FactChecking gCalifo orniasS SecretaryofSt tate:

AnAn nalysisoft theEviden ncePresent tedforSen nateBill168

Californiaisknownthr roughouttheworldasale eaderintheu seofcitizeni initiativeandreferendum.Polls hat ans overwhe elmingly sup pport their right to pet tition state laws, consistently show th California ments,andactsofthe Legislatureont o theballot. However,cit tizensfroma across constitutionalamendm calspectrumbelievethep processcouldbereformed dtobetterser rvethepeopl le. thepolitic OnJuly15,2011,the CaliforniaAssemblypasse edSenateBil l168andsen ntittoGovernorJerryBro owns cording to th bill summary prepared by the Caliifornia Legislative Counse the bill w he d el, would desk. Acc provide th it is a misdemeanor for a person to pay or to receive mon or any ot hat f ney ther thing of value basedon thenumber ofsignatures sobtainedon nastateorlo ocalinitiative, ,referendum m,orrecallpe etition p y the ld and would prescribe penalties for doing so. By creating a new crime, t bill woul impose a state mandated dlocalprogra am. According gtotheLegis slativeCounse elanewcrimeiscreate edbythebill l,withfinesa ashighas$2 25,000 and imprisonment of up to one ye in a coun jail or bo for those found guilty of paying b the ear nty oth e y by acceptingper rsignaturep aymentwouldbesubject ttoafineof upto signature.Anyonefoundguiltyofa $1,000an ndimprisonm mentofuptos sixmonthsinacountyjail orboth. Supporter rsofSB168 arguethatth hebillisaime edatpreven tingfraud,andthatpaym mentbasedo onthe productiv vityofpetitioncirculators encouragesf fraudulentco onduct.Oppo onentscounte erthatthere eisno evidence indicating th payment to people ci hat irculating pet titions based on the num d mber of signa atures t ndtheypoint ttoafedera court decisionin al obtained increasesor contributes tofraudulent behavioran ckingenforcementofasim milar,though lessseverela aw,onconstit tutionalgrounds. Coloradorecentlybloc rsreliedonte estimonyfromSecretary ofStateDeb raBowenan ndheroffice thateffortso ofthe Legislator state Elec ctions Fraud Investigation Unit (EFIU) had resulted in 33 convictions for fa d alsifying petit tions between 1994 and 20 010. For mon nths Citizens in Charge Fo oundation ha been seek as king more de etailed ononthese convictionsf fromtheSecr retaryofStat teunderCali iforniasPubl licRecordsA Act.So informatio far,thedocumentsob btainedindica atethatthe conviction da ataprovided bytheSecre etaryofState may e curate. notbeacc LessThan n33 Through documentso d obtainedfrom mBowensof ffice thusfar, ,itappearst thatasignific cantpercenta ageof thepeoplecountedinthe33allege edpetitionfra audconvictio onswerefoun ndguiltyofof ffensesnotre elated ve,referendu umorrecallpetitions.OnM May23,2011 1,inresponse etoourreque estforinform mation toinitiativ on the 33 cited conv victions, the Secretary of State provi ded copies o 21 pages of press rel f of leases containing information about a tot of 19 individuals. The Secretary ind g n tal dicated that the press rel leases

 wereusedincounting33casesoffalsifyingpetitions,meaningthatpresumablytherecordscovered19 ofthe33cases. OnMay27,2011theSecretarysofficeprovidedadditionalinformation,writing: Ofthose33cases,18caserecordshavebeendestroyedbecausetheyareover tenyearsold,inaccordancewithourretentionpolicy.Ofthe15remainingcase files,onlyfivecontaincourtdocumentsthatidentifyconvictions. Two of the individuals already identified from the press releases were included in the five additional documents. One of these two individuals was a person convicted of a noninitiative petition related crime. AfurtheranalysisofthepressreleasesprovidedbytheSecretaryofStatesofficeshowsthatfiveofthe nineteencaseswerentactuallyrelatedtofalsifyingpetitions: Two people were convicted of forgery on nominating petitions, which are governed by a differentsectionoftheElectionsCodeandnotaddressedbySB168atall. Onepersonwasconvictedofcastingtwoballotsduringthe1996generalelectionsomething notrelatedtopetitioningofanykind. One person was convicted of voter registration fraudagain unrelated to petitioning and not coveredbySB168. Oneindividualwasconvictedofmisusingpetitioninformationafterheusedapetitionsigners informationtoaskherforadate.Nofalsificationorfraudwasalleged.

