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California Form 460 Fppc 2016-2019

welcome to the Fair Political Practices Commission webinar for local candidates and treasurers throughout this webinar we will refer to the Fair Political Practices Commission as the FPPC if you find that you have questions following the presentation please send them to advise at fppc see a govt or call eight six six two seven five three seven seven two the information provided in this webinar is taken from the political Reform Act regulations advice letters and fact sheets advice can be fact-specific subcommittee treasurer's should not rely on this webinar alone for assistance it is important to familiarize yourself with that PPC campaign manual two forms fact sheets and filing schedules for more detailed information this webinar is designed for local candidates who will raise or spend $2,000 or more on their election and we'll cover information you need to get started with your campaign detailed reports of money being raised and spent in elections are required by law to provide transparency to voters before they cast their ballot our goal is to provide you with the tools and information to ensure that your campaign committee is compliant with campaign finance reporting requirements every committee must have a treasurer in some circumstances a candidate may also serve as treasurer a committee may not accept contributions or make expenditures before a treasurer is appointed or while the treasurer's post is vacant even if there's an assistant treasurer a treasurer must sign and verify all reports and campaign statements that are filed keep in mind that an unsigned document is not considered filed treasurer's must also establish a record-keeping system as records should be kept for four years a candidate ensures the treasurer is exercising all reasonable diligence in the performance of his or her duties candidates must stay aware and informed about their treasurer's activities to ensure that campaign funds are properly used and should always review campaign and bank statements all of the FPPC campaign forms can be found on our website this slide lists the most common forms that candidates and treasurers will most likely complete a statement of economic interests commonly known as fppc form 700 must also be completed by all candidates when filing a declaration of candidacy with an elections official this form identifies financial interests of the candidates so that voters are aware of potential conflicts if the candidate is elected there may be additional documents that your filing officer may require in order to be included on the ballot this webinar just covers the FPPC forms the candidate intention statement commonly known as FPPC form 501 is filed with your local elections office and can be filed at any time this form must be filed before you raise or spend money including personal funds in connection with a new election even if you're seeking re-election to the same office note that the filing fee or the ballot statement fee are not included in the spending of personal funds the statement of organization commonly known as FPPC form 410 is filed with the Secretary of State's office and allows you to obtain the FPPC committee ID number the form is filed when you raise or spend two thousand dollars or more even when making a loan to your own campaign the date you reached the two thousand dollar threshold is the date you qualify as a committee the form must be filled out completely as it will be rejected by the Secretary of State if information is missing the most common reasons for the form being rejected are incorrect committee names missing addresses and the exclusion of bank account information please note that in the event that a candidate also serves as the committee treasurer the form must be signed twice all committees must pay a $50 annual filing fee to the Secretary of State by January 15th each year the fee increases to $200 if not paid by the deadline for new committees the fee is due within 15 days of submitting the form bank account information must be included when filing the form for tennis qualified committee otherwise it will be rejected candidates running for office should complete the controlled committee section not the primarily formed committee section if any information changes on your form 4:10 you will need to amend it to reflect the change after you file the form 4:10 the Secretary of State's office will assign your committee and FPPC ID number this is the number you will use on your campaign finance reports this slide shows you how to access your committee ID number which is usually assigned within a week of filing your form 4:10 first go to the Secretary of State's website either by clicking the link shown here or by entering WWF OSCE a govt into your address bar from here you can find your committee ID number by entering the candidates last name or the full name of the committee into the Cal access search bar a contribution can be a monetary or non-monetary payment including a loan the forgiveness of a loan or a third party payment on a loan non-monetary examples are auction items food at a fundraiser and a donor who in coordination with the candidate pays for any type of campaign communication at fair market value when a contribution is received is determined in part by what type of contribution it is a monetary contribution is received on the date the candidate committee or an agent of the committee obtains possession or control of the cash check or other item that constitutes the contribution a non-monetary contribution is received either when the funds were expended by the donor for the goods or services the date the candidate committee or agent of the committee obtained possession or control of the goods or services or the date the candidate or committee received the benefit of the expenditure whichever date is earliest contributions may be received in a variety of ways as long as a record is kept report the entire payment amount as a contribution do not deduct any fees electronic contributions are considered received when an agent of the campaign receives or has control of the debit or credit account information all contributions and expenditures of $100 or more must be drawn on the account of