California Code of Regulations › Title 2 - Administration › Division 6 - Fair Political Practices Commission › Chapter 7 - Conflicts of Interest › Article 2 - Disclosure › Section 18730 - Provisions of Conflict of Interest Codes

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Incorporation by reference of the terms
				  of this regulation along with the designation of employees and the formulation
				  of disclosure categories in the Appendix referred to below constitute the
				  adoption and promulgation of a conflict of interest code within the meaning of
				  Section 87300 or the amendment of a
				  conflict of interest code within the meaning of Section
				  87306 if the terms of this
				  regulation are substituted for terms of a conflict of interest code already in
				  effect. A code so amended or adopted and promulgated requires the reporting of
				  reportable items in a manner substantially equivalent to the requirements of
				  article 2 of chapter 7 of the Political Reform Act, Sections
				  81000, et seq. The requirements of
				  a conflict of interest code are in addition to other requirements of the
				  Political Reform Act, such as the general prohibition against conflicts of
				  interest contained in Section
				  87100, and to other state or local
				  laws pertaining to conflicts of interest.
(b) The terms of a conflict of interest code
				  amended or adopted and promulgated pursuant to this regulation are as follows:
(1) Section
				  1. Definitions.
The definitions contained in the Political Reform Act of
					 1974, regulations of the Fair Political Practices Commission (Regulations
					 18110, et seq.), and any amendments to the Act or regulations, are incorporated
					 by reference into this conflict of interest code.
(2) Section
				  2. Designated Employees.
The persons holding positions listed in the Appendix are
					 designated employees. It has been determined that these persons make or
					 participate in the making of decisions which may foreseeably have a material
					 effect on economic interests.
(3) Section
				  3. Disclosure Categories.
This code does not establish any disclosure obligation for
					 those designated employees who are also specified in Section
					 87200 if they are designated in
					 this code in that same capacity or if the geographical jurisdiction of this
					 agency is the same as or is wholly included within the jurisdiction in which
					 those persons must report their economic interests pursuant to article 2 of
					 chapter 7 of the Political Reform Act, Sections
					 87200, et seq.
In addition, this code does not establish any disclosure
					 obligation for any designated employees who are designated in a conflict of
					 interest code for another agency, if all of the following apply:
(A) The geographical jurisdiction of this
				  agency is the same as or is wholly included within the jurisdiction of the
				  other agency;
(B) The disclosure
				  assigned in the code of the other agency is the same as that required under
				  article 2 of chapter 7 of the Political Reform Act, Section
				  87200; and
(C) The filing officer is the same for both
				  agencies. [FN1]
Such persons are covered by this code for disqualification
					 purposes only. With respect to all other designated employees, the disclosure
					 categories set forth in the Appendix specify which kinds of economic interests
					 are reportable. Such a designated employee shall disclose in the employee's
					 statement of economic interests those economic interests the employee has which
					 are of the kind described in the disclosure categories to which the employee is
					 assigned in the Appendix. It has been determined that the economic interests
					 set forth in a designated employee's disclosure categories are the kinds of
					 economic interests which the employee foreseeably can affect materially through
					 the conduct of the employee's office.
(4) Section
				  4. Statements of Economic
				  Interests: Place of Filing.
The code reviewing body shall instruct all designated
					 employees within its code to file statements of economic interests with the
					 agency or with the code reviewing body, as provided by the code reviewing body
					 in the agency's conflict of interest code. [FN2]
(5) Section
				  5. Statements of Economic
				  Interests: Time of Filing.
(A) Initial
				  Statements. All designated employees employed by the agency on the effective
				  date of this code, as originally adopted, promulgated and approved by the code
				  reviewing body, shall file statements within 30 days after the effective date
				  of this code. Thereafter, each person already in a position when it is
				  designated by an amendment to this code shall file an initial statement within
				  30 days after the effective date of the amendment.
(B) Assuming Office Statements. All persons
				  assuming designated positions after the effective date of this code shall file
				  statements within 30 days after assuming the designated positions, or if
				  subject to State Senate confirmation, 30 days after being nominated or
				  appointed.
(C) Annual Statements.
