informationon contribution limits of importance to statecandidate campaign committees. Thischapter also reviews voluntary expenditureceilings, transfer of funds between or amonga state candidate’s campaign committees,restrictions on fundraising after an election,and the establishment of officeholder

accounts, legal defense fund and recallcommittees.

Many of these provisions were added to thePolitical Reform Act by Proposition 34, whichwas passed by the voters in the November2000 general election. Electronic filingrequirements also were added. (SeeChapter 6.) See Chapter 10 for otherrestrictions applicable to all candidates andcommittees.

State Candidates

Contribution Limits

Contribution limits may increase or decreaseevery two years based on changes in theConsumer Price Index.

Candidates for state office have limits onhow much they may accept from a single

source per election. For purposes ofcontribution limits, the primary, general,special, and special runoff elections areconsidered separate elections. The chartbelow shows the limits per contributor andtype of office sought. (See Chapters 3 and 4for additional information about contributionsand exceptions.)

Candidates may raise contributions for ageneral or special general election prior to aprimary or special primary election for thesame office. If the candidate is defeated inthe primary or special primary election, orwithdraws from the general or specialgeneral election, contributions received forthe general or special general election mustbe returned to the contributors on a pro ratabasis, less the cost of raising andadministering the funds and general electionexpenses that were paid prior to the primary

election (e.g. media purchases). However,contributions (other than loans) made by astate candidate to his or her own campaignmay not be returned to the candidate.

State candidates also must disclose, for eachcontributor itemized on the RecipientCommittee Campaign Statement (Form 460),

Chapter 1Contribution Limits, VoluntaryExpenditure Ceilings, and Related

Restrictions

Contributor Legislature Statewide Elected Officers Governor

Person $3,600 $6,000 $24,100

Small ContributorCommittee

$7,200 $12,100 $24,100

Political Party No limit No limit No limit

Per Election Limits on Contributions to State Candidates

For Elections Occurring January 1, 2007 – December 31, 2008

(and for later elections until adjusted for 2009-2010)

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the total amount that has been received fromthe contributor for the primary and generalelections. (See Chapter 7.) In addition,

contributions from affiliated entities areaggregated for purposes of the limits. (SeeChapter 3.)

Loans

Loans are contributions subject to limits.However, if a loan has been repaid, thelender, guarantor, endorser, or cosigner maymake additional contributions to the samecandidate or committee up to the limit.

Extensions of Credit

When there is an agreement with theprovider of goods or services that a statecandidate or committee will pay for goods orservices on credit, the goods or services maybecome a contribution to the candidate andbe subject to contribution limits if it remainsunpaid after 45 days. (See Chapter 3.)

Candidate’s Personal Funds

Limits do not apply to a candidate’s personalfunds contributed to his or her own campaign.However, a state candidate may not have

loans to his or her campaign of more than$100,000 outstanding at any one time, andmay not charge interest on loans made to thecommittee. The $100,000 limit on personalloans applies to loans from the candidate’spersonal funds as well as to loans obtainedby the candidate from a commercial lendinginstitution which the candidate lends to his orher campaign. “Campaign” includes both theprimary and general, or special and specialrunoff, elections. However, if a candidatehas opened committees for more than one

office or more than one election (forexample, the candidate has a committee forhis or her current term and one forreelection), he or she may make loans up to$100,000 to each committee.

Bernard Ernest, a State Senate candidate, loans his campaign

$50,000 before the primary election. Just before the general election, Bernard wants to loan his committee some more funds. Since

the committee has not paid down on the original $50,000 loan, Bernard may loan no more than $50,000 to his committee.

Contributions from State Lobbyists

A state lobbyist may not contribute to a stateofficeholder or candidate’s campaign if thelobbyist is registered to lobby the agency ofthe elected officer or the agency to which thecandidate is seeking election. The lobbyistalso may not contribute to any othercommittee controlled by that state candidate,

including a ballot measure committee, a localcommittee, a legal defense fund, or anofficeholder account.

Richard receives an invitation to attend a political fundraiser from

an individual running for Insurance Commissioner. Richard is a lobbyist registered to lobby the State Legislature, the Secretary of State, and the Governor.Although Richard may not make a contribution to anyone who holds or is a

candidate for the Assembly, Senate,Secretary of State, or Governor, he may make a contribution to the candidate for Insurance Commissioner.

Contributions to Other Candidates

State candidates may contribute no morethan $3,600 per election to anothercandidate for elective state office. The$3,600 limit applies in the aggregate tocontributions made from personal funds andall campaign funds held by the candidate.

For example, an Assembly candidate maynot contribute more than $3,600 per electionto a candidate for Governor, even though thelimit for Governor is higher. In addition, astate candidate may not contribute more than$3,600 to a ballot measure committee, alegal defense fund, or a committee for localelection, that is controlled by another state

Example

Example





candidate. This limit may increase ordecrease every two years based on changesin the Consumer Price Index.

Voluntary Expenditure Ceiling

State candidates must declare on theCandidate Intention Statement (Form 501)whether they accept the voluntaryexpenditure ceiling established for eachelection. Candidates who accept the ceilingare designated in either the state ballotpamphlet (statewide candidates) or the voterinformation portion of the sample ballot(Senate and Assembly candidates) and maypurchase space to place a 250-word

statement there.

The candidate must choose to accept orreject the expenditure ceilings for both theprimary and general (or special primary andspecial general) elections at the time of filingForm 501. Until the deadline for filingnomination papers (Elections Code Section8020), the candidate may amend the Form501 up to two times to change his or herexpenditure ceiling declaration, as long asthe candidate has not exceeded theapplicable expenditure ceiling. In addition, acandidate who declined the ceiling for theprimary (or special) election but did not

exceed it may amend his or her Form 501within 14 days after the primary (or special)election to accept the ceiling for the general

(or special runoff) election.Voluntary expenditure ceilings may increaseor decrease every two years based onchanges in the Consumer Price Index.

The voluntary expenditure ceilingdoes not apply to candidates for

judge or the State Public EmployeesRetirement System Board.

All expenditures for a state office andelection must be made by the candidate’sdesignated campaign committee for thatelection. Campaign expenditures for aparticular state office may not be made byany other committee controlled by thecandidate.

Expenditures that count toward the voluntaryexpenditure ceiling include only “campaignexpenditures.” Generally, theseexpenditures (including unpaid bills) must becounted toward the next election that followsthe date of the expenditure. Expendituresmade on the day of an election must becounted toward that election. Expenditurescovered by this rule include the following:

Office Primary/Special Election General/Special Runoff Election

Assembly $483,000 $845,000

Senate $724,000 $1,086,000

Governor $7,243,000 $12,071,000

Lt. Governor, Attorney General,Insurance Commissioner, Controller,Secretary of State, Supt. of PublicInstruction, Treasurer

$4,828,000 $7,243,000

Board of Equalization $1,207,000 $1,811,000

Proposition 34 Voluntary Expenditure Ceilings for Candidates forElective State Offices

For Elections Occurring January 1, 2007 – December 31, 2008

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• Purchase, mailing, or distribution ofcampaign literature, signs, buttons,bumper stickers, and similar items.

• Telephone banks, including costs ofdesign, operation, installation, or rental oftelephone lines and equipment; tollcharges; personnel costs; rental of officespace; and associated consultants’ fees.

• Professional services, including campaignconsultants and pollsters, unless specificfees or costs are allocated to a differentelection under a contract with the personproviding the services.

• Overhead expenses, including office

space, utilities, office equipment,furnishings, supplies, internal copying andprinting, monthly telephone charges,personnel costs, and travel expenses.

Expenditures for radio, television,newspaper, or other media advertising counttoward the election following the datespecified in the contract for dissemination ofthe advertisement. If the ad will be publishedor broadcast on the day of an election, theexpenditure counts toward that election.

Expenditures for campaign fundraising arecounted toward the election for which thefunds were raised. If it is not possible toallocate fundraising costs using this method,allocate the expenditures to the electionfollowing the date they were made. If post-election expenditures are made to raisefunds to pay off debts, those expenditures donot count toward the voluntary expenditureceiling.

Nonmonetary contributions of the goods or

services described above received (exceptthose received from a political party) must becounted if an expenditure for equivalentgoods or services would have been made bythe candidate’s committee.

Candidates who have accepted the voluntaryexpenditure ceiling must disclose on theForm 460 Summary Page the total amount of

expenditures that are attributable to eachelection. (See Chapter 7.)

Expenditures made by a candidate’s

committee that do not count toward thevoluntary expenditure ceiling include, but arenot limited to:

1) Contributions to other candidates orcommittees;

2) Costs associated with preparing and filingcampaign disclosure reports;

3) Candidate filing fees;

4) Costs of ballot pamphlet or sample ballotstatements; and

5) Officeholder expenses, election nightcelebrations, and other non-campaignexpenditures.

Lifting the Voluntary Expenditure Ceiling

If a candidate contributes personal funds tohis or her own campaign in excess of thevoluntary expenditure ceiling, theexpenditure ceiling is lifted for all candidatesseeking the same office who have acceptedthe voluntary expenditure ceiling, whether in

the primary (or special) or general (or specialrunoff) election. This is the only event thatlifts the expenditure ceiling. If a candidatewho has accepted the expenditure ceilingmakes expenditures in excess of the ceiling,the candidate has violated the Act.

A candidate who contributes personal funds inexcess of the voluntary expenditure ceilingmust amend the Form 501 within 24 hours ofmaking the contribution and disclose the dateon which the personal contributions exceededthe expenditure ceiling. (Personal funds

transferred from another committee controlledby the candidate must be counted for thispurpose.) The Form 501 must be filed withthe Secretary of State in person or byguaranteed overnight delivery. The Form 501need not be amended if no other candidateaccepted the voluntary expenditure ceiling.





Dianne Sample is a candidate for State Treasurer. On her original

Form 501, Dianne did not accept the

voluntary expenditure ceiling. As her primary election approached, Dianne made several contributions and on May 12 her contributions to her own campaign totaled $5,000,000, more than the amount of the ceiling for the primary election that year.Even though Dianne did not originally accept the voluntary expenditure ceiling, within 24 hours she is required to amend her Form 501and file it with the Secretary of State in person or by guaranteed overnight delivery,indicating May 12 as the date that her personal contributions exceeded the

voluntary expenditure ceiling.

Since Dianne Sample contributed personal funds in excess of the expenditure ceiling during the primary, the ceiling is lifted for all candidates running for State Treasurer,including candidates of other parties, for the remainder of the primary election and the general election.

Transfers From Another ControlledCommittee of the Candidate

A state candidate may transfer funds fromone of his or her controlled electioncommittees to another. Except as discussedbelow, funds transferred from one of a statecandidate’s controlled election committees toanother are subject to contribution limits.The transferred funds must be attributed tospecific contributors of the committee making

the transfer and count toward the amountthose contributors may give to the committeereceiving the transfer.

The committee making the transfer mustchoose between two attribution methods.The first is “LIFO” (last in, first out). Thismeans that the amount to be transferred will

be attributed to the most recent contributorsto the transferring committee. The othermethod is “FIFO” (first in, first out), which

means transferred funds will be attributed tothe earliest contributors. Once thetransferring committee has chosen LIFO orFIFO, it may not change the method ofattribution. Detailed records must bemaintained. (See Chapter 2.)

Abbe Winkler is a city council member running for State

Assembly in the 2008 primary election. She wants to transfer funds from her city council committee to her State Assembly committee

and has chosen the LIFO method of attribution.

Using this attribution method, $3,600 of AZX

Corporation’s contribution will be attributed to the primary election, and $1,400 will be attributed to the general election. AZX Corporation may make no additional contributions to Winkler’s primary election.Ted and Wanda Smith may each give Winkler another $2,600 for the primary election.

The committee making a transfer must reportthe transfer as an expenditure on Schedule Eof the Recipient Committee CampaignStatement (Form 460). The committee

receiving the transfer must report detailedinformation about the transaction onSchedule A (monetary contributions).

Using the information from the aboveexample, Schedule A must include thefollowing information as shown on the nextpage:

Example

Example

Amount of Transferred Date of Original Amount of Original Funds Attributed to the

Contributor Contribution Contribution Contributor Ted Smith 10/25/06 $1,000 $1,000 Wanda Smith 10/25/06 1,000 1,000 AZX Corp. 11/02/06 5,000 5,000 Abbe Winkler 12/5/06 5,000 5,000





• The date of the transfer and the name,address, and identification number of thecommittee making the transfer;

• The name, address and, if applicable, theoccupation and employer or committeeidentification number of the contributor towhom the transferred funds are beingattributed (as disclosed on the campaignstatement filed after the contributions were

originally received or as contained in thecommittee’s records at the time of thetransfer);

• The original date of the transferredcontribution; and

• The amount of the transferredcontribution, including the cumulativeamount received from the contributor inthe calendar year and the amountattributed to the contributor per election.

Some electronic filing formats may be

different.

The committee making the transfer also mustmaintain records that identify the specificcontributors to whom any transferredcontributions have been attributed. If thetransferring committee no longer is required

to maintain detailed records, the receivingcommittee shall maintain either:

• The full name of the contributor;

• The date and amount being transferred foreach contributor, and if the contribution isa loan, the interest rate for the loan; and

• The cumulative amount of contributionstransferred attributed to that contributor

OR• Copies of the transferring committee’s

original verified and filed campaign reportsthat show the original contributionreceived from each contributor to whom atransferred contribution is attributed.

Exceptions:

• Surplus Funds: Funds held by anofficeholder or candidate become“surplus” on the closing date of the semi-annual reporting period following anelection in which the officeholder orcandidate is defeated, or when anofficeholder leaves the office for which thefunds were raised, whichever occurs last.Once a candidate or officeholder’scampaign funds become surplus, they





may not be transferred or carried over to afuture election account or otherwise usedfor that candidate’s future election. (See

Chapter 10.)• Carryover: A state candidate may carry

over campaign funds from the primaryelection to the subsequent generalelection for the same elective officewithout attribution. Non-surplus campaignfunds may also be carried over from onestate election to the next election for thesame office without attribution. To carryover funds from one state election to thenext election for the same office (e.g.,from a 2008 Assembly election to the

2010 election for the same office), thefunds must be transferred to a newcampaign bank account and committeeestablished for the next election, and thetransfer may not be made until after thedate of the election for which they wereraised. The transferring committee willreport the transfer as an expenditure onSchedule E and the committee receivingthe funds will report the transfer as anincrease to cash on Schedule I. If acandidate raises funds for an election but

does not file the necessary documents toappear on the ballot in that election, thefunds may not be carried over, but may betransferred with attribution as discussedpreviously. (Also see below forinformation regarding the use of fundsraised prior to the effective date ofProposition 34.)

As discussed below, state candidatesmay raise funds after an election only

to pay net debt outstanding. Campaign

funds may not be carried over to a futureelection account if the existing committeehas net debt from the prior election.

• Funds Held on January 1, 2001—Candidates for Senate and Assembly: Non-surplus funds held in a committee for

the state Senate or Assembly on January1, 2001 (“pre-34 funds”), may be used fora future election without attribution. There

is no limit to the number of times the fundsmay be transferred; however, if thecommittee holding the funds spends them(that is, the committee’s cash balancedrops below the amount of pre-34 funds itholds), the amount that may betransferred to another committee will bereduced. The transferring committee willreport the transfer on Schedule E and thecommittee receiving the funds will reportthe transfer on Schedule I.

• Funds Held on November 6, 2002—

Candidates for Statewide Office: Non-surplus funds held in a committee forstatewide office on November 6, 2002(“pre-34 funds”), may be used for a futureelection without attribution. There is nolimit to the number of times the funds maybe transferred; however, if the committeeholding the funds spends them (that is, thecommittee’s cash balance drops below theamount of pre-34 funds it holds), theamount that may be transferred to anothercommittee will be reduced. The

transferring committee will report thetransfer on Schedule E and the committeereceiving the funds will report the transferon Schedule I.

• Transferring Assets: It is not necessaryto value and attribute a committee’s usualassets (such as supplies, furnishings, andoffice equipment) that are beingtransferred from one controlled committeeto another of the candidate’s controlledcommittees. A committee must report thepurchase or sale of these assets, but need

not report the transfer.

Raising Campaign Funds After theElection

Committees controlled by state candidatesfor election purposes may receivecontributions after an election only to pay net

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debts outstanding from the election. Theprimary and general elections are separateelections for purposes of calculating net debt.In addition, the contribution limits applicableto the election apply to any new contributionsreceived to pay debt.

To calculate net debts outstanding, thefollowing are added together:

• An amount necessary to cover the cost ofraising funds to pay outstanding debts;

• Any costs associated with complying withpost-election requirements, such as thefiling of campaign statements, and othernecessary administrative costs associated

with winding down the campaign,including office space rental, staff salaries,and office supplies;

• The total amount of unpaid debts, loans,and accrued expenditures incurred withrespect to the election; and

• Legal fees and expenses incurred inconnection with monitoring a ballotrecount or the counting of absentee orprovisional ballots.

That amount is reduced by:

• The total cash on hand available to paythose debts and obligations, including:currency; balances on deposit in banks,savings and loan institutions, and otherdepository institutions; traveler’s checks;certificates of deposit; treasury bills; andany other committee investments valuedat fair market value; and

• The total amounts owed to the candidatecontrolled committee in the form of credits,refunds of deposits, returns, orreceivables, or a commercially reasonableamount based on the collectibility of thosecredits, refunds, returns, or receivables.

Phil Barkhouse ran for State Assembly in 2008. After the

primary election, he had $50,000 in cash left

and owed $95,000 in unpaid loans and accrued expenses. He can raise $45,000 to pay this debt, plus an amount needed to cover fundraising expenses and other administrative costs. All contributions received are subject to the contribution limits that were in effect for the 2008 election.

Larry West ran for State Senate in 2008.After the general election, he had $85,000 in cash left and owed $60,000 in accrued expenses for the election. He may not raise additional funds into the 2008 committee for the general election.

As new funds are received, the amount of

the net debts outstanding is reduced. Theamount of new contributions may not exceedthe amount of net debts outstanding on thedate the contribution is received. Anycontribution that exceeds the amount of netdebts outstanding must be returned to thecontributor within 14 days to prevent aviolation of the Act.

Officeholder Accounts

An elected state officer may acceptcontributions after the date of the election for

the purpose of paying expenses associatedwith holding the office to which the officerwas elected. Officeholder accountcontributions are subject to calendar yearlimits both by donor and in the aggregate. Inaddition, officeholder contributions must becumulated (in full) with any othercontributions from the same contributor(s) forany other future elective state office for whichthe officeholder maintains a controlledcommittee during the term of office in whichthe contribution is received. Officeholder

contributions may not be used forcontributions or transfers to any state or localcommittee or for any “election-related”activities.

Examples





Calendar Year Limits on OfficeholderContributions

The limits will be adjusted biennially basedon the Consumer Price Index. The limitsabove are in effect through December 2008.In order to determine the applicablecontribution limit to an elected state officer’sofficeholder account, use the lower of the

following:(1) The calendar year contribution limits

applicable to the officeholder committeein the table above (aggregate andindividual), or

(2) The lowest per election contribution limit(the aggregate of the primary and generalelection limits) applicable to any futurestate office for which the officeholdermaintains a controlled committee at anytime during the period between the day of

the election for which the officeholderaccount was established and the end ofthe term of office for that election.

Arthur Redding was elected to the Senate in 2006. In January

2007, he opened an officeholder committee.He may not receive more than $3,000 from a single contributor during 2007 and may not receive more than $50,000 in total officeholder contributions during 2007.During 2008, he forms a controlled

committee to run for Lieutenant Governor in 2010. Contributions to the officeholder committee must be counted for purposes of the $6,000 per contributor per election limit for contributions to a candidate for Lieutenant Governor (a total of $12,000 for the primary and general elections combined). Therefore,a contributor who gave $6,000 to the

officeholder committee ($3,000 for 2007 and $3,000 for 2008) may not contribute more

than $6,000 to the Lieutenant Governor committee.

Officeholder funds must be held in a singlebank account at a financial institutionlocated in the State of California and mustbe separate from any campaign bank

account established for election to office. If$1,000 or more is received by or deposited inan officeholder account in a calendar year,the elected state officer must establish acontrolled committee for the account by filinga Statement of Organization (Form 410).The officeholder committee will file campaignstatements and reports at the same timesand in the same places as any othercontrolled committee of the elected stateofficer. (See Chapters 5 and 6.)

Once the officeholder’s term of office ends,or the officeholder leaves office (whichever isearlier), no new contributions may bereceived and the officeholder committeemust be terminated within 90 days. Duringthe 90-day period, officeholder funds may beused only for the following purposes:

• The payment of outstanding officeholderexpenses;

• Repayment of contributions made to theofficeholder account;

• A donation to a bona fide charitable,educational, civic, religious, or similar taxexempt, nonprofit organization, if nosubstantial part of the proceeds will havea material financial effect on theofficeholder, a member of his or herimmediate family, or the committee

treasurer;• The payment for professional services

reasonably required by the officeholdercommittee to assist in the performance ofits administrative functions.

Legislature StatewideElectedOfficers Governor

Per Donor byOffice $3,000 $5,000 $20,000 AggregateTotal byOffice $50,000 $100,000 $200,000

Example





Unlike controlled committees set upfor election purposes, an officeholder

account may be redesignated as anofficeholder account for a future term of thesame office by amending the officeholdercommittee’s statement of organization(Form 410).

Under limited circumstances, the ExecutiveDirector of the Fair Political PracticesCommission may extend the date oftermination or allow a terminated committeeto reopen (for example, to receive a refund orpay expenses incurred for an audit orinvestigation). See Regulations 18404.1 and18531.62 or contact the FPPC for more

information.

Legal Defense Funds

State candidates and officeholders mayestablish a legal defense fund to defrayattorney’s fees and other related legal costsincurred for the candidate or officeholder’slegal defense if the candidate or officeholderis subject to one or more civil or criminalproceedings or administrative proceedingsarising directly out of the conduct of anelection campaign, the electoral process, or

the performance of the officeholder’sgovernmental activities and duties. Aseparate bank account and committee mustbe established for the funds, and theStatement of Organization (Form 410) mustbe filed to create the committee. SeeChapter 5 for committee name requirements.The legal defense committee will filecampaign statements and reports at thesame times and in the same places as anyother controlled committee of the candidateor officeholder. (See Chapters 5 and 6.)

Contributions raised for a legal defense fundare not subject to contribution limits or thevoluntary expenditure ceiling.

However, legal defense funds may only beraised in an amount reasonably calculated topay attorney’s fees and other legal costsrelated to the defense of the candidate or

officeholder, as well as administrative costsdirectly related to compliance withrecordkeeping and reporting requirements.They may not be used for fundraising, mediaor political consulting fees, mass mailings orother advertising, or for paying fines,penalties, judgments or settlements, or toreturn contributions.

(See FPPC Regulation 18530.4 for otherrestrictions, e.g., when a candidate orofficeholder may begin raising legal defensecontributions, committee terminationrequirements, and disposition of leftoverfunds.)

Committees established for a legal defensefund must file the Recipient CommitteeCampaign Statement (Form 460). (SeeChapter 6.)

Recall Elections

A state officeholder who is the subject of arecall may set up a separate committee tooppose the qualification of the recallmeasure and, if the recall petition qualifies,the recall election. Contributions to thecommittee are not subject to limits, and the

voluntary expenditure ceiling does not applyto expenditures made by the target of therecall to oppose the recall.

The committee may be established once theofficeholder receives a notice of intent torecall under Elections Code Section 11021.The committee must set up a separate bankaccount at a financial institution in California,file a Statement of Organization (Form 410),and include the word “recall” in the name ofthe committee. The committee also must filecampaign statements as discussed in

Chapters 6, 7, and 8. After the recallelection, or if the recall petition fails, anyfunds left over become “surplus funds” (seeChapter 10) and must be spent within 30days.

Candidates running to replace anofficeholder who is the target of a recall aresubject to all of the reporting requirements

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and restrictions discussed in this manual(including the contribution limits and theexpenditure ceiling applicable to the generalelection for that office).

Contributions that Exceed theLimits

Election Accounts

Contributions that exceed the contributionlimits are not considered accepted if they arenot deposited into the committee’s bankaccount and are returned within 14 days ofreceipt. For nonmonetary contributions,either the item itself, its monetary value, orthe monetary amount by which the value ofthe nonmonetary contribution exceeds thelimits must be returned within 14 days ofreceipt.

Officeholder Accounts

If an officeholder receives a monetarycontribution(s) to the officeholder accountfrom a single contributor that exceeds theallowable contribution limit to the officeholderaccount, the portion of the contribution thatexceeds the limit must be returned to the

contributor within 14 days of receipt. If acontribution is received that exceeds theallowable contribution limit applicable to afuture state office the officeholder will seek,the portion of the contribution that exceedsthe limit must be returned to the contributorwithin 14 days of receipt or within 14 days ofthe date the officeholder files a Statement ofOrganization (Form 410) for the futureelection, whichever is earlier.

Answering Your Questions

Q. My campaign committee for the Assembly has no debt and a small amount of cash.May I continue to raise funds into that committee after the election?

A. No. You may not raise funds after anelection for purposes other than payingnet debt.

Q. Must I open an officeholder account to raise funds to pay officeholder expenses after the election?

A. Officeholder expenses may be paid fromany committee established for the officethat you hold. You may open an accountand committee for reelection to the sameoffice. Contributions received for thatelection may be used for expensesrelated to your current term of office. Allcontributions raised into the futureelection committee are subject to thecontribution limits for that election.

Q. I am a member of the Assembly and plan to run for State Senate in 2008. May I pay officeholder expenses for my Assembly seat from the campaign bank account set up for my Senate election?

A. No. Officeholder expenses may be paidonly from an account established for theoffice that you hold (including a reelectionaccount or an officeholder account).

Q. I opened an officeholder committee following my election and I also control a ballot measure committee. May other state candidates contribute campaign funds to these committees?

A. Yes, subject to the $3,600 limit oncontributions to state candidates (or the$3,000 limit on officeholder contributionsif you are a member of the Assembly).However, officeholders may not makecontributions from an officeholderaccount to another state elected officer’sofficeholder account.

Q. Following my election to the Assembly,my committee had $25,000 in cash on hand and $75,000 in outstanding loans and accrued expenses. May I keep the $25,000 for officeholder expenses, or carry over the funds to a new committee for my reelection campaign, and raise new funds to pay the debt?





A. No. You may only raise new funds afterthe election to pay “net debt outstanding.”Your committee’s net debt outstanding is$50,000 ($75,000 in outstanding loansand accrued expenses, less the $25,000in cash on hand). Therefore, only$50,000 may be raised, plus amountsneeded to raise the funds and for certainother purposes.

Q. Are contributions received to pay debt from the 2006 Assembly election subject to contribution limits?

A. Yes, they are subject to the contributionlimits for the 2006 primary ($3,300) andgeneral ($3,300) elections. For example,an individual whose total contribution toyour 2006 committee was $1,000 inconnection with the primary election maycontribute up to $5,600 toward the debt(an additional $2,300 for the primaryelection and $3,300 for the generalelection). If you lost in the primary, thisindividual may only contribute anadditional $2,300.

Q. I am a candidate for the Legislature. If I receive a contribution on the day after the

election that was mailed prior to the election, may I keep the contribution if my committee has no debt?

A. No. A contribution is “received” on thedate the candidate or committee obtainspossession or control of it. Because youwill have no debt, the contribution maynot be deposited in the committeeaccount and must be returned within 14days of receipt.

Q. I was a candidate for federal office. How

much may I transfer from my federal campaign committee to my committee for State Senate?

A. Your federal committee can transferfunds to the State Senate committeesubject to the attribution requirementsdescribed in this chapter. The funds

must be attributed to individual donors toyour federal committee and may notcause a donor to exceed the applicablecontribution limit to the Senate committee.

Q. I am a State Senator and will be seeking local office. If I transfer funds from my 2004 Senate committee to the local election committee, may I receive replacement contributions from contributors to the Senate committee?

A. No. The contributions may not bereplaced.

Q. I opened a committee to run for statewide office in 2010. I transferred funds from

my 2004 Senate committee to the new committee using the LIFO attribution method and the committee has received new contributions. I may decide to run for reelection in 2008. May I transfer funds from the 2010 committee to a committee for 2008?

A. Yes, the funds may be transferred, andmust be attributed to specific contributorsto the 2010 committee using the LIFO orFIFO accounting method describedearlier in this chapter.

Q. I lost the primary election for State Assembly. I accepted the expenditure ceiling and my expenditures came very close to the ceiling. I would like to use leftover funds to throw a party for my campaign volunteers and to send a mailer to the voters to refute some lies told about me by my opponent. Will either of these count toward the expenditure ceiling?

A. No. However, see Chapter 10 regardinguses of campaign funds, particularly after

they become “surplus funds.”





Authority

The following Government Code sectionsand Title 2 regulations provide authority for

the preceding information in this chapter:

Government Code Sections

82015 Contribution.82047 Person.82024 Elective State Office.82053 Statewide Elective Office.85203 Small Contributor Committee.85204.5 Special Election Cycle and Special

Runoff Election Cycle.85205 Political Party Committee.85301 Limits on Contributions from

Persons.85302 Limits on Contributions from Small

Contributor Committees.85303 Limits on Contributions to

Committees and Political Parties.85304 Legal Defense Fund.85305 Restrictions on Contributions by

Candidates.85306 Transfers Between a Candidate’s

Own Committees; Use of Funds Raised Prior to Effective Date.

85307 Loans.

85314 Special Elections and Special Runoff Elections as Separate Elections.

85315 Elected State Officer Recall Committees.

85316 Post-Election Fundraising.85317 Carry Over of Contributions.85318 Contributions Received for Primary

and General Elections.85319 Returning Contributions.85321 Post-Election Fundraising;

Elections Held Prior to January 1,

2001.85400 Voluntary Expenditure Ceilings.85401 Candidate Acceptance or Rejection

of Expenditure Ceilings.85402 Lifting Expenditure Limits;

Opponent’s Use of Personal Funds.85403 Violations of Voluntary Expenditure

Limits.

85600 Ballot Pamphlet Designation.85601 Candidate Access to Ballot

Pamphlet.85702 Contributions from Lobbyists.89519 Use of Surplus Campaign Funds.

Title 2 Regulations

18215 Contribution.18215.1 Contributions; When Aggregated.18421.1 Disclosure of the Making and

Receipt of Contributions.18421.4 Reporting Cumulative Amounts for

State Elections and State Recipient Committees.

18503 Small Contributor Committees.

18503.2 Transfer of Funds Raised Prior to Proposition 34 Limits.18530.4 Legal Defense Funds.18530.7 Extensions of Credit.18530.8 Personal Loans.18531 Return of Excessive Contributions.18531.2 Refunding General Election

Contributions.18531.6 Treatment of Debts Outstanding

After an Election—Prior to January 24, 2004.

18531.61 Treatment of Debts Outstanding

After an Election—Contributions Accepted on or After January 24,2004.

18531.62 Elected State Officeholder Bank Accounts.

18534 Required Committee Bank Accounts.

18535 Restrictions on Contributions Between State Candidates.

18536 Transfer and Attribution of Contributions.

18537 Contribution Limits and Application

to Repaid Loans.18537.1 Carry Over of Contributions.18540 Voluntary Expenditure Ceilings.18541 Voluntary Expenditure Limits—

Notification and Designation Requirements.





18542 Notification of Personal Contributions in Excess of the Voluntary Expenditure Limits.

18543 Lifting of Voluntary Expenditure Limits.

18544 Campaign Contribution and Voluntary Expenditure COLAFormula.

18545 Contribution Limit and Voluntary Expenditure Ceiling Amounts.

18572 Lobbyist Contributions—Making a Contribution Defined.




Chapter 2 — Finances/Recordkeeping

Candidates and committees must use a bankaccount to deposit monetary contributionsreceived, and must keep detailed records inorder to fully comply with the reportingrequirements of the Act. Committees alsomay be audited. The recordkeepingrequirements discussed in this chapter applyto candidate election committees,officeholder committees, legal defensecommittees, and recall committees.

