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The City of Sacramento has adopted local campaign finance regulations, which apply to all candidate committees in some form or another. These regulations provide for public campaign financing (also referred to as matching funds), restrict spending and place limits on contributions.

Due to budget constraints, the Campaign Reform Fund was not funded for 2012. Therefore, public financing is not available. However, provisions presented below regarding contribution limits remain in effect.

The following outlines what a candidate needs to know in order to comply with the City’s regulations. Several of the regulations apply to all candidates whether or not the candidate accepts public funding. Campaign finance regulations are very complicated. This information is strictly an outline to help candidates gain a general understanding of the provisions. For the full regulation, candidates should refer to City Code Chapters 2.13 (Campaign Contribution Limits) and 2.14 (Campaign Spending Limits & Public Campaign Financing).

Candidates are highly encouraged to thoroughly read the City Code Sections to ensure compliance with all provisions. To see quick reference worksheets on campaign financing issues, click on the "Snap Shot" notations below.

WHAT A CANDIDATE NEEDS TO KNOW

How does a candidate become eligible for matching funds?

To become eligible the candidate must meet all of the following requirements:

• Files a “Statement of Acceptance of Public Financing” form with the nomination documents.
• Files the “Code of Fair Campaign Practices” form with the nomination documents.
• Has not rescinded the “Statement of Acceptance”.
• Has raised and deposited in the candidate’s official campaign bank account at least $7,500 (Council Member) or $10,000 (Mayor) in eligible contributions.
• Is opposed by a candidate who has qualified for matching funds. Or, is opposed by a candidate who has raised or deposited $7,500 (Council Member) or $10,000 (Mayor) in eligible contributions in his/her official campaign bank account.
• Agrees to participate in at least one public forum in which all qualified candidates are invited to participate.
• Voluntarily agrees to limit campaign spending to $88,000 (Council Member) or $585,000 (Mayor).

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Which contributions count toward the $7,500 or $10,000 eligibility threshold?

Eligible contributions are:

• Contributions raised and deposited in the candidate’s official campaign account after July 1st of the year preceding the election.
• Contributions totaling $250 or less per source. For contributions over $250, only the first $250 of any contribution shall be counted. The remainder shall not.
• Contributions from the candidate’s personal funds, the candidates spouse or dependent children, loans, pledges, extensions of credit, and non-monetary contributions are excluded.

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Which contributions are eligible for matching funds?

Once a candidate has met the above requirements, contributions eligible for matching funds are:

• Only those contributions received and deposited into the candidate’s official campaign account January 1 through June 30 of the election year.
• Contributions totaling $250 or less per source. For contributions over $250, only the first $250 of any contribution shall be counted. The remainder shall not.
• Contributions from the candidate’s personal funds, the candidates spouse or dependent children, loans, pledges, extensions of credit, and non-monetary contributions are excluded.

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Is there a limit to the amount of matching funds that a candidate may receive?

Yes, there is a limit. The maximum amount available to a candidate is $35,200 (Council Member) or $117,000 (Mayor) in qualifying contributions per election period. Qualifying contributions are matched at a ratio of $1.00 for each dollar received.

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Which provisions of campaign financing apply to ALL candidates? All candidates must:

• File a “Statement of Acceptance of Public Financing” or a “Statement of Rejection of Public Financing” with their nomination documents.
• File a "threshold" notice with the City Clerk when eligible contributions are received in the amount of $7,500 (Council Member) or $10,000 (Mayor).
• File a "threshold" notice with the City Clerk (and opposing candidates) when contributions, cash on hand, or qualified campaign expenditures exceed 75% of the spending limits or $66,000 (Council Member) or $438,750 (Mayor).
• File a supplemental pre-election campaign statement Form 460.
• File a supplemental post-election campaign statement Form 460.

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What method of delivery is required for the notices?

Notices shall be made by mailgram, telegram, guaranteed overnight mail, or personal delivery within 24 hours of reaching the contribution, cash on hand, or expenditure thresholds. Forms are available from the Office of the City Clerk.

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Why are these notices required?

These notices are required for two important reasons:

• Provides confirmation that an opposing candidate has met the eligibility requirements of raising $7,500 (Council Member) $10,000 (Mayor) in qualifying contributions.
• Establishes the criteria for which spending limit may be lifted.

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Are there any special instructions relating to tracking contributions?

Yes, there are special instructions.

In any campaign, an accurate and organized record must be kept of all contributions and expenditures. All individuals who handle campaign receipts and expenditures must follow the record keeping procedures required by the Political Reform Act and the Fair Political Practices Commission (FPPC).

In addition, City Code requires candidates requesting matching funds to provide a greater level of contributor detail for amounts received under $100. The City will not match funds for contributions where the candidate did not keep accurate and detailed records. To maximize the number of contributions eligible for matching funds, candidates are encouraged to keep detailed records of all contributions.

