Existing law generally sets out the requirements for the submission of written reports by public agencies to the Legislature, the Governor, the Controller, and state legislative and other executive entities.

This bill would require a written report, as defined, submitted by any state agency or department to the Legislature, a Member of the Legislature, or any state legislative or executive body to include a signed statement by the head of the agency or department declaring that the factual contents of the written report are true, accurate, and complete to the best of his or her knowledge.

This bill would also make any person who declares as true any material matter pursuant to these provisions that he or she knows to be false liable for a civil penalty not to exceed $20,000.

SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION

Senator Steven Glazer

Chair

2017 - 2018 Regular

Bill No: SB Hearing Date: 3/28/2017

SUBJECT:

DIGEST: This bill requires written reports, as defined, submitted to the Legislature, a Member of the Legislature, or any state legislative or executive body, by any state agency or department to include a signed statement by the head of that agency or department declaring that the factual contents of the report are true, accurate, and complete to the best of his or her knowledge. In addition, the bill specifies that any person who declares as true any material that he or she knows to be false shall be liable for a civil penalty not to exceed $20,000.

ANALYSIS:

Existing law:

1. Establishes numerous requirements for state and local government agencies to prepare and submit to the Legislature, the Governor, and other governmental entities, written reports on various subject matters of interests to policymakers and regulatory entities.
2. Provides that any willful omission to perform any duty enjoined by law upon any public officer, or person holding any public trust or employment, where no special provision is made for the punishment of such delinquency, is punishable as a misdemeanor.
3. Provides that every person, who, while taking and subscribing the oath or affirmation, states as true any material matter which he or she knows to be false, is guilty of perjury, and is punishable by imprisonment for two, three, or four years, as specified.
4. Provides that every officer authorized by law to make or give any certificate or other writing is guilty of a misdemeanor if he or she makes and delivers any certificate or writing containing statements which he or she knows to be false.

This bill:

1. Requires written reports submitted to the Legislature, a Member of the Legislature, or any state legislative or executive body by any state agency or department to include a signed statement by the head of that agency or department declaring that the factual contents of the report are true, accurate, and complete to the best of his or her knowledge.
2. Defines a “written report” as either of the following:
   1. A document required by statute to be prepared and submitted to the Legislature, or any state legislative or executive body.
   2. A document, summary, or statement requested by a Member of the Legislature.
3. Specifies that any person who declares as true any material matter pursuant to the provisions of this bill shall be liable to a civil penalty not to exceed $20,000. The civil penalties shall be exclusively assessed and recovered in a civil action brought by the Attorney General in the name of the people of the State of California in any court of competent jurisdiction.
4. Specifies that with respect to the Franchise Tax Board, the signed statement shall be made by the executive officer of that board, and with respect to the State Board of Equalization, the statement shall be made by the executive director of that board.
5. Specifies that the provisions of this bill shall apply to the head of every state agency, including, but not limited to, elected officials of state government, and any state official whose duties are prescribed by the California Constitution.
6. Specifies that the declaration in the signed statement as to the truth, accuracy, and completeness of the factual contents of the written reports shall not apply to any forecasts, predictions, recommendations, or opinions contained in the written report.

Background

Purpose of the bill. According to the author, “in October 2015, a Los Angeles Times article exposed that a report presented to the Legislature by the California High-Speed Rail Authority (Authority) included cost projections that intentionally misrepresented the actual price of the initial segment from Merced to Burbank. The Authority’s report was based on a knowingly inaccurate projection that claimed the project would be completed for $31 billion, while the Authority knew the actual cost was $40 billion. Unfortunately, this is not an isolated incident. Other high profile cases have seen state agencies lie to the Legislature regarding everything from finances to misconduct.”

The author also states that “there are current provisions setting forth penalties for those who knowingly present false information under oath. However, there are no provisions holding the agency or department heads accountable for a report’s accuracy or truthfulness.”

Policy Considerations. Current law already makes it a misdemeanor for a state or local official to submit a written report containing false information. In addition, the Legislature already has the authority to question the accuracy of a report by requiring those responsible for submitting the report to attest to the accuracy of the report under oath.

In addition, it is unclear what exactly is meant by written reports. The bill currently defines a written report as “a document, summary, or statement requested by a Member of the Legislature.” This implies that any request made by a Member of the Legislature to a state agency would fall under the provisions of the bill. Therefore, even a simple request by a Member of the Legislature would now need to include a signed statement by the head of the state agency or department.

If the head of the state agency or department is liable to a $20,000 civil penalty if the information is incorrect, it is reasonable to believe that a response, even to the smallest of the request, would now be unnecessarily delayed.

This unintended consequence was raised by Governor Brown when he vetoed SB 1337 (Desaulnier, 2014), which was identical to this bill, by stating that, “contrary to its stated purpose, this bill creates new bureaucratic verification requirements that would likely impede communication between the Executive Branch and the Legislature.”

Prior/Related Legislation

AB 1566 (Wilk, 2016) would have required written reports, as defined, submitted to the Legislature or executive body, by any state agency or department to include a signed statement by the head of that agency or department that the factual contents of the report are true, accurate, and complete to the best of his or her knowledge. In addition, the bill specifies that any person who declares as true any material that he or she knows to be false shall be liable for a civil penalty not to exceed $20,000. (Failed passage in the Assembly Accountability and Administrative Review Committee)

SB 1337 (Desaulnier, 2014) would have required written reports, as defined, submitted to the Legislature or executive body, by any state agency or department to include a signed statement by the head of that agency or department that the factual contents of the report are true, accurate, and complete to the best of his or her knowledge. In addition, the bill specified that any person who declares as true any material that he or she knows to be false shall be liable for a civil penalty not to exceed $20,000. (Vetoed by Governor Brown)

AB 1135 (Strickland, 2007) would have required written reports, as defined, submitted to the Legislature or executive body, by any state agency or department to include a signed statement by the head of that agency or department that the factual contents of the report are true, accurate, and complete to the best of his or her knowledge. In addition, the bill specified that any person who declares as true any material that he or she knows to be false shall be liable for a civil penalty not to exceed $20,000. (Vetoed by Governor Schwarzenegger)

AB 2404 (Klehs, 2006) would have required written reports, as defined, submitted to the Legislature or executive body, by any state agency or department to include a signed statement by the head of that agency or department that the factual contents of the report are true, accurate, and complete to the best of his or her knowledge. In addition, the bill specified that any person who declares as true any material that he or she knows to be false shall be liable for a civil penalty not to exceed $20,000. (Vetoed by Governor Schwarzenegger)

AB 1625 (Klehs, 2005) would have required written reports, as defined, submitted to the Legislature or executive body, by any state agency or department to include a signed statement by the head of that agency or department that the factual contents of the report are true, accurate, and complete to the best of his or her knowledge. In addition, the bill included misdemeanor penalties up to $5,000, imprisonment in a county jail for up to six months, or both. (Vetoed by Governor Schwarzenegger.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT:

None received

OPPOSITION:

None received

DUAL REFERRAL:  Senate Judiciary Committee