AddingItUp In testifying before the Legislature, California Secretary of State Debra Bowen and her office cited 33 convictionsforfalsifyingpetitionsovera16yearperiodasjustificationforpassageofSenateBill168, whichregulatesthecirculatingofpetitionsforinitiative,referendum,andrecallcampaigns.Todate,the Secretarysofficehasprovideddocumentationthatappearstocover22ofthe33allegedconvictions. Therecordsprovidedshowthatatleastfiveofthose22convictionswereforcrimesnotaddressedby Senate Bill 168 because its provisionsdont affect people circulating petitions to nominate candidates forthelegislatureorotherelectedpositions.Theresultingerrorrateamongthe22documentedcasesis 23 percent. In other words, roughly one quarter of the documented cases were of crimes completely unrelatedtothelegislationtheywerecitedtosupport. Ifcasesfor whichsome recordisavailable (in the formofpressreleases)werecountedincorrectly,it drawsintoseriousquestionwhetherthe11cases,forwhichthereappeartobenorecords,wereinfact relatedtoinitiative,referendumorrecallpetitionsand,therefore,relevanttoSenateBill168. Even if all of the 11 remaining cases, for which no documents have been provided, were related to initiativeandreferendumpetitions,theresultingrateoffraudisstillsurprisinglylow.Assumingthatno morethanfivecaseswereunrelated,thatleavesafraudrateof1.75casesperyear(19942010).Putin perspective, the Secretarys office has indicated that state officials verified at least 26,541,044 signaturesjustover4.4millionperyearbetween2003and2008alone.Takingintoaccounttherate

 of1.75casesoffraudperyear,approximately2.3millionsignaturesarecollectedforeveryoneinstance offraud.Intermsofcrimeratestatistics,thefraudratesince1994isjustover0.005per100,000. FraudDropsSharply All of the fraud convictions are the work of the Election Fraud Investigation Unit, which began its operation in 1994. According to the Secretary of State, the bulk of the 33 alleged convictions were prosecutedintheearlyyearsofthestatesnewinvestigationandprosecutionprogram.Infact,inthe seven years from 1994 to 2000, there were 23 convictions for fraud in petitions for initiatives, referendumsandrecalls:anaverageof3.3convictionsayear.Inthedecadethatfollowed,from2001to 2010, there were only five total convictions related to fraud in initiative, referendum and recall petitioning,oroneconvictioneverytwoyears. Overtime,therateofconvictionshasdeclinedquitesignificantly.Forthelastdecade,theyearlyrateof convictionsdroppedbyawhopping85percentfromwhatitmeasuredfrom1994to2000.Assumingthe Secretary of States office has exercised a relatively consistent level of diligence in investigating and prosecutingpetitionrelatedoffensessince1994,itsuggeststhatthedeclineinconvictionsforfraudisa resultofthesuccessofearlierprosecutionsandconvictions.Theenforcementoflongstandingpetition laws appears to have already provided significant and effective deterrence against breaking petition rules. InvestigationOngoing Citizens in Charge Foundation is now working to obtain additional records from Secretary of State Bowensofficebut,basedonwhathasbeenreleasedsofar,theactualnumberoffraudprosecutionsin CaliforniaissignificantlylowerthanthenumberpresentedtothelegislaturebytheSecretaryofStatein supportofSB168:lowerby23percent. Additionally, the statistics released by Secretary Bowens office concerning fraud convictions involving initiative,referendumandrecallpetitionsstronglysuggestthatanewlawissimplynotneeded,because prosecutionsandconvictionswoninthe1990smayberesponsibleforadramatic85percentreduction ininstancesofverifiedfraud.