the donor you may not accept money orders or cashier's checks of $100 or more you must know the true source of all contributions of $100 or more for reporting purposes the next slide will go into greater detail about identifying the true source of a contribution if you get an anonymous contribution of $100 or more it must be promptly turned over to the Secretary of State for deposit into the state general fund keep in mind that you cannot make change if you receive a donation of $100 or more in cash you are receiving that entire contribution even if you give change back the most serious problem that can occur in your campaign reporting is to receive funds via sources who are not the true source of the contribution sometimes people do not want to disclose their name and address on public documents or they may be trying to get around contribution limits this is more likely to be a problem if you are in a city or county with contribution limits if you receive contributions from several employees employed by the same company you should question if they are being reimbursed campaign money laundering is serious violation of the law as recently as June 2014 the FPPC levied a large fine for campaign money laundering and required a committee to return the contribution to the general fund of the state of California if you have questions about receiving certain contributions please contact the FPPC immediately if you have a home or office fundraiser and the total cost of the campaign event is $500 or less and paid for by the occupant then the occupant has not made a contribution food beverages and other items donated by someone other than the occupant count towards the $500 threshold and are reportable as non monetary contributions if the fundraiser is for two or more candidates it is still subject to the $500 limit a host should hold no more than one home or office fundraiser per day otherwise the full amount is a reportable contribution an announcement in an organization's newsletter versus a newspaper advertisement viewed by the general public is a determining factor as to whether the communication is a member communication for example if a public safety union sends a mass mailing to all its members supporting your candidacy this is not a contribution and is not reportable if a health care trade association places an ad in the newspaper to support your candidacy in cooperation consultation and coordination with you then this would be considered a contribution and is reportable another exception to a contribution is when an organization invites candidates to attend a debate or meeting the cost of the meeting is not a reportable contribution so long as each candidate in the race is invited each candidate does not have to attend but must have the opportunity to do so some of the most common contribution exceptions include voluntary person services including people who are strictly volunteering to help a campaign with envelope stuffing precinct walking or even CPAs who volunteer is unpaid campaign treasurer's this exception does not apply if an individual is paid by a third party for example if an employer helps your campaign and allows an employee to work over 10% of his or her time on your campaign the employer is making a reportable contribution due to the implementation of contribution limits in some local jurisdictions there has been increased spending by outside groups to run independent campaigns to elect a favored candidate these groups are required to file campaign reports for the independent expenditures they are making an independent expenditure is when someone other than the candidate or his or her committee makes a payment for a communication supporting or opposing a candidate that was not made at the behest of the candidate independent expenditures must contain Express advocacy in support or opposition of a clearly defined candidate or ballot measure Express advocacy is based on the context of the full communication ii's are not reported by the candidate or committee but the entity behind the OEE may have reporting obligations a candidate who is raising money for an elective office must have a separate bank account personal funds and campaign funds should never be combined an account may be opened as a personal account however all deposits and expenditures must be designated for the sole purpose of the campaign filing and ballot statement fees can be paid for by using personal funds however there is no reporting of these fees unless the committee reimburses you for the expense the recipient committee campaign statement commonly known as FPPC form 460 is used to report campaign contributions and expenditures the form 460 is used by all committees regardless of the amount raised or spent the form 460 must be filed until the campaign committee bank account is closed and all required reports have been filed form 460 has several schedules and pages that track your campaign committees contributions and expenditures keep in mind that you only need to file the schedules that coincide with your committees financial activity for example if your campaign doesn't have sub vendors or unpaid expenses you won't fill out those schedules if you have more than one open committee you must file campaign statements for all committees each time a statement is due for example if you are a city office holder with a city committee and you have a candidate committee for the Board of Supervisors you will file an original form 460 for the city committee with the city filing officer and a copy of that form 460 with the county filing officer at the same time you will file an original form 460 for the Board of Supervisors committee with the county filing officer and a copy of that form 460 with the city filing officer this slide shows an example of a recent filing scheduled always check the FPPC website for the most up-to-date filing schedules for your respective election keep in mind that the 24-hour reporting period for contributions of $1000 or more received from a single source begins 90 days before the election you'll also note that the second pre-election report may not be sent by regular mail it must be hand-delivered or sent by guaranteed overnight mail remember that local jurisdictions may have additional reporting requirements or