However, candidates who do not raisecontributions from others and spend lessthan $1,000 of their own personal funds donot need to open a campaign bank accountand need not have a campaign treasurer.

Campaign Bank AccountCandidates who anticipate soliciting orreceiving contributions from others, or whoanticipate spending $1,000 or more of theirpersonal funds in connection with theirelection, must open a campaign bank

account.A candidate’s personal funds used to pay thefiling fee and/or the ballot statement fee donot count toward the $1,000 threshold.

Establishing the Account

The campaign bank account may beestablished at a bank, a state or federalsavings and loan association, or a state orfederal credit union. The financial institutionmust be located in California.

Candidates running for one office whileholding another must establish a separatecampaign bank account for each office – butnot more than one bank account per officeper election.

State candidates may establish a separatebank account and committee for the primary

and general elections, but are not required todo so. However, a separate bank accountand committee are required each time acandidate runs for reelection or for a differentelective state office. State candidates maynot redesignate a campaign bank account fora different election, even if it is for the sameoffice. (See Chapter 1.)

Campaign contributions may not becommingled with any individual’s

personal funds. All contributions must bedeposited in, and expenditures must bemade from, the campaign bank account.Except as noted below, candidates must firstdeposit personal funds to be used for thecampaign in the account before makingcampaign expenditures, even if thecandidate does not expect to be reimbursed.

Exceptions:• Candidates may use their personal funds

to pay a filing fee or a ballot statement fee

without first depositing the funds into thecampaign account.

• An officeholder may use personal funds topay officeholder expenses. (See Chapter7 for reimbursement requirements.)

• A candidate may contract with a vendor orcollecting agent to collect contributionsprior to promptly transferring the funds tothe candidate’s campaign bank accountwithout violating the requirement that thecandidate have no more than one bankaccount. Fees deducted by the vendorare considered expenditures from thecampaign bank account at the time theyare deducted.

Investments

Campaign funds may be transferred from acampaign bank account to certificates of

Chapter 2Finances/Recordkeeping

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deposit, interest-bearing savings accounts,money market funds, or similar accounts.The funds must come from a campaign bank

account designated for a specific office andbe deposited in investment accountsestablished only for that office. The fundsmust be redeposited into the same campaignbank account before being used forcampaign expenses.

Credit Accounts

One or more credit accounts may beestablished for each campaign bank account.A single credit card, however, may not bedesignated for more than one campaign bank

account. In addition, payment of charges ona credit account must be made only from theappropriate campaign bank account.

ORIn lieu of establishing a new credit account, acandidate may designate an existingpersonal credit card with a zero balance asthe campaign bank account credit card bylisting the card number and date ofdesignation in the campaign records. Thecandidate must ensure that no personalexpenses are charged to this account untilafter the election and after all campaigncharges have been paid with funds from thecampaign bank account. Once all campaignexpenses charged to the account have beenpaid, the candidate may resume using thecard for personal purposes.

Petty Cash

Candidates may use campaign funds toestablish a petty cash fund at each campaignoffice. Keep in mind the following conditionsrelating to the petty cash fund:

• A petty cash fund may not hold more than$100 at any time.

• No expenditure of $100 or more may bemade from the fund.

• The fund may be used only for expensesassociated with the election to the specificoffice or for the expenses of holding the

office for which the petty cash fund wasestablished.

• Once the funds are spent, payments

made from petty cash must be reported asexpenditures.

Expenditures from Multiple Accounts

A candidate who has more than onecampaign bank account must make allexpenditures in connection with an electionfrom the campaign bank account establishedfor that election, including:

• Campaign strategic planning andfundraising expenses;

• Services and actual expenses of outsidepolitical consultants, the campaigntreasurer, other staff, pollsters, and otherpersons who provide services directly inconnection with the election;

• Voter registration and get-out-the-votedrives; and

• Payments for mailings, politicaladvertising, yard signs, opinion polls orsurveys, and other communications if thepayments:

1) Are for a communication that makesreference to the candidate’s futureelection or status as a candidate; or

2) Are made three months prior to anelection for which the candidate hasfiled a Candidate Intention Statement(Form 501), a declaration ofcandidacy, or nomination papers withan election official, or any otherdocuments necessary to be listed onthe ballot for an elective office.

Officeholder Committees, Legal DefenseCommittees, and Recall Elections

State candidates and officeholders mayestablish separate accounts and committeesto raise funds for officeholder expenses,legal defense, and opposition to theofficeholder’s recall. (See Chapter 1.) All of





these committees are subject to therecordkeeping requirements discussed in thischapter.

In addition, legal defense committees mustkeep separate detailed accounts, records,bills, and receipts for each legal dispute.

RecordkeepingAccurate and organized records must bekept of all contributions received andexpenditures made. All individuals whohandle receipts and make expenditures mustbe aware of and practice the recordkeepingprocedures required by the Political Reform

Act and FPPC regulations that are outlined inthis manual. While others may be involved,the candidate and treasurer, as listed on thecommittee’s Statement of Organization(Form 410), remain legally responsible forthe accuracy of the records.

Record Retention

Candidates and committees must keep allrecords, including original sourcedocumentation, for a period of four yearsfrom the date the campaign statement

relating to the records was filed.

Sharon Goldstein, a State Assemblymember, filed her first

campaign statement on January 31, 2007.The records associated with completing that statement, such as receipts and information on contributors, must be retained until January 31, 2011.

Exceptions:• Elected state officers serving a four-year

term must keep for five years recordsassociated with the campaign statementsthey filed during the first year followingtheir election.

• The electronic filing declaration required tobe filed with Form E-530 must be kept for

five years following the date the report isfiled. (See Chapter 8.)

Records of ReceiptsTwo types of records are required for receipts:a daily record, showing how much moneywas received on any given day; and acontributor record, with detailed informationon each contributor of $25 or more. The dailyrecord requirement may be met simply withbank statements, copies of checks received,or other documentation that provides therequired information listed below.

Receipts Under $25

A daily lump sum total must be kept forcontributions under $25 and miscellaneousreceipts under $25.

Contributor Record

Contributions: $25 to $99.99

For each monetary or nonmonetarycontribution or loan of $25 or more, the datereceived, amount, type of contribution, andfull name and address, including zip code, ofthe contributor must be documented. In

addition, the total amount received from thatcontributor over the course of the currentcalendar year (the “cumulative amount”)must be recorded.

Date Received

A monetary contribution is received on thedate that the candidate or committee, or anagent of the candidate or committee, obtainspossession or control of the cash, check, orother form of contribution, not the date it isdeposited in the bank account. Contributionsreceived by electronic methods such as wiretransfer, credit card or debit accounttransactions are also received on the datethe candidate or committee obtainspossession or control of the funds. Thefollowing list provides examples:

Example





• A contributor makes a contribution overthe telephone. The contribution is“received” by the committee on the date

the contributor gives his or her debit/creditaccount information to the committee.

• A contributor makes a contribution via theInternet and the committee reviews theonline transaction before the contributionis processed. The contribution is“received” by the committee on the datethe committee receives the paymentinformation.

• A contributor makes a contribution via theInternet and the contribution is made bydirect deposit without review and beforetransaction reports are produced. Thecontribution is “received” by the committeewhen the committee has possession ofthe funds.

• A contributor agrees to make contributionsvia “installment” payments by authorizingthe committee to periodically charge his orher credit card or withdraw funds from hisor her account. The contribution is“received” when the committee, or anagent of the committee, obtains

possession or control of the funds for eachinstallment payment. The contributionreported is only the amount of eachinstallment payment when received.Installment payments scheduled to takeplace in the future, but not yet received,are not reportable.

Contributions: $100 or More (Occupationand Employer Information)

If contributions totaling $100 or more arereceived from an individual, in addition to the

above information, the contributor’soccupation and employer are recorded.

If the contributor is self-employed, that factalso must be noted along with the name ofhis or her business. Generally, if a check isdrawn on the account of a business entity,the contributor is the business entity, not theperson who signs the check.

A contribution of $100 or more must bereturned if the contributor’s name,address, and, if the contributor is an

individual, his or her occupation andemployer are not in the committee’srecords within 60 days from receipt of thecontribution. If the contribution cannot bereturned to the contributor, it must be paid tothe Secretary of State within 60 days ofreceipt for deposit in the state’s general fund.If the contribution is returned to thecontributor by check and the check is notcashed by the contributor within 90 days, thecontribution must be paid to the Secretary ofState within the following 30 days for deposit

in the state’s general fund.Contributions may be deposited in thecommittee’s bank account pending receipt ofthe information, in which case they must bereported on the next campaign statementrequired to be filed (including latecontribution reports and the $5,000 and$1,000 election cycle reports). The RecipientCommittee Campaign Statement (Form 460)must be amended within 70 days from itsclosing date to disclose the missingcontributor information unless the

contribution is returned to the donor. Latecontribution reports and the electronic $5,000and $1,000 reports need not be amended.The committee also must record the date thecontributor information is received, if thatdate is different than the date the contribution

is received.

Stanley Hughes, a State Senate candidate, received a

contribution of $100 from Martha Andersen on June 1. The only information he had was

her name and address as listed on her check. On his semi-annual statement covering the reporting period through June 30, he reported receiving $100 from Martha,listed her name and address, and indicated that he would amend his statement when he received her occupation and employer information. By July 31 of that same year,

Example





even after writing to Martha, Stanley still did not have Martha’s occupation and employer.Stanley must return $100 to Martha.

Intermediaries

For contributions of $25 or more madethrough an intermediary (see Chapter 3)records of the above information for both theintermediary and the contributor are required.

Nonmonetary Contributions

If the contribution is nonmonetary and worth$25 or more, a description and the fairmarket value of the contribution must berecorded. (See “Valuing” in Chapter 3.)

Loans

If the contribution is a loan of $25 or more,the following information for the lender mustbe recorded:

• Interest rate of the loan, if any;

• Due date of the loan, if any; and

• Name and address of any guarantor andthe amount guaranteed. The occupationand employer of any individual who

guarantees a loan of $100 or more mustalso be recorded.

If a candidate receives a loan from acommercial lending institution for his or hercampaign, both the institution and thecandidate are reported as the source of theloan.

State candidates who make loans to theirown campaign committee from personalfunds may not charge the committee interest.In addition, state candidates may not have

personal loans, including loans from acommercial lending institution, outstanding totheir campaigns exceeding $100,000 at anyone time. (See Chapter 1.)

Documentation

The committee must keep copies of alldocuments reflecting deposits made and all

records reflecting campaign bank accountbalances, such as bank statements, checkregisters, and passbooks.

The following documents produced orreceived by the committee also must be keptfor receipts of $25 or more: copies ofcontributor checks; contributor cards; lettersof transmittals; notices or writings receivedfrom contributors; memoranda or otherrecords that describe the method used todetermine the fair market value of donated

goods or services (nonmonetarycontributions); and loan agreements or otherdocuments that reflect indebtedness. Inaddition, documentation for electronictransactions must include informationcollected when debiting the contributor’saccount, such as itemized transaction reports(including the credit card confirmationnumber), debit/credit account transactionrecords, and credit card receipts or vouchers.Documentation of contributions received overthe Internet must include a record of thetransaction created and transmitted by thecardholder including the cardholder’s nameand address and card number.

For contributions or other receipts of $100 ormore, copies of any letters or othercommunications sent by the committee toobtain the documents listed above must bekept.

Expenditures

Expenditures: Under $25

A daily lump sum total of all expendituresunder $25 must be kept.

Expenditures: $25 or More

For expenditures of $25 or more to a singlepayee, or a series of payments for a single





product or service that total $25 or more, thefollowing must be recorded:

• Full name and street address, including

zip code, of payee;

• Expenditure amount;

• Date the expenditure was made or, foraccrued expenses, the date the goods orservices were received; and

• Description of the goods or servicesreceived.

Contributions to Other Candidates orCommittees and IndependentExpenditures

For expenditures that are contributions toanother officeholder, candidate, orcommittee, or independent expenditures (seeChapter 4) to support or oppose a ballotmeasure, the amount of the expenditure andalso the cumulative amount paid in thatcalendar year in connection with theofficeholder, candidate, committee, or ballotmeasure must be recorded.

For all such expenditures of $25 or more, thefollowing information is required:

• Date the contribution or independentexpenditure was made;

• Whether the expenditure is anindependent expenditure;

• Name of the officeholder or candidate andthe office and district he or she holds orfor which he or she seeks nomination orelection, or the number or letter of themeasure and the jurisdiction in which themeasure is to be voted on; and

•

Cumulative amount spent on behalf of thecandidate, measure, or committee.

Candidates may not use campaignfunds to make independent

expenditures to support or oppose otherstate or local candidates.

Loans Made to Others

The following additional information must bekept for loans made by the committee:

interest rate, if any; due date, if any; and fullname and street address of anyoneguaranteeing the loan or who is liabledirectly, indirectly, or contingently for theloan. (For restrictions on loans to others, seeChapter 10.)

Transfers to Another ControlledCommittee of the Candidate

A candidate’s controlled committee thattransfers funds using the LIFO or FIFOmethod must keep records of the specific

contributors attributed to each transfer. Inthe event that a transferring committee is nolonger required to keep such documents, thereceiving committee may use copies of thetransferring committee’s campaignstatements or other available records thatconfirm the identity of the originalcontributors. (See Chapter 1.)

Expenditure Limits

Candidates who have accepted the voluntaryexpenditure ceiling must maintain records

identifying how campaign expenditures thatcount toward the ceiling were allocated. (SeeChapter 1 for information on the voluntaryexpenditure ceiling and to determine whichexpenditures count toward the ceiling.)

Documentation

All bank and credit card records forexpenditures must be kept.

For any expenditure of $25 or more made bythe committee or by any agent on behalf of

the committee, canceled checks, bills,invoices, or statements; receipts; credit cardcharge slips, vouchers; contracts; loanagreements; and other documents producedor received by the committee reflectingadditional obligations also must be kept bythe committee. Copies of canceled checkscan be retained if the copies contain a legible

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image of the front and back of the canceledcheck and the copies are obtained from thefinancial institution.

If no receipt, voucher, or invoice is available,a voucher should be written as soon aspossible with the date and amount of thepayment, the name of the payee, and adescription of the goods or services received.A voucher is not required for payments under$25.

Notices to Major Donors, Mass Mailings,and Telephone Calls

A copy or a record of all $5,000 “majordonor” notices (see Chapter 3) and a copy ofany mass mailings (see Chapter 4) sent bythe committee must be kept. For certaintelephone calls made to 500 or more votersand paid for by the committee (see Chapter4), a script of the call or a copy of therecorded phone message also must be kept.

AuditsThe Act authorizes audits of committees.Mandatory audits of candidates, theircontrolled committees, and primarily formed

committees that support or opposecandidates are conducted by the FranchiseTax Board. Committees established forofficeholder expenses and legal defense arealso subject to mandatory audits under theAct if the controlling candidate orofficeholder’s election committee is selectedfor audit.

Mandatory audits for the office of StateController and members of the Board ofEqualization are conducted by the FairPolitical Practices Commission.

Discretionary audits may be conducted bythe Fair Political Practices Commission ofany committee.

Statewide Candidates

All candidates for statewide office who raiseor spend $25,000 or more in a primary or

general election will be audited. Ten percentof such candidates who raise or spend lessthan $25,000 will be subject to audit by

random selection.

Supreme Court, Court of Appeal, Memberof the Board of Equalization

Candidates for Supreme Court, Court ofAppeal, or Board of Equalization who raise orspend $25,000 or more in a primary orgeneral election will be audited.

State Legislature

Candidates for the State Legislature whoraise or spend $15,000 or more in a primary

or general election will be subject to audit byrandom selection of 25 percent of the Senatedistricts, and 25 percent of the Assemblydistricts.

All state legislative candidates who raise orspend $15,000 or more in connection with aspecial election or a special runoff electionwill be audited.

Treasurer DutiesEvery committee must have a treasurer.

There are no restrictions on who may betreasurer. In fact, the candidate controllingthe committee may be the treasurer. Thecommittee may not accept contributionsor make expenditures before a treasureris appointed or while the treasurer’s postis vacant, even if there is an assistanttreasurer (see below). If the committeetreasurer is unavailable to carry out his or herduties for an extended time, a new treasurershould be designated and the committee’sStatement of Organization (Form 410)

amended.

Treasurers or assistant treasurers must signand verify all reports and statements filed.The verification indicates under penalty ofperjury that:

• The signer has used all reasonablediligence in preparing the statement; and





treasurer’s performance to requiredstandards if the candidate knows or hasreason to know that the treasurer is notexercising all reasonable diligence in theperformance of his or her duties.

• Review with care the campaignstatements prepared for filing by thecommittee.

• Correct any inaccuracies and omissions incampaign statements of which thecandidate is aware and check and correctany information on campaign statementswhich a person of reasonable prudencewould question based on all of thesurrounding circumstances.

• Perform with due care any other tasksassumed in connection with the raising,spending, or recording of campaign fundsinsofar as such tasks relate to theaccuracy of information entered oncampaign statements.


Q. If, in the early days of the campaign, the candidate is not able to find someone to serve as the campaign treasurer, may the

candidate serve in that capacity until another person is found?

A. Yes. In fact, a separate treasurer isnever required; the candidate may serveas treasurer throughout the campaign.

Q. Are there any specific accounting qualifications for someone to be able to serve as treasurer, or any conditions which would disqualify someone from being able to serve as treasurer?

A. No.

Q. What should be done if the treasurer and assistant treasurer, or the candidate, are not able to sign before the deadline?

A. In order to ensure that the statement isfiled on time, you may submit the filing ifit is signed by one of the following: the

candidate, treasurer, or assistanttreasurer. If the candidate’s signature ismissing, submit an amendment toprovide his or her signature as soon aspossible. Likewise, if both the treasurerand assistant treasurer are unavailable,submit an amendment to provide therequired signature as soon as possible.

Q. Are committee records and source documentation required to be kept on paper, or may the committee use an electronic recordkeeping system?

A. Electronic records are permitted,provided that all of the requiredinformation is collected and recorded in atimely and uniform manner that ensuresthe accuracy and reliability of theinformation. Committees are responsiblefor ensuring that electronic records canbe read and/or printed for auditingpurposes during the applicable retentionperiod.

Q. Are form letters thanking the committee for contributions it has made required to be retained for recordkeeping purposes?

A. Form letters containing no informationnecessary to complete or verify thecommittee’s campaign statements arenot required to be retained.

Authority

The following Government Code sectionsand Title 2 regulations provide authority forthe preceding information in this chapter:


82015 Contribution.

82018 Cumulative Amount.82025 Expenditure.82044 Payment.82047.5 Primarily Formed Committee.84100 Treasurer.84104 Recordkeeping.84300 Cash and In-Kind Contributions;

Cash Expenditures.





84302 Contributions by Intermediary or Agent.

84307 Commingling with Personal Funds.84310 Identification Requirements for

Telephone Calls.85201 Campaign Bank Account.85304 Legal Defense Fund.85315 Elected State Officer Recall

Committees.85318 Contributions Received for Primary

and General Elections.85501 Prohibition on Independent

Expenditures by Candidate Controlled Committees.

85700 Donor Information Requirements; Return of Contributions.

89511.5 Use of Personal Funds for Incumbent Elected Officers.

90000 Responsibility.90001 Mandatory Audits and

Investigations.90002 Audits and Investigations; Time.90003 Discretionary Audits.90006 Audit and Investigation by

Commission.90007 Auditing Guidelines and

Standards.

Title 2 Regulations18401 Required Recordkeeping for

Chapter 4.18421.1 Disclosure of the Making and

Receipt of Contributions.18421.2 Street Address.18421.3 Reporting of Contributions and

Expenditures Collected by Contract Vendors or Collecting Agents.

18426.1 Assistant Treasurer.18427 Duties of Treasurers and

Candidates with Respect to Campaign Statements.

18432.5 Intermediary.18440 Telephone Advocacy.18521 Establishment of Separate

Controlled Committee for Each Campaign Account.

18523 Nondesignated Contributions or Loans.

18524 Investment and Expenditure of Candidates’ Campaign Funds.

18525 Incumbent Candidates’ Election Expenses and Officeholder Expenses.

18530.4 Legal Defense Funds.18531.5 Recall Elections.18531.62 Elected State Officeholder Bank

Accounts.18534 Required Committee Bank

Accounts.18570 Return of Contributions with

Insufficient Donor Information.18994 Auditing and Investigations.18995 Standards and Guidelines for

Auditing Statements and Reports.




Chapter 3 — Contributions

This chapter begins with a definition of“contribution” and provides guidelinesnecessary to proper reporting, including adiscussion on valuing nonmonetarycontributions. Contributions to statecandidates and committees are subject tothe limits described in Chapter 1.

What Is a Contribution?A “contribution” is a monetary or nonmonetarypayment received by a candidate orcommittee for which the candidate orcommittee has not provided full and adequateconsideration in return. A contribution maytake any of the following forms:

• Money (cash, check, credit card, wiretransfers);

• Nonmonetary items (donated goods orservices, discounts);

• Payments made by a third party foradvertising or other communications (seeChapter 4);

• Loans (including loan guarantees, co-signing, and lines of credit);

• Extensions of credit for goods or services;

• Money, nonmonetary items, and loans fromthe candidate to his or her own committeeor from the candidate’s family; and

• Enforceable promises (for example, acontributor promises, in writing, to pay forspecific goods or services and, based onthat written promise, the committeeexpends funds or enters into a legally-

enforceable contract to purchase thegoods or services).

Each type of contribution is reporteddifferently. In fact, when a contribution isreceived is determined in part by what typeof contribution it is.

In general, a monetary contribution isreceived on the date that the candidate,committee, or an agent of the committeeobtains possession or control of the cash,check, or other item that constitutes thecontribution. (See Chapter 2 for detailedinformation about when a monetarycontribution is received.)

John Burns, the campaign consultant for Friends of Joshua

Truman, received a hand-delivered check at

a May 14, Friday evening fundraiser for Friends. John did not give the check to the committee’s treasurer for deposit until the following Monday, May 17. The contribution was received on May 14, the day the committee’s agent obtained possession of the check.

Friends of Joshua Truman also contracts with a website service to receive contributions over the Internet. The website service sends the committee’s treasurer an email each time a contributor logs on to the website service and enters his or her donor information and credit card number. Logging onto the website service, the treasurer can accept the contribution and receive the funds. The committee reports receipt of the contribution on the date it receives the email because it controls the contribution on that date.

A nonmonetary contribution is received onthe earliest of the following:

• The date funds were expended by the

contributor for the goods or services;• The date the candidate, committee, or an

agent of the committee obtainedpossession or control of the goods orservices; or

• The date the candidate or committeereceived the benefit of the expenditure.

Chapter 3Contributions

Examples

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An enforceable promise is received on thedate the candidate, committee, or an agentof the committee receives documents

verifying that a contributor has made alegally enforceable promise to pay for goodsor services. A pledge card is not consideredan enforceable promise to make acontribution. “Enforceable promise” alsodoes not include a contributor’s agreement tomake future installment payments throughwire transfer, credit card transaction, debitaccount transaction or similar electronicpayment.

When an agent of the committee, such as acampaign consultant, receives a contribution

for the committee, the treasurer must benotified by the agent no later than the closingdate of the next campaign statement due.

An extension of credit is a contributionwhen there is an agreement between theprovider of goods or services and a statecandidate or his or her controlled committeethat payment for goods or services providedto the candidate or committee will be madeat a later date. (Also see Chapter 7 forreporting extensions of credit that were

previously reported on Schedule F asaccrued expenses.) An extension of creditdoes not become a contribution if thecandidate or committee pays for the goods orservices on or before the earlier of:

• 45 days after the date of the invoice; or

• 45 days from the date the goods orservices are delivered; or

• For ongoing services, 45 days after thedate of the invoice as long as the servicesare billed no less frequently than on a

three-month billing cycle.

If the candidate or committee does not payfor the goods or services within 45 days asdescribed above, an extension of credit doesnot become a contribution if all of thefollowing requirements are met:

• The credit arrangement is recorded inwriting;

• It is the regular business of the provider of

the goods or services to provide similargoods or services;

• The goods and services are provided inthe ordinary course of business and onthe same terms and conditions offered tocustomers generally;

• The provider enters into the agreementwith the intent that the candidate orcommittee will pay in accordance with theterms of the written agreement and theprovider does not know that the candidate

or committee would not be able to pay;and

• The provider makes reasonable efforts tocollect the full amount of the paymentwithin four months of the date that thepayment is due under the terms of thewritten agreement.

Katz Construction, Inc., has agreed to let Assembly

candidate Evelyn Michaels use some empty offices in its building for her campaign

headquarters. The company does not normally rent space in its building, but they have estimated the fair market value of the space rental at $1,000 per month. The company and the candidate have a written agreement stating that the rent is due on the first of each month. Because Katz Construction does not provide rental office space in the normal course of its regular business, if Michaels does not pay each month’s rent within 45 days of the first of the month, the $1,000 will become a

nonmonetary contribution to her campaign on the 46 th day and will be reportable on Schedule C of Form 460 and subject to contribution limits.

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Exceptions

There are many exceptions to the definitionof “contribution.” Exceptions for certain types

of political communications are alsodiscussed in detail in Chapter 4. Some ofthe most common exceptions include:

Volunteer Personal Services: If anindividual donates his or her personal orprofessional services to a campaign, nocontribution has been made or received.However, if an employer donates employeeservices to a campaign, and any employeespends more than 10% of his or hercompensated time in a calendar monthproviding the services, the employer hasmade a nonmonetary contribution to thecommittee.

Home/Office Fundraisers: If someoneholds a fundraiser or other campaign event inhis or her home or office, the costs incurredby the occupant of the home or office neednot be reported as long as the total cost ofthe event is $500 or less. However, ifsomeone else donates food, beverages, oranything else of value to the event, the fairmarket value of those donated goods is a

nonmonetary contribution. In addition, thedonated goods must be counted todetermine whether the total cost of the eventis $500 or less.

Jaleel Baker holds a fundraiser in his home for your committee. He

spends $250 on decorations, food, and drinks for the event. His neighbor, Sheila Mkemo, brings some door prizes with a fair market value of $50. Since the total cost of the event is under $500, Jaleel’s $250 is not

reportable. However, since Sheila is not the occupant of the home, her nonmonetary contribution of $50 is reportable, although not itemized.

Shannon Priestly sponsors an event for your committee after work in her business’ downtown office. Shannon spends $450 to

have the event catered. Jason Cameron,who works in the building next door, supplies a flower centerpiece worth $75. Since the

total cost of the event exceeds $500, both Shannon’s contribution of $450 and Jason’s $75 flower arrangement are reportable by your committee.

Member Communications: Paymentsmade by an organization (including a politicalparty) for certain communications that aresent only to the organization’s members,employees, or shareholders, or their families,are not contributions to a candidate endorsedin the communications. (See Chapter 4.)

Restrictions on Contributions

There are contribution limits for statecandidates and committees that makecontributions to state candidates. (SeeChapter 1.) In addition, there are otherrestrictions on receiving contributionsapplicable to all committees. For example,contributions of $100 or more must be madeby written instrument and may not be madeor received in cash. (See Chapter 10.) Inaddition, contributions of $100 or more must

be returned if the contributor’s name,address, occupation, and employer are notobtained within 60 days of receipt of thecontribution. (See Chapter 2.)

Receiving ContributionsAggregating Contributions

Contributions received from certaincombinations of individuals and entities mustbe added together to determine the totalamount that will be treated as received from

a single contributor. These rules apply forpurposes of the contribution limits andreporting.

The following are aggregated:

• Contributions from the personal funds ofan individual and contributions made by

Examples





an entity when the same individual directsand controls the entity’s contributions.

• Contributions from two or more entities if a

majority of the same persons directs andcontrols the contributions of each entity.

• Contributions made by entities that aremajority owned by any person with thecontributions of the majority owner and allother entities majority owned by thatperson, unless those entities actindependently in their decisions to makecontributions.

The term “person” includes anindividual, proprietorship, firm,

partnership, joint venture, syndicate,business trust, company, corporation, limitedliability company, and association.

The following are basic examples to providegeneral guidance regarding aggregation ofcontributions. Every case is unique and ifthese examples are not helpful, contact theFPPC for advice.

Sally Perez contributed $98 from her personal funds and another

$98 from the funds of her wholly-owned business, Flowers by Sally Perez, to the Anderson Committee. Because contributions from an individual and his or her business, or from any other account he or she directs and controls, are considered to be from a single contributor, the Anderson Committee must itemize both contributions and report a cumulative amount received from Sally and her business of $196 on its committee campaign statement.

EXtream Snowboards, Inc., made a contribution of $250 to the Johnson Committee. EXtream Snowboards, Inc., is a wholly-owned subsidiary of LeesureTech Industries, which also made a contribution of $250 to the Johnson Committee. If there was coordination between EXtream Snowboards and LeesureTech Industries,

their contributions are considered to be from a single contributor. The Johnson Committee must itemize both contributions

and report a cumulative amount received of $500 on its campaign statement.

William Smith is a developer with four separate corporations. William makes political contributions from his personal funds and directs and controls the contributions of each of his corporations. William made a contribution of $1,600 from his personal funds and contributions of $2,000 from the funds of one of his corporations to the Perez for Assembly Committee for the 2008 primary election. The committee may not

receive any additional contributions from Smith or his corporations for the primary election.

Southwest TeleCom has a greater than 50% ownership interest in American TeleCom.Each entity, entirely on its own and with separate decisionmaking bodies, makes a contribution of $1,000 to Senator Yadon.The senator does not aggregate these contributions because Southwest TeleCom and American TeleCom acted completely

independently in their decisions to make the contributions.

Also see Chapter 7 for information onreporting aggregated contributions receivedfrom major donor committees.

Credit Card, Electronic, and Other Typesof Contributions

Contributions may be received by credit card,wire transfer, debit account transaction, orsimilar electronic payment options (including

contributions received via the Internet ortelephone). All of the reporting andrecordkeeping requirements apply to thesecontributions. (See Chapter 2.) Some tipsare:

• For contributions of $25 or more, thecommittee treasurer should make sure

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that a copy of the credit card voucher orother documentation is sent to thecommittee as soon as practicable after the

contributions are made.• The entire amount charged to the

contributor is reported as a contribution.

• Fees associated with this type offundraising, or deducted by the vendorbefore the contributions are sent to thecommittee, are reported as expenditures;the fees are not deducted from theamount of each contribution reported.

Fundraisers

The full amount (face value) of a fundraiserticket is a reportable contribution.

Your committee holds a fundraiser and charges $100 per

person. After the event, you determine that it cost your committee $25 per person to pay the caterer, hall rental, entertainment,invitations, etc. Report on Schedule A of the Form 460 each contributor’s name, address,occupation, and employer and the full $100 per ticket contribution. Do not subtract $25

from each ticket sold.

Auctions and Garage Sales: When itemsare donated for auction or sale at afundraiser, the donated item is anonmonetary contribution. (See below fordetermining the value.) When someonebuys an item, the payment is usuallyconsidered a “Miscellaneous Increase toCash” and is reported as such. (SeeChapter 7.) If any one person or entity pays$100 or more, the payment is itemized.

However, when someone pays more for anitem than it is worth, the amount that is equalto the fair market value is reported as amiscellaneous increase to cash and theamount over the fair market value as amonetary contribution. Each is itemized at$100.

Andy Foster owns an electronics store and donates a TV worth

$500 to your committee. At your committee’s

auction, Gloria Fernandes bids $600 for the TV. Itemize $500 as a nonmonetary contribution from Andy’s store. Then, itemize $500, that part of Gloria’s payment which is the fair market value of the TV, as a miscellaneous increase to cash. Also itemize $100, the amount over the fair market value, as a monetary contribution from Gloria.

Bar Receipts: Funds received by sellingdrinks at a fundraiser at fair market value are

reported as miscellaneous increases to cash,not contributions.

