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CC - Item 4C - Second Reading and Adopt of Ord. 1023 Adding Chp 1.14 to RMC for Electronic and Paperless Filing of FPPC FormsROSEMEAD CITY COUNCIL STAFF REPORT TO: THE HONORABLE MAYOR AND CITY COUNCIL p%� FROM: BEN KIM, CITY MANAGER S DATE: NOVEMBER 12, 2024 SUBJECT: SECOND READING AND ADOPT ORDINANCE NO. 1023 ADDING CHAPTER 1.14 TO THE MUNICIPAL CODE TO ALLOW FOR ELECTRONIC AND PAPERLESS FILING OF FAIR POLITICAL PRACTICES COMMISSION (FPPC) CAMPAIGN DISCLOSURE STATEMENTS SUMMARY On October 8, 2024, the City Council held the first reading of Ordinance No. 1023, which adds Chapter 1.14 to the Municipal Code. This chapter allows for electronic and paperless filing of Fair Political Practices Commission Campaign Disclosure Statements. To streamline this process, the City Clerk's Office will implement NetFile, an electronic filing system that enables online submission of various FPPC forms, including Forms 460, 470, 496, and 497, while also complying with Secretary of State requirements. In order for the City of Rosemead to accept electronically filed statements, the City Council must adopt an ordinance (Attachment A) that approves the use of this online filing system. This ordinance will include a legislative finding that the system operates securely and effectively, ensuring it does not unduly burden filers. STAFF RECOMMENDATION That the City Council approve and adopt the second reading, by title only, of Ordinance No. 1023, authorizing the addition of Chapter 1.14 of the Rosemead Municipal Code, to allow for electronic and paperless filing of Fair Political Practices Commission Campaign Disclosure Statements. FISCAL IMPACT There is no fiscal impact with the approval and adoption of this ordinance. The Netfile system cost in the amount of $4,930 per year was included in the City Clerk budget for Fiscal Year 2024-2025. ET"3 1074110 _Y Ilu_EKG] City Council Meeting October 8, 2024 Page 2 of 2 ENVIRONMENTAL REVIEW The Ordinance is not subject to review under the California Environmental Quality Act ("CEQA") pursuant to CEQA Guideline Section 15061(b)(3) because it can be seen with certainty that there is no possibility that the Ordinance may have a significant effect on the environment. This Ordinance would not result in any development or changes to the physical environment. STRATEGIC PLAN IMPACT None. PUBLIC NOTICE PROCESS This item has been noticed through the regular agenda notification process. Prepared and Submitted by: *fF-- Ericka Hernandez, City Clerk Attachment A: Ordinance No. 1023 Attachment B: City Council Staff Report only- Dated October 8, 2024 Attachment A Ordinance No. 1023 ORDINANCE NO. 1023 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ROSEMEAD AMENDING MUNICIPAL CODE ADDING CHAPTER 1.14 TO TITLE 1 REGARDING ELECTRONIC AND PAPERLESS FILING OF FAIR POLITICAL PRACTICES COMMISSION CAMPAIGN DISCLOSURE STATEMENTS WHEREAS, California Government Code Section 84615 provides that a legislative body of a local government agency may adopt an ordinance that requires an elected officer, candidate, committee, or other person required to file statements, reports or other documents online or electronically with the City Clerk; and WHEREAS, the City has entered into an agreement with Netfile, a vendor approved by the California Secretary of State, to provide an online electronic filing system ("System") for Campaign disclosure statements; and WHEREAS, the System will operate securely and effectively and will not unduly burden filers. Specifically, (1) the System will ensure integrity of the data and includes safeguards against efforts to tamper with, manipulate, alter, or subvert the date; (2) the System will only accept a filing in the standardized record format developed by the Secretary of State and compatible with the Secretary of State's system for receiving online or electronic filings; and (3) the System will be available free of charge to the filers and to the public viewing filings; and WHEREAS, the City of Rosemead desires to amend the Rosemead Municipal Code to add a new chapter related to electronic filing of campaign statements. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ROSEMEAD, DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Amendment. Chapter 1.14, "Electronic filing of campaign disclosure statements," is hereby added to Title 1 [General provisions] of the Rosemead Municipal Code as follows: Chapter 1.14 ELECTRONIC FILING OF CAMPAIGN DISCLOSURE STATEMENTS 1.14.010. General. A. Any elected officer, candidate, committee, or other person required to file statements, reports, or other documents ("statements") as required by Chapter 4 of the Political Reform Act (California Government Code Section 84100 et seq.) may file such statements using the City Clerk's online system according to procedures established by the City Clerk. These procedures shall ensure that the online system complies with the requirements set forth in Section 84615 of the Government Code. From and after January 1, 2021, elected officers, candidates and committees required to file statements must file such statements using the City Clerk's online system, unless exempt from the requirement to file online pursuant to Government Code Section 84615. B. The online filing system shall only accept a filing in the standardized record format that is developed by the California Secretary of State pursuant to Section 84602(a)(2) of the California Government Code and that is compatible with the Secretary of State's system for receiving an online or electronic filing. C. The online filing system shall include a procedure for filers to comply with the requirement that they sign