Also provided in City Code is the requirement that candidates aggregate (add together) contributions from related entities. The tracking of related entities is important as it may affect whether or not a contribution is considered eligible for matching funds. For a definition of “related entities” and a description on the requirement to aggregate these types of contributions, refer to the City Code 2.13.060.

For more information on the record keeping procedures required by the Political Reform Act, refer to FPPC’s publication “Campaign Disclosure Manual 2 – Information for Local Candidates". Candidates should also read the City Code 2.14.280 provisions pertaining to Duties of Treasurers and Candidates.

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How do I request matching funds? Requesting Matching Funds

After qualifying, a candidate must complete and submit the following:

• A signed Public Financing Matching Funds Request Form (provided by the City Clerk) containing qualifying contributions current through two (2) calendar days before filing.
• An electronic copy of the completed form via computer disk or other electronic media.
• Copies of contribution checks, money orders, or other written legal tender for each qualifying contribution requested.

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How often may a matching funds request form be submitted?

After the initial request, a candidate or candidate’s controlled committee may submit another request for matching funds each time a threshold of $7,500 (Council Member) or $10,000 (Mayor) in qualifying contributions is reached.

A candidate may also submit a request for matching funds of $1,000 or more during the ten (10) calendar days preceding the election.

After the date of the election, the candidate may submit one (1) final request for payment. Such request shall be submitted within two (2) days after the last day of the election period.

For all requests, the information contained in the request form shall cover qualifying contributions current through two (2) calendar days before filing the form.

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How long does it take to receive the funds?

The City’s Finance Department has ten (10) working days to approve or reject a request for payment of matching funds. When approved, the City will disburse the funds to the candidate or the candidate’s controlled committee. Submission of clear and organized support documentation will assist with the timely processing of the request.

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What are the eligibility requirements for requesting matching funds if a candidate is involved in a general (run-off) election?

The requirements are the same, except that only those contributions received and deposited into the candidate’s official campaign account from July 1 through December 31 of the election year are eligible.

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Are there other provisions relating to contributions?

Yes, City Code limits the amount a candidate may accept, from a single source during an election period. This limit also applies to committees that give funds to candidates and to committees that make independent expenditures for or against candidates. The limits are:

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What is an election period as it applies to contributions?

The City’s contribution limits restrict the amount that a candidate may accept from a contributor in a given election period. For a regular election for city elective office, there are two election periods (primary and general). If no candidate obtains a majority of the votes cast (50% plus one) in the primary, the two candidates receiving the highest number of votes will advance to a general election (also know as a run-off). If there is no run-off election, there is no “general” period.

If a candidate receives the maximum contribution from a single source during the primary election period, and that candidate is involved in a run off, the candidate may again accept the full limit from that source in the general election period. This applies only if there is a general election and only for those candidates involved in that election. It does not apply if a candidate wins a majority of votes cast in the primary election, or is unsuccessful.

The periods for contributions are as follows:

• Primary Election Period (candidate wins in primary election) – July 1 of the year preceding the election year through June 30 of the election year.
• General Election Period (candidate involved in run-off election) – July 1 through December 31 of the election year.
• Special Election Period (not applicable to the 2008 regular election) - The date the office becomes vacant through the end of the month in which the special election is held.
• Contributions received prior to committee qualification would be considered for purposes of the contribution limits and shall be reported and attributed to the appropriate period. The limits shall also apply to candidates who raise less than $1000 per calendar year, and do not meet the qualifications for forming a campaign committee.

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What is an off-election year and how does it apply to contributions?

Off-election years are those calendar years, or portions of calendar years, before and after an election year where there is an overall “cap” or “limit” on the total amount of contributions that can be gathered in a single year. The individual limitations still apply in an off-election year, with the additional requirement that the total received per year is capped.

During an off-election year the total amount of contributions that may be accepted by candidates in a calendar year are limited to $26,650 (Council Member) or $53,300 (Mayor).

To understand when an off-election year begins and ends, it is important to first understand the period of time that is an “election year”. An election year is: 1) the year of the election; and 2) the last six months of the year preceding the election.

An off-election year is: 1) the first six months of the year preceding the election; and 2) the six months after the primary election in which a candidate prevails. Each of the two years following the election is an off-election year.

If a general (run-off) election is held, the off-election year is delayed until January 1 of the following year. This applies only to those candidates involved in the general election.

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For purposes of the individual contribution limits, how does a candidate document contributions received in an off-election year?

Often, candidates gather contributions both before and after the time frames established as an election period. The requirements for attributing contributions in an off-election year are:

Contributions received by an incumbent officeholder in an off-election year shall be attributed to the election period in which the candidate won office, unless the contributions are deposited into a new campaign account for a future election to the same or different office.

Contributions received by a non-incumbent candidate in an off-election year shall be attributed to the primary, general or special election period for the elective office in which the candidate is seeking, unless the contributions are deposited into an account established for a prior election or an election to a different office.