Appendices
A. B. C. CopyoftheenrolledversionofSenateBill168assenttoGovernorJerryBrown CopyofthefinalflooranalysisforSenateBill168 ThedocumentsproducedbySecretaryofStateDebraBowensofficeinsupportoftheclaim indicatedinthelegislativeanalysisthattherewere33convictionsforfalsifyingpetitions between1994and2010.

Senate Bill No. 168

Passed the Senate May 9, 2011

Secretary of the Senate

Passed the Assembly July 14, 2011

Chief Clerk of the Assembly

This bill was received by the Governor this of , 2011, at oclock m.

day

Private Secretary of the Governor

SB 168

CHAPTER An act to add Section 102.5 to the Elections Code, relating to petitions.
legislative counsels digest

SB 168, Corbett. Petitions: compensation for signatures. Under existing law, a person who is a voter or is qualified to register to vote in this state may circulate an initiative or referendum petition, and a person who is a voter may circulate a recall petition. This bill would provide that it is a misdemeanor for a person to pay or to receive money or any other thing of value based on the number of signatures obtained on a state or local initiative, referendum, or recall petition and would prescribe penalties for doing so. By creating a new crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. The people of the State of California do enact as follows: SECTION 1. Section 102.5 is added to the Elections Code, to read: 102.5. (a)It shall be unlawful for a person to pay or to receive money or any other thing of value based on the number of signatures obtained on a state or local initiative, referendum, or recall petition. (b)Violation of this section shall be a misdemeanor, as follows: (1)A person or organization who pays a person based on the number of signatures obtained on a state or local initiative, referendum, or recall petition shall be punished by a fine not to exceed twenty-five thousand dollars ($25,000), or by imprisonment

98

SB 168

in a county jail not to exceed one year, or by both that fine and imprisonment. (2)A person who is paid based on the number of signatures obtained on a state or local initiative, referendum, or recall petition shall be punished by a fine not to exceed one thousand dollars ($1,000), or by imprisonment in a county jail not to exceed six months, or by both that fine and imprisonment. (c)Nothing in this section prohibits the payment for signature gathering not based, either directly or indirectly, on the number of signatures obtained on a state or local initiative, referendum, or recall petition. SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

98

Approved

, 2011

Governor

BILL ANALYSIS

SB 168 Page 1

SENATE THIRD READING SB 168 (Corbett) As Introduced February 3, 2011 Majority vote SENATE VOTE ELECTIONS :23-15 5-2 APPROPRIATIONS 10-5

----------------------------------------------------------------|Ayes:|Fong, Bonilla, Hall, |Ayes:|Fuentes, Bradford, | | |Mendoza, Swanson | |Charles Calderon, Campos, | | | | |Gatto, Hall, Hill, Lara, | | | | |Mitchell, Solorio | | | | | | |-----+--------------------------+-----+--------------------------| |Nays:|Logue, Valadao |Nays:|Harkey, Donnelly, | | | | |Nielsen, Norby, Wagner | | | | | | ----------------------------------------------------------------SUMMARY : Prohibits a person from paying another person or being paid based on the number of signatures obtained on an initiative, referendum, or recall petition. Specifically, this bill : 1)Makes it unlawful for a person to pay or to receive money or any other thing of value based on the number of signatures obtained on a state or local initiative, referendum, or recall petition. 2)Provides that a violation of this bill is a misdemeanor subject to the following penalties: a) For a person or organization that pays someone based on the number of signatures collected, a fine of up to $25,000 and/or imprisonment in a county jail for up to one year; and, For a person paid based on the number of signatures collected, a fine of up to $1,000 and/or imprisonment in a county jail for up to six months.

b)

3)Provides that nothing in this bill prohibits the payment for signature gathering that is not based, either directly or