Raffle Tickets: Receipts from the sale ofraffle tickets at a fundraiser are reported ascontributions. Items donated for raffle prizesare reported as nonmonetary contributions.(Note that Penal Code Section 319 imposessome restrictions on raffles.)

Intermediary

An intermediary is a person or entity that

makes a contribution on behalf of anotherperson and has been or will be reimbursedfor the contribution. For each contribution of$100 or more from an intermediary, thename, address, and, if applicable, theoccupation/employer information must bedisclosed for both the true source of thecontribution and the intermediary.

Berry Barr and Vienna Waltz each made a $100 contribution

from their personal funds to support Tina

Baker for State Treasurer, with the understanding that they would be reimbursed by their employer, the Music Company.Berry and Vienna must tell the committee that they are acting as intermediaries on behalf of their employer, the Music Company. Tina’s campaign statement must show the $200 contribution from the Music

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Example

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Company, and also Berry Barr and Vienna Waltz as intermediaries of $100 each.

The Playa del Sol Stockbrokers Emporium

requested its employees to attend a fundraiser for Megan Waters, a candidate for Assembly, with the intent of reimbursing the employees for their contributions. The employees informed Megan that their contributions would be reimbursed by the Emporium. When the committee’s treasurer completed the committee’s Form 460, he reported the total of the contributions coming from Playa del Sol Stockbrokers Emporium and reported those employees who contributed $100 or more as intermediaries

for the Emporium.

A corporation has asked its employees to make personal contributions to Friends of Joshua Monet, a candidate’s committee, with the intent of reimbursing its employees for the contributions they make. Neither the employees nor the corporation inform the committee that the employees will be reimbursed. The corporation and the employees have violated the Act.

Candidates and committees are required tocheck and, if necessary, correct anyinformation regarding the true source of acontribution that a person of reasonableprudence would question based on all of thesurrounding circumstances. If there isreason to question the source of acontribution, i.e., if there is reason to believethe information contained on the contributioncheck does not contain the name of theperson who is actually making thecontribution, the donor should be asked if he

or she is acting as an intermediary for thetrue source of the contribution.

Joint Checking Accounts and BusinessAccounts

Individuals (including spouses) may makeseparate contributions from a joint checkingaccount. For reporting purposes, the full

amount of the contribution is reported ascoming from the individual who signs thecheck. If two or more individuals sign the

check, the contribution is divided equallybetween or among the signers, unless thereis an accompanying document signed byeach individual whose name is printed on thecheck which clearly indicates a differentapportionment.

Linda and Jerry Nelson have a joint checking account. From

this account, Linda signed a $100 check payable to Friends of Joshua Truman. The committee identifies Linda Nelson as the

contributor of the full $100.

A check drawn on a joint checking accountthat is signed by an individual not listed onthe check (e.g., an accountant) must beaccompanied by a document signed by atleast one of the individuals listed on thecheck stating to whom the check is to beattributed.

Generally, if a check is drawn on the accountof a business entity, the contributor is thebusiness entity, not the person who signs the

check.

Minor Children

A contribution made by a child under the ageof 18 is presumed to be a contribution fromhis or her parent or guardian, unless thefacts show otherwise, e.g., that the childactually chose to make the contribution.

Transfers and Carryover from a PriorCampaign

A state candidate may carry over funds fromone election to the next election for the sameoffice, and may transfer funds from onecontrolled committee to another committeefor a different office, subject to certainrestrictions. (See Chapter 1.)

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Contributions from Other Candidates

Candidates and committees may receivecontributions, within the applicable

contribution limits, from other candidates orofficeholders. (See Chapter 1 for detailedinformation about contribution limits.)

Undesignated Contributions

Candidates who are soliciting contributionsfor more than one office and receive acontribution that has not been designated fora specific office may deposit the contributionin any of their campaign bank accounts.

Undesignated monetary contributions should

be deposited in a campaign bank accountwithin 30 days of receipt. Nonmonetarycontributions should be allocated to aparticular committee within 30 days of receiptor by the deadline for the reporting period inwhich the nonmonetary contribution isreceived, whichever is earlier.

$5,000 Notification to Potential “MajorDonors”

Candidates and committees that receive oneor more contributions totaling $5,000 or more

in a calendar year from an individual or entitythat made the contribution(s) from personal,business, or corporate funds must send thecontributor written notice that they may needto file a campaign statement if theircontributions to state and local candidatesand committees (including legal defense fundand officeholder committees) total $10,000 ormore in a calendar year. The notice may betailored as long as it contains languagesubstantially similar to the language below:

If your contribution(s) to this committee andto other California state or local committeestotal(s) $10,000 or more in a calendar year,California law requires you to file a MajorDonor Committee Campaign Statement(Form 461). The deadline and location forfiling this statement will depend upon thetiming and type of contribution(s) you have

made. In addition, once you become amajor donor, you are required to file a latecontribution report within 24 hours if you

make contributions totaling $1,000 or moreto a single candidate, his or her controlledcommittee, or to a committee primarilyformed to support or oppose a candidate orballot measure during the 16 days beforethe election in which the candidate ormeasure is being voted upon or makecontributions totaling $1,000 or more to astate or county political party committeeduring the 16 days prior to a state election.

Failure to file campaign statements mayresult in late filing penalties ($10/day) and

fines (up to $5,000/violation). For moreinformation, contact the Fair PoliticalPractices Commission toll free at (866)275-3772 or refer to its website:www.fppc.ca.gov.

Additionally, if you make contributions of$50,000 or more in a calendar year inCalifornia and some or all of thosecontributions are to state candidates,committees, or ballot measures, you arerequired to file your Form 461electronically with the Secretary of State.For more information on the electronicfiling requirements, contact the Secretaryof State’s Office at (916) 653-6224.

The notice is not required if the source of thecontribution is an existing committee,because it already is required to filecampaign statements.

The notice must be sent, faxed, or emailed tothe contributor within two weeks of receipt ofthe $5,000 contribution(s). No further notices

are required for subsequent contributionsreceived from the same contributor within thesame calendar year.

A copy of each notice or a record of allnotices showing the date sent, faxed, oremailed, and the name and address of theperson receiving the notice must be retained.





Valuing Nonmonetary Contributions

This section provides assistance indetermining how to value nonmonetary

contributions so that they may be reportedaccurately. The varieties of nonmonetarycontributions are vast, so not all possibilitiesare presented. Contact the FPPC forassistance.

Fair Market Value

When a nonmonetary contribution isreceived, the fair market value of the goodsor service must be reported.

The owner of an audio-visual store donates a television set

worth $500 to your committee for sale at an auction. Although the set costs the store owner less than $500, the fair market value of the television (the amount it would cost any member of the public to purchase the set from the store) is $500. Therefore, the nonmonetary contribution from the store owner is $500.

If a business donates the use of anemployee to work on a campaign, the

amount the individual is paid for working onthe campaign is reportable only if theemployee spends more than 10% of his orher compensated time in a calendar monthworking on the campaign.

An accounting firm provides your committee with the services of an

accountant during the last month of the campaign. The accountant spends 25% of her time working for the campaign, for which her gross compensation from the accounting

firm is $2,500. The amount of the contribution from the accounting firm is $2,500.

If a committee receives discounts on goods orservices it purchases and the discounts arenot offered to the public in the regular courseof business, the discount is a nonmonetarycontribution which must be reported.

Your committee treasurer knows the owner of Janns’ Printing

Shop and gets the owner to give your

committee a 50% discount on the printing of a brochure that normally would cost $1,200.Your committee has received a nonmonetary contribution of $600 from Janns’ Printing Shop.

Volunteer personal services are notconsidered to be a nonmonetary contribution.

The owner of Janns’ Printing Shop volunteers her time to print

fundraiser invitations for your committee.Your committee must report the fair market

value of the materials, but need not include any of the shop owner’s time in determining the amount of the nonmonetary contribution.

If the committee does not know the fairmarket value of a nonmonetary contribution,such as an original piece of artwork, thecommittee may send a letter requesting thatthe contributor provide the value of thecontribution in writing. The contributor islegally obligated to provide an amount if thevalue of the contribution is $100 or more.

Mailings

Generally, the fair market value of a mailingis reported as a contribution when themailing expressly advocates support of oropposition to a candidate and was made atthe behest of the affected candidate.

The Treetop Paper Company produces and sends a mailing to

support your committee. Although the company receives paper at a discounted rate,

report the receipt of a nonmonetary contribution in the amount it would have cost you had you paid fair market value for the mailing.

Multiple Candidates and Measures: If amailer expresses support of or opposition tomore than one candidate or ballot measure,the fair market value attributable to each may

Example

Example

Example

Example

Example





be calculated by prorating the costs amongthe featured candidates and ballot measures.The prorated value is based on the amount

of space allotted to each candidate ormeasure supported or opposed in the mailer.

The Weston Chamber of Commerce produces and mails a

one-page flyer urging voters to vote for gubernatorial candidate Stan Smith and against two ballot measures. Half of the flyer is devoted to supporting Smith and the other half equally opposes the measures. The Chamber coordinates the mailing with candidate Smith, but does not coordinate

with any committee set up to oppose the two measures. The total cost of producing and mailing the flyer is $14,000. Smith has received a nonmonetary contribution valued at $7,000, and the Chamber has made independent expenditures of $3,500 apiece opposing the two ballot measures.

The value of a mailer that supports oropposes candidates and measures beingvoted on in different jurisdictions may beprorated based on the number of mailerssent to each candidate or ballot measure’s jurisdiction.

Political and Non-Political Material: Thecost of a mailing containing both expressadvocacy in support of or opposition to acandidate and other nonpolitical material canbe prorated. Costs directly associated withthe political message are reportable by thecandidate, including, for example,compensation paid to employees who spendmore than 10% of their compensated time ina calendar month producing or mailing the

political materials, and the pro rata cost ofpaper, envelopes, and postage. Theallocation may be based on the additionalweight of the political material or thecomparative number of pages as betweenthe political and non-political material.

Member Communications: Payments madeby an organization or its sponsored committeefor a communication that supports or opposes

a candidate are not contributions orexpenditures as long as the communication ismade only to the organization’s members,employees, or shareholders, or the families ofits members, employees, or shareholders.The communication may not be for generalpublic advertising, such as billboards,newspaper ads, or radio or television ads.(See Chapter 4.)

Bulk Rate Permits: Use of an organization’sbulk rate permit is a nonmonetary contributionfrom the organization. If the committee paysthe actual postage costs incurred under thebulk rate permit, the fair market value of thecontribution is either:

• The price the organization paid for thebulk mailing permit; or

• The difference in postage costs betweenthe bulk mailing rate and that of regularmail.

If the organization pays for the costs of themailing using its bulk rate permit, and the

committee does not have such a permit, thevalue of the contribution is (1) the amount itwould have cost to pay for the mailing usingregular mail; or (2) the cost of the bulk ratemailing plus the cost of a permit.

Phone Banks

Businesses and other entities will sometimesallow a campaign committee to use theirphones to call prospective voters during non-business hours. The fair market value of the

use of the phones is calculated to determinethe amount reported as a nonmonetarycontribution, even if only local calls aremade. One method to determine the fairmarket value is to contact organizations thatprovide phone banks as a business.

Example





Polls and Surveys

A person or entity that provides data from apublic opinion poll or survey to a candidate or

committee is making a nonmonetarycontribution if the candidate or committeerequests the data or the data are used forpolitical purposes. FPPC staff has advisedthat a formula utilized by the Federal ElectionCommission may be used for valuing pollingor survey data, as long as the formula isused in a reasonable manner to provide afair estimate. The formula calculates thevalue based on the age of the data. Thechart below illustrates the fair market value ofdata based on the number of days that pass

from the date the entity originally receivedthe data to the date the data were providedto the candidate or committee.

Age of Data Value

0 - 15 days Full Value16 - 60 days 50%61 - 180 days 5%More than 180 days No Value

When only a portion of a survey is providedto or for the benefit of a candidate, the

nonmonetary contribution is the proratedportion of the total value of the survey.

The Chewing Gum Association PAC commissioned a public

opinion poll to determine voters’ attitudes about candidates running for Governor,candidates in a Senate district, and a city ballot measure. The PAC provided the poll results to the candidate they supported for Governor, those in certain Senate districts,and to the committee supporting the city

ballot measure. Since only a portion of the data pertained to the Senate and city ballot measure elections, these candidates and the ballot measure committee reported a prorated amount when disclosing the nonmonetary contributions received.


Q. We are holding a $100-a-plate fundraiser for our committee. The actual cost of the

event to our committee will be $25 per person. When someone gives us $100 to attend the dinner, do we report $100 as a contribution, or do we subtract the $25 cost and report receiving a $75 contribution?

A. The cost of the ticket for the fundraiser isthe amount of the contribution. Report$100 as the contribution.

Q. When we send out a fundraising letter,are we required to put our committee identification number on the invitation?

A. There is no requirement to put theidentification number anywhere on themailer. However, many campaigns do sobecause if other committees, or otherswith their own reporting obligations,contribute to your committee, they willneed your identification number tocomplete their campaign reports.

Q. We would like to hold a raffle at our next fundraiser. Are there any restrictions on raffles?

A. The Political Reform Act does not restrictraffles. However, Penal Code 319 doesprohibit some raffles. This code isinterpreted and enforced by eachcounty’s district attorney. Contact thelocal district attorney where the raffle willbe held for further information. Ofcourse, be sure all of the reporting andrecordkeeping requirements are met.

Q. If Jan, my next door neighbor, spends $1,000 on an event to help raise funds for

two different candidates and the event is held in her home, has she made a contribution to each committee?

A. Yes. The total cost of a home fundraisermust be $500 or less, or the event willqualify as a nonmonetary contribution.

Example





This is true no matter how manycommittees benefit from the event.

Q. May a non-profit organization hold a joint

fundraiser with a political committee?

A. Yes. However, any costs incurred by thenon-profit organization which are notreimbursed by the political committee wouldbe considered to be a nonmonetarycontribution from the non-profit to thepolitical committee. The non-profitorganization should contact the IRS for anypossible restrictions based upon theorganization’s tax status.

Q. Three candidates wish to conduct

individual polls. A polling firm has offered a reduced rate because all three polls can be combined using one very large sample.Are the candidates receiving contributions from the polling firm because of the discounted fee, and are the candidates making contributions to each other?

A. To the extent each candidate pays onlyhis or her share of the cost of the poll, thecandidates are not making contributionsto each other. Additionally, if the polling

firm provides the discount as part of itsstandard business policy of providingdiscounts in similar situations and doesnot provide the discount for politicalpurposes, the candidates will not receivea contribution from the polling firm.

Returning Contributions

There are several provisions in the Act andFPPC regulations that regulate the return ofcontributions.

Reporting: A contribution is not required tobe reported if it is not deposited, cashed, ornegotiated and it is returned to thecontributor before the closing date of thecampaign statement on which it wouldotherwise be reported.

A “late contribution” (a contribution of $1,000or more received during the last 16 days

before an election) is not required to bereported if it is not deposited, cashed, ornegotiated and it is returned within 24 hours

of receipt. Once a contribution is deposited,cashed, or negotiated, it must be disclosedon the next campaign statement, even if it issubsequently returned. (See Chapter 7 fordetailed information on reporting returnedcontributions.)

Contributions in Excess of theContribution Limits: A monetarycontribution that exceeds the contributionlimits on its face, or when aggregated withother contributions from the contributor, maynot be deposited, cashed, or negotiated and

must be returned to the donor within 14 daysof receipt. In the case of a nonmonetarycontribution, the contribution must bereturned or a monetary refund must be givento the contributor within 14 days of receipt.

Missing Contributor Information: Acontribution of $100 or more must be returnedwithin 60 days of receipt if the candidate orcommittee has not obtained the contributor’sname, address, and in the case of acontributor who is an individual, his or heroccupation and employer. (See Chapter 2.)

Defeated Candidates: If a state candidate isdefeated in a primary election or withdrawsfrom the general election, general electionfunds must be refunded to contributors on apro rata basis, less any expenses associatedwith raising and administering the funds, andany general election expenses that were paidprior to the primary election or the candidate’swithdrawal (e.g., media purchases).

General Rule: A state candidate may returnall or a part of a contribution at any time.

“Surplus funds” also may be returned tocontributors. (See Chapter 10.) However,contributions, other than loans, made by astate candidate to his or her own campaignmay not be returned.





Authority




82015 Contribution.82025.5 Fair Market Value.82018 Cumulative Amount. 82047 Person.84105 Notification of Contributors.84211 Contents of Campaign Statements.84300 Cash and In-Kind Contributions;

Cash Expenditures. 84302 Contributions by Intermediary or

Agent.84306 Contributions Received by Agents

of Candidates and Committees.85301 Limits on Contributions from Persons.85308 Family Contributions.85311 Affiliated Entities; Aggregation of

Contributions to State Candidates.85312 Communications to Members of an

Organization.85319 Returning Contributions.85700 Donor Information Requirements;

Return of Contributions.

Title 2 Regulations

18215 Contribution.18216 Enforceable Promise to Make a

Payment.18421.1 Disclosure of the Making and

Receipt of Contributions.18421.3 Reporting of Contributions and

Expenditures Collected by Contract Vendors or Collecting Agents.

18423 Payments for Personal Services as

Contributions and Expenditures.18427.1 Notification to Contributors of $5,000 or More.

18428 Reporting of Contributions and Independent Expenditures Required to be Aggregated.

18432.5 Intermediary.

18523 Nondesignated Contributions or Loans.

18530.7 Extensions of Credit.

18531 Return of Excessive Contributions.18531.2 Refunding General Election Contributions.

18531.7 Payments for Communications— Section 85312.

18533 Contributions from Joint Checking Accounts.




Chapter 4 — Communications

One of the most important aspects of anycampaign is communicating with the voters.The Political Reform Act does not regulatethe truth or accuracy of politicalcommunications, but does require reportingof most payments in connection with flyers,mailers, billboards, and newspaper, radioand television advertising. Identificationrules also may apply.

Contributions and IndependentExpenditures

Generally speaking, when someone otherthan the candidate or his or her committeepays for a communication supporting thecandidate, the candidate has received anonmonetary contribution unless thepayment was not made “at the behest of” thecandidate. Payments for communicationsthat support a candidate by the use ofexpress advocacy, which are not made at thebehest of the candidate, are called“independent expenditures.” In these cases,the candidate being supported is not requiredto report the payments, although the personmaking them may have reporting obligations.In addition, payments for certain other typesof communications may not be reportable atall, or may be subject to special reportingrequirements. (See Chapter 8.)

Whether a communication is a contribution,an independent expenditure, or some othertype of reportable payment depends onseveral factors, including whether thecommunication “expressly advocates” the

election or defeat of a clearly identifiedcandidate or ballot measure. Theinformation and examples provided belowmay be of assistance in making thatdetermination. However, it is impossible toaddress all of the types of communications ina campaign. If presented with specific facts,FPPC staff can provide assistance.

When reviewing this section, it is important toremember the following:

• Contributions from one state candidate toanother state candidate are subject tocontribution limits.

• A candidate may not make independentexpenditures from campaign funds tosupport or oppose another candidate.

• Communications paid for by a candidate’scontrolled committee that support thecontrolling candidate, or oppose his or her

opponent, are not consideredcontributions or independentexpenditures.

• In most cases, when a noncontrolledprimarily formed committee pays for acommunication that supports or opposes acandidate or ballot measure, the paymentis a contribution or independentexpenditure.

Express Advocacy

A communication expressly advocates support or opposition of a clearly identifiedcandidate when it uses words such as “votefor,” “elect,” “support,” “cast your ballot,”“vote against,” “defeat,” “reject,” “signpetitions for,” etc. The law further providesthat a communication that does not containexpress advocacy is also an independentexpenditure if the communication, taken as awhole, unambiguously urges a particularresult in an election. Courts have applied anarrowing construction to the statutory

language, and the law is generallyinterpreted to require express advocacy to beconsidered an independent expenditure.(The Governor Gray Davis Committee v.American Taxpayer Alliance, 102 Cal.App.4th 449 (2002).)

Chapter 4Communications

1 - 8 6 6 -ASK -FPPC





Clearly Identifies

A communication clearly identifies acandidate or measure when the candidate’s

name, photograph, or status as a candidate orofficeholder is used, or the measure’s name,popular title, or official title is used. Someflyers may mention a group of candidates bysome well-defined characteristic of the group.Even if no specific names are used, these,too, may be communications which clearly identify candidates.

An individual paid $4,000 for a newspaper ad stating “Vote for

Joe Winner.” The communication expressly

advocates support for a clearly identified candidate and must be reported either as a contribution if it was made at the candidate’s behest or an independent expenditure if it was not made at the candidate’s behest.

Later, the same individual paid $2,000 for post card-sized flyers that simply stated,“Vote on Election Day.” This communication is not reported as a contribution or independent expenditure because it did not expressly advocate support of or opposition to a candidate or measure.

A communication that expressly advocatessupport of or opposition to a clearly-identifiedcandidate or measure is a contribution, ifmade at the behest of the candidate orcommittee, or independent expenditure, if notmade at the behest of the candidate orcommittee.

Made at the Behest

A payment is made at the behest of acandidate or committee if the payment ismade under the control or at the direction of,in cooperation, consultation, coordination, orconcert with, at the request or suggestion of,or with the express prior consent of thecandidate or committee or an agent of thecandidate or committee, and thearrangement occurs prior to the making ofthe communication.

Expenditures made at the behest of acandidate or committee include expendituresmade by a person other than the candidate

or committee, to pay for a communicationrelating to one or more clearly identifiedcandidates or ballot measures if it is created,produced, or disseminated:

• After the candidate or committee hasmade or participated in making anydecision regarding the content, timing,location, mode, intended audience,volume of distribution, or frequency ofplacement of the communication, or

• After discussion and agreement betweenthe candidate or committee and thecreator, producer or distributor of acommunication, or the person paying forthat communication, regarding thecontent, timing, location, mode, intendedaudience, volume of distribution, orfrequency of placement of thecommunication.

An expenditure is presumed to be made atthe behest of a candidate or committee if it is:

• Based on information about thecandidate’s or committee’s campaign

needs or plans provided to the expendingperson by the candidate or committee; or

• Made by or through any agent of thecandidate or committee in the course ofthe agent’s involvement in the currentcampaign; or

• For a communication relating to a clearly-identified candidate or ballot measurewhen:

− The person making the expenditureretains the services of a person whoprovides either the candidate or thecommittee supporting or opposing theballot measure with professional servicesrelated to campaign or fundraisingstrategy for the same election, or

− The communication replicates,reproduces, republishes, or

Example





disseminates, in whole or in substantialpart, a communication designed,produced, paid for, or distributed by the

candidate or committee.An expenditure is not made at the behest ofa candidate or committee just because:

• A person interviews the candidate orcandidate’s agent on issues affecting theperson making the expenditure, or

• The person making the expenditureobtains a photograph, biography, positionpaper, or press release, or similar materialis provided by the candidate or his or heragent, or

• The person making the expenditure hasmade a contribution to the candidate orcommittee, or

• A person makes an expenditure inresponse to a general, nonspecific requestfor support by a candidate or committee,provided that there is no discussion withthe candidate or committee prior to theexpenditure relating to details of theexpenditure, or

• The person making the expenditure has

invited the candidate or committee tomake a public appearance before theperson’s members, employees,shareholders, or their families providedthat there is no discussion with thecandidate or committee prior to theexpenditure relating to details of theexpenditure, or

• A person informs a candidate orcommittee that the person has made anexpenditure, provided that there is noexchange of information, not otherwiseavailable to the public, relating to details ofthe expenditure, or

• The expenditure is made at the request orsuggestion of the candidate or committeefor the benefit of another candidate orcommittee.

Citizens for Winner, a non- controlled committee primarily

formed to support Joe Winner’s candidacy,

printed campaign literature stating, “Vote for Joe Winner.” The communication included a copy of a photograph the committee obtained from the public information counter at Joe’s campaign headquarters. Joe did not in any other way coordinate with the committee in producing the campaign literature. The committee made an independent expenditure,not a contribution to Joe’s campaign.

On the other hand, if the committee contacted Joe Winner and arranged for a professional photographer to meet with him

for the purpose of taking photographs for the mailer, the committee would be making a nonmonetary contribution to Joe’s campaign.

Determination Based on Facts

As the previous examples illustrate, whethera communication is deemed to be expressadvocacy and whether the communication ismade at the behest of the affected candidateor measure committee, are factualdeterminations based on the text of thecommunication and the circumstances

associated with it. Although determinationsmust be made on the facts of each particularsituation, the following examples addresscommon situations that may arise in acampaign.

Reporting

There are distinctly different reportingrequirements for contributions andindependent expenditures.

When a person or group of persons makes

expenditures for a communication at thebehest of a candidate or committee, thecandidate or committee must report thereceipt of a nonmonetary contribution. Theperson making the expenditure may alsohave to file reports.

Example





Candidates and committees who are thebeneficiaries of independent expenditures donot report them. However, the person

making the expenditure may have filingobligations.

During Joe Winner’s campaign,two newspaper advertisements

supporting Joe were published without his knowledge or consent. Since the payments for these communications were not made at his behest, they were independent expenditures by the person(s) funding the ads and were not reportable by Joe’s campaign. The person(s) who paid for the

ads may have a filing obligation.

Endorsements

An endorsement of a candidate or measuremay become a contribution or anindependent expenditure when a payment ismade in connection with the endorsement.

The president of a state police officers’ association announces

at its annual meeting that the association endorses John Law for Attorney General.

Merely making an oral endorsement is not a contribution or independent expenditure to John Law.

Closer to the election, at the request of candidate John Law, the association mails a special flyer to the voters announcing its endorsement of him. Since the mailing was made at the behest of the candidate, the association has now made a nonmonetary contribution to John Law.

Frequently, a candidate will publish his or herendorsement by another official. As long asthe communication does not advocate theelection of the endorsing official (or thedefeat of that official’s opponent), a paymentmade to communicate the endorsement isnot a contribution to the endorsing candidateor official, even though the endorsement wasmade at the behest of both individuals.

A legislative candidate paid for a mailing which quoted the

Governor’s verbal endorsement of his

candidacy. Although the Governor was also on the ballot, the flyer did not ask voters to vote for the Governor. The flyer was not a contribution to the Governor’s committee; nor did the Governor make a contribution to the legislative candidate.

If a candidate pays for a communicationsupporting his or her own candidacy that alsosupports or opposes a ballot measure, thepayment is not a contribution or independentexpenditure made in connection with the

ballot measure.There are times when a candidate pays for acommunication which supports anothercandidate, but the payment is not made atthe behest of the endorsed candidate. If thecandidate paying for the communication alsois included in the communication, and thenon-paying candidate is listed on the sameballot as the paying candidate, and thecommunication is targeted only to thepotential voters in the paying candidate’sdistrict, no independent expenditure is made.

Lynda Isherwood, a State Senator running for reelection,

sent out a flyer to registered voters in her district asking them to support her candidacy.The flyer also encouraged the voters to vote for Gary Swanson for Governor, although this endorsement was not made at Gary’s behest. Because the gubernatorial election and State Senate election would appear on the same ballot for those living in Lynda’s district, and the flyer was sent only to voters

in Lynda’s district, the payment for the flyer is not an independent expenditure.

Non-Contributions

Debates: A payment for a debate or similarforum to which at least two candidatesrunning for the same office are invited is not

Example

Example

Example

Example





a contribution to the candidates, if the debateis sponsored by a nonpartisan organization.

The League of Women Voters invited all candidates for Assembly District 81 to speak at a forum.Only one candidate attended. Because at least two candidates running for the same office were invited, the cost of the meeting is not a contribution to the candidate who attended.

Similarly, a payment for a debate or forumsponsored by a political party or a committeeaffiliated with a political party is not acontribution if a majority of the candidates forthe party’s nomination are invited toparticipate.

Meetings: A payment made by a bona fideservice, social, business, trade, union, orprofessional organization for reasonableoverhead expenses associated with aregularly-scheduled meeting at which acandidate speaks is not a contribution if theorganization pays no additional costs inconnection with the speaker’s attendance.

At a union’s regularly-scheduled monthly meeting, one candidate

was invited to solicit votes. The union did not incur any additional costs in connection with the speaker’s presentation and, thus, no contribution was made.

Member Communications: Paymentsmade by an organization or its sponsoredcommittee for a communication that supportsor opposes a candidate are not contributionsor expenditures as long as the communicationis made only to the organization’s members,employees, or shareholders, or the families ofits members, employees, or shareholders.The payments may not be for general publicadvertising, such as billboards, newspaperads, or radio or television ads. If made by theorganization’s sponsored committee, the

committee would report the payments asbeing made for general membercommunications.

Your campaign consultant asks a labor organization to send a

mailing supporting your election. The mailing will be sent only to the organization’s membership. The mailing is not a contribution to you. Later, the campaign consultant asks the organization to send the mailing to all registered voters in your district. The mailing to the voters is a contribution to you.

Payments made by a political party for a

communication that supports a candidate arenot contributions to the candidate as long asthe communication is distributed only to theparty’s members, employees, and families ofits members and employees. However, theparty must report the payments as if theywere contributions or independentexpenditures.

The Green Party pays for a mailing supporting your

candidacy to all of its members five days before your election. The cost of the mailing exceeds $1,000. The Party must file a late contribution report. You are not required to disclose the mailing as a contribution.

News Stories: A payment for the cost ofpublishing or broadcasting a news story,commentary, or editorial is not a contributionwhen the payment is made by a federallyregulated broadcast outlet or a regularlypublished newspaper, magazine or otherperiodical of general circulation that routinelycarries news, articles, and commentary ofgeneral interest.

Non-Political Communications: A paymentmade at the behest of a candidate, which isfor a communication by the candidate or anyother person, is not a contribution to thecandidate if the communication:

Example

ExampleExample

Example





• Does not contain express advocacy; and

• Does not make reference to thecandidate’s candidacy for elective office,the candidate’s election campaign, or the

candidate’s or his or her opponent’squalifications for office; and

• Does not solicit contributions to thecandidate or to third persons for use insupport of the candidate or in oppositionto the candidate’s opponent.

If an individual or entity (including acommittee) pays $50,000 or more for acommunication that identifies a statecandidate but does not expressly advocatethe candidate’s election or defeat, theindividual or entity may be required to fileForm E-530 with the Secretary of State.(See Chapter 8.)

Voter Registration: A payment made at thebehest of a candidate as part of voterregistration or get-out-the-vote activities is nota contribution if the communication does notexpressly advocate the candidate’s election.

At the behest of an elected official, an organization paid for a

voter registration booth at a local fair. No other literature was distributed at the booth.The payment for the voter registration booth was not a contribution to the official.

Voting Records: An entity may publish thevoting records of public officials. As long as

only the voting records arepublished, thecommunication is not

considered a contributionor an independentexpenditure.

IdentificationRequirements forMailings

Contribution Solicitations

When a candidate or controlled committeesolicits contributions in writing, the solicitationmust identify the name of the controlled

committee as well as the specific office andterm of office for which contributions arebeing solicited.

Any solicitation for contributions to anofficeholder account (see Chapter 1) mustinclude the following:

“For purposes of the Political ReformAct’s contribution limits, a contribution toan officeholder account is alsoconsidered to be a contribution to allcampaign committees for future elective

state office the officeholder seeks duringhis or her current term of office.”

Mass Mailings

A “mass mailing” is more than 200 similarpieces of mail sent in a single calendarmonth. The Political Reform Act containssender identification requirements for massmailings that are “mailed” (e.g., USPS,FedEx) to a person’s home, business, orpost office box.

Solicitation letters, notices of fundraisingevents, newsletters sent by the candidate orcommittee, and other types of campaignliterature are common types of mass mailings.

The Political Reform Act does not regulatethe truth or accuracy of mail or other

Sender Identification

Committee to Elect Waters Mayor10 Parkway Plaza

Playa del Sol, CA 95888

Sharon Eshenaur620 McFadden StreetPlaya del Sol, CA 95888

Example





campaign-related advertisements ormaterials.

