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CITY COUNCIL AGENDA REPORT
City of Anaheim
OFFICE OF THE CITY MANAGER
DATE: OCTOBER 24, 2023
FROM: OFFICES OF THE CITY MANAGER, CITY ATTORNEY AND
CITY CLERK
SUBJECT: ORDINANCE AMENDING SECTIONS 1.11.010 (DEFINITIONS) AND 1.11.070 (LOBBYIST REGISTRATION) OF CHAPTER 1.11
(SUNSHINE PROVISIONS) OF THE ANAHEIM MUNICIPAL
CODE TO STRENGTHEN AND EXPAND THE REGULATIONS
OF THE LOBBYISTS PROGRAM; AND ESTABLISH AN
AUDITING PROCESS
ATTACHMENTS (Y/N): YES ITEM # 19
GOVERNMENT CODE § 84308 APPLIES: NO
REQUESTED ACTION:
That the City Council:
1. Introduce an ordinance amending Chapter 1.11 of the Anaheim Municipal Code to i) to include in the definition of a Lobbyist an individual employed or contracted for a role that includes influencing legislative or administrative action as a substantial or regular portion of the employment or contract, such as someone whose responsibilities include those typically associated with “government affairs” or “government relations” or similar; ii) provide a more specific definition of “lobbying,” and iii) establish a pro-active auditing process for the Lobbyist Registration Program.
2. By Motion, determine that the ordinance relates to organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment, and therefore is not a project within the meaning of the California Environmental Quality Act ("CEQA") and the State CEQA Guidelines, Section 15378(b).
DISCUSSION:
At the August 29, 2023 Council meeting, City Council approved a priority list of reforms stemming from the recommendations in the JL Group investigative report, and a calendar of when these items were to be brought forward for City Council discussion and action.
The City’s Lobbying Policy was calendared for September 12, 2023.
Lobbying Ordinance
October 24, 2023
At the September 12, 2023 Council meeting, City Council provided direction to staff to expand the definition of a lobbyist, strengthen the regulations of the Lobbyist Registration Program and establish an auditing process.
THE CURRENT LOBBYING PROVISIONS
A. Adoption of the Sunshine Ordinance (2017)
In 2017, at the request of then-Council Member Jose Moreno, the City Council added Chapter 1.11 (Sunshine Ordinance) to the Anaheim Municipal Code (“AMC”). Among other things, that ordinance established a lobbyist registration requirement and process.
All persons involved in lobbying activities in the City of Anaheim are required to register with the City Clerk within fifteen (15) days of engaging in those activities, and to file a report with the City Clerk on a quarterly basis detailing their lobbying activities (including who at the City they had contact with and the legislative or administrative action the contact pertained to). The City Clerk is authorized to impose a fine (in an amount set by City Council resolution, which is currently $50) on lobbyists who fail to comply with these provisions. In addition, the Ordinance tasks the City Clerk with preparing an annual report to the City Council outlining the activities of registered lobbyists, as well as a list of any fines assessed or notices issued to those lobbyists.
B. Amendment of the Lobbying Provisions to Add Criminal Penalties (2022) In 2022, at the request of then-Council Member Avelino Valencia, Chapter 1.11 was amended in several respects. As relevant to the lobbying provisions, AMC 1.11.070 was amended to make certain violations of the lobbying regulations a misdemeanor.
Specifically, if a person knowingly or intentionally (1) acts as a lobbyist in the City without having registered as required by the Code, (2) fails to file a report of lobbying activity as required by the Code, (3) files a false or inaccurate report or a report that omits material information required to be disclosed, or (4) conceals or diverts compensation for lobbying activity in order to avoid the requirements of the Code, they may be charged with a misdemeanor and subject to a maximum of six (6) months in jail and a fine of $1,000.
In addition, if convicted, the person will be banned from acting as a lobbyist or otherwise attempting to influence municipal legislation for compensation for one year after that conviction, and three years if convicted of a second violation. These modifications to the lobbying provisions drew a distinction between inadvertent violations of the Code (such as filing a report late), which remain subject to an administrative fine, and intentionally committing more serious violations, which may be charged as a crime.
PROPOSED LOBBYING PROVISIONS
After discussion by the Council at the September 12 meeting, staff worked to draft various suggested revisions to the City’s current provisions of the Sunshine Ordinance dealing with lobbyist regulations. It is the intent of these proposed revisions to address four main concerns raised during the discussion: (1) ensuring that the definition of “lobbyist” includes in-house lobbyists, (2) providing more specifics on what “lobbying” includes and should not include, (3) establishing a more proactive auditing effort to ensure lobbyists Lobbying Ordinance
October 24, 2023
are complying with their obligations, and (4) addressing fees and other administrative matters associated with the current ordinance.