				  All designated employees shall file statements no later than April 1. If a
				  person reports for military service as defined in the Service member's Civil
				  Relief Act, the deadline for the annual statement of economic interests is 30
				  days following the person's return to office, provided the person, or someone
				  authorized to represent the person's interests, notifies the filing officer in
				  writing prior to the applicable filing deadline that the person is subject to
				  that federal statute and is unable to meet the applicable deadline, and
				  provides the filing officer verification of the person's military
				  status.
(D) Leaving Office
				  Statements. All persons who leave designated positions shall file statements
				  within 30 days after leaving office.
(5.5) Section
				  5.5. Statements for Persons Who
				  Resign Prior to Assuming Office.
Any person who resigns within 12 months of initial
					 appointment, or within 30 days of the date of notice provided by the filing
					 officer to file an assuming office statement, is not deemed to have assumed
					 office or left office, provided the person did not make or participate in the
					 making of, or use the person's position to influence any decision and did not
					 receive or become entitled to receive any form of payment as a result of the
					 person's appointment. Such persons shall not file either an assuming or leaving
					 office statement.
(A) Any person who
				  resigns a position within 30 days of the date of a notice from the filing
				  officer shall do both of the following:
(1)
				  File a written resignation with the appointing power; and
(2) File a written statement with the filing
				  officer declaring under penalty of perjury that during the period between
				  appointment and resignation the person did not make, participate in the making,
				  or use the position to influence any decision of the agency or receive, or
				  become entitled to receive, any form of payment by virtue of being appointed to
				  the position.
(6) Section
				  6. Contents of and Period Covered
				  by Statements of Economic Interests.
(A)
				  Contents of Initial Statements.
Initial statements shall disclose any reportable
					 investments, interests in real property and business positions held on the
					 effective date of the code and income received during the 12 months prior to
					 the effective date of the code.
(B) Contents of Assuming Office Statements.
Assuming office statements shall disclose any reportable
					 investments, interests in real property and business positions held on the date
					 of assuming office or, if subject to State Senate confirmation or appointment,
					 on the date of nomination, and income received during the 12 months prior to
					 the date of assuming office or the date of being appointed or nominated,
					 respectively.
(C) Contents
				  of Annual Statements. Annual statements shall disclose any reportable
				  investments, interests in real property, income and business positions held or
				  received during the previous calendar year provided, however, that the period
				  covered by an employee's first annual statement shall begin on the effective
				  date of the code or the date of assuming office whichever is later, or for a
				  board or commission member subject to Section
				  87302.6, the day after the closing
				  date of the most recent statement filed by the member pursuant to Regulation
				  18754.
(D) Contents of Leaving
				  Office Statements.
Leaving office statements shall disclose reportable
					 investments, interests in real property, income and business positions held or
					 received during the period between the closing date of the last statement filed
					 and the date of leaving office.
(7) Section
				  7. Manner of Reporting.
Statements of economic interests shall be made on forms
					 prescribed by the Fair Political Practices Commission and supplied by the
					 agency, and shall contain the following information:
(A) Investment and Real Property Disclosure.
When an investment or an interest in real property [FN3] is
					 required to be reported, [FN4] the statement shall contain the
					 following:
1.A statement of the nature
				  of the investment or interest;
2.The name of the business entity in which
				  each investment is held, and a general description of the business activity in
				  which the business entity is engaged;
3.The address or other precise location of
				  the real property;
4.A statement
				  whether the fair market value of the investment or interest in real property
				  equals or exceeds $2,000, exceeds $10,000, exceeds $100,000, or exceeds
				  $1,000,000.
(B) Personal
				  Income Disclosure. When personal income is required to be reported, [FN5] the
				  statement shall contain:
1.The name and
				  address of each source of income aggregating $500 or more in value, or $50 or
				  more in value if the income was a gift, and a general description of the
				  business activity, if any, of each source;
2.A statement whether the aggregate value of
				  income from each source, or in the case of a loan, the highest amount owed to
				  each source, was $1,000 or less, greater than $1,000, greater than $10,000, or
				  greater than $100,000;
3.A
				  description of the consideration, if any, for which the income was
				  received;
4.In the case of a gift,
				  the name, address and business activity of the donor and any intermediary
				  through which the gift was made; a description of the gift; the amount or value
				  of the gift; and the date on which the gift was received;
5.In the case of a loan, the annual interest
				  rate and the security, if any, given for the loan and the term of the
				  loan.