electronic filing so be sure to check with your local filing officer this slide shows an example of the form 460 cover page the reporting period dates must reflect the dates on your filing schedule do not make up your own dates only report activity for the designated reporting period remember that all paper copies of campaign ports must have a wet signature if your local jurisdiction has electronic filing you don't need to submit a paper copy if the treasurer is unavailable to sign the candidate may sign and submit the form for 60 but must include a letter explaining that the treasurer is unavailable the committee must then submit an amendment to the 460 when the treasurer is available to sign the statement this is a good reason to designate an assistant treasurer on your form 410 the form is considered filed as long as the candidate has signed it the instruction pages for the form 460 will take you step-by-step through the process of filling out the form Schedule A shows all the money coming in to your campaign if an agent of the campaign receives a check before you that's the date received for reporting not the date on the check and not the date the check is deposited itemize persons and organizations that have contributed a cumulative amount of $100 or more during the calendar year list the name street address and occupation and employer if the contribution is from an individual and committee ID number if the contribution is coming from another committee for example if you received 99 dollars in one period and 99 dollars in another period in the same calendar year you must itemize the contributor information and list the total contribution from the donor as $198 it's very important to always obtain occupation and employer information for contributions of $100 or more from a single source if you don't get this information within 60 days you must return the contribution remember that your filing officer reviews your filings and will request an amendment if you do not provide sufficient occupation employer information this slide highlights the most common insufficient reporting so you can avoid having to file an amendment when reporting contributions never leave the occupation employer box blank for individual contributors the 60-day time frame for requesting occupation and employer information from the donor begins on the date the contribution is received if you have requested the occupation and employer information and are awaiting a response from the donor it's acceptable to list pending in the Box all contributions under $100 are still reported online to as lump sum amount reporting a contribution with the business address is acceptable however Pio boxes are not when completing the cumulative to date column you must include all contributions including non monetary contributions reported on Schedule C and loans received reported on Schedule B it is acceptable to round off to the nearest dollar if you receive a contribution from a joint checking account the contribution is attributed to the check signer unless both individuals sign if that is the case split the contribution unless there is an accompanying document signed by both parties stating otherwise contributions from an individual and a business entity in which the individual is either the sole or majority owner or directs and controls the contributions are aggregated for reporting purposes be aware that there is an additional column entitled per election to date we have included it here but it is not generally used by local candidates however you may have to complete it if local ordinances require it an intermediary is someone who made a contribution on behalf of another and is being reimbursed on the local level sometimes businesses don't understand that they cannot reimburse their employees for contributions and not be reported as the true source in this example Jennifers should tell you she's an intermediary or else she and her company have broken the law but as a candidate or treasurer you also have a legal obligation to make inquiries if there is reasonable information that a person may not be the true source of the contribution the reporting example used in this slide is the proper way to disclose reimbursements question patterns of activity especially if you are receiving contributions from multiple employees from the same company please note that if someone hands you a check signed by someone else the person handing you the check is not an intermediary as long as the check has the true source of the donation you are not required to report the person who handed you the check for example if a check you received from a local business was handed to you by an employee but the check was drawn from the business's account and duly noted the employees name would not be disclosed on the report you must deposit funds into your campaign bank account before spending on your campaign a candidates personal funds may be reported as a loan to the campaign you can report your own money as either a loan on Schedule B or a contribution on Schedule A each time you receive a loan from the same source it's considered a separate transaction you must continue to report all outstanding loans on subsequent reporting periods do not report loan repayments on Schedule E if you report the amount you paid on Schedule E the report won't balance if a loan is forgiven it becomes a contribution and is also reported on Schedule A most common reporting errors occur on the loan schedule follow the instructions on Schedule B and the summary page carefully your total for net changed this period on line 3 may be a negative figure as shown in this example when you are paying back loans don't leave blanks use zero or a dash cumulate loans and contributions from the same source on schedules a and see on this slide note you will carry over a negative number to the summary page because more money was paid back on the loan than was received Schedule C is used to report non-monetary contributions which are donated goods or services used for your campaign these may also be called in-kind contributions if a printer donates free walk pieces to your campaign this is a non-monetary contribution to your campaign non-monetary contributions must be reported at fair market value do not use the wholesale value