The proposed revisions are included as a red-lined attachment to this staff report, and are obviously subject to further discussion and alteration by the Council. A summary of the proposed revisions follows.
A. Definition of Lobbyist
Under the proposed revisions, the definition of “Lobbyist” would be expanded to include any individual who is employed or contracted for a role that includes influencing legislative or administrative action as a substantial or regular portion of the employment or contract, such as someone whose responsibilities include those typically associated with “government affairs” or “government relations” or similar. The intent of this revision would be the expand the scope of the City’s lobbyist registration provisions to include both outside paid lobbyists (currently covered) and also those lobbyists who are employed by or work directly for a company or entity on whose behalf they are advocating.
B. Lobbying Activity
The definition of lobbying activity would be revised to provide a more objective, and hopefully clearer, standard on what constitutes regulated lobbying. For example, the definition of “influencing” would mean “communicating directly with any elected or appointed official of the City, the staff, aides, or advisers of the Mayor or City Council, any member of the City Executive Team, the Legislative Body, or any board or commission of the City, or taking any other action for the principal purpose of supporting, promoting, influencing, modifying, opposing, delaying, or advancing any legislative or administrative action.” There would also be a more robust definition of “legislative or administrative action.”
Regarding the exceptions to the lobbyist provisions, the proposed revisions would clarify the exception relating to licensed professionals (architects, engineers, attorneys, etc.) who are acting in that professional role, without intending to make any substantive revisions to that current exception. The proposed revisions also would add an exception to ensure that those who submit responses to bids are not considered to be lobbying merely by submitting those bids, but could be considered to be lobbying if they directly communicate with members of the City Council for the purpose of influencing a decision to award or deny a contract. Consistent with the current ordinance, no exception for labor organizations (such as seen in some other cities’ ordinances) is being proposed.
C. New Auditing Proposal
In order to address the Council’s concern about the need for more active enforcement, staff is proposing to add language that would mandate annual audits by the City Auditor of at least 20% of the lobbyists registered in the City. This proposed provision is derived from the City of Austin which also mandates its City Auditor to conduct such audits, but of only 5% of the registrants per year.
Lobbying Ordinance
October 24, 2023
As part of the new registration process, lobbyists would be required to acknowledge their commitment to retain and provide business records for the City Auditor’s review, and to cooperate with the City with regard to any audit performed. Lobbyists would then be required to retain on file all business records relevant to any lobbying reported in the Quarterly Report for a period of not less than five years from the date the Quarterly Report is filed, and to submit copies, or make original documents available, to the City Auditor upon request.
Staff is also proposing an additional provision – that would be unique to the City of Anaheim as far as staff is aware – as an attempt to capture situations where lobbying activity is occurring, but lobbyist registration is not. Under the proposed audit provision, the City Auditor would be mandated to periodically seek from any elective or appointed official of the City, the staff, aides, or advisers of the Mayor or City Council, any member of the City Executive Team, or Legislative Body, board or commission of the City, no less frequently than semi-annually, information about past meetings or communications with anyone who reasonably may be considered to have lobbied such individuals based on the definitions in the Ordinance. Were the Auditor to discover, based on that inquiry, individuals who appear to have engaged in lobbying activity but who have not registered as lobbyists or properly reported lobbying activity, the Auditor would notify and forward evidence to the City Clerk and the City Attorney, who would then determine any next steps.
D. Fees and Other Administrative Matters
1. Quarterly Report
Currently, the Quarterly Report requires lobbyists to report campaign contributions made during the reporting period. The proposed ordinance amends the code to formalize this requirement in the code.
2. Annual Registration
The proposed ordinance provides for the Annual Registration of each lobbyist by January 15 of each year unless the Lobbyist has filed a termination report with the City Clerk by such date.
3. Fees
Fees are established by resolution following a public hearing; updates to fees will be brought forward for consideration at a later date, which include for Council consideration registration fee, annual registration fee and penalties.
Lobbying Ordinance
October 24, 2023
IMPACT ON BUDGET:
There is no impact on the budget.
Respectfully submitted, Respectfully submitted,
Jim Vanderpool Robert Fabela
City Manager City Attorney
Respectfully submitted,
Theresa Bass
City Clerk
Attachments:
1. Ordinance
2. AMC (Redlined)