Sender Identification RequirementsSent by One Candidate or Committee

The name of the candidate, his or her streetaddress, city, state, and zip code must beplaced on the outside of each piece of mail inno less than 6-point type and in a color orprint which contrasts with the background sothat it is easily read. If a single candidate’scontrolled committee is sending the mailer,the name of the committee may be placed onthe outside of the mailer if the committee’sname contains the name of the candidate. Apost office box may be used as the addressonly if the committee’s street address is onits Statement of Organization (Form 410) onfile with the Secretary of State.

Sent by Two or More Candidates orCommittees

The name and address of the candidate (orcommittee, if its name includes thecandidate’s name) who is paying the greatestshare of the mass mailing, including costs for

designing, postage, and printing, must beplaced on the outside of each piece of mailas described above.

If two or more candidates pay equally for themailer, the name and address of at least oneof the candidates (or committees, as notedabove) must be shown on the outside asdescribed above, and the names andaddresses of all candidates (or committees)must appear on at least one insert.

Required Recordkeeping

For each mass mailing, the following must beretained for a period of four years:

• A sample of the mailing;

• A record of the date(s) the mailing wassent;

• The number of pieces sent; and

• The method of postage used.


Q. Must the committee’s identification number appear on a mailing?

A. No.

Q. If an organization includes a copy of a candidate’s flyer in its regularly-published newsletter, is the candidate required to be identified on the outside of the mailer?

A. No. The candidate’s name and addressmust be identified on the flyer only.

Q. A committee has more than one address.Which address must be used on mass mailings?

A. Any address that also appears on thecommittee’s Statement of Organization(Form 410) on file with the Secretary ofState may be used.

Q. A committee pays for a candidate’s mailing as a nonmonetary contribution.Which committee must be identified on the outside, the committee paying for the mailing or the candidate’s committee?

A. Only the committee that pays for themailing is required to be identified on the

outside of the mailing.

Q. A labor union pays for a mailing advocating the election of a State Assembly candidate. The mailing list includes both union members and non- union members and 20% of the mailing costs are attributed to non-union members. Must the candidate report the full cost of the mailing as a non-monetary contribution?

A. No. The candidate may pro-rate the cost

and report as a nonmonetary contributionthe mailing costs for the non-unionmembers.

Q. If a committee is sending a post card- type mailing, may the name of the committee appear only once?

A. Yes.





Q. Where on the outside of the mailing must the candidate or committee identification be placed?

A. There is no specific requirement forlocation of the identification, as long as itappears somewhere on the outside of themailing.

Identification Requirements forTelephone Calls and OtherAdvertisementsIn addition to the rules for mass mailings, thePolitical Reform Act requires identification anddisclosure on certain other advertisements

and communications.

Candidates and committees that usecampaign funds to make 500 or more phonecalls in support of or opposition to candidatesor ballot measures must disclose during thephone call that the candidate or committeeauthorized or paid for the call. Committeesmay not contract with phone bank vendorsthat do not disclose this information. Thisrequirement does not apply to calls that arepersonally made by the candidate, campaignmanager, or volunteers. A script of the callor a copy of the recorded phone messagemust be kept for four years.

When any committee makes expenditurestotaling $5,000 or more for an individual’sappearance in a printed, televised, or radioadvertisement, or in a telephone message,that supports or opposes the qualification orpassage of a state or local ballot measure,the advertisement must include a statementthat the individual is being paid by thecampaign or its donors. In addition, the Paid

Spokesperson Report (Form 511) must befiled. (See Chapter 8.)

No identification or disclosure is required bythe Political Reform Act on the followingitems when paid for by a candidate insupport of his or her own campaign:

• Lawn signs;

• Billboards;

• Campaign literature that is distributed bysome means other than mail, such as

handouts at fundraisers or shopping malls,or door hangers;

• Radio or television advertisements (theseare regulated by the FederalCommunications Commission); or

• E-mails, faxes, or website pages.

Authority



82015 Contribution.82025 Expenditure.82031 Independent Expenditure.82041.5 Mass Mailing.82044 Payment.82047 Person. 84211 Contents of Campaign Statement.84305 Requirements for Mass Mailing.84310 Identification Requirements for

Telephone Calls.84501 Advertisement.84503 Disclosure; Advertisement For or

Against Ballot Measures.84504 Identification of Committee.84505 Avoidance of Disclosure.84506 Independent Expenditures;

Advertisements.84511 Ballot Measure Ads; Paid

Spokesperson Disclosure.85310 Communications Identifying State

Candidates.85312 Communications to Members of an

Organization.85500 Independent Expenditures; 24-

Hour Disclosure; Coordination.85501 Prohibition on Independent






Title 2 Regulations

18215 Contribution.18225 Expenditure.

18225.7 Made At the Behest of.18401 Required Recordkeeping for

Chapter 4.18435 Definition of Mass Mailing and

Sender.18440 Telephone Advocacy.18450.1 Definitions. Advertisement

Disclosure.18450.4 Content of Disclosure Statements.

Advertisement Disclosure.18450.11 Spokesperson Disclosure.18523.1 Written Solicitation for

Contributions.18531.63 Elected State Officeholder

Contribution Cumulation.18531.7 Payments for Communications --

Section 85312.18550.1 Independent and Coordinated

Expenditures.




Chapter 5 — Getting Started

Before money is raised or spent inconnection with an election, candidates andcommittee treasurers should become familiarwith the various campaign disclosure formsrequired under the Political Reform Act.

Candidates must file the Candidate Intention(Form 501) before raising or spending anymoney in connection with an election,including the candidate’s personal funds.(Personal funds of the candidate may beused to pay filing or ballot statement fees

prior to filing Form 501.) Subsequent filingsdepend upon the amount that will be raisedor spent.

If any monetary contributions will be receivedfrom others, a separate campaign bankaccount must be opened. (See Chapter 2.)

Less than $1,000

If less than $1,000 will be raised or spent in acalendar year, including the candidate’spersonal funds, the Officeholder/Candidate

Campaign Statement—Short Form (Form470) may be filed by the candidate onceeach year. However, if after filing the Form470, $1,000 or more is received or spent, theStatement of Organization (Form 410), andthe Recipient Committee CampaignStatement (Form 460) must be filed. TheForm 470 Supplement may also be required.

Personal funds of the candidate used to payfiling or ballot statement fees are not countedtoward the $1,000 threshold.

$1,000 or MoreCandidates who will raise or spend $1,000 ormore in a calendar year must:

• File the Form 501;

• Set up a bank account (contact the IRS fora taxpayer identification number);

• File the Statement of Organization (Form410) within 10 days of raising or spending$1,000 or more; and

• File the Recipient Committee CampaignStatement (Form 460) disclosing receiptsand expenditures. (See Chapter 6.)Additional reports also may be required.(See Chapters 1, 6, and 8.)

Chapter 5Getting Started

1 - 8 6 6 -ASK -FPPC





Form 501CandidateIntentionStatement

Candidate Intention (Form 501)

When and Where to File

Before any contributions are solicited orreceived for an election and before any

campaign expenditures are made frompersonal funds, candidates must file Form501. A new Form 501 must be filed for eachelection, even if the candidate is running forreelection. The Form 501 is filed with:

Secretary of StatePolitical Reform Division1500 11th Street, Room 495Sacramento, CA 95814

The Form 501 is considered filed when it isplaced in the mail. The date of postmark is

the date filed.

State Candidate Expenditure CeilingStatement

On Form 501, a candidate must statewhether he or she accepts or rejects thevoluntary expenditure ceiling. Candidateswho accept the ceiling are designated in

either the state ballot pamphlet (statewidecandidates) or the voter information portionof the sample ballot (Senate and Assemblycandidates) and may purchase space toplace a 250-word statement there. The

candidate must choose to accept or rejectthe expenditure ceilings for both the primaryand general (or special primary and specialgeneral) elections at the time of filing Form501. (See Chapter 1 for information on thevoluntary expenditure ceiling.)

Amendments

Until the deadline for filing nomination papers(Elections Code Section 8020), the candidatemay amend the Form 501 up to two times tochange his or her expenditure ceilingdeclaration, as long as the candidate has notexceeded the applicable expenditure ceiling.In addition, a candidate who declined theceiling for the primary (or special) electionbut did not exceed it may amend his or herForm 501 within 14 days after the primary (orspecial) election to accept the ceiling for thegeneral (or special runoff) election.






Q. Am I required to file a document to withdraw as a candidate?

A. The FPPC does not administer the lawswhich govern what candidates must do toappear on a ballot or to remove theirnames from a ballot. Contact theSecretary of State's Elections Division.

Q. Am I required to file Form 501 if I will set up a committee to fight my recall?

A. No.

Q. Am I required to file a Form 501 if I am a replacement candidate in a recall

election?

A. Yes. Replacement candidates must file aForm 501.

Q. Am I required to file Form 501 when I run for reelection to the same office?

A. Yes. If you seek reelection to the sameoffice, you are required to file an “Initial”Form 501 prior to raising or spending anymoney for the new election.

Q. When may I begin to solicit and raise

funds for my election?

A. You may solicit and receive funds assoon as you have placed the Form 501 inthe mail.

Q. I have completed the process to be an official write-in candidate. Do I have any reporting obligations?

A. Yes. You have the same reportingobligations as any other candidate andmust file Form 501 before you solicit orreceive any contributions.

Q. Am I required to file Form 501 to set up an officeholder account or a legal defense fund?

A. No.





Officeholder and CandidateCampaign Statement - ShortForm (Form 470)The Form 470 may be filed by a candidate or

officeholder who does not anticipate raisingor spending $1,000 or more in a calendaryear. Payments from the candidate’spersonal funds used to pay filing or ballotstatement fees do not count toward the$1,000 threshold.

Form 470 may not be used if the candidateor officeholder has an existing controlledcommittee established for a past election,future election, or ballot measure (includingrecalls).

When to File

Form 470 is filed once each year on orbefore the filing deadline for the first semi-annual statement (July 31) or the firstpreelection statement filed in connection withan election, whichever occurs first. (See

Chapter 6.) Visit the FPPC website(www.fppc.ca.gov) for filing schedules.

If the Form 470 is filed and, later in thecalendar year, $1,000 or more is raised orspent, the candidate’s filing deadlines and

forms will change. (See Form 470Supplement.)

Where to File Form 470

Statewide Office

For the offices of Governor, LieutenantGovernor, Attorney General, Controller,Secretary of State, State Treasurer,Superintendent of Public Instruction,Supreme Court Justice, or InsuranceCommissioner:

• Original and one copy with the Secretaryof State’s Office;

• One copy with the Registrar-Recorder ofLos Angeles County;

• One copy with the Elections Department,San Francisco; and,

Form 470OfficeholderandCandidate

CampaignStatement





• One copy with the candidate/officeholder’scounty of domicile, if different from LosAngeles or San Francisco.

State Office

For the offices of State Senate or Assembly,State Board of Equalization, or appellatecourt:

• Original and one copy with the Secretaryof State’s Office;

• One copy with the county with the largestnumber of registered voters in thecandidate’s district; and

• One copy with the candidate/officeholder’s

county of domicile, if different than thecounty with the largest number of voters inthe district.

Addresses for the Secretary of State, Countyof Los Angeles, and City and County of SanFrancisco are located in Chapter 6.


Q. What reporting period does the Form 470 Cover?

A. Form 470 is filed once each calendaryear and covers the entire calendar year.When you file Form 470 with yourdeclaration of candidacy, or on or beforethe deadline for filing your firstpreelection statement, you do not need tofile any additional campaign statementsas long as neither your total receipts noryour total expenditures are $1,000 ormore during the calendar year.

Q. If I am in a special January election and

will not raise or spend $1,000 in connection with that election, when am I required to file Form 470?

A. File Form 470 in the precedingNovember, the deadline for filing yourfirst preelection statement in connectionwith the January election. In addition, if

your second preelection statement is duein January, another Form 470 must befiled. The reason for this is because a

Form 470 is filed in each calendar year.The first Form 470 covers the calendaryear preceding the election, and thesecond Form 470 covers the calendaryear in which the election takes place.





Form 470 SupplementIf a candidate files a Form 470 covering acalendar year in which the candidate isrunning in an election (i.e., with thedeclaration of candidacy, in lieu of a first

preelection statement, or for the June 30semi-annual filing) and later receivescontributions totaling $1,000 or more, ormakes expenditures totaling $1,000 or more,prior to the election, the candidate must sendForm 470 Supplement or other written notice.


The Form 470 Supplement must be filedwithin 48 hours of receiving or spending$1,000.

The notification is sent to:• Secretary of State’s Office; and

• Each candidate seeking the same office.

Method of Delivery

The notification must be sent via guaranteedovernight delivery, personal delivery, or fax.

Content of Notification

The Form 470 Supplement is included in theForm 470, or the candidate may provide thefollowing information on a blank piece ofpaper:

• The candidate’s name, address, anddaytime telephone number;

• The elective office sought and districtnumber, if applicable;

• The date of the election; and

• The date contributions or expenditurestotaling $1,000 or more were received ormade.

The candidate also must file a Statement ofOrganization (Form 410) (see the next few

pages) and begin filing the RecipientCommittee Campaign Statement (Form 460).(See Chapter 6.)

Form 470Supplement





Statement of Organization(Form 410)A candidate who receives $1,000 or more incontributions in a calendar year qualifies as arecipient committee and must file a Form410.


The original and one copy of the Form 410are filed with the Secretary of State within 10days of receiving $1,000 or more.

Secretary of StatePolitical Reform Division1500 11th Street, Room 495Sacramento, CA 95814

The Form 410 may be filed prior to raising$1,000 and then must be amended within 10days of reaching the $1,000 threshold todisclose the date qualified as a committee.(See below for how to amend a Form 410.)

Upon receipt of the Form 410, the Secretaryof State’s Office will assign the committee anidentification number. This number is usedon all reporting forms. Once assigned, the

identification number will be posted on theSecretary of State’s website(www.sos.ca.gov) and written notification willbe sent to the committee treasurer. Contactthe Secretary of State’s Office at (916) 653-6224 with questions about obtaining acommittee identification number.

Requirement to Establish SeparateAccounts and Committees

A state candidate must set up a new bankaccount and committee for each election

(even for reelection purposes). The sameaccount and committee may be used for boththe primary and general elections (or forspecial and special runoff elections).Personal funds used to pay the filing andballot statement fees do not count toward the$1,000 threshold for qualifying as acommittee. However, all other personal

funds used in connection with the electionare counted.

On February 15, Megan Waters,a candidate for Assembly,opened her campaign bank account with a personal loan of $1,500. By February 25,Megan must have either mailed or personally delivered the Form 410 to the Secretary of State.

A separate bank account and committeemust be set up to raise funds for officeholderexpenses and for legal defense. (SeeChapter 1.)

24-Hour Deadline

A committee that qualifies during the last16 days before the election must file Form410 within 24 hours of qualifying. The Form410 must be filed by fax, guaranteedovernight delivery, or personal delivery.

Fourteen days before the state election, candidate Lilly Pond

received a contribution of $900, bringing her cumulative contributions received to date to

$1,250. Because she qualified as a committee within 16 days before her election,she must file the Form 410 with the Secretary of State within 24 hours of qualifying as a committee. Because she did not anticipate receiving or spending $1,000 during the calendar year, Lilly filed a Form 470 as a first preelection statement. Within 48 hours, she also must file the Form 470 Supplement with the Secretary of State, and provide a copy to all her opponents. The Form 470 Supplement must be sent to all

recipients by guaranteed overnight delivery,fax, or personal delivery.

Amendments

When any information on the Form 410changes, an amendment must be filed within10 days of the change. To amend:

Example

Example





• The “Amendment” box is checked at thetop of the Form 410 and the committee’sidentification number entered;

• The name of the committee is provided;

• The information that has changed isincluded; and

• The verification is signed. In the case of acontrolled committee, both the treasurerand the candidate(s) must sign.

In January, Cynthia Doorman, an Assembly candidate, filed a Form

410 prior to qualifying as a committee. On February 10, Cynthia received a number of

contributions totaling more than $1,000. By February 20, Cynthia must have either mailed or personally delivered an amended Form 410 to the Secretary of State showing the date the committee qualified.

24-Hour Deadline for Amendments

If, during the last 16 days before the election,the committee changes:

• The name of the committee;

• The treasurer or other principal officers;

• Any candidate who controls thecommittee; or

• Any committee with which the committeeacts jointly,

the amended information must be filed within24 hours with the Secretary of State. Theinformation must be delivered by fax,guaranteed overnight delivery, personaldelivery, or electronic transmission.

Termination

The Form 410 is also used to terminate acommittee. See Chapter 9 for terminationrequirements and deadlines.

Example





How to Complete Form 410

Statement Type

Check the “Initial” box if this is the first filingand indicate the date on which the committeemet the $1,000 threshold or check the “Not

Yet Qualified” box.Check the “Amendment” box to amendinformation on an existing Form 410, e.g., toreport the date the committee qualified as acommittee.

Check the “Termination” box to close thecampaign committee. The committee’scampaign filing obligations will continue untilit meets the requirements to terminate andfiles a Form 410, checking the “Termination”box. (See Chapter 9.)

Committee Name

Provide the full name of the committee. Thename of a candidate’s controlled electioncommittee must include the last name of thecandidate.

The name of a committee established by anelected officeholder to raise officeholder

funds (see Chapter 1) must include theelected officer’s last name, the office held,the year of the officeholder’s election and thewords “Officeholder Account.”

Committees established for legal defense

funds (see Chapter 1) must include thecandidate or officeholder’s last name and theterm “Legal Defense Fund” in the name ofthe committee. Committees established byan officeholder to defend against a recallattempt must include the term “Recall” in thecommittee name.

Committee Address

Use a street address as the address of thecommittee. A post office box may be usedas a mailing address. The committee may

have more than one mailing address.

County of Domicile

Indicate the county in which the committee islocated. This may be different than thecounty in which the committee is active.

Form 410Statement ofOrganization





Joy O. Cooking is running for Assembly in a district located in

Los Angeles County. However, the

committee’s address is in Orange County where the treasurer has his office. The Form 410 reports Orange County as the “County of Domicile” and Los Angeles County under “County Where Committee is Active if Different than County of Domicile.”

Treasurer, Assistant Treasurer, and OtherPrincipal Officers

The committee must have a treasurer andmay have an assistant treasurer. Report thenames of the treasurer and assistant

treasurer along with their mailing addressesand phone numbers. If the committee hasprincipal officers, other than the candidate ortreasurers, list each officer’s full name,position held, and street address.

If a candidate chooses to be his or her owntreasurer, list the name, mailing address, andtelephone number of the candidate.

Verification

The Form 410 is not considered filed if it is

not signed. The treasurer, or assistanttreasurer, and the candidate/officeholdermust sign the verification.

When two or three candidates control acommittee, each candidate must sign theverification. If more than three candidatescontrol the committee, one of the candidatesmay sign on behalf of all controllingcandidates.

Example





Type of Committee

Controlled Committee

Candidates must complete this section. If theoffice sought is partisan, indicate the politicalparty to which the candidate belongs. If theoffice is non-partisan, check the “Non-

Partisan” box in the “Party” column.

Name of Financial Institution

Report the name and complete address ofthe financial institution where thecommittee’s campaign bank account islocated, as well as the campaign bankaccount number. If a bank account has notbeen opened at the time of filing an “Initial”Form 410, amend the Form 410 within tendays of opening the bank account to providethis information. This information is also

required for a committee set up by an electedstate officeholder to raise funds forofficeholder expenses. (See Chapter 1.)

Legal Defense Committees

The Statement of Organization for acandidate or officeholder’s legal defense

committee (see Chapter 1) must contain adescription of the specific legal dispute ordisputes for which the committee is beingestablished. The Form 410 must beamended as each legal dispute is eitherresolved or initiated. Until appropriaterevisions to the Form 410 are approved by

the Commission, provide the information inany available space on the current version ofthe Form 410 (January/05) or on anattachment.


Q. Must we wait until $1,000 is received to file a Form 410?

A. No. You may file a Form 410 prior tocommittee qualification. Check the box“Not Yet Qualified.” Once you have

reached the $1,000 threshold, file anamendment reporting the date thecommittee qualified.

Q. May our committee use a mail receiving and forwarding service, such as Mail Boxes Etc., as the committee’s street address on the Form 410?

Form 410Statement ofOrganizationPage 2





A. No. A post office box or lock box numberis not acceptable as a street address.You may use a post office box address

on a mass mailing as long as youindicated this address as your mailing address on the Form 410.

Q. As a candidate, may I be designated treasurer on the Form 410?

A. Yes, you may be the treasurer orassistant treasurer.

Q. I am an officeholder and the target of a recall election. I have formed a separate committee to oppose the recall. On the Form 410, what sections do I complete

under Part 4—Type of Committee?

A. You should complete both the ControlledCommittee and the Primarily FormedCommittee sections. Be sure to includethe word “recall” in the name of thecommittee.

Q. I am running as a replacement candidate on a recall ballot. On the Form 410, what sections do I complete under Part 4— Type of Committee?

A. You should complete the ControlledCommittee section.

Candidate Statement ofEconomic Interests (Form 700)In addition to filing reports of their campaignfinances, candidates for state office arerequired to complete a Statement ofEconomic Interests (Form 700) under thePolitical Reform Act’s conflict of interestrules. All investments and real property held

on the day the declaration of candidacy isdue, as well as income received during the12 months prior to the date of filing thedeclaration of candidacy, must be reported.This statement is due no later than the finalfiling date for the declaration of candidacy.Candidates for state office file the Form 700with the registrar of voters or other county

official where the declaration of candidacy isfiled.

Sitting justices of an appellate court or the

Supreme Court are not required to file theForm 700 as a candidate.

Authority



81004 Reports and Statements; Perjury; Verification.

81004.5 Reports and Statements; Amendments.

81007 Mailing of Report or Statement. 82007 Candidate. 82013 Committee. 82016 Controlled Committee. 82025 Expenditure. 82044 Payment. 82047.5 Primarily Formed Committee. 82048.7 Sponsored Committee. 84101 Statement of Organization; Filing. 84102 Statement of Organization;

Contents. 84103 Statement of Organization; Amendments.

84106 Sponsored Committee; Identification.

84200 Semi-Annual Statements. 84206 Candidates Who Receive or Spend

Less than $1,000. 84214 Termination. 84215 Campaign Reports and

Statements; Where to File. 85200 Statement of Intention to be a

Candidate. 85201 Campaign Bank Account. 85304 Legal Defense Funds.85315 Elected State Officer Recall

Committee. 85318 Contributions Received for Primary

and General Elections.





85401 Candidate Acceptance or Rejection of Expenditure Ceilings.

87201 Candidates (Statement of

Economic Interests).

Title 2 Regulations

18402 Committee Name. 18404 Termination of Candidate’s and

Committees’ Filing Requirements.18404.1 Termination and Reopening of

Committees.18406 Short Form for Candidates or

Officeholders Who Receive and Spend Less than $1,000 in a Calendar Year.

18419 Sponsored Committees. 18520 Statement of Intention to Be a

Candidate. 18521 Establishment of Separate

Controlled Committee for Each Campaign Account.


Accounts.




Chapter 6 — When and Where to File

This chapter reviews when and wherecommittees file reports disclosing receiptsand expenditures. State candidates will usethe Recipient Committee CampaignStatement (Form 460). (Also see Chapter 8for additional special reports that may berequired.)

Candidates and officeholders without acommittee should consult Chapter 5,Officeholder/Candidate CampaignStatement—Short Form (Form 470), todetermine whether a report is due and, if so,

when and where to file.

Electronic filing requirements are alsodiscussed in this chapter, and a separatesection at the end of this chapter addressesfiling requirements for officeholders andcandidates who control more than onecommittee.

All reports and statements filed under thePolitical Reform Act are public records openfor public inspection.

Campaign filing deadlines may be obtained

online at www.fppc.ca.gov. (Click onto“Candidates and Committees,” then clickonto “Filing Deadlines.”) In addition, the FairPolitical Practices Commission, theSecretary of State, and county registrars ofvoters are able to provide this information.However, the committee treasurer isresponsible for meeting all applicable filingdeadlines. No agency is required to send areminder notice prior to the filing deadline.

Deadlines that fall on a Saturday, Sunday, orofficial state holiday are extended to the nextbusiness day. This rule does not apply toreports required to be filed within 24hours, such as the election cycle reportsdiscussed below, and the latecontribution reports and late independentexpenditure reports discussed in Chapter8; there are no other provisions for

extensions. Filing after a deadline may leadto late filing penalties of $10 for each day thestatement is late, and committees that fail tofile are subject to administrative penalties ofup to $5,000 per violation. Except wherenoted, statements filed on paper must behand delivered or postmarked, first-classmail, by the due date.

Electronic ReportsCertain state candidates and their controlledcommittees may be required to file campaign

reports electronically with the Secretary ofState as well as on paper. Electronic filingsare required of state candidates and theircontrolled committees once contributionstotaling $50,000 or more have been receivedor expenditures totaling $50,000 or morehave been made. The period for cumulatingcontributions and expenditures beganJanuary 1, 2000. The cumulation period isopen and not based on a calendar year.

Until a candidate has triggered the electronicfiling requirements, only paper reports arerequired. However, once electronic filingrequirements have been triggered, all futurereports filed by the candidate’s controlledcommittees must be filed electronically(including local committees controlled by astate candidate), and most must also be filedon paper, including the statement oforganization, certain late contribution reports,etc. In addition, committee(s) may berequired to file the $5,000 and Election Cyclereports discussed below.

Until further notice, paper reports shouldcontinue to be filed with the Secretary ofState and in all other required locations inaddition to any reports filed electronically.

Exception: The $5,000 and Election Cyclereports discussed below are not required tobe filed on paper or with local filing officers,

Chapter 6When and Where to File Reports

1 - 8 6 6 -ASK -FPPC





including Election Cycle reports filed duringthe late contribution period.

For detailed information on electronic filing

requirements, contact the Secretary ofState’s Office at (916) 653-6224 orhttps://cafile.sos.ca.gov/CalOnline/.

When to File

$5,000 Reports and Election CycleReports

State Candidate Controlled Committees: Once a state candidate has reached the$50,000 threshold at which campaign reportsmust be filed electronically, the candidate

must begin filing the $5,000 Reports andElection Cycle Reports discussed below. Forpurposes of these special electronic reports,an “election cycle” means the period of timebeginning 90 days prior to an election andending on the date of the election.

$5,000 Reports

If any of a state candidate’s committeesreceives a contribution of $5,000 or morefrom a single contributor, including a smallcontributor committee, at any time other thanduring an election cycle, an electronic reportmust be filed with the Secretary of Statewithin 10 business days.

Election Cycle Reports

During the 90-day election cycle precedingthe candidate’s election, if any of a statecandidate’s committees receives acontribution of $1,000 or more from a single contributor, an electronic report must be filedwith the Secretary of State within 24 hours.

On January 29, 2010, a candidate for Lieutenant

Governor on the June ballot received a contribution of $6,000 from a PAC. Within 10 business days, the candidate must electronically report the contribution to the Secretary of State. On April 27, the

candidate received a contribution of $10,000 from a different PAC into a committee established for a past election. Within 24

hours, the candidate must electronically report the contribution to the Secretary of State.

The Form 497 Contribution Report is used tofile both the $5,000 and Election Cyclereports. (See Chapter 8.)

These electronic reportingrequirements apply to a single

contribution of $5,000 or $1,000, respectively.Two $500 contributions from a singlecontributor will not trigger the Election CycleReport until the late contribution reportingperiod. (See Chapter 8.) During the latecontribution reporting period, contributionstotaling $1,000 or more from a single sourcemust be reported within 24 hours.

A candidate’s contributions of personal fundsto his or her campaign must be reportedunder these requirements.

Exception: Transfers between acandidate’s controlled committees for

election to state office do not trigger theseelectronic reporting obligations.

Semi-Annual and PreelectionCampaign Statements

The law sets specific deadlines for whenForm 460 must be filed.

Semi-Annual Statements

Most committees file a semi-annualstatement for each half of the year, whether

or not they receive contributions or makeexpenditures during the six-month period.An existing committee or a committee newlyformed during the first six months of the yearwill have a semi-annual statement due July31 for the period January 1 - June 30.

An existing committee will have a semi-annual statement due January 31 of the

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Example





following year for the period July 1 -December 31. A committee newly formedduring the last six months of the year will

have a semi-annual statement due January31 of the following year for the periodJanuary 1 - December 31.

A State Senator is not seeking reelection and her committee did

not raise or spend any funds during the calendar year. The committee must file a semi-annual statement covering the period January 1 through June 30, due on or before July 31, and a semi-annual statement covering the period July 1 through December

31, due by January 31.

Judges

Judges and judicial candidates are notrequired to file semi-annual statementsduring any six-month period in which theyhave not received or made any contributionsor expenditures. This is also true for electioncommittees controlled by judges and judicialcandidates.

Preelection Statements

In addition to semi-annual statements,controlled committees will file preelectionstatements before the election in which thecandidate is listed on the ballot.

For specific reporting periods and filingdeadlines, visit the FPPC website atwww.fppc.ca.gov or call the FPPC forassistance.

A state officeholder not being voted on willfile the two preelection reports due before thestate primary and general elections if his or

her controlled committee, during the periodcovered by the preelection statement, hasmade:

• any contribution to an officeholder,candidate, or committee; or

• any independent expenditure to supportor oppose a measure; or

• any transfer of funds to a ballot measurecommittee he or she controls.

The second preelection statement must befiled by personal delivery or guaranteedovernight delivery by candidates being votedon in the election.

A committee controlled by a candidate forelective state office who lost in the stateprimary election is required to file preelectionstatements in connection with the generalelection only if the committee makes anycontributions or independent expenditures tosupport or oppose another candidate,committee, or ballot measure during the

period covered by the statement.

Candidates who will not appear on the ballotbecause they are running unopposed are notrequired to file preelection statements.

Recall Committees

Committees established by officeholders whoare the subject of a recall election (seeChapter 1) must file Form 460 on a quarterlybasis according to the following schedule:

Period Covered Filing DeadlineJanuary 1 - March 31 April 30April 1 - June 30 July 31July 1 - September 30 October 31October 1 - December 31 January 31

During the semi-annual period in which arecall election is held, a committeeestablished by an officeholder who is thesubject to the recall will file, instead ofquarterly statements, two pre-electionstatements and a semi-annual statement in

connection with the election. [Note: Recallcommittees also must file $5,000 reports,Election Cycle reports, and late contributionreports.]

Senator Don Williams is the subject of a recall election being

held on September 13. In March, he formed

Example

Example





a separate committee to oppose the recall.The committee must file quarterly statements on April 30 and July 31. During the period

July 1 through December 31, the committee must file two pre-election statements in connection with the election, and a semi- annual statement for the period ending December 31, due on January 31 of the following year.

Amendments

Except for amendments required to providecontributor information (see Chapter 2), thereis no deadline for filing amendments tocampaign reports. However, amendments

should be filed as soon as practicable in thesame locations as the original.

Faxing Statements

Campaign statements filed on paper thatcontain 30 pages or less may be faxedprovided that the faxed copy of the campaignstatement is the exact copy of the originalversion. The original document with anoriginal signature, must still be sent by first-class mail, guaranteed overnight delivery, orpersonal delivery within 24 hours of the filing

deadline. (Because the late contribution andindependent expenditure reports, Forms 496and 497, respectively, and the Form 470Supplement, do not require a signature, thecommittee is not required to send a copyafter faxing.)

Original Statements

An “original” campaign statement is onecontaining the original signature of theofficeholder or candidate, and/or treasurer orassistant treasurer. (Forms filedelectronically with the Secretary of State arealso considered “originals” for certainpurposes.)

Where to FileState candidates and their controlledcommittees file statements based on the

office sought by the candidate as shownbelow.

