California Closes 'Pay-to-Play Loophole' for Local Officials and Contractors
California Gov. Gavin Newsom signed into law Thursday legislation that will bar local elected officials from accepting or soliciting contributions of over $250 from pending contractors.
The legislation cleared the Assembly 66-0 and the Senate 32-0 and will take effect January 1, 2023.
The bill, SB 1439, would apply to contributions from anyone affiliated with a group that has a pending license, permit or contract — or 12 months after a final decision on it.
What's more, a contractor or anyone going before the local agency with such a request will have to disclose during the proceeding if they made contributions over $250 within the past 12 months.
SB 1439 should help ensure our local elected officials are accountable to the public interest, not special interests and major donors.Jonathan Mehta Stein, Executive Director, California Common Cause
Democratic Senator Steve Glazer, who represents Senate District 07 and proposed the bill, said it will have a "profound" impact on local government operations.
"It will break the link between ... campaign fundraising and most decisions by local elected officials. Developers, contractors, license applicants and others will not be able to use campaign contributions to influence government decisions and these same parties can also use this reform to turn down unwanted solicitations from politicians," Glazer said.
"Unfortunately, the scandals in this space are far and wide throughout California."
Common Cause, a nonpartisan, nonprofit government accountability group that was the main supporter of the bill, quoted a KCET story that ran last year in citing the need to close what it calls a "pay-to-play loophole."
KCET found that $38,000, or over 30% of the roughly $125,000 in campaign contributions to city of Huntington Park council members between 2018 and 2020, came from eight companies, whose executives were identified as city contractors at some point during that time. The city doled out more than $11 million combined to four big contractors that donated gifts and campaign contributions during that period.
Other stories also cited by Common Cause include a 2021 San Gabriel Valley Tribune story about cannabis vendors who contributed over $100,000 to several campaigns and committees supporting elected officials who later approved commercial licenses from them and a 2015 Los Angeles Times piece reporting an NFL mogul and affiliated groups donated over $100,000 to local Inglewood officials who approved permits.
That is what the legislation intended to curb.
“This bill becoming law means that Californians don't have to worry if a contractor, developer or other special interest has pumped full the campaign coffers of their city council right before big decisions are made. SB 1439 should help ensure our local elected officials are accountable to the public interest, not special interests and major donors," said Jonathan Mehta Stein, the executive director of California Common Cause.
"SB 1439 is a win for good government and local democracy in California. It will help to restore public trust in government by stemming corruption and its appearance in local jurisdictions across the state," he said.
According to Stein, it also levels the playing field for candidates who do not want to rely on large contributions from special moneyed interests to win elections.
"SB 1439 is not only good for residents who want to have faith in their government," he said, "But also for candidates and special interests who do not want to engage in the all too often implicit game of pay-to-play politics."
