§ 18730. Provisions of Conflict of Interest Codes.
(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 Government Code section 87300 or the
amendment of a conflict of interest code within the meaning of Government Code
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, Government Code sections 81000, et seq. 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 Government Code 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 (2 Cal. Code of Regs. sections 18100,
et seq. 18100,
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 Government Code 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, Government Code 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, Government
Code section 87200; and
(C) The filing officer is the same for both agencies. 1
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 his or her statement of economic interests
those economic interests he or she has which are of the kind described in the
disclosure categories to which he or she 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 he or she foreseeably
can affect materially through the conduct of his or her 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. 2
(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.
(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
he or she did not make or participate in the making of, or use his or her position
to influence any decision and did not receive or become entitled to receive
any form of payment as a result of his or her 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 he or
she 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 Government Code section 87302.6, the day
after the closing date of the most recent statement filed by the member pursuant
to 2 Cal. Code Regs. section 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) Investments and Real Property Disclosure.
When an investment or an interest in real property3 is required to be reported,4
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 two thousand dollars ($2,000), exceeds
ten thousand dollars ($10,000), exceeds one hundred thousand dollars ($100,000),
or exceeds one million dollars ($1,000,000).
(B) Personal Income Disclosure. When personal income is required to be reported,5
the statement shall contain:
1. The name and address of each source of income aggregating five hundred dollars
($500) or more in value, or fifty dollars ($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 one thousand
dollars ($1,000) or less, greater than one thousand dollars ($1,000), greater
than ten thousand dollars ($10,000), or greater than one hundred thousand dollars
($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,6 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 ten thousand dollars ($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 he or she is a director, officer, partner, trustee, employee,
or in which he or she 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 his or her statement of economic interests. 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.
Subdivisions (a), (b), and (c) of Government Code section 89501 shall apply
to the prohibitions in this section.
This section shall not limit or prohibit payments, advances, or reimbursements
for travel and related lodging and subsistence authorized by Government Code
section 89506.
(8.1) Section 8.1 Prohibition on Receipt of Gifts in Excess of $360 $390.
(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 $360 $390 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 his or her statement of economic interests. 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.
Subdivisions (e), (f), and (g) of Government Code 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 his or her election to office through the date that he or she 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 his or her election to office through the date that he or she 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 he or she 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 five hundred dollars
($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 his or her election to office
through the date he or she vacates office, receive a personal loan of five hundred
dollars ($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 one hundred dollars ($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 two hundred fifty dollars ($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 his or her official position to influence the making of any governmental
decision which he or she 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 his or her immediate family
or on:
(A) Any business entity in which the designated employee has a direct or indirect
investment worth two thousand dollars ($2,000) or more;
(B) Any real property in which the designated employee has a direct or indirect
interest worth two thousand dollars ($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 five hundred dollars
($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 $360 $390 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 his or her 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 his or her 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 his or her
official 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 his or her 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 one thousand dollars ($1,000) or more.
(10) Section 10. Disclosure of Disqualifying Interest.
When a designated employee determines that he or she should not make a governmental
decision because he or she 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 his or her duties under this code may
request assistance from the Fair Political Practices Commission pursuant to
Government Code section 83114 and 2 Cal. Code Regs. sections 18329 and 18329.5
or from the attorney for his or her 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, Government Code sections 81000
– 91014. In addition, a decision in relation to which a violation of the
disqualification provisions of this code or of Government Code section 87100
or 87450 has occurred may be set aside as void pursuant to Government Code section
91003.
NOTE: Authority cited: Section 83112, Government Code. Reference: Sections 87103(e), 87300 87302, 89501, 89502 and 89503, Government Code.
1 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 Government Code section 81004.
2See Government Code section 81010 and 2 Cal. Code of Regs. section 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.
3For the purpose of disclosure only (not disqualification), an interest in real
property does not include the principal residence of the filer.
4Investments 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.
5A designated employee’s income includes his or her community property
interest in the income of his or her spouse but does not include salary or reimbursement
for expenses received from a state, local or federal government agency.
6Income 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.