(C) Business
				  Entity Income Disclosure. When income of a business entity, including income of
				  a sole proprietorship, is required to be reported, [FN6] the statement shall
				  contain:
1.The name, address, and a general
				  description of the business activity of the business entity;
2.The name of every person from whom the
				  business entity received payments if the filer's pro rata share of gross
				  receipts from such person was equal to or greater than
				  $10,000.
(D) Business
				  Position Disclosure. When business positions are required to be reported, a
				  designated employee shall list the name and address of each business entity in
				  which the employee is a director, officer, partner, trustee, employee, or in
				  which the employee holds any position of management, a description of the
				  business activity in which the business entity is engaged, and the designated
				  employee's position with the business entity.
(E) Acquisition or Disposal During Reporting
				  Period. In the case of an annual or leaving office statement, if an investment
				  or an interest in real property was partially or wholly acquired or disposed of
				  during the period covered by the statement, the statement shall contain the
				  date of acquisition or disposal.
(8) Section
				  8. Prohibition on Receipt of
				  Honoraria.
(A) No member of a state board or
				  commission, and no designated employee of a state or local government agency,
				  shall accept any honorarium from any source, if the member or employee would be
				  required to report the receipt of income or gifts from that source on the
				  member's or employee's statement of economic interests.
(B) This section shall not apply to any
				  part-time member of the governing board of any public institution of higher
				  education, unless the member is also an elected official.
(C) Subdivisions (a), (b), and (c) of Section
				  89501 shall apply to the
				  prohibitions in this section.
(D)
				  This section shall not limit or prohibit payments, advances, or reimbursements
				  for travel and related lodging and subsistence authorized by Section
				  89506.
(8.1) Section
				  8.1. Prohibition on Receipt of
				  Gifts in Excess of $590.
(A) No member of a
				  state board or commission, and no designated employee of a state or local
				  government agency, shall accept gifts with a total value of more than $590 in a
				  calendar year from any single source, if the member or employee would be
				  required to report the receipt of income or gifts from that source on the
				  member's or employee's statement of economic interests.
(B) This section shall not apply to any
				  part-time member of the governing board of any public institution of higher
				  education, unless the member is also an elected official.
(C) Subdivisions (e), (f), and (g) of Section
				  89503 shall apply to the
				  prohibitions in this section.
(8.2) Section
				  8.2. Loans to Public Officials.
(A) No elected officer of a state or local
				  government agency shall, from the date of the election to office through the
				  date that the officer vacates office, receive a personal loan from any officer,
				  employee, member, or consultant of the state or local government agency in
				  which the elected officer holds office or over which the elected officer's
				  agency has direction and control.
(B) No public official who is exempt from the
				  state civil service system pursuant to subdivisions (c), (d), (e), (f), and (g)
				  of Section 4 of Article VII of the
				  Constitution shall, while he or she holds office, receive a personal loan from
				  any officer, employee, member, or consultant of the state or local government
				  agency in which the public official holds office or over which the public
				  official's agency has direction and control. This subdivision shall not apply
				  to loans made to a public official whose duties are solely secretarial,
				  clerical, or manual.
(C) No elected
				  officer of a state or local government agency shall, from the date of the
				  election to office through the date that the officer vacates office, receive a
				  personal loan from any person who has a contract with the state or local
				  government agency to which that elected officer has been elected or over which
				  that elected officer's agency has direction and control. This subdivision shall
				  not apply to loans made by banks or other financial institutions or to any
				  indebtedness created as part of a retail installment or credit card
				  transaction, if the loan is made or the indebtedness created in the lender's
				  regular course of business on terms available to members of the public without
				  regard to the elected officer's official status.
(D) No public official who is exempt from the
				  state civil service system pursuant to subdivisions (c), (d), (e), (f), and (g)
				  of Section 4 of Article VII of the
				  Constitution shall, while the official holds office, receive a personal loan
				  from any person who has a contract with the state or local government agency to
				  which that elected officer has been elected or over which that elected
				  officer's agency has direction and control. This subdivision shall not apply to
				  loans made by banks or other financial institutions or to any indebtedness
				  created as part of a retail installment or credit card transaction, if the loan
				  is made or the indebtedness created in the lender's regular course of business
				  on terms available to members of the public without regard to the elected
				  officer's official status. This subdivision shall not apply to loans made to a
				  public official whose duties are solely secretarial, clerical, or
				  manual.