Addresses and fax numbers for statewide filing officers are:

Secretary of StatePolitical Reform Division1500 11th Street, Room 495Sacramento, CA 95814(916) 653-5045

Registrar-Recorder of Los Angeles

County Campaign Finance Disclosure Section12400 Imperial HighwayNorwalk, CA 90650-3134(562) 651-2548

Registrar of Voters, City and County ofSan FranciscoDepartment of ElectionsRoom 48, City HallOne Doctor Carlton B. Goodlett PlaceSan Francisco, CA 94102-4635(415) 554-7344

Committees controlled by statecandidates must also file a copy of

their campaign statements in the candidate’scounty of domicile, which is the county wherethe candidate maintains his or her permanentresidence.

Multiple Controlled Election Committees

When a candidate or officeholder controlsmore than one election committee, whether

the committees are formed for differentelections to the same office or for a differentoffice, all committees must file statementseach time any committee statement is due.

When an elected officeholder in one jurisdiction runs for an office in anotherjurisdiction, the officeholder and all election

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committees he or she controls file originally-signed campaign disclosure statements withthe filing officer in the jurisdiction in which the

officeholder holds office and the jurisdictionin which the officeholder is seeking office.

Nels Nelson controls a committee for his election to the Beach

County School Board. In addition, Nels formed a committee to run for Assembly in a June election. As an incumbent school board member and a candidate for Assembly, he files campaign statements for both committees with the following filing officers in connection with the June election:

•

School Board committee files an original and one copy of the Form 460 with:

County Clerk, Beach County Secretary of State

• Assembly committee files an original and one copy of the Form 460 with:

Secretary of State

County Clerk, Beach County (county with the largest number of registered voters in the Assembly district and his county of domicile)

An officeholder who does not have acontrolled committee may file the Form 470by July 31 for the position held. If the

officeholder subsequently opens a committeeto run for a different office, he or she mustfile the Form 460 for the required preelection

and semi-annual statements. Since theForm 470 was filed in connection with aposition for which the candidate does nothave a committee, a Form 470 Supplementis not required. (See Chapter 5.) However,if the officeholder opens a committee prior toJune 30 for election to a different office, theForm 460 must be filed by July 31 for boththe position held and the office sought. Theofficeholder may file one Form 460 and listboth the position held and the office soughton the Cover Page, Part 5.

Controlled Ballot Measure Committees

Some officeholders and candidates alsocontrol ballot measure committees. Datesand locations for filing statements for thesecontrolled ballot measure committees varydepending on whether the committee is ageneral purpose ballot measure committeeor one that is primarily formed to support oroppose a particular ballot measure ormeasures. Such committees must alwaysfile a copy of each statement with the

candidate’s county of domicile. (See theFPPC’s manual for ballot measurecommittees.)

Filing Officers What

Statewide OfficesGovernor, Lieutenant Governor, AttorneyGeneral, Controller, Secretary of State,State Treasurer, Superintendent of Public

Instruction, Insurance Commissioner, andSupreme Court Justices:

Secretary of State

Registrar/Los Angeles County

Registrar/San Francisco

County of domicile if different thanLos Angeles or San Francisco

Original & 1 copy

1 copy

1 copy

1 copy

State OfficesLegislature, State Board of Equalization,and Appellate Courts:

Secretary of State

County with the largest number ofregistered voters in the candidate’s district

County of domicile if different from thecounty with the largest number of voters

Original & 1 copy

1 copy

1 copy

Example





State Primarily Formed Ballot MeasureCommittees

Controlled state ballot measure committees

are only required to file statements when andwhere state ballot measure committees arenormally required to file; committeescontrolled by the officeholder or candidate tosupport their election to office are notrequired to file in connection with the ballotmeasure committee schedule.

Local Primarily Formed Ballot MeasureCommittees

Controlled local ballot measure committeesshould file according to the filing schedule

provided by their local filing officer. In addition,these committees file at the same times andplaces the controlling officeholder or candidateis required to file campaign statements inconnection with the office he or she is seeking.The candidate’s controlled election committeeis not required to file on the ballot measurecommittee schedule if he or she is not alsobeing voted on in the election and is notrequired to file in the jurisdiction of the ballotmeasure election if that is different than thecandidate’s regular filing location. For

example, a state candidate who controls acommittee supporting a city ballot measure isnot required to file campaign statements inthe city for any of his or her other controlledcommittees.

General Purpose Ballot MeasureCommittees

In addition to any other times provided bylaw, controlled general purpose ballotmeasure committees are required to filepreelection statements whenever the

controlling officeholder or candidate isrequired to file these statements inconnection with an election to office.

Teddy Graham has a committee to run for reelection to the State

Senate. In addition, Teddy controls a state

general purpose ballot measure committee,domiciled in Beach County, that supports measures throughout the state dealing with

shoreline protection. On the due date for the first preelection statement required for his reelection race, Teddy will file the following:

• Reelection Committee will file the Form 460 with:

- Secretary of State Original and one copy

- Beach County Clerk One copy

• Ballot Measure Committee will file the Form 460 with:

- Secretary of State Original and one copy

- Registrar/Los Angeles County One copy

- Registrar/San Francisco One copy

- Beach County Clerk One copy


Q. Are paper copies of the electronic $5,000 and Election Cycle reports required, and are copies required to be filed with the county filing offices?

A. No.

Q. A state officeholder filed a Form 501 and a Form 410 for a future election. The committee’s bank account has not received $1,000. Must the committee file semi-annual statements?

A. Yes.Q. Must a contribution of $1,000 or more

received during the 90-day election cycle be reported within 24 hours if the contribution was received for a different election (for example, a contribution for the November election that is received

Example





during the 90 days prior to the June election)?

A. Yes. A state candidate who is required to

file electronically with the Secretary ofState must file a report within 24 hoursfor any contribution of $1,000 or morethat is received during the 90 days beforethe candidate’s name appears on theballot for an elective state office.

Q. Are the electronic $5,000 reports and $1,000 election cycle reports required if a contribution is received by a state candidate’s legal defense committee,officeholder committee, other state or

local election committee, or a general purpose ballot measure committee?

A. Yes. All controlled committees, exceptprimarily formed ballot measurecommittees, must file these reports. Forexample, a general purpose ballotmeasure committee controlled by a stateofficeholder not seeking election in 2008must file the $5,000 report if thecommittee receives a contribution of$5,000 or more during the calendar year.If the state officer is listed on the June 3,

2008 ballot, the general purpose ballotmeasure committee must file the $1,000reports beginning March 5, 2008.

Q. Must a state candidate listed on the June 3, 2008 ballot file preelection statements for his or her legal defense committee, officeholder committee, other state or local election committees, or general purpose ballot measure committee?

A. Yes. All committees, except primarily

formed ballot measure committees, mustfile preelection statements whenever thecontrolling candidate is required to filepreelection statements in connection withelection to office.

Authority




81004 Reports and Statements; Perjury; Verification.


81007 Mailing of Report or Statement.81007.5 Faxing of Report or Statement.81008 Public Records; Inspection;

Reproduction; Time; Charges.82027 Filing Officer.83116 Violation of Title.84200 Semi-Annual Statements.84200.3 Odd-Year Reports in Connection

with a Statewide Direct Primary Election Held in March of an Even- Numbered Year.

84200.4 Time for Filing Reports Required Pursuant to Section 84200.3.

84200.5 Preelection Statements.84200.7 Time for Filing Preelection

Statements for Elections Held in June or November of an Even- Numbered Year.

84200.8 Time for Filing Preelection Statements for Elections Not Held in June or November of an Even- Numbered Year.

84203 Late Contribution; Reports.84209 Consolidated Statements.84215 Campaign Reports and

Statements; Where to File.84605 Who Shall File Online.85304 Legal Defense Fund.85309 Online Disclosure of Contributions.

85315 Elected State Officer Recall Committee.

85500 Independent Expenditures; 24- Hour Disclosure; Coordination.

91013 Late Filing of Statement or Report; Fees.





Title 2 Regulations

18116 Reports and Statements; Filing Date.

18426 Semi-Annual Statement Early Filing.


Accounts.




Chapter 7 — Committee Report

Candidate controlled committees (includinglegal defense fund and officeholdercommittees) use the Recipient CommitteeCampaign Statement (Form 460) to reportcampaign activity for all semi-annual, specialodd-year, preelection, quarterly, andsupplemental preelection statements.

This section discusses how to completeForm 460.

Certain state committees may be required tofile electronically in addition to reports on

paper. (See Chapter 6.) Call the Secretaryof State at (916) 653-6224 for information.

Chapter 7Committee Report—Form 460

1 - 8 6 6 -ASK -FPPC





Form 460

How to Complete the Cover Page

Period Statement Covers

If this is the first report of the calendar year,

the “from” date should be January 1.Otherwise, this date should be the day afterthe closing date of the most recently-filedcampaign statement.

Date of Election

When filing a preelection statement inconnection with an election, provide the dateof the election.

Amending Form 460

To change or provide information missing

from a previously filed Form 460, complete anew Form 460 Cover Page, checking the“Amendment” box under “Type of Statement.”Also check the box showing the type ofstatement being amended (e.g., preelection,semi-annual) and enter the period covered bythe statement being amended. Provide abrief explanation and list the schedules or

parts being amended. Include an amendedsummary page, if applicable.

Attach the amended schedule(s) and file theamendment with all of the filing officers thatreceived the original filing. (See Chapter 6.)

To amend a report filed electronically with theSecretary of State, a complete replacementfiling is required. Contact the Secretary ofState at (916) 653-6224 for assistance.

Part 3: Committee Information

When completing this section, make sure theinformation is the same as that listed on thecommittee’s Statement of Organization, Form410. If the committee has not received anidentification number from the Secretary ofState, enter “pending” in the “I.D. Number” box.

Part 4: Verification

The Form 460 is not considered filed if it isnot signed. The committee treasurer or theassistant treasurer named on the committee’sStatement of Organization, Form 410, mustreview and sign the statement.

Form 460Cover Page





In addition, the officeholder or candidate whocontrols the committee must sign thestatement. If two or three officeholders orcandidates control the committee, each mustsign. If there are more than threeofficeholders or candidates controlling thecommittee, one may sign on behalf of theothers.

Part 5: Officeholder or CandidateControlled Committee

Provide the name of the officeholder orcandidate controlling the committee andindicate the office sought or held includingthe location and district number, if any. If thecandidate controls other committees,including ballot measure committees, listthose committees here. If you are aware ofany primarily formed committees that exist toreceive contributions or to makeexpenditures on behalf of the candidatecontrolling this committee, also list thosecommittees. If more than one candidatecontrols the committee, copy Part 5 as many

times as needed to include the requiredinformation for all controlling candidates.

Part 6: Primarily Formed Ballot MeasureCommittee

Controlled committees that are primarilyformed to support or oppose a ballotmeasure must also complete this section.

Form 460Cover Page 2





How to Complete the Summary Page

The Summary Page lists the totals of all

contributions received and expendituresmade during the period covered by thestatement and the cumulative amounts ofcontributions received and expendituresmade during the calendar year.

Column A

This column reflects the totals found on thesummaries located at the bottom of eachschedule attached to the statement. If thereis no activity to report on a particularschedule, place a zero on the appropriate

line. Never leave a line in Column A blank.

Column B

Amounts shown on Lines 2, 7, and 9 ofColumn B are carried forward from year toyear (and statement to statement) until theyare paid. If this is the first statement of the

calendar year, this column should reflect thesame totals as found in Column A, except forLines 2, 3, 5, 7, 8, 9, and 11 (if applicable).Otherwise, Column B totals are calculated byadding the figures in Column B from the laststatement filed with the figures found inColumn A of the current statement. (Note:The amounts reported on Lines 2, 7, and 9 ofColumn B should be the same as the totaloutstanding amounts disclosed in column (d)of Schedules B, H and F respectively, of thecurrent report.)

The figures in Column B reflect thecumulative amounts received since January

1 of the current calendar year.The cumulation period for a statement isalmost always a calendar year. An exceptionto calendar year cumulation applies if thecommittee is required to file a preelectionstatement in one year in connection with anelection held in another year, such as

Form 460SummaryPage





elections held in January or early February.When this happens, the cumulation periodbegins on January 1 of the year before the

election and ends on the closing date of thesemi-annual statement filed after theelection.

Lines 1-5

Collectively, these lines representcontributions received: monetary,nonmonetary, and loans.

Lines 6-11

These lines together represent expendituresmade: payments, loans made, accrued

expenses (bills that are still outstanding), andnonmonetary adjustments.

Lines 12-16

The Current Cash Statement section shouldreflect the committee’s actual cash conditionat the end of the reporting period. If depositsor expenditures have been made that havenot cleared the account, the committee’sbank balance may not match the endingcash balance.

Do not deduct investments made withcommittee funds from Line 12 or Line 16 ifthe investment can be readily converted tocash; e.g., the purchase of certificates ofdeposit, shares in interest bearing accounts,or money market funds. Reflect theinvestment amounts in the total amount ofcash available.

Line 12

Make sure that this figure is the same as thefigure shown on Line 16 (Ending Cash

Balance) of the most recently filed statement.If this is the first statement of the calendaryear and no previous statement has beenfiled for this committee, but money wasraised or spent in the previous reportingperiod that did not equal $1,000 or more,enter the amount of cash on hand onDecember 31. Otherwise, enter zero.

Line 13

This figure represents a total of all monetarycontributions and loans received during the

reporting period. Nonmonetary contributionsshould not be included.

Line 14

This amount represents all items, such asinterest on a bank account, that increase thecash position but are not consideredcontributions. The amount is carried forwardfrom Schedule I, Miscellaneous Increases toCash.

Together, Lines 13 and 14 reflect all the

money that has been received during thecurrent reporting period.

Line 15

This figure represents the total amount thecommittee has spent during the reportingperiod, including loans made and anyaccrued expenses paid.

Line 16

This amount represents the total of Lines 12,13, and 14 minus Line 15. The amount

reported on Line 16 must equal the totalamount of cash the committee has in itscampaign bank account and the amount ofall funds held in interest bearing accounts,certificates of deposit, money marketaccounts, shares in government bonds, orany other investments that can be readilyconverted to cash.

If this is a termination statement, Line 16must be zero.

Line 17

This figure is carried forward from ScheduleB, Part 2. The amount represents the total ofall loan guarantees, endorsements, orsecurity received during the period.





Line 18

This figure includes investments that cannotbe readily converted to cash, as well as the

balance due on all outstanding loans thecommittee has made to others.

Do not include any amount that is invested ininterest bearing accounts, certificates ofdeposit, money market accounts, or anyother investments that can be readilyconverted to cash. This amount should bepart of the ending cash figure reported onLine 16.

Line 19

Report the total of all money owed by thecommittee. Using Column B, add Line 2(loans received) and Line 9 (accruedexpenses).

Lines 20 & 21

If an officeholder or candidate is being votedupon in both the state primary and generalelections, and the statement covers a periodduring the last six months of the year, thecommittee is required to report a lump sumamount of contributions received and

expenditures made. Complete this sectionfor the preelection statements filed inconnection with the November election, aswell as the semi-annual statement due inJanuary after the election.

Contributions Received: Under 1/1through 6/30, report the total contributionsreceived using Column B, Line 5 from theSummary Page of the statement that ended6/30. Subtract this figure from the totalcontributions reported on the Summary Page

for the current period using Column B, Line5. Enter this amount under 7/1 to Date.

Expenditures Made: Under 1/1 through6/30, report the total expenditures madeusing Column B, Line 11 from the SummaryPage of the statement that ended 6/30.Subtract this figure from the total

expenditures reported on the Summary Pagefor the current period using Column B, Line11. Enter this amount under 7/1 to Date.

Line 22

Candidates who have accepted the voluntaryexpenditure ceiling for a particular electionmust disclose on that election committee’sreport the total amount of expenditures madethrough the end of the reporting period thatare subject to the expenditure ceiling for theelection. Report the date of the election andthe total amount expended for that election.Report totals for the primary and generalelections separately. This information is

not required if the expenditure ceiling hasbeen lifted. Include nonmonetarycontributions received, except for thosereceived from a political party. In addition,goods or services received during a reportingperiod for which no payment has been made(accrued expenses, Schedule F) must becounted. Once an accrued expense hasbeen reported on Line 22, do not count theexpense again when it is paid. It is notnecessary to amend a previously-reportedexpenditure total to reflect any subsequent

adjustments, such as refunds. (See Chapter1 for information on voluntary expenditureceilings, including what expenditures must beincluded.)


Q. Is there any circumstance where Line 16,Ending Cash Balance, would show a negative amount?

A. If you report a negative amount on Line16, this means that either you have made

a mathematical error in your calculationsor you are overdrawn at the bank.Rounding off also may cause a smallnegative in the cash on hand balance.

Q. Is there any circumstance where an amount in Column A would be negative?





A. Yes. As loans and accrued expenses arepaid down, the amount reflected inColumn A may be a negative amount.

Q. What should I do if I am unable to balance my accounting records by the filing deadline?

A. Because the Political Reform Act doesnot provide for deadline extensions,complete the form as accurately as youcan and file by the deadline. Then file anamended form as soon as possible.

General Rules for ReportingContributions Received

(See Chapter 3 for definitions and additionalinformation about receiving contributions.)

$5,000 Contributor – Major Donor Notice

If $5,000 or more is received from onesource in a calendar year, a “major donor”notice must be sent to the contributor. (SeeChapter 3.) Do not send the notice if thecontribution is from another recipientcommittee.

Rails, Inc. made a $5,000 contribution to your committee.Within two weeks of receiving the contribution, notify Rails, Inc. in writing that they must file as a major donor if they make any number of contributions totaling $10,000 or more during the calendar year.

Joint Checking Account

If a check is received that is imprinted withtwo individuals’ names, report the contributionas coming from the person who signed the

check. However, if both signed the check, orone signed the check but both have signed anaccompanying letter indicating that thecontribution is from both, then report 50% ofthe contribution coming from the oneindividual and 50% coming from the other,unless the letter attributes specific amounts toeach contributor. (See Chapter 3.)

Intermediary

If a contribution of $100 or more is receivedfrom someone who is acting as an

intermediary for the true source of the funds,disclose both the true source of thecontribution and the intermediary. (SeeChapter 3.)

Sarah Honey made a $500 contribution to your committee

and notified you that she would later be reimbursed by her employer, Hilltop Dairy.Your committee will report Hilltop Dairy,including its address and contributor code, as the source of the contribution and also

disclose Sarah as the intermediary, providing her address, occupation, and employer.

Aggregating Contributions

There are a variety of situations in which twoor more contributions need to be aggregatedfor reporting. For instance, when anindividual, who is the sole proprietor of acompany, makes a contribution fromcompany funds and another contributionfrom personal funds, these contributions areadded together for reporting purposes. (See

Chapter 3.)

There are special rules for “majordonors” (usually these are individuals andbusiness entities that make contributionstotaling $10,000 or more in a calendar year)when they make contributions that aresubject to aggregation. The major donormust notify each committee to which itmakes a contribution of the name underwhich the major donor is filing its report(Form 461). The recipient of the contribution

must identify the name of the “filer” and thename of the contributor, if that is differentthan the name of the filer.

Temple Construction is a subsidiary of Temple

Enterprises. Contributions made by the two entities must be aggregated and they qualify

Example

Example

Example





as a major donor. Your committee receives a contribution from Temple Construction.Temple Construction is required to notify you

that its contribution is reported on a campaign statement filed under the name of Temple Enterprises. Your committee must identify both names on its report and, if you receive contributions from both entities, the contributions must be aggregated for purposes of the contribution limits and for reporting cumulative amounts.

Contributor Information

A contribution of $100 or more must bereturned to the contributor within 60 days of

receipt if the contributor’s name, address,and, if the contributor is an individual, his orher occupation and employer are not in thecommittee’s records. Contributions may bedeposited in the committee’s bank accountpending receipt of the information, in whichcase they must be reported on the nextcampaign statement (Form 460) filed. Thecampaign statement must be amendedwithin 70 days from its closing date todisclose the missing contributor informationunless the contribution was returned to the

donor. (See Chapter 2 for detailedinformation about returning contributions andrecordkeeping requirements.)

Reporting Cumulative Amounts

Contributions from the same source (includingaggregated contributions) are cumulated fromJanuary 1 through December 31. Whenreporting the cumulative amount ofcontributions received from any one source,include all monetary and nonmonetarycontributions, and loans (including loan

guarantees) received by all committeescontrolled by the candidate. (Exception:Contributions received by controlled ballotmeasure committees and legal defense fundsare not cumulated with contributions receivedby the controlling candidate’s electioncommittees.)

Calendar Year Cumulation Exception

An exception to calendar year cumulationapplies if the committee is required to file a

preelection statement in one year inconnection with an election held in anotheryear, e.g., certain January/Februaryelections. When this happens, thecumulation period begins on January 1 of theyear before the election and ends on theclosing date of the semi-annual statementfiled after the election.

Returned Contributions

Not Deposited: A contribution need not bereported if it is returned to the contributor

prior to depositing it in the campaign bankaccount and prior to the closing date of thecampaign statement on which it would bereported. A late contribution is not required tobe reported if it is not deposited, negotiated,or cashed and is returned to the contributorwithin 24 hours of receipt.

Deposited, Negotiated, or Returned AfterClosing Date: Contributions that have beendeposited or negotiated, or which were notreturned prior to the closing date of the

campaign statement, are reported onSchedule A. If the contribution is returnedwithin 30 days of receipt, and within thereporting period, the return may be shown asa negative figure on Schedule A. Otherwise,report the return of the contribution onSchedule E.

Returned for Insufficient Funds: If a checkis returned from the bank for insufficientfunds and the committee returns the check tothe contributor during the same reporting

period, both the receipt and the return of thecontribution may be reported on Schedule Awith the return shown as a negative amount.Otherwise, the return is reported onSchedule E.





Transfers

Use Schedule A or I to report transfers offunds received from another committee

controlled by the candidate, including ballotmeasure committees. (See Chapter 1 forinformation on transfers and carry over.)

Enforceable Promises

If a contribution is received in the form of an“enforceable promise” that has not been paidduring the period, report the contribution as amemo entry on Schedule A. An “enforceablepromise” has been received when acontributor promises, in writing, to pay forspecific goods or services and, based on that

promise, the committee expends funds orenters into a legally-enforceable contract witha vendor to purchase the goods or services.An “enforceable promise” has not been madeif a person signs a pledge card or similardocument, or agrees to make a contributionby installment payments through wiretransfer, credit card transaction, debitaccount transaction, or similar electronicpayment.

Disclose the date of the promise, all of the

required information about the contributor,and the amount promised, but do not includethe amount in the summary totals. When thecontributor makes the actual payment, fullydisclose the contribution on Schedule A, ifthe payment is made to the committee, or onSchedule C, if the contributor pays thevendor directly, and include the amount inthe appropriate summary section.

Installment Payments

Contributions may be received as installment

payments made at regular intervals over aperiod of time via credit card, debit card, wiretransfer, or similar electronic means. Whena contributor authorizes a series ofinstallment payments, the contribution isreported as received when the committee, or

agent of the committee, obtains possessionor control of the funds for each installmentpayment.

Sandra Nickel informed your committee that she wanted to

contribute a total of $500, but would need to make the contribution in five payments of $100 each month. On June 1, she provided you with her credit card information and authorized your committee to charge her account $100 on that date and on the first of the next four months. Your committee has a statement due July 31 covering the period January 1 through June 30. Your campaign

statement must itemize Sandra and report receipt of $100 from her on June 1; the report would not include the future contributions.

Example





How to Complete Schedule AMonetary Contributions Received

Report monetary contributions the candidateor committee has received on Schedule A,

except for loans (reported on Schedule B),receipt of repayments for loans made(reported on Schedule H), and miscellaneousreceipts (reported on Schedule I).

Date Received

List the date the committee obtainedpossession or control of the contribution. Forinstance, report the date the check wasreceived, which may differ from the date onthe check or the date the check wasdeposited. For contributions received by

electronic transaction (such as credit card,debit account, or wire transfer, includingthose received over the Internet), report thedate the committee received or had control ofthe credit/debit account information or otherpayment information, or the date thecommittee received or had control of thefunds, whichever is earlier.

Contributor Information

Itemize persons and organizations that havecontributed a cumulative amount of $100 ormore during the calendar year. Provide each

contributor’s name, street address, city, state,and zip code. Remember to maintain thenames and addresses of contributors of $25or more in your records. (See Chapter 2.)

Duncan MacManus contributed $25 during the year’s first

reporting period. On your committee’s first report for the year, Duncan was not itemized.During the second reporting period, you received a $99 contribution from Duncan.Itemize Duncan on this report, providing his

address, occupation, and employer information, reporting $99 as received “this period” and reporting a “cumulative amount” of $124.

Contributor Codes

For each itemized contributor, check the boxindicating whether the contributor is an

Form 460Schedule A

Example





individual, a committee, “other” (such as abusiness entity), political party, or smallcontributor committee.

Occupation and Employer, I.D. Number,and Intermediary Information

If the contributor is an individual, provide theindividual’s occupation and employer, or, ifself-employed, provide the name of thebusiness. Do not leave this blank. If thisinformation has not been obtained, put“requested” or similar language in thiscolumn and amend Schedule A when theinformation has been received.Contributions of $100 or more must bereturned within 60 days of receipt if thisinformation is not obtained. (See Chapter 2.)

If the contributor is a recipient committee,report that committee’s identification number.If the identification number has not yet beenassigned or is unknown, report the full name,street address, city, state, and zip code ofthat committee’s treasurer.

If a contribution is received through anintermediary, provide the name, streetaddress, city, state, zip code, and, ifapplicable, occupation and employer of boththe intermediary and the true source of thecontribution.

Amount

Report the amount of the contribution.

Cumulative to Date

Contributions from a single source arecumulated from January 1 throughDecember 31. The amount listed in the“Cumulative to Date-Calendar Year” columnwill differ from the “Amount Received ThisPeriod” column if the committee has receivedother contributions, including nonmonetary

contributions, loans, or loan guarantees fromthe same source during in the year. There isan exception to calendar year cumulation ifthe committee is required to file a preelectionstatement in one year in connection with anelection held in another year, e.g., certainJanuary/February elections. When thishappens, the cumulation period begins onJanuary 1 of the year before the election andends on the closing date of the semi-annualstatement filed after the election.

Per Election to DateStatecandidates arealso required tocomplete the“Per Election toDate” column.For each

Form 460Schedule AContinuationSheet

Abbreviations forDisclosing Per Election

Cumulative Amounts

P = Primary 2008 = 08G = General 2009 = 09S = Special 2010 = 10R = Runoff 2011 = 11





itemized contribution, disclose the type ofelection, the year of the election, and theamount received from the contributor for that

election. For example, an Assemblycandidate who receives a $7,200 checkintended for both the primary and generalelections would disclose per electionamounts of $3,600 P-year of the election and$3,600 G-year of the election. These figuresmay include amounts received in differentcalendar years.

Your committee received a contribution of $3,600 for the

2008 primary election from Kaia Scott in May

2008. In October 2008, Kaia contributed $3,600 for the 2008 general election. When itemizing the November 2008 contribution,disclose per election totals as: $3,600 P-08 and $3,600 G-08.

In April 2007, Lakeesha Rashford contributed $1,000 for the May 2007 special election,and in July 2007, she contributed $1,000 for the special runoff election. In October 2007,she contributed $2,000 to pay debt from the runoff election. When itemizing the October contribution, disclose per election totals as:

$1,000 S-07 and $3,000 R-07.Candidate James Medino made a personal contribution of $25,000 in October 2008 to his committee for the 2008 general election.In December 2007, he had made a $50,000 personal contribution for the primary election.When itemizing the contribution for the general election, disclose per election totals as: $50,000 P-08 and $25,000 G-08.

Schedule A Summary

Complete the summary section of eachschedule after completing the correspondingschedule. Each summary provides detailedinstructions for every line.


Q. I plan to contribute to my own campaign.May I be reimbursed later?

A. No. State candidates may not returnpersonal contributions they have made totheir committees. If you want to be

repaid for personal contributions made toyour campaign, you may make loans upto $100,000. Report the loans onSchedule B, Part 1.

Q. I received a contribution of $75 this period from someone who contributed $50 earlier this year. I itemized the $75 contribution on Schedule A. Should the $75 be included on Line 1 or Line 2 of the Schedule A summary?

A. All itemized contributions (including

contributions under $100 that areitemized because the contributor’scumulative total is $100 or more) aretotaled on Line 1 of the schedulesummary. Only unitemized contributionsare included on Line 2 of the schedulesummary.

Schedule B – Loans Received

Use Schedule B to report activity on loansreceived by the committee. Outstandingloans are reported on each campaign

statement until they are paid. Schedule Bhas two parts:

• Part 1 lists loans received or outstanding,and the repayment, forgiveness, orpayment by a third party of a loanpreviously received.

• Part 2 lists information on loan guarantors.

Examples





How to Complete Schedule B – Part 1Loans Received

Lender Information

Provide the name, street address, city, state,and zip code of each lender of $100 or more.

Financial Institution

If a financial institution, such as a bank, hasloaned the committee money or thecommittee has drawn on a line of credit,report the institution as the lender by listingits name and address, including zip code. Ifthe candidate has obtained a loan from acommercial lending institution for which he orshe is personally liable, report both thecandidate and the institution as the lender.

IndividualIf the lender is an individual, also provide theindividual’s occupation and employer, or, ifthe contributor is self-employed, provide thename of the business. Do not leave thiscolumn blank. If this information has notbeen obtained, put “requested” or similarlanguage in this column and amend

Schedule B, Part 1 later. (See Chapter 2 forrestrictions on contributions received whenthe name, address, occupation, or employerinformation is missing.)

Officeholder/Candidate

Officeholders and candidates depositing theirpersonal funds in the campaign account toassist in their own elections may report thefunds as a loan on Schedule B. A statecandidate may not have an outstandingpersonal loan of more than $100,000 to hisor her campaign at any one time, includingloans from a commercial lending institutionfor which the candidate is personally liable.(See Chapter 1 for further information.)

Contributor Codes

For each itemized lender, check the boxindicating whether the lender is an individual,committee, “other” (such as a business entity),political party, or small contributor committee.

Report each loan separately, even ifthe committee has received more

than one loan from a single source.

Form 460Schedule BPart 1

QuickTIP





(a) Outstanding Balance Beginning ThisPeriod Enter the outstanding loan balance at the

beginning of this reporting period (Column(d) of the last report filed). If the loan wasreceived this period, enter zero or leaveColumn (a) blank.

(b) Amount Received This Period Enter the amount received from the lenderduring this reporting period. If this loan wasreceived in a previous reporting period, enterzero or leave Column (b) blank.

(c) Amount Paid or Forgiven This Period Enter the amount of any reduction of the loan

during this reporting period. Check whether thereduction was a payment or forgiveness.When the lender forgives all or part of a loan, ora third party makes a payment on a loan, alsoreport the lender or third party on Schedule A.Enter zero or leave this column blank if nopayments were made this reporting period.

(d) Outstanding Balance at Close of ThisPeriod Enter the outstanding balance of the loan atthe close of this reporting period. Enter the

due date, if any.

(e) Interest Paid This PeriodEnter the interest rate and the amount ofinterest paid on the loan(s) during thisreporting period. If the lender is not charginginterest, indicate “none” on the “interest rate”line. Interest paid is reported separately frompayments made on the loan principal.Interest payments are also transferred to theSchedule E Summary.

Candidates may not charge their

committees interest for the use oftheir personal funds.

(f) Original Amount of LoanEnter the original amount of the loan and thedate it was received. If this is the first timethe loan is being reported, this is the sameamount as reported in Column (b).

(g) Cumulative Contributions to Date Enter the cumulative amount of contributions(including loans, loan guarantees, monetary

and nonmonetary contributions) receivedfrom the lender during the calendar yearcovered by this statement.

State candidates are also required to reportthe amount received per contributor perelection. For each itemized contribution,disclose the type of election, the year of theelection, and the amount received from thecontributor for that election. For example, anAssembly candidate who receives a $7,200loan intended for both the primary andgeneral elections would disclose per election

amounts of $3,600 P-year of the election and$3,600 G-year of the election. These figuresmay include amounts received in differentcalendar years. When a loan is repaid, thecumulative amount may be reduced by theamount repaid.

