Purpose and Scope of the Act

The Political Reform Act of 1974 (Act) was an initiative measure intended to correct election abuses in California. (Calif. Common Cause v. Fair Political Practices (1990) 221 Cal.App.3d 647, 649 citing Secs. 81001, 81002; see Diamond et al., California's Political Reform Act: Greater Access to the Initiative Process (1975) 7 Sw.U.L.Rev. 453, 463-464; hereafter cited as California's Political Reform Act.) The drafters designed the Act to provide California voters a greater degree of governmental supervision over the political process. (Id.) The Act was deemed necessary as the legislative and executive departments had been generally unresponsive to political reform. (California's Political Reform Act, supra, at 464.) It is the intent of the Act that "[s]tate and local government . . . serve the needs and respond to the wishes of all citizens equally, without regard to their wealth." (Calif. Common Cause, supra, 221 Cal.App.3d at 649 citing Sec. 81001(a).)

This law forbids public officials from making or otherwise influencing government decisions in which they have a material financial interest distinguishable from the interests of the general public. (Gov. Code, Sec. 87100.) An official has a disqualifying financial interest in a government decision “if it is reasonably foreseeable that the decision will have a material financial effect, distinguishable from its effect on the public generally,” on the official’s financial interests. (Gov. Code § 87103; Cal. Code Regs, tit. 2, Secs. 18700(a), 18703.)

An effect is considered “reasonably foreseeable” if there is substantial likelihood that such effect will occur; if an effect is only a mere possibility, it is not reasonably foreseeable. (Smith v. Super. Ct. (1994) 31 Cal.App.4th 205, 212.)

Summary of Elements

“Taken together, a public official has a conflict of interest under section 87100 if:

1. the official has a financial interest of the type delineated in section 87103,
2. ‘the effect of the governmental decision on the official's financial interest [is] reasonably foreseeable...,’
3. ‘the foreseeable effect of the governmental decision on the [financial] interest [is] material ...,’ and
4. that effect is ‘distinguishable from [its effect on] the public generally.’”

(Santa Clarita Organization for Planning & the Environment v. Abercrombie (2015) 240 Cal.App.4th 300, 314 citing Consumers Union of U.S., Inc. v. California Milk Producers Advisory Bd. (1978) 82 Cal.App.3d 433, 436.)

If a qualifying conflict exists, the public official is to disclose the conflict and recuse himself or herself (§ 87105); if that does not happen, a court "may" — but is not required to — "set the official action aside as void" (§ 91003(b); see All Towing Services LLC v. City of Orange (2013) 220 Cal.App.4th 946, 957-958.)

Section 91005 is the liability provision encompassed in the Political Reform Act of 1974, as codified in sections 81000 through 91014. Section 87100 prohibits public officials from acting to influence a government decision in which they have a financial interest.

Section 91003 is one of the enforcement provisions of the Political Reform Act, and states, in relevant part: "Any person residing in the jurisdiction may sue for injunctive relief to enjoin violations or to compel compliance with the provisions of this title...." (Sec. 91003(a).)

Reporting Violations

The act permits private citizens to bring actions after first filing with the civil prosecutor a written request for the civil prosecutor to commence the action. The civil prosecutor has 40 days to respond. (McCauley v. Howard Jarvis Taxpayers Assn. (1998) 68 Cal.App.4th 1255, 1260.)

Attorneys Fees Provision

"[...] Weinreb correctly states that the primary purpose of the prevailing party attorneys' fee provisions of the Political Reform Act is to encourage private litigation enforcing the act.” (People v. Roger Hedgecock for Mayor Com (1986) 183 Cal.App.3d 810, 816.) “The Supreme Court explained in Christiansburg that a rule which routinely awarded attorneys' fees to prevailing defendants ‘... could discourage all but the most airtight claims, for seldom can a prospective plaintiff be sure of ultimate success.’” (Id.) “No matter how honest one's belief that he has been... [wronged], no matter how meritorious one's claim may appear at the outset, the course of litigation is rarely predictable.” (Id.) “Decisive facts may not emerge until discovery or trial.” (Id.) “The law may change or clarify in the midst of litigation.” (Id.) “Even when the law or the facts appear questionable or unfavorable at the outset, a party may have an entirely reasonable ground for bringing suit.” (Id. citing Christiansburg Garment Co. v. EEOC (1978) 434 U.S. 412 at 422.)