report what the item would be sold for to the general public discounts not available to the public are considered contributions communications to voters supporting your candidacy such as a mailing or a news page for ad paid for by a third party would be a non-monetary contribution assuming the donor coordinated the mailing with you Schedule E is used to report the money spent by the committee during the reporting period an expenditure is made on the date the payment is made or the date the committee receives the goods or services whichever is earlier all campaign funds are held in trust for expenditures for your campaign and they must serve a political legislative or governmental purpose there can be absolutely no personal use of campaign funds such as the purchase of cosmetics personal living accommodations jewelry etc committees can use campaign funds for an election night celebration or similar event professional services payments for gas for campaign events and payments to slate mailer organizations because they are related to political purposes committees are not allowed to use campaign funds for a vacation health club dues and personal living accommodations here are a few things to keep in mind when reporting campaign expenditures instead of opening up additional credit card accounts you can use an existing personal credit card by zeroing out the account you must include the date the card was designated for the account the card information etc in your records and use it solely for the campaign campaign expenditures must be paid for using campaign funds only no personal expenses by the candidate or committee may be charged on the card always keep good records of the account and transactions associated with the account as the FPPC has the authority to levy fines to committees who don't keep records after the card is paid off and is no longer designated for the campaign it may be redesignated for personal use remember to keep copies of credit card statements for proof a petty cash fund may also be established for the campaign however it cannot exceed $100 keep receipts for your records and restock cash as necessary report only when money from petty cash is actually spent spending the entire $100 in one is considered a prohibited cash expenditure use a credit card or write a check instead candidates are required by law to deposit funds into their campaign bank account before making expenditures using personal funds for campaign expenditures is prohibited often candidates are not aware that their personal funds cannot be directly spent on campaign items when the candidate initially sets up their campaign committee if this has happened in your campaign the treasurer must ensure that the payments are reported as described in this slide although each case is reviewed on its own facts and circumstances the FPPC does not generally assess fines for clear inadvertent errors made by first-time treasurer's and candidates as long as they take steps to educate themselves on proper reporting early in the campaign candidates are allowed to be reimbursed if they pay for filing or ballot statement fees using personal funds this is the one exception to the law all other personal funds must be deposited into the campaign account prior to being spent the example on this slide demonstrates how to report a credit card payment note that expenditures of $100 or more must be itemized without reporting payees for credit card charges the public does not know where the money was actually spent if you make campaign related payments for meals gifts and travel note that there is additional reporting required be sure you read the instructions on the form for 60 campaign workers make out-of-pocket expenditures for your campaign they must be reimbursed within 45 days or you must report their expenditures as a non-monetary contribution there are two ways to report sub vendors the first method is using Schedule E whenever an agent or an independent contractor such as a campaign employee consulting firm or advertising agency makes an expenditure or incurs a debt of $500 or more on behalf of the committee the expenditure must be reported in the same detail as if it had been made directly by the committee sub vendor payments of $100 or more on the campaign credit card must be itemized the second method for reporting sub vendor payments is by using scheduled G this is an optional schedule you may use this form or report sub vendors on Schedule E always keep receipts for your records the total amount on this schedule is not transferred to the summary page accrued expenses for goods or services received but not yet paid for are reported on Schedule F also report payments made by the committee for previous accrued expenses on Schedule E or your statement won't balance if the debt is forgiven are paid by a third party it will be reported on Schedule F and a non-monetary contribution will be reported on Schedule C like loans on Schedule B this schedule may show a negative number if you pay more than you incur you must continue to report accrued expenses on Schedule F until the expense is fully paid but you only need to itemize the vendors once not all money coming into your bank account is a contribution but it must still be reported increases to the committee's cash position that are not monetary contributions loans or repayments of loans made to others are reported on schedule I the reporting is similar to schedule a disclosure an example is when people purchase donated items at a garage sale or auction fundraiser any purchase up to the fair market value is reported on schedule I because the purchaser is receiving the benefit of the item anything over fair market value is reported as a contribution on Schedule A other examples are refunds or Bank interest for example a painting is donated and the artist lists the fair market value at $500 $500 would be shown on Schedule C as a non-monetary contribution from the artist who donated the painting the painting is sold at an auction for $700 you would report $500 on schedule I the fair market value and $200 on Schedule A the amount above the fair market value this slide shows an example of the summary page and we see just you fill it out last as it contains totals from all of the schedules some schedules may