SB 168 Page 2

indirectly, on the number of signatures collected on a petition. FISCAL EFFECT : According to the Assembly Appropriations Committee, unknown, likely minor non-reimbursable costs to cities and counties for prosecution and incarceration, offset to some extent by fine revenues. COMMENTS : According to the author, "Some signature gathering firms compensate circulators based on the number of signatures they collect. Some circulators reach the deadline to qualify initiatives by illegally misinforming voters and forging names. Others have forged signatures onto their petitions by copying names they chose from a phonebook. Lastly, some have inserted carbon paper and a second petition behind the original one in order to collect signatures." In 1999, the United States Supreme Court examined a Colorado law that imposed a number of restrictions on the signature collection process for ballot initiatives. In that case the court ruled that there must be a compelling state interest to justify any restrictions on initiative petition circulation. Buckley v. American Constitutional Law Foundation (1999), 525 U.S. 182. Although the United States Supreme Court has not ruled on the constitutionality of prohibiting payment for signature

collection on a per-signature basis, a number of federal courts have considered challenges to such laws, with the courts reaching different conclusions. Federal appellate courts in the Second, Eighth, and Ninth Circuits upheld laws that prohibited payments for signature collection on election petitions on a per-signature basis, while the Sixth Circuit Court of Appeals struck down a similar law in Ohio. Additionally, a number of federal district courts have struck down bans on per-signature payments in other states. In light of the differing opinions reached by various federal courts on the constitutionality of laws that prohibit payments on a per-signature basis for signature gathering on petitions, it is unclear whether a court challenge to this bill, if enacted, would be successful. According to the Secretary of State's Election Fraud Investigation Unit (EFIU), between 1994 and 2010, the EFIU opened 240 cases for falsifying petitions, of which 46 were sent

SB 168 Page 3

to district attorneys for prosecution, resulting in 33 convictions. Since the EFIU was created in 1994, a larger number of convictions have been obtained for falsified petitions than for any other election crime except fraudulent voter registration. This bill prohibits the payment of individuals on a per-signature basis for collecting signatures on petitions. Typically, in California, individuals who are paid to circulate petitions or register voters on a per-signature or per-piece basis are independent contractors. However, to the extent that this bill forces individuals who are paid to circulate petitions or register voters to be paid an hourly wage, this bill could also result in these individuals being considered employees under California law. As such, the individual, corporation, or group paying individuals to circulate petitions may be required to pay minimum wage, provide workers' compensation insurance and unemployment insurance for its employees, and maintain a payroll system. This may result in higher costs to groups that pay individuals to circulate petitions. In addition, prohibiting payment of individuals on a per-signature basis could increase costs because it may become more difficult to measure the work product of petition circulators. Potential increased costs may be partially offset if, by reducing the incentive to submit fraudulently-obtained signatures, this legislation results in paid circulators submitting fewer such signatures. Supporters of this bill contend that paying signature gatherers on a per-signature basis encourages fraud, because a circulator who collects more signatures will earn more, and is more likely to forge signatures or misrepresent the content of a petition in order to encourage people to sign. Opponents of this bill contend that outlawing payment for signature collection on a per signature basis will "make it prohibitively expensive to do an initiative or a recall and next to impossible to do a referendum," and argue that there is little evidence that per-signature payment methods are more prone to fraud than other methods. This bill is identical to SB 34 (Corbett) of 2009, which was vetoed. In his veto message, Governor Schwarzenegger expressed concern that prohibiting per-signature payments could "make it more difficult for grassroots organizations to gather the necessary signatures and qualify measures for the ballot."

SB 168 Page 4

Please see the policy committee analysis for a full discussion of this bill. Analysis Prepared by FN: 0001512 : Ethan Jones / E. & R. / (916) 319-2094

ATruthin nGovernance ereportfromCitizensinCh hargeFounda ation Copyrig ght2011,CitizensinCharg geFoundation nCitizensinC ChargeFound dationistheo onlynational transparti isanvoterrightsgroupded dicatedtopro otectingand expandingth heballotinitia ativeand referendu umprocess. Formoreinformationv visit: CitizensInChargeFound dation.org