A loan is a contribution unless it is receivedfrom a commercial lending institution in theordinary course of business. It is notnecessary to disclose cumulative amountsfor loans that are not contributions.

SummaryAs loans are paid, Line 3 of the summarysection of Schedule B will eventually be anegative amount. When transferring anegative figure from Line 3 to the SummaryPage, Column A, Line 2, be sure to subtractthe amount from the previous report, ColumnB, Line 2, to determine the figure for thisreport’s Column B, Line 2.

QuickTIP





Form 460Schedule BPart 2

How to Complete Schedule B – Part 2

Loan GuarantorsGuarantor Information

If someone other than the controllingcandidate guarantees, co-signs, endorses, orprovides security for a loan of $100 or more,enter the name and address of the guarantorand, if the guarantor is an individual, his orher occupation and employer, or, if self-employed, the name of the business.

Contributor Codes

For each itemized guarantor, check the boxindicating whether the guarantor is anindividual, committee, “other” (such as abusiness entity), political party, or smallcontributor committee.

Loan

Enter the name of the lender or the entity atwhich a line of credit was established and thedate of the loan or the date the line of creditwas established.

Amount Guaranteed This Period

Enter the amount guaranteed this period, ifapplicable. For lines of credit, enter the fullamount established or secured by theguarantor during the period. (Reportamounts drawn on a line of credit onSchedule B – Part 1.)

Cumulative to Date

Enter the cumulative amount of contributions(including loans, loan guarantees, monetaryand nonmonetary contributions) receivedfrom the guarantor during the calendar yearcovered by the statement.

State candidates are also required to reportthe amount guaranteed per contributor perelection. For each itemized loan guarantee,disclose the type of election, the year of theelection, and the amount guaranteed by thecontributor for that election. For example, an

Assembly candidate who receives a $7,200loan guarantee where the loan is intended forboth the primary and general elections woulddisclose per election amounts of $3,600 P-year of the election and $3,600 G-year of theelection. These figures may include amountsreceived in different calendar years.

Balance Outstanding to Date

Report the outstanding balance for which theguarantor is liable at the close of thisreporting period.

Loan guarantees are not included inthe Schedule B Summary, but are

carried forward in a lump sum to Line 17 ofthe Summary Page.

QuickTIP





How to Complete Schedule CNonmonetary Contributions Received

Use Schedule C to report nonmonetarycontributions received by the committee.Nonmonetary contributions are goods orservices provided to the committee for whichit does not pay the fair market value.

The fair market value is the amount the

committee would pay for the goods orservices on the open market; whatever itwould cost any member of the general publicto obtain the same good or service. (SeeChapter 3 for assistance in determining thefair market value of a nonmonetarycontribution.)

Seaside TV Sales donated a television to your committee.

The cost to Seaside TV for the television was $500. Because it would have cost your

committee $1,000 to purchase the TV at fair market value, the nonmonetary contribution from Seaside TV Sales is $1,000.

Examples of Nonmonetary Contributions

• Items donated for a garage sale, raffle, orauction.

• Signs, postage, and printing.

• Food and entertainment provided for afundraiser.

• Use of office space, an automobile, orairplane.

• Discounts or rebates that are notextended to the general public.

• Mailing lists, mailings, and otheradvertising.

• Compensation paid by an employer to anemployee who spends more than 10% ofhis or her compensated time in a calendarmonth working on behalf of a committee.Compensation includes gross wages paidand any benefits in lieu of wages, such asstock options or an annuity purchase.Compensation does not include routinefringe benefits, such as the employer’spayments to a health plan or payroll taxes.

• Forgiveness of an accrued expense by the

creditor.• An extension of credit that has become a

contribution (see Chapter 3).

(See Chapters 3 and 4 for exceptions, suchas volunteer personal services, home/officefundraisers, and member communications.)

Form 460Schedule C

Example





Date Received

A nonmonetary contribution is received onthe earlier of the following:

• The date that funds are spent by thecontributor; or

• The date the candidate or committeeobtains possession or control of the goodsor services, or receives the benefit of theexpenditure.

A PAC, in coordination with your committee, printed a brochure

advocating your candidate’s election. The PAC delivered the brochures to your headquarters on February 22 and paid the

bill for the printing on March 15. Your committee received the nonmonetary contribution on February 22.

• For an extension of credit, the date theextension of credit became a contribution;generally, that is 46 days following thedate the invoice was received or the datethe goods or services were received,whichever is earlier. (See Chapter 3 fordetailed information.)

Contributor Information Occupation/Employer and Amount Columns

Itemize contributors of $100 or more. If thecontributor is an individual, in addition to his orher street address, city, state, and zip code,provide occupation and employerinformation, in addition to the amountreceived this period, and the cumulativeamount to date. (See Chapter 2 forrestrictions on contributions received whenthe name, address, occupation, or employerinformation is missing.)

Contributor Codes

For each itemized contributor, check the boxindicating whether the contributor is anindividual, committee, “other” (such as abusiness entity), political party, or smallcontributor committee.

Description of Goods or Services

Provide a brief description of the goods orservices received.

Amount/Fair Market Value

Report the value of the nonmonetarycontribution received. (See Chapter 3 forassistance in determining the fair marketvalue of a nonmonetary contribution.)

Cumulative to Date

Enter the cumulative amount of contributions(including loans, loan guarantees, monetaryand nonmonetary contributions) receivedfrom the contributor during the calendar year

covered by the statement.State candidates are also required to reportthe amount received per contributor perelection. For each itemized contribution,disclose the type of election, the year of theelection, and the amount received from thecontributor for that election. For example, anAssembly candidate who receivesadvertising space worth $7,200 intended forboth the primary and general elections woulddisclose per election amounts of $3,600 P-year of the election and $3,600 G-year of the

election. These figures may include amountsreceived in different calendar years. (SeeSchedule A instructions earlier in this chapterfor examples.)

Schedule C Summary

The total of nonmonetary contributionsreported on Line 3, Schedule C summarysection, is reported on the Form 460Summary Page as both a contribution (Line4, Column A) and an expenditure (Line 10,Column A).


Q. What is the value of the time provided by a graphic artist who volunteers to design a logo for our committee?

A. The artist’s time is not reportable becauseit constitutes volunteer personal services.

Example





However, if the artist is an employee of abusiness and spends more than 10% ofhis or her compensated time in a calendar

month working on the design, the paidcompensation becomes a nonmonetarycontribution from the artist’s employer.

Q. How do I determine the fair market value of a mailing list provided by another committee?

A. The most common way to determine thevalue is to contact a business from whichsimilar mailing lists can be obtained.

Schedule D – Expenditures Supporting/

Opposing Other Candidates, Measures,and Committees

Schedule D is a summary of paymentsreported on Schedules E, F, and H that arecontributions or independent expenditures tosupport or oppose other candidates,measures, and committees. Types ofexpenditures include:

• A monetary contribution or loan to anothercandidate or committee.

• A payment to a vendor for goods or

services for a candidate or committee (i.e.,a nonmonetary contribution).

• A donation to a candidate or committee ofgoods on hand, or the payment of salary orexpenses for a campaign employee whospends more than 10% of his or hercompensated time in a calendar monthworking for another candidate or committee.

• A payment for a communication (e.g., amailing, billboard, radio ad) that expresslyadvocates the election/passage or defeatof a clearly-identified candidate or ballot

measure, but the payment is not made to,or at the behest of, the candidate or ballotmeasure committee. (See Chapter 4regarding independent expenditures.)

Contributions from a state candidateto another state candidate are

subject to limits. (See Chapter 1.)

Candidates also are prohibited from usingcampaign funds to make independentexpenditures in support of or opposition to

another candidate.

Do not report payments made to support thecontrolling candidate’s own candidacy, or tooppose the candidate’s opponent(s) onSchedule D. Use Schedule E instead.

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How to Complete Schedule DSummary of Expenditures Supporting/Opposing Other Candidates,Measures, and Committees

Date

Report the date the contribution or

independent expenditure was made. Amonetary contribution is made on the date itis mailed, delivered, or otherwise transmittedto the officeholder, candidate, or committee.

A nonmonetary contribution is made on theearlier of the following:

• The date an expenditure is made for thegoods or services; or

• The date the candidate, committee, or anagent obtains possession or control of thegoods or services.

Your committee, working on behalf of Friends of the Forest,

arranges for the mailing of a campaign piece supporting their issue. The mailer is sent to voters directly from the mail house on September 4. On September 6, the mail

house submits to you an invoice for payment.Your committee made a nonmonetary contribution to Friends on September 4 (the date Friends received the benefit of the expenditure).

An independent expenditure is made on the

date the communication is mailed, delivered,broadcast, or otherwise disseminated to thepublic.

The payment for a communication which isnever transmitted is not an independentexpenditure and need not be reported onSchedule D. Report the expenditure onSchedule E.

Candidate and Office, Measure andJurisdiction, or Committee

If a total of $100 or more is contributed orexpended during a calendar year to supportor oppose a single candidate, ballotmeasure, or a general purpose committee(e.g., a political party), disclose the name ofthe candidate and the office sought or held,the number or letter and jurisdiction of theballot measure, or the name of the general

Form 460Schedule D

Example





purpose committee. For each candidate ormeasure listed, indicate whether the paymentwas made to support or oppose the candidate

or measure.

Type of Payment

Check one of the boxes indicating the type ofpayment. If the payment is a nonmonetarycontribution, provide a description of thepayment.

Amount This Period

Provide the amount(s) of contributions orindependent expenditures made this periodrelative to each candidate, measure, or

committee.

Committee to Elect Waters to the Assembly made a $100

contribution to Committee to Support Bike Lanes, Yes on Measure C on October 3. In addition to reporting it on Schedule D, the expenditure is also reported on Schedule E.

Cumulative to Date Calendar Year

Report the cumulative amount contributed toor expended to support or oppose eachitemized candidate, ballot measure, orcommittee since January 1 of the currentcalendar year.

If contributions are made to more than oneelection committee controlled by the samecandidate, report the total amountcontributed to all of the committees. Do notcumulate contributions made to a candidateand to that candidate’s controlled ballotmeasure committee.

Tyson Tribe has two committees: one for his 2006 election campaign to the Assembly, and one to raise funds for reelection in 2008. If your committee contributes to both, the amounts you contribute are cumulated on Schedule D.

Per Election to Date

Report the cumulative amount per electionthat has been contributed to each candidate

that is subject to state contribution limits.

Contribution of Goods When No PaymentIs Made

If goods on hand are contributed to anothercandidate or committee (e.g., paper, copier),describe the goods or services in the“Description” column, and disclose the fairmarket value of the contribution.

If, during a calendar year, an officeholder orcandidate uses personal funds to make

contributions of $10,000 or more, orindependent expenditures of $1,000 or more,to support or oppose other officeholders,candidates, committees, or ballot measures(including a controlled ballot measurecommittee), the candidate must file a MajorDonor and Independent ExpenditureCommittee Campaign Statement (Form 461).These payments are not reported on ScheduleD. (See FPPC’s Information Manuals forMajor Donor and Independent ExpenditureCommittees for reporting information.)


Q. Must a candidate file Form 461 (Major Donor and Independent Expenditure Committee Campaign Statement) if he or she makes personal contributions to his or her controlled campaign committee of $10,000 or more?

A. No.

Q. Must the spouse of a candidate file Form 461 if he or she makes personal

contributions to his or her spouse’s campaign of $10,000 or more?

A. If the spouse makes contributions fromcommunity funds, the spouse is notrequired to file Form 461. If the spousemakes contributions from legally separatefunds, Form 461 is required.

Example

Example





Q. Must a candidate file Form 461 if he or she makes personal contributions to his or her controlled ballot measure committee

of $10,000 or more? A. Yes.

Q. Must a candidate file Form 461 if he or she makes personal contributions to other candidates and committees which total less than $10,000, and makes contributions to his or her own committee,and all contributions combined equal $10,000 or more?

A. No.

Schedule E – Payments Made andSchedule F – Accrued Expenses(Unpaid Bills)

An expenditure is “made” on the date thepayment is made or the date the committeereceives the goods or services, whichever isearlier. Expenditures of campaign fundsmust have a political, legislative, orgovernmental purpose. (See Chapter 10.)

Use Schedule E to report money spent bythe committee during the reporting period.

Do not use Schedule E to report therepayment of loans received; use ScheduleB, Part 1 instead. Also, do not use ScheduleE when reporting loans made to othercandidates, officeholders, and committees;use Schedule H instead.

Use Schedule F to report amounts owed bythe committee for goods or services receivedbut not paid for by the end of the reportingperiod.

During October and November,

you: (a) Paid a deposit on a room for a fundraiser

to be held January 10;

(b) Ordered and received the fundraiser invitations for which you were billed but had not made a payment by December 31; and

(c) Ordered, but did not receive, flowers for the fundraiser for which you will be billed at the end of January.

On your semi-annual statement covering the period ending December 31, report the payment for the room deposit on Schedule E.Because you received the invitations but had not paid for them by December 31, disclose the outstanding amount on Schedule F. The cost of the flowers will not be reported until the next reporting period because you did not pay for nor receive the flowers during the period covered by the statement.

Unpaid administrative overhead expenses of

the committee, such as rent, utilities, phones,or employee salaries, need not be reportedon Schedule F if the committee has notreceived a bill in the normal course ofbusiness or if the due date for the payment isafter the closing date of the statement.Regular administrative overhead does notinclude contracts for services such asaccounting, legal, campaign consulting, andpublic relations.

On June 15, your committee

received two bills for June services. One bill was from an outside accounting firm and the other was for office rent. The due date for both invoices is July 15. If, on June 30, the committee has not paid the two bills, the bill from the outside accounting firm is reported on Schedule F as an accrued expense on your semi-annual statement; the rent bill, however, is not.

General Rules

Information Required

Itemize each payment or accrued expense of$100 or more to a single payee, and anypayments totaling $100 or more for a singleproduct or service made during the period.

If the committee has entered into anagreement to make payments over time for aproduct or service, other than general

Example

Example





administrative expenses such as rent andutilities, the unpaid balance may bereportable on Schedule F as an accrued

expense.

Savings Accounts/Certificates of Deposit/Money Market Accounts

Do not report on Schedule E the transfer ofcampaign funds into a savings account,certificate of deposit, money market account,or the purchase of any other asset that canbe readily converted to cash. Report theseamounts as cash on hand on the SummaryPage, Line 16.

TransfersReport transfers of funds to anothercommittee controlled by the candidate onSchedule E. (For more information ontransfers and carryover between a statecandidate’s own committees, see Chapter 1.)

Contributions and IndependentExpenditures

If the committee makes contributions tosupport or oppose other candidates,officeholders, or committees, or independentexpenditures to support or oppose ballotmeasures, in addition to reporting thepayments or accrued expenses on ScheduleE or F, complete Schedule D. For paymentsmade for goods or services that arenonmonetary contributions or independentexpenditures, also identify the candidate,committee, or ballot measure supported oropposed by the expenditure in the“Description of Payment” column onSchedule E or F.

Subvendor Payments

Whenever an agent or independentcontractor (such as a campaign worker,consulting firm, or advertising agency) makesan expenditure, or incurs a debt, of $500 ormore on behalf of the committee, theexpenditure must be reported in the same

detail as if it had been made directly by thecommittee. These are commonly known as“subvendor payments.” Following are some

examples of the types of subvendorpayments that must be itemized.

• Development of campaign strategy;

• Design or management of campaignliterature or advertising;

• Advertising time or space; and

• Surveys, polls, signature gathering, anddoor-to-door solicitation of voters.

Agents and independent contractors mustprovide the committee with the required

payment information no later than threeworking days prior to when the campaignstatement must be filed (or within 24 hoursfor a late contribution or a late independentexpenditure). Expenditures made by theagent or independent contractor for its ownoverhead and operating expenses need notbe itemized. The committee also mustobtain and keep receipts, invoices, and otherdocumentation of subvendor payments.(See Chapter 2.)

In many cases, funds paid to an agent orindependent contractor in one reportingperiod will not be used by the agent orcontractor until a subsequent reportingperiod. Report payments to the agent/ contractor on Schedule E of the campaignstatement covering the period in which thepayment was made. When the agent/ contractor spends the money, reportsubvendor payments on the campaignstatement covering the period in which theagent/contractor made the expenditures;

itemize payments made by the agent/ contractor of $500 or more.

Subvendor payments are most commonlyreported on Schedule G, but may bereported on Schedule E or F along with thepayment made or owed to the agent/ contractor. When itemizing subvendorpayments on Schedule E or F, do not include





the payments in the “Amount Paid” column,as this will inflate expenditure totals.

An agent purchased $535 worth of flowers, $250 worth of postage, and $100 worth of balloons for a fundraiser. Itemize the agent’s name and address on Schedule E (or Schedule F if the agent was not reimbursed during the reporting period), provide a code or a description of the expenditures, and the amount being reimbursed: $885. In addition,on Schedule G, itemize the name and address of the florist, enter the code FND or provide a description of the expenditure, and the amount

paid to the florist: $535.

Credit Card Payments

When reporting payments to a credit cardcompany, report the name, street address,city, state, zip code, and the amount ofpayment. In addition, provide the name,street address, city, state, and zip code ofany vendor that received $100 or more, theamount paid to each vendor itemized, and acode or description of the payment. If apayment on the credit card has not been

made by the end of the reporting period, oronly partial payment has been made, reportthe amount outstanding to the credit cardcompany on Schedule F. Payments to thecredit card company should be reflected onSchedule E, when payments are made, andSchedule F, when there is a balance stillowing at the end of the reporting period.Vendors are not required to be listed morethan one time.

Sandra’s committee for Assembly

used the campaign credit card on December 28 at two different vendors to purchase office supplies and to have invitations to a fundraiser printed. The printing job cost $560, while the office supplies were under $100. Since the committee did not make a payment on the credit card by December 31, the end of the

reporting period, the amount owed is reported on Schedule F. In addition to the total amount owed to the financial institution that issued the

credit card, the committee also itemizes the printer, since the amount owed is $100 or more. The committee will report payments it makes to the financial institution, but does not reitemize any vendors.

Contingency Payments

If the committee has entered into anagreement to pay a contingency fee, such asa bonus to a consultant if the campaign issuccessful, report the fee amount onSchedule F only if it is outstanding at the

end of the campaign. The fee is not requiredto be reported as an accrued expense until itis due.

Reimbursements

Candidates

Candidates may not use their personalfunds for campaign expenses (except forfiling and ballot statement fees) without firstdepositing them into the campaign bankaccount.

Volunteers, Employees, Agents, andContractors

Volunteers (including a candidate’s spouse),employees, and agents or independentcontractors, e.g., a consultant or anadvertising agent, may be reimbursed forgoods, services, or travel expenses when thefollowing criteria are met:

• The treasurer is provided with a datedreceipt and a written description of eachexpenditure prior to reimbursement;

• The reimbursement is paid within 45calendar days after the expenditures aremade; and

• There is a written contract between thecommittee and the agent/independentcontractor providing for the reimbursement

Example

Example





of expenditures. (Volunteers andemployees do not need a written contract.)

If the reimbursement does not occur within45 calendar days, the expenditure isconsidered a nonmonetary contribution fromthe volunteer, paid employee, or agent/ independent contractor, unless the personseeking reimbursement has made a goodfaith effort to obtain reimbursement and isunable to collect from the committee.

Officeholders

Officeholders may be reimbursed forexpenses related to holding office paid for

from personal funds when the followingcriteria are met: (See Chapter 10.)

• The officeholder provides the committee’streasurer with a dated receipt and awritten description of the expenditure; and

• Reimbursement occurs:

− For a monetary expenditure: Within 90calendar days after the officeholderincurs the expense.

− For a credit card or charge account:Within 90 calendar days of the end ofthe billing period.

If the reimbursement does not occur withinthe 90-day period, the amount must bereported as a nonmonetary contribution fromthe officeholder to the committee and noreimbursement may occur.

An officeholder may be reimbursed fromeither the controlled committee campaignbank account established for election to theincumbent term of office, from an officeholder

account established for that office, or from acontrolled committee bank accountestablished for a different election to thesame office, if all of the conditions mentionedabove are met. When reportingreimbursements to the officeholder,subvendor payments of $100 or more mustbe itemized.





Form 460Schedule E

How to Complete Schedule EPayments Made

Name and Address of Payee

Itemize each payment of $100 or more made

to a single payee during the reporting period,and any payments totaling $100 or moremade during the period for a single productor service. Include the name, street address,city, state, and zip code of the payee. Do notuse a post office box number when reportingthe address of a payee or creditor.

Code or Description of Payment

When itemizing payments, provide either acode or a description of the payment.(Expenditure codes are explained in detail in

the Form 460, Schedule E instructions.) Ifnone of the codes listed on Schedule E fullyexplains the expenditure, leave the codecolumn blank and provide a brief descriptionof the goods or services purchased.

If several expenditures are made to onevendor during the same reporting period, allof the payments to the vendor may be

reported in a single record. When coding theexpenditures, use the code that representsthe largest share of the expenditures, andthe description field for the other codes or adescription. Alternatively, each expenditure

may be reported separately by category.

Payment of Accrued Expenses

When paying accrued expenses previouslyreported on Schedule F, report all paymentson Schedule E, itemizing at $100.Subvendor information is only required to bereported once, and does not need to bereitemized on Schedule E if it was disclosedon Schedule F of a previous report.

Schedule E Summary

The total amount of expenditures is reportedon Line 4 of the summary section of ScheduleE and on the Form 460 Summary Page,Column A, Line 6. If the committee is payinginterest on an outstanding loan, in addition toreporting the amount on Schedule B, Part 1,Column (e), also report the amount on Line 3of the summary section of Schedule E.





How to Complete Schedule FAccrued Expenses (Unpaid Bills)

Name and Address of Creditor

Itemize each accrued expense of $100 ormore owed to a single creditor. Provide thename, street address, city, state, and zipcode of the creditor. Do not use post officebox numbers. Continue to list an unpaid billuntil it is paid.

Code or Description of Payment

When itemizing accrued expenses, provideeither a code or a description of theoutstanding payment. (Expenditure codesare explained in detail in the Form 460,

Schedule E instructions.) If none of thecodes listed on Schedule F fully explains theoutstanding payment, leave the code columnblank and provide a brief description of thegoods or services.

If several accrued expenses are owed to onevendor during the same reporting period, allof the accrued expenses to the vendor may

be reported in a single record. When codingaccrued expenses, use the code thatrepresents the largest share of the accruedexpenses, and the description field for the

other codes or a description. Alternatively,each expenditure may be reportedseparately by category.

Amount Columns

For each itemized accrued expense, reportany outstanding balance remaining for theaccrued expense from the previous period incolumn (a), the amount of new accruedexpenses incurred this period in column (b),the amount paid this period in column (c),and any outstanding balance at the close of

the period in column (d).When payments on accrued expenses aremade, in addition to itemizing payments of$100 or more on Schedule F, itemize thepayments on Schedule E. Includeunitemized payments on accrued expenseson Line 2 of the summary section ofSchedule E.

Form 460Schedule F





Estimating Accrued Expenses

If the exact amount of a debt or obligation isunknown, an estimate may be reported.

When the exact amount is known thecommittee must 1) amend the statement onwhich the estimated amount was reported; or2) make an adjustment on the next campaignstatement by showing the difference betweenthe estimated amount and the actual amountin column (b), Amount Incurred This Period.If the actual amount is less than the estimate,the amount listed in column (b) should be anegative number and subtracted from thetotals. When reporting estimated amounts orcorrections to estimated amounts, note that

fact on the campaign statement.

On its second preelection statement, the Richards for

Treasurer committee reported an estimated accrued expense of $5,000 owed to ABC Printing. An invoice was received during the next reporting period showing the actual amount owed as $4,500. On Schedule F,column (a) of its next statement, the committee will report an outstanding accrued expense of $5,000. In column (b), the amount incurred

this period will be a negative $500. The committee paid the entire bill and therefore will report $4,500 as paid this period in column (c),with a zero balance in column (d).

Forgiven Accrued Expenses or ThirdParty Payments

If a creditor reduces or forgives a debtpreviously reported on Schedule F, or ifanother person pays a debt for the committee:

• Indicate that the debt was forgiven,

reduced, or paid by a third party and write“See Schedule C” in the “Description ofPayment” column. Also report thecreditor/payor and the amount as anonmonetary contribution on Schedule C.

• Report the amount forgiven, reduced, orpaid by a third party in the “Amount PaidThis Period” column and indicate that it

was a forgiveness or third party paymentor report the amount as a negativenumber in the “Amount Incurred This

Period” column. Do not report the amounton Schedule E.

Extensions of Credit as Contributions

When there is an agreement with theprovider of goods or services that thecommittee will pay for goods or services oncredit, the goods or services may become acontribution to the candidate and be subjectto contribution limits if the debt remainsunpaid after 45 days. (See Chapter 3.) If acontribution in the form of an extension ofcredit has previously been reported onSchedule F as an accrued expense, disclosethe creditor and the amount as anonmonetary contribution on Schedule C.On Schedule F, indicate that the debt hasbecome a contribution, showing the amountas a negative number in the “AmountIncurred This Period” column.

Outstanding Accrued Expenses

Line 9, Column B of the Summary Pageshould reflect the total of all outstanding

accrued expenses. Accrued expenses arecarried forward on future statements until paid.

Schedule F Summary

Line 3 of the summary section of Schedule Fwill be a negative amount when payments onaccrued expenses are more than the amountof new accrued expenses. Transfer theamount to the Summary Page, Column A,Line 9 as a negative amount and subtract itfrom the figure in Column B of the previouscampaign statement to determine the figure

for Column B, Line 9 of this statement.


Q. When are unpaid bills reportable as accrued expenses?

A. The basic rule is that you must report anaccrued expense any time you have

Example





received goods or services but have notpaid for them by the end of the reportingperiod.

Q. What if I have not received an invoice from the vendor yet?

A. If you have received the goods orservices, you must report the accruedexpense even if you have not received aninvoice. If you do not know the exactamount, you may estimate the amount ofthe expense. When reporting anestimate, note that fact on Schedule F.

Q. We have a contract to pay our campaign consultant $1,000 per month. If the

closing date of the campaign statement falls during the middle of the month, say March 17, must we report an accrued expense for the period March 1 through March 17?

A. No. When you have agreed in writing topay a contractor a set amount at regularintervals, it is not necessary to proratethe amount owed to the contractor if thereporting period closes before the end ofthe contract period.

Q. When an accrued expense is owed and there are subvendor payments, when are the subvendors reported? For example,if we report an accrued expense owed on a credit card and list the subvendors,must we reitemize the subvendors again on Schedules E and F when the accrued expense is paid?

A. No. It is not necessary to reitemizesubvendors when payments are made onaccrued expenses, or if an accruedexpense is reported on more than one

statement. In this example, thesubvendors must be reported on the firststatement disclosing the accruedexpense owed to the credit cardcompany. On subsequent statements,only the credit card company must beitemized.





Schedule G – Payments Made by anAgent or Independent Contractor

Use Schedule G to report payments made onbehalf of the committee by agents (such ascampaign workers) and independentcontractors (such as a consulting firm or anadvertising agency). This schedule may beused in lieu of itemizing these amounts onSchedule E or F.

General Rules

Who Completes Schedule G

Schedule G may be completed by the agentor independent contractor and given to thecommittee, or it may be completed by thecommittee from information provided by theagent or independent contractor.

DeadlineAgents and independent contractors mustprovide the committee with the requiredpayment information no later than threeworking days prior to the filing deadline of thecampaign statement (or within 24 hours for alate contribution or late independentexpenditure).

How to Complete Schedule G

Name and Address of Payee or Creditor

Itemize payments of $500 or more made bythe agent or independent contractor. Providethe name, street address, city, state, and zipcode of the payee. Do not use post office

box numbers.See the general rules for Schedules E and Finstructions for additional information.

Do not transfer Schedule G totals to anyother schedule or to the Summary Page.

Form 460Schedule G





Schedule H – Loans Made to Others

Schedule H is for reporting loans made bythe committee. Outstanding loans arereported on each campaign statement untilthey are paid.

General Rules

Generally, campaign funds may be used to

make loans to other candidates,officeholders, or bona fide charitable,educational, civic, religious, or similar tax-exempt non-profit organizations. There arerestrictions on loans to any other person,including a candidate who controls thecommittee, or to a non-profit organizationthat is affiliated with a candidate, thetreasurer, or other committee officials.

Because a loan is considered a contribution,loans to candidates are subject to applicable

state or local contribution limits. (SeeChapter 1.)

How to Complete Schedule H

Recipient Information

For each loan of $100 or more that wasmade or was outstanding during the

reporting period, disclose the recipient’sname and address and, if the recipient is anindividual, his or her occupation andemployer or, if self-employed, the name ofthe business.

(a) Outstanding Balance Beginning ThisPeriodEnter the outstanding loan balance at the

beginning of this reporting period (Column(d) of the last report filed). If the loan wasreceived this period, Column (a) should beleft blank.

(b) Amount Loaned This PeriodEnter the amount loaned to the recipientduring this reporting period. If this loan wasmade in a previous reporting period, Column(b) should be left blank.

(c) Repayment or Forgiveness This PeriodEnter the amount of any reduction of the loanduring this reporting period. Indicate whetherthe loan was paid or forgiven. If thecommittee forgives a loan, also report thetransaction on Schedule E and, if therecipient of the loan is a candidate or

Form 460Schedule H





committee, report the forgiveness as acontribution on Schedule D.

(d) Outstanding Balance at Close of ThisPeriodEnter the outstanding balance of the loan atthe close of this reporting period. Enter thedue date, if any.

(e) Interest ReceivedEnter the interest rate and amount of interestreceived on the loan during this reportingperiod. Interest received is reportedseparately from payments received on theloan principal. Interest received is alsotransferred to the Schedule I Summary.

(f) Original Amount of LoanEnter the original amount of the loan and thedate it was made. If this is the first time theloan is being reported, this will be the sameamount as reported in Column (b).

(g) Cumulative Loans to DateFor each loan made during this reportingperiod that is a contribution, enter thecumulative amount of contributions (includingloans, loan guarantees, monetary and

nonmonetary contributions) made to therecipient during the calendar year covered bythe statement. If the recipient is subject tostate contribution limits, also enter the totalamount contributed in connection with eachelection and identify the election year.(Loans to candidates or other committeesmust also be reported on Schedule D.)

Schedule H Summary

Line 3 of the summary section of Schedule Hwill be a negative amount when payments

received this period are greater than theamount of new loans made. Transfer theamount to the Summary Page, Column A,Line 7 as a negative figure and subtract thisamount from the figure in Column B, Line 7on the previous statement filed to determinethe amount to report in this statement’sColumn B, Line 7 of this statement.

Schedule I – Miscellaneous Increasesto Cash

Report on Schedule I increases to the

committee’s cash position that are notmonetary contributions, loans, or repaymentsof loans made to others.

Examples

• Proceeds, up to the fair market value, ofitems sold at a garage sale or auction.

• Refunds received on deposits, such as atelephone or room rental deposit or fromover-payment of bills.

• Interest received or credited to a checking

or savings account or other time deposit.• Interest payments received on loans made

to others.

• Receipts from the sale of committeeassets.

• Transfers of funds received by acontrolled committee from anothercommittee controlled by the samecandidate. However, see Chapter 1 forreporting transferred funds subject toattribution.

Donated Items

When reporting sources who havepurchased donated items, e.g., items sold ata garage sale, report the amount received,up to the fair market value, on Schedule I.Any amount in excess of the fair marketvalue is a contribution and reported onSchedule A.

Gail Winds purchased a television donated by Seaside TV Sales at

your committee’s garage sale. The donated television was previously reported on Schedule C with a fair market value of $1,000.Gail paid $1,100 for the television. Report the fair market value of $1,000 on Schedule I and itemize the additional $100, the amount over

Example





the fair market value, as a contribution on Schedule A.