(E) This section shall not
				  apply to the following:
1.Loans made to the
				  campaign committee of an elected officer or candidate for elective
				  office.
2.Loans made by a public
				  official's spouse, child, parent, grandparent, grandchild, brother, sister,
				  parent-in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or
				  first cousin, or the spouse of any such persons, provided that the person
				  making the loan is not acting as an agent or intermediary for any person not
				  otherwise exempted under this section.
3.Loans from a person which, in the
				  aggregate, do not exceed $500 at any given time.
4.Loans made, or offered in writing, before
				  January 1, 1998.
(8.3) Section
				  8.3. Loan Terms.
(A) Except as set forth in subdivision (B),
				  no elected officer of a state or local government agency shall, from the date
				  of the officer's election to office through the date the officer vacates
				  office, receive a personal loan of $500 or more, except when the loan is in
				  writing and clearly states the terms of the loan, including the parties to the
				  loan agreement, date of the loan, amount of the loan, term of the loan, date or
				  dates when payments shall be due on the loan and the amount of the payments,
				  and the rate of interest paid on the loan.
(B) This section shall not apply to the
				  following types of loans:
1.Loans made to the
				  campaign committee of the elected officer.
2.Loans made to the elected officer by his or
				  her spouse, child, parent, grandparent, grandchild, brother, sister,
				  parent-in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or
				  first cousin, or the spouse of any such person, provided that the person making
				  the loan is not acting as an agent or intermediary for any person not otherwise
				  exempted under this section.
3.Loans made, or offered in writing, before
				  January 1, 1998.
(C)
				  Nothing in this section shall exempt any person from any other provision of
				  Title 9 of the Government Code.
(8.4) Section
				  8.4. Personal Loans.
(A) Except as set forth in subdivision (B), a
				  personal loan received by any designated employee shall become a gift to the
				  designated employee for the purposes of this section in the following
				  circumstances:
1.If the loan has a defined
				  date or dates for repayment, when the statute of limitations for filing an
				  action for default has expired.
2.If the loan has no defined date or dates
				  for repayment, when one year has elapsed from the later of the following:
a.The date the loan was made.
b.The date the last payment of $100 or more
				  was made on the loan.
c.The date
				  upon which the debtor has made payments on the loan aggregating to less than
				  $250 during the previous 12 months.
(B) This section shall not apply to the
				  following types of loans:
1.A loan made to the
				  campaign committee of an elected officer or a candidate for elective
				  office.
2.A loan that would
				  otherwise not be a gift as defined in this title.
3.A loan that would otherwise be a gift as
				  set forth under subdivision (A), but on which the creditor has taken reasonable
				  action to collect the balance due.
4.A loan that would otherwise be a gift as
				  set forth under subdivision (A), but on which the creditor, based on reasonable
				  business considerations, has not undertaken collection action. Except in a
				  criminal action, a creditor who claims that a loan is not a gift on the basis
				  of this paragraph has the burden of proving that the decision for not taking
				  collection action was based on reasonable business considerations.
5.A loan made to a debtor who has filed for
				  bankruptcy and the loan is ultimately discharged in
				  bankruptcy.
(C) Nothing
				  in this section shall exempt any person from any other provisions of Title 9 of
				  the Government Code.
(9)
				  Section 9. Disqualification.
No designated employee shall make, participate in making,
					 or in any way attempt to use the employee's official position to influence the
					 making of any governmental decision which the employee knows or has reason to
					 know will have a reasonably foreseeable material financial effect,
					 distinguishable from its effect on the public generally, on the official or a
					 member of the official's immediate family or on:
(A) Any business entity in which the
				  designated employee has a direct or indirect investment worth $2,000 or
				  more;
(B) Any real property in
				  which the designated employee has a direct or indirect interest worth $2,000 or
				  more;
(C) Any source of income,
				  other than gifts and other than loans by a commercial lending institution in
				  the regular course of business on terms available to the public without regard
				  to official status, aggregating $500 or more in value provided to, received by
				  or promised to the designated employee within 12 months prior to the time when
				  the decision is made;
(D) Any
				  business entity in which the designated employee is a director, officer,
				  partner, trustee, employee, or holds any position of management; or
(E) Any donor of, or any intermediary or
				  agent for a donor of, a gift or gifts aggregating $590 or more provided to,
				  received by, or promised to the designated employee within 12 months prior to
				  the time when the decision is made.