statements and reports under penalty of perjury pursuant to Section 81004 of the Government Code. 1.14.020 Procedures for utilizing online filing. A. During the period commencing with the effective date of the ordinance codified in this chapter and ending January 1, 2025, an elected officer, candidate, appointee, committee or consultant may choose to utilize the electronic filing system by electronically filing a statement that is required to be filed with the City Clerk pursuant to Chapter 4 of the Political Reform Act. Once the elected officer, candidate, appointee, committee or consultant has filed electronically, all subsequent statements shall be filed electronically. From and after January 1, 2025, electronic filing is mandatory unless the officer, candidate, or committee is exempt as described in Section 1.14.010. B. Any elected officer, candidate, appointee, committee or consultant who has electronically filed a statement using the City Clerk's online system is not required to file a copy of that document in paper format with the City Clerk. C. The City Clerk shall issue an electronic confirmation that notifies the filer that the statement was received, which notification shall include the date and the time that the statement was received and the method by which the filer may view and print the data received by the City Clerk. The date of filing for a statement filed online shall be the day that it is received by the City Clerk. D. If the City Clerk's system is not capable of accepting a statement due to technical difficulties, an elected officer, candidate, or committee shall file that statement in paper format with the City Clerk. 1.14.030 Availability of statements for public review—Record retention. A. The City Clerk's system shall make all data filed available on the city's web page in an easily understood format that provides the greatest public access. The data shall be made available free of charge as soon as possible after receipt. The data made available on the city's web page shall not contain the street name and building number of the persons or entity representatives listed on the electronically filed forms or any bank account number required to be disclosed by the filer. The City Clerk's office shall make a complete, unredacted copy of the statement, including any street names, building numbers, and bank account numbers disclosed by the filer, available to any person upon request. B. The City Clerk's Office shall maintain, according to the city's retention schedule, a secured, official version of each online or electronic statement which shall serve as the official version of that record for purpose of audits and any other legal purpose. SECTION 2. California Environmental Quality Act. The City Council finds that the Ordinance is not subject to review under the California Environmental Quality Act ("CEQA") pursuant to CEQA Guideline Section 15061(b)(3) because it can be seen with certainty that there is no possibility that the Ordinance may have a significant effect on the environment. This Ordinance would not result in any development or changes to the physical environment. SECTION 3. Severability. If any provision of this Ordinance or the application thereof to any person or circumstance is held invalid, the remainder of the Ordinance, including the application of such phrase or provision to other persons or circumstances shall not be affected thereby and shall continue in full force and effect. To this end, provisions of this Ordinance are severable. The City Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, clause, or phrase hereof irrespective of the fact that any one or more sections, subsections, subdivisions, paragraphs, sentences, clauses, or phrases be held unconstitutional, invalid, or unenforceable. SECTION 4. Publication and effective date. The City Clerk shall publish this ordinance as required by law. This Ordinance shall take effect and be enforced thirty (30) days after its adoption. PASSED, APPROVED AND ORDAINED this day of , 2024. Steven Ly, Mayor APPROVED AS TO FORM: ATTEST: Rachel Richman, City Attorney Ericka Hernandez, City Clerk STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss CITY OF ROSEMEAD ) I, Ericka Hernandez, City Clerk of the City of Rosemead, County of Los Angeles, State of California, hereby attest to the above signature and certify that Ordinance No. 1023 was introduced for first reading at the regular meeting of October 8, 2024. Said Ordinance was approved and adopted by the City Council of the City of Rosemead at a regular meeting held on the day of 2024, by the following vote: AYES: NOES: ABSENT: ABSTAIN: Ericka Hernandez, City Clerk Attachment B City Council Staff Report Dated October 8, 2024 ROSEMEAD CITY COUNCIL STAFF REPORT TO: THE HONORABLE MAYOR AND CITY COUNCIL FROM: BEN KIM, CITY MANAGER 45;q-� DATE: OCTOBER 8, 2024 SUBJECT: INTRODUCTION AND FIRST READING OF ORDINANCE NO. 1023 ADDING CHAPTER 1.14 TO THE MUNICIPAL CODE TO ALLOW FOR ELECTRONIC AND PAPERLESS FILING OF FAIR POLITICAL PRACTICES COMMISSION (FPPC) CAMPAIGN DISCLOSURE STATEMENTS SUMMARY The City Clerk is the local filing officer for the City of Rosemead, and is responsible for receiving, reviewing, and storing campaign disclosure information, as well as making it accessible to the public. To provide a more efficient process, the City Clerk's Office will be implementing NetFile, an electronic/paperless filing system that accommodates online filing of several types of FPPC forms, including Forms 460, 470, 496, and 497, and meets the requirements of the Secretary of State. In order for the City of Rosemead to accept electronically filed statements, the City Council must adopt an