Uncashed Checks

If the committee writes a check that is neverdeposited or negotiated, report the amount ofthe uncashed check on Schedule I.

Decreases to Cash

All decreases to cash must be reported asexpenditures on Schedule E or H.

How to Complete Schedule IMiscellaneous Increases to Cash

Date

Report the date the committee received themiscellaneous receipt.

Source Information

Itemize sources of $100 or more. Providethe full name, street address, city, state, andzip code of the source. Post office boxnumbers are not acceptable.

Description

Provide a description of the receipt, e.g.,refund on room deposit for fundraiser,interest earned on loans made to others.

Amount

Enter the amount of the receipt.

Schedule I Summary

The total amount of miscellaneous increasesto cash is reported on Line 4 of the summarysection of Schedule I and on the SummaryPage, Column A, Line 14.

Form 460Schedule I





Authority





82013 Committee.82015 Contribution. 82018 Cumulative Amount.82025 Expenditure.82025.5 Fair Market Value.82044 Payment.84105 Notification of Contributors.84211 Contents of Campaign Statement.84212 Forms; Loans.84213 Candidate Verification.84216 Loans.84216.5 Loans Made by a Candidate or

Committee.84302 Contributions by Intermediary or

Agent. 84303 Expenditures by Agent or

Independent Contractor. 84306 Contributions Received by Agents

of Candidates and Committees.85201 Campaign Bank Account.85306 Transfers Between a Candidate’s

Own Committees; Use of Funds Raised Prior to Effective Date.

85307 Loans.85308 Family Contributions.85311 Affiliated Entities; Aggregation of

Contributions to State Candidates.85319 Returning Contributions.85501 Prohibition on Independent



89511.5 Use of Personal Funds for Incumbent Elected Officers.

89515 Use of Campaign Funds for Donations and Loans.

Title 2 Regulations

18116 Reports and Statements; Filing Dates.

18215 Contribution.18215.1 Contributions; When Aggregated.18216 Enforceable Promise to Make a

Payment.18401 Required Recordkeeping for

Chapter 4.18421 Cash Equivalents.18421.1 Disclosure of the Making and

Receipt of Contributions.18421.2 Street Address.18421.3 Reporting of Contributions and

Expenditures Collected by Contract

Vendors or Collecting Agents.18421.4 Reporting Cumulative Amounts for

State Elections and State Recipient Committees.

18421.6 Reporting Accrued Expenses.18423 Payments for Personal Services as

Contributions and Expenditures.18427.1 Notification to Contributors of

$5,000 or More.18428 Reporting of Contributions and

Independent Expenditures Required to be Aggregated.

18431 Reporting of Expenditures by an Agent or Independent Contractor.

18432.5 Intermediary.18526 Reimbursement of Expenditures.18530.7 Extensions of Credit.18533 Contributions from Joint Checking

Accounts.18536 Transfer and Attribution of

Contributions.18570 Return of Contributions with

Insufficient Donor Information.




Chapter 8 — Additional Reports

In addition to the reports discussed inChapter 6, other special reports may berequired depending on a committee’s activity,including:

• Supplemental Independent ExpenditureReports (Form 465)

• Supplemental Pre-Election Reports(Forms 460 and 495)

• 496 Independent Expenditure Reports(Form 496)

• 497 Contribution Reports (Form 497)

• Paid Spokesperson Reports (Form 511)

• Special Odd-Year Reports (Form 460)

• Reports of Communications IdentifyingState Candidates (Form E-530)

Each report is discussed in detail in thefollowing pages.

Because candidates may not usecampaign funds to make independent

expenditures supporting or opposing other

candidates, the discussion of independent

Chapter 8Additional Reports

Your Committee File

Makes independent expenditures of $1,000 or more to support Form 465or oppose a single ballot measure

Makes contribution(s) totaling $10,000 or more to other state Form 460officeholders during the first or third quarter of an odd-numbered year

Makes contributions of $10,000 or more in connection with Form 495a local or special state election

Makes contributions or independent expenditures of $5,000 Form 496 or 497or more at any time to support or oppose qualification orpassage of a state ballot measure

Makes independent expenditures of $1,000 or more to support Form 496or oppose a single ballot measure during the 16 daysbefore the candidate or measure’s election

Receives contributions totaling $1,000 or more from Form 497a single source during the 16 days before your election

Makes contributions totaling $1,000 or more to a candidate Form 497or ballot measure committee during the 16 days before the

candidate or measure’s election, or to a state or county politicalparty committee during the 16 days before a state election

Makes expenditures of $5,000 or more for an individual to appear Form 511in a ballot measure advertisement

Makes payments of $50,000 or more to “feature” a state Form E-530candidate 45 days before an election

1 - 8 6 6 -ASK -FPPC

QuickTIP





expenditure reports (Forms 465 and 496),below, describes committee filingrequirements when independent

expenditures are made to support or opposeballot measures. However, the Forms 465and 496 may also be required if independentexpenditures are made from a candidate’spersonal funds. See Chapter 4 for thedefinition of “independent expenditure.”

Supplemental IndependentExpenditure Report (Form 465)A Supplemental Independent ExpenditureReport (Form 465) is required when anindependent expenditure of $1,000 or moreis made to support or oppose a single ballotmeasure.

Form 465 must be filed in addition to anypreelection or semi-annual campaignstatements the candidate or committee isrequired to file. Independent expendituresdisclosed on Form 465 also must bedisclosed on the candidate or committee’scampaign statements (Form 460, or Form461 if personal funds are spent).

Form 465 is required only if $1,000 or more

is spent to support or oppose a singlemeasure. If a communication features morethan one measure, the Form 465 is filed onlyif $1,000 or more was expended on eachmeasure featured. A separate Form 465must be filed for each measure supported oropposed.

Your committee mails a flyer asking the voters to vote for

three ballot measures. The flyer is not done at the behest of the committees formed to

support the measures. The total cost of the mailing, including postage, amounts to $4,850. Because the amount attributable to each measure is $1,000 or more, you must file Form 465 for each measure.

If a candidate sends out a communicationopposing his or her opponent, the candidate

has not made an independent expenditure.(See Chapter 4.)

When to FileFile Form 465 at the same time(s) acommittee primarily formed to support oroppose the ballot measure identified in thecommunication is required to file statements,including the semi-annual deadline followingthe election if independent expenditures aremade after the end of the second preelectionreporting period.

During the second preelection reporting period, your controlled

committee for the Assembly made an independent expenditure by spending $1,150 to print brochures supporting Measure C in Del Sol County. The second preelection statement in connection with the ballot measure’s election is due on April 12. Your committee must file a Form 465 with Registrar of Voters in Del Sol County by April 12.

Also see the Form 496 discussion later inthis chapter.

Where to FileFile Form 465 in the same location(s) acommittee primarily formed to support oroppose the ballot measure identified in thecommunication is required to file campaignstatements. This is so the voters in theaffected jurisdiction have access to reportsshowing who has spent funds in an attemptto influence the voters there.

The Committee for Ernest Bert is domiciled in Palos County.

Because it made an independent expenditure of $1,400 supporting a Del Sol County ballot measure, it files the Form 465 with the Del Sol County Registrar of Voters.

Example

Example

Example





Filing Officers

Enter the title and address of each filingofficer with whom the committee files itsregular preelection or semi-annualstatements.

Verification

The Form 465 is not considered filed if it isnot signed.

Amendments

To amend a previously filed Form 465, fileanother Form 465 with the “Amendment” boxchecked and the corrected or missinginformation included. There is no deadlinefor filing amendments. However,amendments should be filed as soon aspracticable. File the amendment in the same

location(s) as the original.


Q. Is an officeholder or candidate who files a Campaign Statement-Short Form (Form 470) still required to file a Form 465 if he or she spends $1,000 or more in personal funds on an independent

expenditure to support/oppose another candidate or ballot measure?

A. Yes. He or she must file the Form 465 toreport this activity.

Q. Is an independent expenditure reportable by the committee for the candidate or the

ballot measure named in the communication?

A. No. Because the communication is notmade at the behest of the candidate orballot measure committee, that is, withoutits coordination, control, or suggestion,the expenditure for the communication isonly reported by the person making it.

Q. Is a candidate’s controlled committee making an independent expenditure when it pays for a communication that

supports the controlling candidate and also supports or opposes a ballot measure listed on the same ballot or a communication that opposes the controlling candidate’s opponent?

A. No. These types of expenditures areconsidered promoting one’s own election.

Form 465Page 2





Supplemental PreelectionCampaign Statement (Form 495)A Supplemental Preelection CampaignStatement (Form 495) must be filed if:

• The committee makes contributionstotaling $10,000 or more to any number ofcandidates or committees primarily formedto support or oppose candidates ormeasures all being voted upon in one jurisdiction on the same day, and

• The contributions were made during theperiod beginning six months prior to therecipient’s election and ending 17 daysbefore the election.

Form 495, covering the period beginning sixmonths prior to the election through 17 daysbefore the election, is filed as an attachmentto a campaign statement (Form 460). Theperiod covered by the Form 460 begins theday after the closing date of the most recentcampaign statement filed through 17 daysbefore the election.

Form 495 is not required during any semi-annual period in which the committee isrequired to file regular preelection statements

or if all the information that would be reportedon the Form 495 is reported on a semi-annual statement or Special Odd-YearReport already on file. (See the section onSpecial Odd-Year Reports later in thischapter.)

Two months before her November election, Susan

Dulles, candidate for State Senate, makes a $4,500 contribution to the Committee to Support Bike Lanes, Yes on Measure C, and

contributes $3,000 each to two candidates running for county supervisor, all in Beach County. Since Susan must file a preelection campaign statement in connection with her own election, it is not necessary that she also file Form 495.

One month before a local April ballot measure election held in an odd-numbered year, an incumbent Assemblymember makes

a contribution of $12,000 to the committee primarily formed to support the measure.The Assemblymember’s committee must file Form 495 attached to its Form 460 no later than 12 days before the April election. The Form 495 will disclose the $12,000 contribution and the Form 460 will disclose all contributions received and expenditures made by the Assemblymember’s committee,including the $12,000 contribution, since the last Form 460 was filed. Both forms are filed where the Assemblymember regularly files

his campaign statements, e.g., the Secretary of State, the registrar of voters of the county with the largest number of registered voters in his district, and the candidate’s county of domicile.

When to File

File Form 495, attached to the committee’sForm 460, no later than 12 days before therecipient’s election. The reports must besent by guaranteed overnight delivery orpersonal delivery.

Where to File

File Form 495 and the campaign statementwith each office where the committee isrequired to file its regular campaignstatements.

If the committee made contributions of$10,000 or more in connection with morethan one election, a separate Form 495 mustbe completed for each election.

Examples






Committee Information

Disclose the committee’s name, street

address, city, state, zip code, identificationnumber, and daytime telephone number, aswell as the name, address, and daytimetelephone number for the committeetreasurer and assistant treasurer, if any.

Contributions Made

Enter the date and jurisdiction of the electionand the total amount contributed during theperiod beginning six months before theelection and ending 17 days before theelection.

Verification


Amendments

To amend a previously filed Form 495, fileanother Form 495 with the “Amendment” box

checked and the corrected or missinginformation included. There is no deadlinefor filing amendments. However,amendments should be filed as soon aspracticable. File the amendment in the samelocation(s) as the original.

Form 495





496 Independent ExpenditureReport (Form 496)The independent expenditure reportsdiscussed below must be filed in addition toany required preelection or semi-annualcampaign statements. Independentexpenditures also must be disclosed on thecandidate’s or committee’s next campaignstatement (Form 460, or Form 461 if thecandidate’s personal funds are used), and onthe Supplemental Independent ExpenditureReport (Form 465). See Chapter 4 for thedefinition of “independent expenditure.”

• An independent expenditure has been“made” when the communication hasbeen mailed, delivered, broadcast, orotherwise disseminated to the public.

• Expenditures by a controlled committeesupporting the controlling candidate’selection (or opposing his or heropponent) are not required to be reportedas “independent expenditures.”

• Expenditures by a controlled committee

for communications supporting thecontrolling candidate’s election that alsosupport or oppose other candidates orballot measures being voted on in thesame jurisdiction and election are notrequired to be reported as “independentexpenditures.”

Committees Required to FileElectronically with Secretary of State

A state candidate’s controlled committeemust file reports electronically with theSecretary of State once contributions totaling$50,000 or more are received orexpenditures totaling $50,000 or more aremade. (See Chapter 6.) If the committeemakes independent expenditures to supportor oppose a state ballot measure, thefollowing reports are required:

90-Day Election Cycle Reports: Ifindependent expenditures totaling $1,000 ormore are made to support or oppose a single

state ballot measure during the 90-dayelection cycle prior to the measure’s election,Form 496 must be electronically filed with theSecretary of State within 24 hours of makingthe expenditure. Independent expenditureselectronically disclosed within 24 hoursduring the 90-day election cycle are notrequired to be disclosed as “late independentexpenditures” (i.e., no paper copies arerequired, including paper copies filed withcounty filing officers).

$5,000 Ballot Measure ExpenditureReports: If independent expenditurestotaling $5,000 or more are made at any timeother than the 90-day election cycle tosupport or oppose the qualification orpassage of a single state ballot measure,Form 496 must be electronically filed with theSecretary of State within 10 business days ofmaking the expenditure. No paper copiesare required, including paper copies filed withcounty filing officers.

Late Independent ExpendituresIf independent expenditures totaling $1,000or more are made to support or oppose asingle ballot measure during the 16 daysprior to the measure’s election, Form 496must be filed within 24 hours of making theindependent expenditure. The report is filedas if the committee was primarily formed tosupport or oppose the measure identified inthe communication. This allows the voters inthe affected jurisdiction to have access toreports showing who has spent funds

attempting to influence them. File a separatereport for each ballot measure supported oropposed by fax, guaranteed overnightdelivery, or personal delivery. Regular mailmay not be used.

QuickTIPS





A State Senate candidate’s committee makes a late

independent expenditure to support a county

ballot measure. The candidate’s county of domicile is Beach County. The candidate files the Form 496 with the clerk of the county in which the measure is being voted on, and the Registrar of Voters for Beach County.

Example






Filer Information

Enter your committee’s name, streetaddress, city, state, zip code, andidentification number.

Date of This Filing

Indicate the date of filing this report.

Report Number

Assign a unique number to each lateindependent expenditure report, such as1, 2, 3, PR-1, PR-2, PR-3, etc.

Amendment to Report NumberIf this is an amendment to a report previouslyfiled, assign a new unique identifying numberas the Report Number, check the“Amendment” box, and indicate the numberof the report being amended.

Number of Pages

Note the number of pages included in thereport.

Name of Candidate/Measure Supported orOpposed

Part 1. Disclose the name, ballot number orletter, and jurisdiction of the ballot measuresupported or opposed. Check the boxindicating whether the ballot measure wassupported or opposed by the independentexpenditure.

Independent Expenditures/Payments Made

Part 2. Disclose the date the committee madethe expenditure, a description of theexpenditure, e.g., printing, postage, mail house,etc., and the amount of the expenditure.

Contributions of $100 or More Received

Part 3. Disclose contributions of $100 ormore received since the closing date of the

Form 496





last campaign statement filed. If no previouscampaign statement has been filed, disclosecontributions of $100 or more received since

January 1 of the current calendar year.Report the date the contribution wasreceived, the full name, street address, city,state, and zip code of the contributor. Foreach itemized contributor, check the boxindicating whether the contributor is anindividual, a committee, “other” (such as abusiness entity), political party, or smallcontributor committee. If the contributor is anindividual, provide his or her occupation andemployer. Report the amount received, and,if the contribution was a loan, provide the

interest rate.

Amendments

To amend a previously filed Form 496, file anew Form 496 with the corrected informationand the “Amendment” box checked. The“Report Number” of the report beingamended should be included. There is nodeadline for filing amendments. However,amendments should be filed as soon aspracticable. File the amendment in the samelocation(s) as the original.


Q: Is a candidate making an independent expenditure when he or she pays for a communication supporting his or her own candidacy or opposing his or her opponent?

A: No. The expenditure is consideredpromoting one’s own election.

497 Contribution Report(Form 497)The reports discussed below must be filed inaddition to any required preelection or semi-annual campaign statements. Contributionsreported on Form 497 also must be disclosedon the candidate’s next campaign statement(Form 460).

Candidates Required to File Electronicallywith Secretary of State

A committee controlled by a candidate for

elective state office must file reportselectronically with the Secretary of Stateonce contributions totaling $50,000 or moreare received or expenditures totaling $50,000or more are made. (See Chapter 6.)Committees filing electronically must file thefollowing Form 497 reports:

$5,000 Contribution and $1,000 ElectionCycle Reports: Form 497 must be filedwithin 10 business days if the committeereceives a contribution of $5,000 or more

from a single contributor at any time otherthan the 90-day election cycle prior to thecandidate’s election, and within 24 hours fora contribution of $1,000 or more receivedduring the 90-day election cycle. (SeeChapter 6.) These reports are not requiredto be filed on paper or with the county filingofficers. However, during the 16-day “latecontribution” period prior to the candidate’selection, contributions totaling $1,000 ormore from a single source must be disclosedwithin 24 hours. In addition, late

contributions made by a state candidate toother candidates and committees must bereported as discussed below, even if thecandidate and the recipient file electronicallywith the Secretary of State.

Ballot Measure Contribution Reports: Ifcontributions totaling $5,000 or more aremade to support or oppose the qualificationor passage of a single state ballot measure(including the period following the election inwhich the measure is voted on), Form 497

must be filed within 10 business daysdisclosing the contribution(s) made, as wellas contributions of $100 or more receivedsince the committee’s last campaignstatement (Form 460) was filed. No papercopies are required and no copies arerequired to be filed with county filing officers.





Late Contributions

Form 497 must be filed if a committeecontrolled by a candidate:

• Receives a contribution of $1,000 or more,or multiple contributions aggregating$1,000 or more, from a single sourceduring the 16 days prior to the candidate’selection (except as noted above forcandidates filing electronically with theSecretary of State); or

• Makes a contribution or contributionstotaling $1,000 or more to a candidate,primarily formed committee, or ballotmeasure committee during the 16 days

before the candidate’s or measure’selection; or

• Makes a contribution or contributionstotaling $1,000 or more to a state orcounty political party committee during the16 days before any state election.

This includes monetary and nonmonetarycontributions, loans, or a combination ofcontributions and loans. This also includes acandidate’s personal funds contributed orloaned to his or her own campaign, but does

not include a transfer made between twocampaign committees for elective state officecontrolled by the same candidate.

Fourteen days before the November election, Local 1260

PAC made a $500 contribution to Megan Water’s campaign. Ten days before the election, the committee made another $500 contribution. These two contributions in the aggregate amount to $1,000. Both the PAC and Megan’s committee must file a late

contribution report within 24 hours of the second contribution.

Only contributions made or received duringthe last 16 days before the election areaggregated to reach the $1,000 threshold. Acontribution made or received before the 16-day late contribution period is not aggregated

with a contribution made to the samecandidate or committee, or received from thesame source, during the late period.

Seventeen days before the November election, Megan

received a $600 contribution from an individual contributor. Another $600 was received from the same contributor four days before the election. Since an aggregate of $1,000 was not received during the last 16 days before the election from this individual,Megan’s campaign is not required to file a late contribution report for this contributor.

When to FileA late contribution is received on the date thecandidate, committee, or an agent of thecommittee obtains possession or control ofthe check or nonmonetary item whichconstitutes the contribution. A latecontribution is made on the date it is mailed,delivered, or otherwise transmitted to acandidate or committee. Form 497 must befiled within the required 24 or 48 hours. The“next business day” rule for filing periodicreports does not apply to late reports.

Monetary

The Form 497 must be filed within 24 hours of receiving or making a late monetarycontribution.

Nonmonetary

Making

Within 24 hours of making a latenonmonetary contribution:

• File a Form 497 late contribution report;and

• Notify the recipient of the value of the latenonmonetary contribution by personaldelivery, fax, or guaranteed overnightmail.

Example

Example





Receiving

Within 48 hours of receiving a latenonmonetary contribution:

• File a Form 497 late contribution report.

When more than one nonmonetarycontribution will be made to or received froma single contributor during the latecontribution reporting period, the committeemay, on or before the deadline, file a singleForm 497 covering the entire latecontribution period. The report shoulddisclose the total value of nonmonetarycontributions that will be made, or, if theactual value of nonmonetary contributions is

not known at the time of filing, a good faithestimate of the value that will be contributedor received during the period. If the value oflate nonmonetary contributions differs fromthe estimated amount by 20 percent or more,the estimated report must be amended within24 hours from the time the committee knowsthat the estimated value is incorrect.

Where to File

Except as noted above for electronic filers,the Form 497 must be filed by fax,

guaranteed overnight delivery service, orpersonal delivery, at the same locationswhere the committee files its regularcampaign statements (e.g., Form 460).Regular mail may not be used.






Enter the committee’s name, street address,city, state, zip code, and identificationnumber.

• Indicate the date of filing this report.

• Assign a unique number to each latecontribution report, such as 1, 2, 3, PR-1,

PR-2, PR-3, etc.• If this is an amendment to a report

previously filed, assign a new uniqueidentifying number as the Report Number,check the “Amendment” box, and indicatethe number of the report being amended.

• For late contributions received, provide:

− The date received;

− The contributor’s full name and mailingaddress, the appropriate contributorcode, and, if the contributor is an

individual, his or her occupation andemployer, or, if self-employed, enter thename of his or her business;

− The amount of the contribution; and

− If the contribution is a loan, check thebox and provide the interest rate, if any.

• For late contributions made, provide:

− The date made;

− The recipient’s full name and mailingaddress;

− Office sought or held (if to a candidate);

− Ballot measure number or letter and jurisdiction (if to a ballot measure

committee);

− The amount of the contribution; and

− The date of the election, if a statecommittee is disclosing a latecontribution to a local candidate.

Amendments

To amend a previously filed Form 497, file anew Form 497 with the corrected informationand the “Amendment” box checked. The

“Report Number” of the report beingamended should be included. There is nodeadline for filing amendments. However,amendments should be filed as soon aspracticable. File the amendment in the samelocation(s) as the original.

Form 497Page 1ContributionsReceived






Q. Our committee will receive more than one nonmonetary late contribution from the same source during the final 16 days before the election. Rather than file several reports, may our committee file one late contribution report estimating the value of all nonmonetary contributions we anticipate receiving from this source during the late contribution reporting period?

A. Yes. The committee may make a goodfaith estimate of the value that will becontributed during the period. File thelate contribution report within 48 hours ofthe first $1,000 in nonmonetarycontributions received. If the actual valuediffers from the estimated amount by 20percent or more, amend the estimatedreport within 24 hours from the time youdetermine the correct amount.

Q. Is a late contribution report required when a contributor forgives a loan during the late contribution reporting period?

A. Yes. A loan of $1,000 or more which isforgiven during the late contributionreporting period triggers a latecontribution report.

Q. A candidate has two committees, one for a past election and one for the current election. If the committee for the past election receives $1,000 or more from a single source in the late contribution period in connection with the current committee’s election, does it file a late contribution report?

A. Yes.

Q. If a committee makes a $5,000 contribution to a general purpose committee that is supporting state ballot measures, must the committee file a Form 497 within 10 days?

A. A $5,000 Report is triggered if:

1. The committee knows the $5,000 willbe used to support or oppose a singlestate ballot measure; or

2. The receiving committee has reportedonline making contributions orexpenditures exceeding $100,000 in thepast 12 months to support or oppose astate ballot measure that has not yetbeen on the ballot.

Q. If a committee makes a $5,000 contribution to a primarily formed committee supporting a state ballot

Form 497Page 2ContributionsMade






Filer Information

Provide the committee’s full name, streetaddress, city, state, zip code, and telephonenumber. Also, list the committee’s

identification number, as provided by theSecretary of State.

Payments Made

In the first column, provide the date thepayments were made, or the services werereceived, whichever is earlier. In the secondcolumn, indicate the name and address ofthe individual who was paid $5,000 or moreto appear in the advertisement. In the thirdcolumn, provide the name, number or letter,and jurisdiction of the ballot measuresupported or opposed by the advertisement.Finally, in the last column, indicate the totalamount of the expenditure.

Verification


Amendments

To amend a previously filed Form 511, fileanother Form 511. Check the “Amendment”box and give a brief description of theamendment. Enter the committee’s name

and address, and disclose the amendedinformation. Like the original, theamendment must be signed and dated.There is no deadline for filing amendments.However, amendments should be filed assoon as practicable. The amendment is filedin the same location(s) the original was filed.

Special Odd-Year ReportDuring an odd-numbered year, special odd-year reports must be filed if the committeemakes contributions totaling $10,000 or more

to elected state officers, their controlledcommittees, or committees primarily formedto support or oppose any elected state officerbetween January 1 and March 31, orbetween July 1 and September 30. Thespecial odd-year reports are due April 30 andOctober 31, respectively.

Form 511





The special odd-year report is filed with thecommittee’s regular filing officer(s) on itsregular campaign disclosure form(s) (Form

460).

What to Report

The form is completed in the same manneras a regular preelection or semi-annualstatement (see Chapter 6) and includes all ofthe committee’s activity during the reportingperiod, not just contributions to elected stateofficers.

During March of an odd- numbered year, Lieutenant

Governor Dominic Mesanovic makes a contribution of $3,600 to another state officeholder’s controlled ballot measure committee, and four contributions to four different Assembly officeholders of $3,600 each. Dominic’s committee will file a special odd-year report on a Form 460 covering the period January 1 through March 31. The report is due no later than April 30.Dominic’s special odd-year report is filed with his regular filing officers. His next statement,the semi-annual, will cover April 1 through

June 30, and is due no later than July 31.


Q. Are special odd-year reports filed for the 2 nd and 4 th quarters of an odd-numbered year as well as for the 1st and 3 rd ?

A. No. Semi-annual reports cover the 2nd and 4th quarters.

Q. Is there a special form for filing a special odd-year report?

A. No. Use the same form you wouldordinarily use to file preelection and semi-annual reports (Form 460).

Q. Must my committee file a special odd- year report when it receives contributions of $10,000 or more during the 1st or 3 rd quarters of an odd-numbered year?

A. No.

Q. Is a special odd-year report triggered if a state officeholder transfers $10,000 or

more from his or her committee for state office to his or her statewide ballot measure committee?

A. No.

Communications IdentifyingState Candidates (Form E-530)A committee that spends $50,000 or more fora communication disseminated during the 45days before an election that clearly identifiesa state candidate appearing on the ballot, butdoes not expressly advocate the election ordefeat of that candidate, must fileelectronically with the Secretary of State theForm E-530 within 48 hours of making apayment, or promising to make a payment of$50,000 or more. (Contact the Secretary ofState’s Office at (916) 653-6224 or go towww.sos.ca.gov.) The report must disclosethe amount and date of the payment(s), andthe name of and office sought by thecandidate(s) identified in the communication.In addition, if $5,000 or more was received orpromised from a single source to pay for thecommunication, the name, address,occupation, and employer (if applicable) ofthe contributor, as well as the date andamount received or promised, must bereported.

The Children’s Action Group purchased billboard space up

and down Interstate 5 stating, “Thank You,Governor Nyland, for Supporting California’s Children.” The billboard space was rented

for the 30 days prior to the Governor’s election. The total cost for design, printing,placement, and space rental was $65,000 and was paid on October 6. By October 8,the group must file the Form E-530 electronically with the Secretary of State.

Example

Example





Form E-530 must be filed in addition toany preelection or semi-annual campaignstatements the committee is required to

file. Payments disclosed on Form E-530also must be disclosed on the committee’snext campaign statement (Form 460).

The report must be verified by a written“electronic filing declaration,” signed, dated,and verified on the same date the report istransmitted to the Secretary of State. Thisdeclaration must be retained in thecommittee’s records for five years followingthe date that the campaign report to which itrelates is filed. The statement must includethe following language:

“I have used all reasonable diligencein preparing this report and to the bestof my knowledge the informationcontained herein is true and complete.I certify under penalty of perjury underthe laws of the State of California thatthe foregoing is true and correct.”

Authority




82025 Expenditure. 82036 Late Contribution. 82036.5 Late Independent Expenditure. 82044 Payment. 84200.3 Odd-Year Reports in Connection

with a Statewide Direct Primary

Election Held in March of an Even- Numbered Year.84200.6 Special Campaign Statements and

Reports.84202.5 Supplemental Preelection

Statement.84202.7 Time for Filing by Committees of

Odd-Numbered Year Reports.

84203 Late Contribution; Reports.84203.3 Late In-Kind Contributions.84203.5 Supplemental Independent

Expenditure Report.84204 Late Independent Expenditures; Reports.

84204.5 Ballot Measure Contributions and Expenditures; Reports.

84511 Ballot Measure Ads; Paid Spokesperson Disclosure.

85310 Communications Identifying State Candidates.

85501 Prohibition on Independent Expenditures by Candidate Controlled Committees.

Title 2 Regulations

18116 Reports and Statements.18402.5 Supplemental Pre-Election

Statements.18421.1 Disclosure of the Making and

Receipt of Contributions.18425 Late Contributions; Reports.18450.11 Spokesperson Disclosure.18466 State Ballot Measure Contributions

and Expenditures; Online Reports.18531.10 Communications Identifying State

Candidates.18539.2 Reporting Payments Pursuant to

Government Code Section 85310.




Chapter 9 — After the Election

copy of the report to the FPPC. Reports filedby state officeholders are posted on theFPPC website.

The report also must be filed by an electedofficial if an individual or entity donates$5,000 or more in a calendar year tocharitable organizations or events at therequest of the elected official.

There is no specific form for reporting co-sponsored payments. The report mustcontain all of the information shown in theexample above.

Defeated Candidates – Future

Filing ObligationsForm 470 Filers

A candidate who filed the campaignstatement short form, Form 470, has nofurther reporting obligations after the electionas long as less than $1,000 was raised orspent during the calendar year.

Form 460 Filers

See the “Termination Requirements” sectionat the end of this chapter for deadlines for

terminating an election committee. Form 460must be filed on a semi-annual basis as longas the committee remains open.

In addition, state candidates must file theelectronic $5,000 reports discussed inChapter 6 if contributions of $5,000 or moreare received for the purpose of payingoutstanding debt. Other special reports alsomay be required. (See Chapter 8.)

Termination

State candidate controlled committees mustterminate by a specified deadline. (See the“Termination Requirements” section later inthis chapter.)

A committee may terminate only if thecommittee:

• Has ceased receiving contributions or

making expenditures and does notanticipate receiving contributions ormaking expenditures in the future;

• Has no remaining campaign funds;

• Has filed all required campaignstatements, disclosing all reportabletransactions, including the disposition ofleftover funds; and

• Has eliminated all debts, or has nointention or ability to discharge debts.


Q. May I terminate my committee even if I have outstanding debt owing to creditors?

A. Yes. When you file your terminationstatements showing outstanding debt,you are declaring that you do not havethe ability to discharge debts, loans, orother obligations. However, if you plan toraise additional funds, or pay theoutstanding debt with personal funds, you

may not terminate.

How to TerminateUse the Form 410 to terminate thecommittee. Check the “Termination” box,and report the committee’s identificationnumber and the date of termination; the dateof termination generally is the date all fundshave been expended. In addition, identifythe name of the committee and have thetreasurer or assistant treasurer sign the

verification. The controlling officeholder(s)/ candidate(s) also signs the verification.Form 460 also must be filed showing that allfunds have been expended and thecommittee has no cash on hand. Check the“Termination” box on the cover page.





Where to File

File the original and a copy of the Form 410with the Secretary of State. File Form 460 in

the committee’s regular filing locations. (SeeChapter 6.)

Candidate Election CommitteeTermination Requirements

A controlled committee formed for a stateelection held after February 15, 2002, mustbe terminated after the election. Thedeadline for termination depends on whetherthe candidate is successful in the electionand whether the committee has net debt.(For a definition of “net debts outstanding”see Chapter 1. In addition, see thediscussion of “surplus funds” in Chapter 10.)