not have been used during the reporting period mark with a zero or a - and don't include the blank schedules when filing your campaign statement add column a to your previous statements column B if this is the first statement for the year columns and B may be the same column B lines 2 7 & 9 must be carried forward from the last report even if when it is from a different year because outstanding loans and accrued expenses are carried forward until paid off sections 20 through 22 are only used by state candidates if a mistake has been made on the form 460 an amended form may be filed any amendments to the form should be filed before the election and as soon as the information that has changed is known to the treasurer both the candidate and treasurer sign and date the form remember that candidates must sign twice if acting as their own treasurer the 24 hour late contribution report commonly known as form 497 begins 90 days before an election this report is triggered when committees receive $1,000 or more in aggregate from a single source a candidates personal funds and loans must be included on the report contributions are reported in the aggregate for example if you receive $500 on August 10th and then another $500 on September 10th you must file the form as the aggregate is now $1,000 from a single source during the 24 hour contribution reporting period if you receive $1,000 from a single source and filed a report your next report is due the next time you reach the $1,000 threshold if you receive a contribution on a weekend or a state holiday the filing deadline is extended to the next business day except for the weekend immediately before the election the weekend before the election these contributions must be reported within 24 hours even if the deadline falls on a Saturday or a Sunday all of these deadlines are on the filing schedule you can fax or email the report as no original signature is required state candidates and judges only file online with the Secretary of State some local jurisdictions may have electronic filing provisions as well also include these contributions on your next form for 60 or your form won't balance depending on what elected office you are seeking you may receive large contributions the political Reform Act does not limit the amount a local candidate may receive from a source however local jurisdictions may have their own contribution limits if you receive a contribution of $5,000 or more from a single source the law requires you to notify the $5,000 donor that they may need to file an fppc report during the 90 day period before the election the notice must be sent within one week if the contribution is $10,000 or more this notice is sent when the candidate or committee receives five thousand dollars or more in the aggregate from a single source for example if your neighbor gave you a 2000 our contribution in January and another $3,000 contribution in February the committee must provide the major donor notice per the timeframe set forth in regulation one eight four to 7.1 a copy of the notice must also be kept in the committee records the notice is not required to be sent to other committees like a political party or PAC although money you receive is required to be reported to the public on the form 497 the money you spend is reported on the form 460 and does not have a 24-hour reporting deadline if you have questions on Form 496 check with the FPPC before you file independent expenditure reporting is generally done by PACs or other groups paying for communications they do not coordinate with your campaign committees have to put disclaimers on ads stating who paid for the ad this is a screenshot of one of the ad disclaimer charts available on the FPPC website there are separate charts for candidates ballot measure committees and PACs for example a ballot measure ad must include major funders of $50,000 or more a candidate committees ad does not if you are sending out a mass mailing you must include the phrase paid for by next to the sender's name on the communication piece all campaign committees mailing over 200 pieces of communications including blasts email campaigns must include the identification of the sender and the phrase paid for by this identification must be presented in the same size and color as the committee name and no less than six point type and in a color or print that contrasts with the background and is easily legible the phrase paid for by must be immediately adjacent to and above or immediately adjacent to and in front of the committee name and address all committees are subject to this rule the law does not require local candidates or committees to terminate a candidates future filing obligations are usually determined by the outcome of the election successful candidates may continue to keep their committees open to receive contributions use campaign funds to offset officeholder expenses or hold funds for future elections for defeated candidates there's no deadline for terminating the committee or disposing of remaining funds however if your funds become surplus they may not be used for a future election always check the campaign manual or contact the FPPC if you are a defeated candidate with leftover funds as specific timeframes apply to avoid your funds becoming surplus the form 462 be filed on a semi-annual basis as long as the committee stays open this slide highlights key points from this webinar filing reports in a timely manner and disclosing the required information will allow for greater transparency in your campaign finance reporting the FPPC x' enforcement division has taken a proactive approach to working with candidates and committees before the election to ensure compliance with campaign finance and disclosure laws if you are unsure about what to file or when to file it please contact the FPPC and always use us as a resource our our website is a resource for your Campaign Committee check regularly for updated information on filing deadlines campaign finance reports and changes to regulations this concludes the end of our presentation any questions about the content covered in this webinar can be sent to advise at fppc CA govt thank you for listening today as always we value your feedback so please send any comments to us at comments at FPPC CA govt