ordinance (Attachment A) approving the use of an online or electronic filing system, which shall include the legislative finding that the online or electronic system will operate securely and effectively and will not unduly burden filers. While adoption of an ordinance is not required for the use of an electronic filing system for Form 700s, the implementation and utilization of NetFile for electronic/paperless filing for all Form 700 (Statement of Economic Interest) will significantly improve ease of access to Form 700s to the public as well as decrease the time that City Clerk staff spends managing the annual gathering, tracking, and filing of Form 700s. DISCUSSION The Political Reform Act recognizes campaigns that spend or raise more than $2,000 as "Controlled Committees." Under the Act, these committees are obligated to file detailed campaign finance statements, also known as Fair Political Practices Commission (FPPC) Form 460s. The City Clerk serves as the local filing officer for the City of Rosemead, and is responsible for receiving, reviewing, and storing campaign disclosure information, as well as making it accessible to the public. The City Clerk's office currently accepts paper filings of such documents and staff have been manually redacting and uploading forms to the City website. AGENDA ITEM 4.0 City Council Meeting October 8, 2024 Page 2 of 3 Assembly Bill (AB) 2151 mandates that cities post all campaign statements, reports, and other documents required by the Political Reform Act to their websites within 72 hours of filing. To streamline this process, the City Clerk's Office plans to implement NetFile, an electronic filing system that supports online submission of various FPPC forms, including Forms 460, 470, 496, and 497, and complies with Secretary of State requirements. NetFile will help the city adhere to AB 2151, enhance public transparency, and simplify the filing process for users. Currently, 191 cities and 32 counties in California use NetFile for electronic campaign disclosure filings. Government Code Section 84615 allows local government agencies to require an elected and appointed official, candidate, or committee to file FPPC campaign statements, reports, or other documents online or electronically with a local filing officer. In order for the City of Rosemead to accept electronically filed statements, the City Council must adopt an ordinance approving the use of an online or electronic filing system, which shall include the legislative finding that the online or electronic system will operate securely and effectively and will not unduly burden filers. In terms of security, the NetFile system is a web -based, vendor -hosted application that utilizes "industry best practices" for securing data, using the same data encryption for online filings that is used by banks for online banking. NetFile stores and backs up data at three separate locations, creating the essential safety measures and redundancy that allows for recovery of information in the event of an emergency or disaster. Implementation of the NetFile system will promote transparency and provide convenience for committees, individuals, and the public. It provides 24-hour filing and viewing accessibility of campaign finance information from any computer, anywhere. In certain instances, the NetFile system will also increase the accuracy of filed campaign statements by prohibiting any filings that may have inadvertently omitted information required under the Political Reform Act. To ensure a smooth implementation and transition, NetFile and the City Clerk's Office will offer training to all filers. Statement of Economic Interests (Form 700) The City Clerk manages the annual filing of Form 700s for key city officials, commissioners and designated staff. Amendments or incomplete submissions occasionally occur. To improve this process, it is recommended that all Form 700 filings, beginning January 1, 2025, be done electronically. The electronic filing system will provide immediate error alerts to filers, reducing the need for the City Clerk to request corrections. Currently, 237 cities and 51 counties in California use electronic systems for Form 700. Implementing the electronic filing component of NetFile for Form 700 is an internal procedural update and does not require an ordinance. Campaign Statements Adding Chapter 1.14 of the Rosemead Municipal Code will permit the electronic and paperless filing of Fair Political Practices Commission (FPPC) campaign disclosure statements through an online system. City Council Meeting October 8, 2024 Page 3 of 3 STAFF RECOMMENDATION That the City Council approve the first reading, by title only, of Ordinance No. 1023, authorizing the addition of Chapter 1.14 of the Rosemead Municipal Code, to allow for electronic and paperless Fling of Fair Political Practices Commission Campaign Disclosure Statements. FISCAL IMPACT There is no fiscal impact with the approval and adoption of this ordinance. The Netfile system cost in the amount of $4,930 per year was included in the City Clerk budget for Fiscal Year 2024-2025. ENVIRONMENTA REVIEW The Ordinance is not subject to review under the California Environmental Quality Act ("CEQA") pursuant to CEQA Guideline Section 15061(b)(3) because it can be seen with certainty that there is no possibility that the Ordinance may have a significant effect on the environment. This Ordinance would not result in any development or changes to the physical environment. STRATEGIC PLAN IMPACT None. PUBLIC NOTICE PROCESS This item has been noticed through the regular agenda notification process. Prepared and submitted by: Ericka Remandez, City Clerk Attachment A: Ordinance No. 1023