Successful Candidates

A committee with no net debts outstandingmust be terminated no later than ninemonths after the date the officeholder leavesoffice or the term of office ends, whichever isearlier.

A committee with net debts outstanding mustbe terminated no later than 24 months after

the date the officeholder leaves office or theterm of office ends, whichever is earlier.

Senator Dorothy Patrillo has a controlled committee formed in

2004 for her current Senate term and has opened a new committee for reelection in 2008. The 2004 committee, which has no debt, must be terminated no later than nine months after either the date she leaves office or the 2004 term of office ends, whichever is earlier. (The 2004 term of office ends in

December of 2008.) The termination date for the 2008 Senate committee depends upon whether Senator Patrillo is reelected and whether her committee has net debts outstanding at the end of her 2008 term of office.

Defeated Candidates

A committee with no net debts outstandingmust be terminated no later than nine

months after the election. A committee withnet debts outstanding must be terminated nolater than 24 months after the election.

State Officeholders with LocalCommittees

Candidates who are elected to a state officemust terminate any controlled committeesthat were formed for local elections heldconcurrent with or prior to their election tostate office. The local committees must beterminated within 24 months of the

candidate’s election to state office.

Assemblymember Hiesheena Washington has an open

committee established for her 2000 election to city council. She also has an open Senate committee formed in 2004 for her current term of office. The committee formed for city council must be terminated by November 2,2006.

Notification Requirements for Committees

with Debts

A committee with debt must provide 60 daysnotice to creditors prior to termination.

A committee may terminate with debt, butprior to terminating must dispose of all cashand close its bank account. No newcontributions may be received – futurecontributions must be returned to thecontributor – and no further expendituresmay be made once the committee has beenterminated. A Statement of Organization

(Form 410) must be filed stating that thecommittee has been terminated. Aterminating Form 460 reflecting zero endingcash must also be filed.

Extensions and Reopening

A committee may request to delay itstermination for up to six months if it is

Example

Example





continuing to receive contributions oranticipates receiving contributions for thepurpose of paying debts, if the candidate or

committee is a party to litigation, or for othergood cause. The request for extension mustbe submitted to the Executive Director of theFair Political Practices Commission no laterthan 45 days prior to the due date for thecommittee’s termination.

A terminated committee may submit arequest to the Executive Director of the FairPolitical Practices Commission to reopen thecommittee under certain, limitedcircumstances. See Regulation 18404.1 or

contact the FPPC for more information.

If the committee has debt and intendsto raise funds after the termination

deadline to pay the debt, an extensionshould be requested. The committee cannotbe reopened for this purpose once it isterminated.

State Officeholder CommitteeTermination Requirements

A committee established by an elected state

officeholder to pay officeholder expenses(see Chapter 1) must be terminated within 90days of the date the officeholder leaves officeor the term of office ends, whichever isearlier. Unlike controlled electioncommittees, an officeholder committee maybe redesignated for the next term of thesame office by amending the committee’sForm 410. The Executive Director of the FairPolitical Practices Commission may for goodcause extend the termination date or allowthe committee to be reopened.

Legal Defense Committee TerminationRequirements

A legal defense committee must beterminated within 90 days of the date the lastlegal dispute for which the committee wasestablished has been resolved. The

Executive Director of the Fair PoliticalPractices Commission may for good causeextend the termination date or allow the

committee to be reopened.

Authority



82015 Contribution.84103 Statement of Organization;

Amendment.84200 Semi-Annual Statements.84206 Candidates Who Receive or

Spend Less than $1,000.84214 Termination.85309 Online Disclosure of Contributions.

Title 2 Regulations

18215 Contribution.18404 Termination of Candidate’s and

Committees’ Filing Requirements.18404.1 Termination of Committees.18406 Short Form for Candidates or

Officeholders Who Receive and Spend Less than $1,000 in a Calendar Year.

18426 Semi-Annual Statement Early Filing.

18530.4 Legal Defense Funds.18531.62 Elected State Officeholder Bank

Accounts.

QuickTIP




Chapter 10 — Restrictions

Although the Political Reform Act is primarilya disclosure law, there are several importantrestrictions and prohibitions on receivingcontributions and spending campaign funds.This chapter reviews these restrictions andprohibitions, as well as some that arecontained in laws other than the PoliticalReform Act.

In addition, while the receipt of campaigncontributions generally will not create a conflictof interest for an elected officeholder in theperformance of his or her elected duties,contributions may be the source of a conflict ofinterest for officeholders or candidates whoare also appointed to boards or commissions.The section on “Disqualification and CampaignContributions” covers this area of the law.

Also review Chapter 1 for informationabout contribution and expenditure limits,as well as other Proposition 34-relatedrestrictions imposed on state candidates.

Restrictions on Contributions

Laundered Funds

If a contribution of $100 or more is receivedfrom a single source in a calendar year, thesource must be identified on the committee’sForm 460. If a contribution is receivedthrough an intermediary, both theintermediary and the true source of thecontribution must be identified. If theinformation for both the true source and theintermediary are not provided, this isconsidered laundering, a serious violation of

the Political Reform Act. Any launderedcontributions must be paid to the Secretaryof State for deposit in the state general fund.

Barry owns a music store and supports Julie’s campaign for

Assembly. Since Barry was going to be out of town when Julie was holding a fundraiser,he asked an employee of his to attend on

behalf of the store. The employee attended the fundraiser using a personal check to pay $100. Upon his return, Barry reimbursed the employee the $100. At the time the employee made the contribution to the campaign, he informed them that Barry’s music store was the true source of the funds.Julie’s campaign report must itemize both Barry’s store and the employee. The name of Barry’s store and its address, along with the employee’s name, address, occupation,and employer are reported.

Barry’s employee attended another fundraiser for Julie, but this time Barry wrote a company check to the campaign, which the employee used to attend the fundraiser. In this case,Julie’s campaign report must only report Barry’s store as the source of the contribution; the employee is not an intermediary.

Cash

The committee may not accept a cashcontribution of $100 or more. Such a

contribution may be returned to thecontributor prior to the end of the reportingperiod, provided the cash was not previouslydeposited or spent. A cash contribution thatis inadvertently deposited into the campaignbank account must be refunded within 72hours of receipt, except a cash contributionof $1,000 or more from a single source madeduring the late contribution reporting period(the last 16 days before the election) must bereturned to the contributor within 48 hours ofreceipt.

Anonymous

Anonymous contributions of $100 or moreare prohibited. If the committee receives acash contribution of $100 or more from anunknown source, it must be sent to theSecretary of State for deposit in the state’sGeneral Fund.

Chapter 10Restrictions

Example

1 - 8 6 6 -ASK -FPPC





Candidate Loans

A state candidate may not have personalloans to his or her campaign of more than

$100,000 outstanding at any one time,including loans obtained by the candidatefrom a commercial lending institution whichthe candidate lends to his or her committee.“Campaign” includes both the primary andgeneral, or special and special runoff,elections.

Bernard Ernest, a State Senate candidate, loans his campaign

$50,000 before the primary election. Just before the general election, Bernard wants to

loan his committee some more funds. Since the committee has not paid down on the original $50,000 loan, Bernard may loan no more than $50,000 to his committee.

Commingling

Campaign funds may not be commingledwith an individual’s personal funds and maynot be used for personal expenses.Campaign funds must be kept in an accountseparate from any account which containspersonal funds.

Money Orders/Cashier’s Checks/Traveler’s Cheques

All monetary contributions of $100 or moremust be made by written instrument (such asa check) containing the name of the donorand drawn from the account of the donor orthe intermediary. Contributions of $100 ormore made by money order, cashier’s check,or traveler’s cheque are prohibited and mustbe returned to the contributor, or, if madeanonymously, sent to the Secretary of Statefor deposit in the state’s general fund.

Legal Name

Contributions must be made in the name bywhich the contributor is identified for legalpurposes.

Delivered in State Office Buildings

A contribution may not be received, ordelivered to another person, personally or

through an agent, in the State Capitol or anyother state office building for which the Stateof California pays the majority of the rent.

This prohibition does not apply tocontributions received or delivered in alegislative district office or through the mail.

From Foreign Nationals, National Banks,and National Corporations

Committees may not receive contributionsfrom foreign nationals, national banks, or

national corporations. The Federal ElectionCampaign Act (2 U.S.C. Section 441b)prohibits contributions from national banksand national corporations (corporationsestablished by an Act of Congress) inconnection with any local, state, or federalelection to political office. For furtherinformation, the Federal ElectionCommission may be contacted at (800) 424-9530 (www.fec.gov).

From State Lobbyists

State lobbyists may not contribute to a stateofficeholder or candidate’s campaign if thelobbyist is registered to lobby the agency ofthe elected officer or the agency to which thecandidate is seeking election. The lobbyistalso may not contribute to a local committeecontrolled by a state candidate.

Richard receives an invitation to attend a political fundraiser from

an individual running for Insurance Commissioner. Richard is a lobbyist

registered to lobby the State Legislature, the Secretary of State, and the Governor.Although Richard may not make a contribution to anyone who holds or is a candidate for the Assembly, Senate,Secretary of State, or Governor, he may make a contribution to the candidate for Insurance Commissioner.

Example

Example





Misuse of Public Resources

The Political Reform Act prohibits publicfinancing of campaigns, except for elections

in charter cities and counties.

In addition, laws outside the Act prohibit theuse of public resources, such as officeequipment, staff time, etc., for campaign orpersonal purposes. (Gov. Code Section8314; Penal Code Section 426.)

Government Code Section 54964 prohibitsan officer, employee or consultant of a localagency from expending or authorizing theexpenditure of any local agency funds tosupport or oppose a ballot measure or a

candidate.For further information on laws outside theAct, contact the Attorney General’s office at(800) 952-5225 or your district attorney.

Soliciting Contributions from PublicEmployees

Government Code Section 3205 prohibits alocal candidate from knowingly, directly orindirectly, soliciting a political contribution fromany employees of his or her agency or from a

person on an employment list of that agency.There is an exception for solicitations that aremade to a significant segment of the public.For further information, contact the AttorneyGeneral’s office at (800) 952-5225 or yourdistrict attorney.

Use of Campaign Funds andSurplus Campaign FundsTo ensure that campaign funds are not usedfor personal benefit, the expenditure ofcampaign funds must be reasonably related

to a political, legislative, or governmentalpurpose. An expenditure must be directlyrelated to a political, legislative, orgovernmental purpose if it confers asubstantial personal benefit on the candidateor elected officer, or member of theirhousehold, or any individual authorized toapprove campaign expenditures.

See Chapter 1 for information on thepermissible uses of funds held in legaldefense and officeholder committees.

Kathi Sonenfeld for Assembly Committee buys pizzas for its

volunteers every Thursday when a group gathers to stuff envelopes for the campaign.This is allowed, since there is a reasonably related political purpose for this expenditure.

Kathi has decided to enter a Master’s degree program at her local college. While the program may enhance her qualifications as a candidate, she may not use campaign funds for this purpose; a Master’s degree would

confer a personal benefit to her that is not considered directly related to a political,legislative, or governmental purpose.

After an election, a successful candidate mayuse left over campaign funds for officeholderexpenses or for a future election. Campaignfunds held by officeholders who leaveoffice or by defeated candidates aresubject to the “surplus funds” restrictionsdiscussed below. Equipment and other non-cash assets held by a candidate or committee

may not be used for personal purposes.

Following the election,unsuccessful candidate Robin

Welles decides to give the committee’s computer to his son. Because the computer was purchased with campaign funds, Welles must purchase the computer from the committee, at fair market value, in order to do this.

Election Night Celebrations

Costs associated with election nightcelebrations or similar campaign events maybe paid by the committee.

Attorneys’ Fees

Generally, attorneys’ fees and other costsrelated to administrative, civil, or criminal

Example

Example





• Parking citations received whileperforming political, legislative, orgovernmental activities.

• Fines assessed in relation to situations inwhich the use of campaign funds to payfor an attorney is allowed (discussedabove).

• Fines imposed for late filing of campaignstatements and Statements of EconomicInterests (Form 700).

Your treasurer was two days late in filing the committee’s first

preelection statement, and the Secretary of State has fined the committee $20. The committee may pay the fine with campaign funds.

Gifts

Unless directly related to a political,legislative, or governmental purpose, personalgifts may not be paid for from campaignfunds. However, as long as no one individualreceives a total of $250 or more in a calendaryear, gifts to campaign employees or workersare permitted because they are considered

directly related to a political, legislative, orgovernmental purpose. If the campaign paysfor a gift to a member of the immediate family(spouse or registered domestic partner anddependent children) of a campaign employeeor worker, it should be considered a gift to theemployee or worker when calculating whetherthe $250 per person limit has been met.

Health-Related Expenses

A committee may pay for health care benefitsfor its employees or independent contractors.

However, no other health-related expensesmay be paid with campaign funds; acommittee may not pay for the candidate’shealth club dues, special dietary foods, ormedical check-ups.

Independent Expenditures

Candidates are prohibited from usingcampaign funds to make independent

expenditures to support or oppose othercandidates, or to make contributions to othercommittees for the purpose of makingindependent expenditures to support oroppose other candidates.

Loans

Campaign funds may be loaned to otherpolitical committees. (Loans to statecandidate committees are subject to limits.Transfers from a local candidate’s committeeto his or her state committee must be

attributed to the original contributors. SeeChapter 1.) In addition, campaign funds maybe used to make loans to bona fidecharitable, educational, civic, religious, orsimilar tax-exempt, non-profit organizations.However, the loan may not personally benefitthe officeholder, candidate, committeetreasurer, or any individual with authority toapprove the expenditure of campaign funds,or any such person’s immediate familymember. The loan must be reasonablyrelated to a political, legislative, or

governmental purpose. Campaign fundsmay not be loaned to an individual or to anentity other than those described above.

Professional Services

When the committee reasonably requires theservices of professionals, such as anaccountant or attorney, their fees may bepaid with campaign funds. (See below forrestrictions on salary and compensation paidto a candidate or officeholder.)

Real PropertyThe committee may not purchase realproperty. It may, however, lease property forup to one year, as long as its use is directlyrelated to a political, legislative, orgovernmental purpose. Neither thecandidate or officeholder, committeetreasurer, any individual with authority to

Example





approve the committee’s expenditures, or animmediate family member of any of thesepersons may be a lessee or sublessor, or

hold legal title to the leased property.

Refunding Contributions

The return of contributions to contributors ispermitted. However, contributions, otherthan loans, made by a state candidate to hisor her campaign may not be returned.

Returning Contributions LackingContributor Information

When a contribution of $100 or more in acalendar year is received from a single

contributor, the committee must report thecontributor’s name and address, and, if thecontributor is an individual, his or heroccupation and employer. If the committeedoes not have this information in its recordswithin 60 days of receipt, the contributionmust be returned. (See Chapter 2.)

Salary and Compensation

The candidate or officeholder, or anyindividual authorized to approve thecommittee’s expenditures, may not receive a

salary or other compensation from thecommittee for the performance of political,legislative, or governmental activities. Thecommittee may pay for professional servicessuch as an accountant, however, even if theaccountant has authority to sign committeechecks.

Paula Greene, a member of Senator Howard’s staff, also is

the treasurer of the Senator’s campaign committee. Ms. Greene does all

recordkeeping for the committee and completes the committee’s campaign reports. She also has authority to approve committee expenditures. Campaign funds may be used to pay Ms. Greene for services she provides as committee treasurer. Funds may not be used to supplement or pay her government salary.

Security Systems

A candidate may use campaign funds topurchase an electronic security system. To

do so, the candidate must have receivedthreats to his or her physical safety becauseof his or her status as a candidate or electedofficial and the incidents must be verified byan appropriate law enforcement agency. Nomore than $5,000 may be spent and a reportto the FPPC is required.

Tickets for Entertainment and SportingEvents

The committee may purchase entertainmentand sporting event tickets for use by the

candidate or officeholder, or officer, director,employee, or staff of the committee, as longas attendance is directly related to apolitical, legislative, or governmentalpurpose.

Candidates for the 81st Assembly District have been offered the

chance to speak during half-time at the local college football game. Campaign funds may be used to purchase tickets for the candidates and committee staff to attend,

but only because they will be speaking.

Tickets to Political Fundraisers

A committee may purchase tickets to politicalfundraisers (subject to any applicablecontribution limits) for the candidate orofficeholder, or officer, director, employee, orstaff of the committee.

Travel

A committee that pays for travel or

accommodations for the candidate orofficeholder, any individual with authority toapprove the committee’s expenditures, oremployees or staff of the committee mustcomply with the standards set by InternalRevenue Code Sections 162 and 274(deduction of travel expenses for taxpurposes). The Internal Revenue Service

Example

Example





Q. I am a candidate running for statewide office. I make long-distance campaign phone calls on my home phone. How

may I pay for them? A. When the bill arrives, calculate the

portion that is campaign-related. Havethe committee write a check for thatportion directly to the phone company; donot pay the bill out of personal funds andget reimbursed.

Q. Very often, I need to get a babysitter for those evenings that I am out campaigning. May I use campaign funds to pay a babysitter?

A. You may use campaign funds to pay ababysitter, but only up to $200 per event.

Q. As a candidate, I will be using my personal car to get around during the campaign. Is mileage considered a reportable contribution if I do not want to be reimbursed?

A. No. Incidental use of your personal carfor campaign purposes is not considereda contribution and is not reportable.

Q. May I use campaign funds to have an additional telephone line put in my home?

A. Yes, as long as the additional phone lineis used for campaign purposes only. If,after the campaign, you choose to retainthe additional phone line for personalpurposes, you must pay the campaignwhat it would cost to install an additionalline at that time.

Q. Is it permissible use campaign funds to pay an independent contractor (e.g., the

campaign consultant) additional money if I win my election?

A. Yes, under the Act you use campaignfunds to pay a contractor for fees thatare part of the written contract.

Q. May I give bonuses to my campaign workers?

A. Yes, but in most cases, the bonuseswould be considered gifts and would belimited to $250 per calendar year.

Disqualification and CampaignContributions

Generally, campaign contributions receivedin connection with an elective office cannotserve as the basis for disqualifying the officialfrom voting on a matter affecting thecontributor. However, if the official holds anappointed position and receivescontributions for an elective office, he or shemay be subject to the provisions of

Government Code Section 84308 which:• Prohibits soliciting, directing, or receiving

campaign contributions in excess of $250from parties, participants, or their agentsduring proceedings regarding licenses,permits, or other entitlements for use, orfor 90 days after the decision.

• Requires disclosure of all such campaigncontributions and also requires an official’sdisqualification from making decisions incertain proceedings in which the official is

acting in an appointed position if morethan $250 in campaign contributions hasbeen received from a party or participantwithin 12 months preceding the decision.

Who Is Covered?

Generally, appointed board members,commissioners, or individuals who headstate or local government agencies and whomake decisions in proceedings involvinglicenses, permits, or other entitlements foruse are subject to Section 84308. Common

positions include:• Planning Commissioners

• Local Agency Formation Commission(LAFCO) members

• Members of redevelopment agencieswhich are not entirely comprised ofelected members of the same agency





• Transportation Authority members

• Air Quality Management District members

• Waste Management Authority members

• California Coastal Commissioners

Sarah Fisher is a candidate for the State Senate. She also is an

appointed member of her city’s planning commission. Christopher Bradley has a permit request pending before the planning commission. Under Section 84308, Sarah is prohibited from soliciting or receiving any contribution of more than $250 from Christopher or Christopher’s agent.

Sarah Fisher was elected to the State Senate and resigned her position on the planning commission. Since she is now serving solely in an elected position, she is not required to disqualify herself from making decisions in the State Senate by virtue of receiving contributions of more than $250 from any person.

Exempted Agencies

Section 84308 does not apply to thefollowing agencies:

• Judicial branch

• Legislature

• Board of Equalization (Gov. Code Section15626 applies)

• Constitutional officers

• Local agencies whose members areelected by the voters (e.g., board ofsupervisors, city council, or school board)

• Committees of an agency that are

comprised solely of elected members ofthe same agency (e.g., city councilmembers who serve on the city’s budgetand finance committee)

• Elected members of an agency, all ofwhom also serve as the governing body ofanother agency (i.e., city council members

who also serve on the city’sredevelopment agency board)

Section 84308 specifically prohibits officersfrom soliciting, accepting, or directingcampaign contributions of more than $250from any party, participant, or agent of aparty or participant while a proceeding ispending before the officer’s agency and for90 days following the decision. Thisprohibition applies even when thecontribution is for another candidate.

Sunny Shine, a planning commissioner, serves as the

treasurer for Councilmember Claude E. Sky’s campaign. Sunny may not solicit, accept, or direct a campaign contribution of more than $250 for Claude’s campaign from a party,participant, or agent whose proceeding is pending before the planning commission.

The FPPC’s fact sheet entitled “CampaignContributions May Cause Conflicts forAppointees and Commissioners” may beconsulted for further information concerningSection 84308.

Authority



82025 Expenditure. 82044 Payment .84300 Cash and In-Kind Contributions;

Cash Expenditures. 84301 Contributions Made Under Legal

Name.84302 Contributions by Intermediary or

Agent. 84304 Anonymous Contributions.84307 Commingling with Personal Funds. 84308 Contributions to Officers;

Disqualification.

Example

Example





84309 Transmittal of Campaign Contributions in State Office Buildings.

85201 Campaign Bank Account. 85501 Prohibition on Independent Expenditures by Candidate Controlled Committees.


85701 Disgorgement of Laundered Contributions.

85702 Contributions from Lobbyists.85704 Prohibition on Earmarking.89510 Acceptable Contributions. 89511 Campaign Funds Held by

Candidates and Committees.89511.5 Use of Personal Funds for Incumbent Elected Officers.

89512 Expenditures Associated with Seeking or Holding Office.

89513 Use of Campaign Funds for Specific Activities.

89514 Use of Campaign Funds for Attorney’s Fees.

89515 Use of Campaign Funds for Donations and Loans.

89516 Use of Campaign Funds for Vehicle Expenses.

89517 Use of Campaign Funds for Real Property, Appliances or Equipment.

89517.5 Use of Campaign Funds for Security System.

89518 Use of Campaign Funds for Compensation.

89519 Use of Surplus Campaign Funds.

Title 2 Regulations

18432.5 Intermediary .18438.1 Officers and Agencies Under

Government Code Section 84308. 18438.5 Aggregated Contributions Under Government Code Section 84308.

18438.6 Solicitation, Direction, and Receipt of Contributions Under Government Code Section 84308.

18438.7 Prohibitions and Disqualification Under Government Code Section 84308.

18438.8 Disclosure Under Government Code Section 84308. 18439 Definition of “Personally Deliver.” 18526 Reimbursement of Expenditures. 18570 Return of Contributions with

Insufficient Donor Information.18572 Lobbyist Contributions – Making a

Contribution Defined.18960 Direct Personal Benefit Defined. 18951 Surplus Funds. 18961 Incidental Use.




Chapter 11 — Committees Primarily Formed toSupport or Oppose State Candidates

This chapter briefly reviews the requirementsfor primarily formed committees that supportor oppose a single state candidate but arenot controlled by the candidate they support.If the committee is formed to support oroppose more than one state candidate, refer

to the manual for general purposecommittees.

Generally, the requirements and restrictionsoutlined in this manual apply to a committeeprimarily formed to support or oppose a statecandidate, including the following:

• The recordkeeping rules apply to allcommittees, as well as the duties imposedon the committee treasurer. (Chapter 2.)Although a separate bank account is notrequired in many cases, it is highly

recommended. Contributions receivedmay never be commingled with anindividual’s personal funds. (Chapter 10.)

• The $5,000 major donor notificationrequirement applies and committeesshould understand the guidelinesnecessary for proper reporting ofcontributions. (Chapters 3 and 7.)

• A mass mailing must include the nameand address of the committee on theoutside of the mailing in no less than 6-point type and in a color or print which

contrasts with the background. A copy ofthe mailing must be retained for fouryears. (Chapter 4.)

• The committee must be identified if it paysfor 500 or more telephone calls.(Chapter 4.)

• Any broadcast or mass mailing that is anindependent expenditure must include thename of the committee and the names ofthe committee’s top two donors of $50,000or more.

• A primarily formed committee for a state

candidate may not receive contributionsfrom another state candidate if thecommittee is making independentexpenditures.

• Committee funds must be used for apolitical, legislative or governmentalpurpose. (Chapter 10.) However,committee funds do not become surplusand there is no deadline to terminate thecommittee.

Filing Obligations

Once $1,000 or more is raised, thecommittee must begin filing the followingcampaign reports:

• Form 410 Statement of Organization

• Form 460 Campaign Statement (semi-annual and preelection)

• Form 465 Supplemental IndependentExpenditure Report

• Form 496 Independent ExpenditureReport

• Form 497 Contribution Report

Generally, reports are filed at the same timesand in the same places that the candidate’scontrolled committees are required to file,except that a primarily formed committee is

Chapter 11Committees Primarily Formed

to Support or Oppose StateCandidates

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Chapter 11 — Committees Primarily Formed toSupport or Oppose State Candidates

not required to file reports in its (or thecandidate’s) county of domicile.

Read the specific instructions for the forms to

determine when and where they should befiled. In addition, if the committee is anelectronic filer and makes independentexpenditures totaling $1,000 or more duringthe 90-day election cycle prior to thecandidate’s election, the Form 496 must befiled within 24 hours.

Contribution Limits

If the committee will make contributions tothe candidate it supports (or to any statecandidate), the committee may not receivemore than $6,000 per calendar year from asingle contributor. Contributions to thecandidate the committee supports aresubject to the per election contribution limitsdiscussed in Chapter 1.

If the committee is raising funds only for thepurpose of making independent expendituresto support or oppose the candidate, there areno limits on contributions received. If thecommittee will do both—make contributionsto candidates and make independent

expenditures—and the committee willreceive contributions of more than $6,000 ina calendar year from a single donor, thecommittee will need two bank accounts.



Fair Political Practices Commission Appendix-2 Campaign Manual 1, 2/2008

Appendix — About the Political Reform Act/How to Get Help

• Manuals, fact sheets, and usefulsummaries of the law

• Schedules of upcoming seminars and

educational workshops

Additional Campaign Manuals

Additional copies of this manual, andmanuals for other types of campaigncommittees are available from theCommission, the Secretary of State, andmany city clerks or county registrars.Manuals are available for:

• State Candidates and officeholders, andcommittees primarily formed to support/

oppose candidates• Local Candidates and officeholders, and

committees primarily formed to support/ oppose candidates

• General purpose recipient committees(including PACs, sponsored committees,political party committees, and countycentral committees)

• Ballot measure committees

• Major donor committees

•

Independent expenditure committees• Slate mailer organizations

Computer Generated Statements

Interactive campaign forms may be found atthe Commission’s website atwww.fppc.ca.gov.

In lieu of using official FPPC forms,candidates and committees may producetheir own computer-generated form usingFPPC’s format.

If filers choose to produce their own form,they must obtain Commission approvalbefore it may be filed. Approval will begranted on forms that contain all of therequired information in a format substantiallysimilar to the Commission’s forms. Ifsubstantive changes are made to a

previously-approved form, the amended formshould be submitted for approval. Also, eachJanuary, the Commission should be

contacted to determine if there have beenchanges to the disclosure statements thatmay require changes to computerized forms.

In addition, the Commission maintains a listof commercial software vendors who havereceived Commission approval for theirsoftware packages. Contact the Commissionif you are interested in obtaining this list. Thelist is also available on the Commission’swebsite (www.fppc.ca.gov).

Local candidates are not required to file

campaign statements electronically unlessthey are running for state office. However,some local jurisdictions require electronicfiling. Check with your local filing officer.

Need Help Fast?Assistance may be obtained regarding filingrequirements, forms, or an upcoming issueby calling the Commission’s TechnicalAssistance Division at (916) 322-5660, ortoll-free at (866) 275-3772, ext. 2.

For even more information! The Commissionperiodically conducts educational workshopson various topics. Contact the TechnicalAssistance Division or the website to see if aworkshop is coming to your area.

Obtaining Information ElsewhereA subscription for regulations is availablefrom:

Barclay’s Law PublishingP.O. Box 3066South San Francisco, CA 94083(800) 888-3600

Opinions and advice letters are availablefrom these subscription services:

Westlaw (800) 328-9352Database: “CA-ETH”(Advice letters from 1986 to present)





Lexis-Nexis (800) 227-9597Database: “CA Fair Political PracticesCommission”

(Advice letters from 1990 to present)

Other Resources

The Secretary of State, city clerks, andcounty clerks or registrars of voters are thefiling officers for campaign disclosurestatements. Committee statements will befiled with the Secretary of State or a localclerk or registrar depending on whether thefiler is a state candidate, a candidate runningfor local election, or a state or localcommittee.

Secretary of State

The Secretary of State is also responsible forissuing campaign committee identificationnumbers. Contact that office regarding theavailability and processing of ID numbers.

(916) 653-6224(916) 653-5045 faxwww.sos.ca.gov

Federal Election Commission

The Federal Election Commission answersquestions regarding federal elections andcontributions to all candidates from nationalbanks, national corporations, and foreignnationals.

(800) 424-9530 (located in Washington, D.C.)www.fec.gov

Franchise Tax Board

The Franchise Tax Board is responsible forresponding to questions regarding tax status,

tax-deductibility of political contributions, 501(c)(3) groups, audits, or any tax-relatedquestions.

(800) 852-5711www.ftb.ca.gov

Internal Revenue Service

The Internal Revenue Service providesassistance regarding federal tax laws and

obtaining a taxpayer identification number.

(877) 829-5500 (located in Washington, D.C.)(800) 829-3676 (taxpayer ID number)www.irs.gov

Federal Communications Commission

The Federal Communications Commissioncan answer questions regarding rates forpurchasing broadcast time and equal accessto broadcast media.

(888) 225-5322 (located in Washington, D.C.)

www.fcc.govemail: [email protected]

Local OrdinancesA city or county officeholder, candidate, orcommittee may be subject to additionalreporting or other requirements. This isbecause cities and counties may enactordinances that impose additional or differentdisclosure requirements. For example, theremay be contribution limits, lower itemization

thresholds, or an additional preelectionstatement, just to mention a few.

A city or county campaign ordinance maynever pre-empt state law. Enforcement andinterpretation of a local ordinance is theresponsibility of the local jurisdiction. TheCommission is not empowered to give adviceconcerning local ordinances.

Privacy Information NoticeInformation requested on all FPPC forms is

used by the FPPC to administer and enforcethe Political Reform Act (Government CodeSections 81000-91014 and California Codeof Regulations Sections 18110-18997). Allinformation required by these forms ismandated by the Political Reform Act.Failure to provide all of the informationrequired by the Act is a violation subject to





administrative, criminal or civil prosecution.All reports and statements provided arepublic records open for public inspection and

reproduction.

If you have any questions regarding thisPrivacy Notice or how to access yourpersonal information, please contact theFPPC at:

Manager, Filing Officer Programs428 J Street, Suite 620Sacramento, CA 95814(916) 322-5660

Campaign statements are filed with the

Secretary of State and city and county filingofficers.

EnforcementThe Fair Political Practices Commission, theAttorney General, county district attorneys,and elected city attorneys of charter citieshave enforcement authority under the Act.

Failure to provide all or any part of theinformation required by the Political ReformAct is a violation subject to:

• An administrative enforcement proceedingbefore the Fair Political PracticesCommission;

• A criminal misdemeanor proceeding;

• A civil action; and

• Levying of late penalties by filing officers.

Penalties for not filing campaign statementsmay be imposed up to $5,000 per violation.

Additional information on the Commission’s

enforcement procedures is available on thewebsite at www.fppc.ca.gov.



State of California

Fair PoliticalPractices Commission

How To Contact Us :

By mail :Fair Political Practices Commission428 J Street Suite 620

Candidate Campaign Disclosure Manual (California)

Documents

Transcript of Candidate Campaign Disclosure Manual (California)