(9.3) Section
				  9.3. Legally Required
				  Participation.
No designated employee shall be prevented from making or
					 participating in the making of any decision to the extent the employee's
					 participation is legally required for the decision to be made. The fact that
					 the vote of a designated employee who is on a voting body is needed to break a
					 tie does not make the employees' participation legally required for purposes of
					 this section.
(9.5) Section
				  9.5. Disqualification of State
				  Officers and Employees.
In addition to the general disqualification provisions of
					 section 9, no state administrative official
					 shall make, participate in making, or use the official's position to influence
					 any governmental decision directly relating to any contract where the state
					 administrative official knows or has reason to know that any party to the
					 contract is a person with whom the state administrative official, or any member
					 of the official's immediate family has, within 12 months prior to the time when
					 the official action is to be taken:
(A) Engaged in a business transaction or
				  transactions on terms not available to members of the public, regarding any
				  investment or interest in real property; or
(B) Engaged in a business transaction or
				  transactions on terms not available to members of the public regarding the
				  rendering of goods or services totaling in value $1,000 or
				  more.
(10) Section
				  10. Disclosure of Disqualifying
				  Interest.
When a designated employee determines that the employee
					 should not make a governmental decision because the employee has a
					 disqualifying interest in it, the determination not to act may be accompanied
					 by disclosure of the disqualifying interest.
(11) Section
				  11. Assistance of the Commission
				  and Counsel.
Any designated employee who is unsure of the duties under
					 this code may request assistance from the Fair Political Practices Commission
					 pursuant to Section
					 83114 and Regulations 18329 and
					 18329.5 or from the attorney for the employee's agency, provided that nothing
					 in this section requires the attorney for the agency to issue any formal or
					 informal opinion.
(12)
				  Section 12. Violations.
This code has the force and effect of law. Designated
					 employees violating any provision of this code are subject to the
					 administrative, criminal and civil sanctions provided in the Political Reform
					 Act, Sections
					 81000-91014. In addition, a
					 decision in relation to which a violation of the disqualification provisions of
					 this code or of Section
					 87100 or
					 87450 has occurred may be set aside
					 as void pursuant to Section
					 91003.[FN1]
Designated employees who are required to file statements of
					 economic interests under any other agency's conflict of interest code, or under
					 article 2 for a different jurisdiction, may expand their statement of economic
					 interests to cover reportable interests in both jurisdictions, and file copies
					 of this expanded statement with both entities in lieu of filing separate and
					 distinct statements, provided that each copy of such expanded statement filed
					 in place of an original is signed and verified by the designated employee as if
					 it were an original. See Section
					 81004.[FN2]
See Section
					 81010 and Regulation 18115 for the
					 duties of filing officers and persons in agencies who make and retain copies of
					 statements and forward the originals to the filing officer.[FN3]
For the purpose of disclosure only (not disqualification),
					 an interest in real property does not include the principal residence of the
					 filer.[FN4]
Investments and interests in real property which have a
					 fair market value of less than $2,000 are not investments and interests in real
					 property within the meaning of the Political Reform Act. However, investments
					 or interests in real property of an individual include those held by the
					 individual's spouse and dependent children as well as a pro rata share of any
					 investment or interest in real property of any business entity or trust in
					 which the individual, spouse and dependent children own, in the aggregate, a
					 direct, indirect or beneficial interest of 10 percent or greater.[FN5]
A designated employee's income includes the employee's
					 community property interest in the income of the employee's spouse but does not
					 include salary or reimbursement for expenses received from a state, local or
					 federal government agency.[FN6]
Income of a business entity is reportable if the direct,
					 indirect or beneficial interest of the filer and the filer's spouse in the
					 business entity aggregates a 10 percent or greater interest. In addition, the
					 disclosure of persons who are clients or customers of a business entity is
					 required only if the clients or customers are within one of the disclosure
					 categories of the filer.