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Other Things to Know

There are several other important local and state regulations that the candidate must be aware of. Those regulations are:

Lifting of Spending (Expenditure) Limits – The voluntary expenditure limits (ceiling) shall be lifted as to any candidate running for elective office if one of the following occurs:

• If another candidate for the same office declines to accept the voluntary expenditure limits and receives contributions, has cash on hand, or makes qualified campaign expenditures in excess of 75% of the limit for that office. Seventy-five percent of the limits are $66,000 (Council Member) and $438,750 (Mayor).
• If an independent expenditure committee or committees in aggregate spends more than 50% of the expenditure limits $44,000 (Council Member) or $292,500 (Mayor) in support of, or in opposition to another candidate for that office, the spending limits may be lifted.

The determination to lift the expenditure limits shall be made only by the City Clerk. In making the determination to lift the limits, the City Clerk shall rely on information contained in filed threshold notifications or campaign disclosure statements. No candidate who accepts the spending limits may exceed the limits except upon notice by the City Clerk.

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Use of Matching Funds - Matching public funds may only be used for expenditures for direct voter outreach purposes. This is defined to mean campaign literature, publicity, postage and signage. Matching public funds may not be spent for the following:

• Payments made to the candidate or a family relative, or a business in which the candidate or family relative has an ownership interest. For a definition of the term “family relative” reference City Code Section 2.16.140.
• Payments in excess of the fair market value of services, materials, facilities or other things of value received in exchange;
• Payments in cash; and
• Payments made for travel outside of California and expenses related to such travel.

Candidates who accept matching public funds shall obtain and maintain verifiable written receipts, invoices or other written documentation of the purpose and nature of expenditures. Expenditures for which there is no such documentation shall be excluded from consideration in determining whether public funds were spent on permissible purposes.

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Surplus Funds for Candidates Receiving Matching Funds - Candidates who receive matching funds, and have surplus funds remaining in his/her campaign account, after all obligations are met, shall return such surplus funds to the City. This amount shall not exceed the amount paid to the candidate from the Campaign Reform Fund.

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Audit - Each candidate who receives matching funds shall be subject to audit. Such candidate shall provide the City with all financial records, documents and any other information or materials requested.

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Large Political Committees– Committees that qualify as a Large Political Committee (LPC) may not give contributions to candidates over $5,350 (Council Member) or $10,650 (Mayor) until the committee has qualified as a LPC with the City Clerk’s Office. For more information refer to the City Clerk's web page on Large Political Committees.

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Missing Contributor Information– The Political Reform Act requires that a contribution of $100 or more be returned within 60 days of receipt if the candidate or committee has not obtained the contributor’s name and address, and in the case of an individual contributor, his or her occupation and employer. For more information on the record keeping procedures refer to page 2-11 of the “Campaign Disclosure Manual 2 – Information for Local Candidates.”

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Written Solicitations by Candidates - City Code Section2.13.065 provides that any Council candidate or controlled committee of a candidate making a written solicitation for a contribution to the candidate’s campaign for City elective office shall include the following written notice in no less than ten-point type on each solicitation.

Notice – Council Member

Chapter 2.13 of the Sacramento City Code limits the amounts that a contributor may give to a candidate for a City Council position for a primary, general or special election. Generally, a contributor other than a large political committee may not give more than $1,600 to a candidate for a City Council position for a primary, general or special election, while a large political committee may not give more than $5,350 to a candidate for City Council for a primary, general or special election. Chapter 2.13 contains certain other rules that may affect the amounts that an individual contributor may give. Please read Chapter 2.13 before making a contribution to my campaign.

Notice – Mayor

Chapter 2.13 of the Sacramento City Code limits the amounts that a contributor may give to a candidate for a City Council position for a primary, general or special election. Generally, a contributor other than a large political committee may not give more than $3,200 to a candidate for Mayor for a primary, general or special election, while a large political committee may not give more than $10,650 to a candidate for Mayor for a primary, general or special election. Chapter 2.13 contains certain other rules that may affect the amounts that an individual contributor may give. Please read Chapter 2.13 before making a contribution to my campaign.

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Transfer of Funds– A city elective candidate may transfer funds from any other committee controlled by the candidate to the committee established for that city elective office, if all of the following provisions are met:

• The funds are transferred into a new campaign accounts established for that elective office. A candidate may not re-designate an existing campaign account.
• The contributions transferred are attributed to specific contributors. Contributions shall be allocated and attributed to individual contributors on a “first in, first out” FIFO or “last in, first out” LIFO basis. Reference City Code 2.13.070 (B.2) for a definition of FIFO or LIFO.
• The contributions transferred and attributed to individual contributors, when added together with all other contributions from the same contributor, do not exceed the individual contribution limits.

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NEED ASSISTANCE OR HAVE QUESTIONS?

We are happy to assist you. Please contact us via email at: clerk@cityofsacramento.org, or by phone at (916) 808-7200.