New Behested Payment Reporting Rules and Completing the Form 803

The Commission recently adopted new regulations requiring additional disclosure on behested payment reports in certain circumstances. The new regulations went into effect on December 22, 2021. To see the text of the new regulations go to the Newly Adopted, Amended, or Repealed Regulations page.

The FPPC is updating the Form 803 as well as its electronic behested payment reporting system as a result of the new regulations. Below is a description of how a filer may use the existing Form 803 to provide disclosure of information required by the new regulations until the amended Form 803 is completed and approved by the Commission. The Commission anticipates making the amended Form 803 available in March of 2022.

Regulation 18424 requires additional disclosure in a behested payment report in two circumstances that raise questions as to the payment’s purposes and potential for influence: first, where the official, the official’s spouse, or an official’s staff member has a relationship of control over, or is employed by, a payee nonprofit organization; and second, where the payor of a behested payment is involved in a proceeding before the official’s agency at the time the behested payment is made or within the past 12 months.

How to Report on the Form 803

Section 3: For a nonprofit payee organization, disclose if the official, official’s immediate family member, campaign staff or officeholder staff is any of the following: founder, in a decision-making role such as an executive board member or advisory board member, salaried employee, or honorary board member to the payee, in parentheses in the Payee’s Name field or on an attachment, include the person’s name and affiliation with the Payee. Example:  Name: Boys and Girls Club of Sacramento (Taylor Smith, Executive Director for payee, spouse of Senator Smith)

Section 2: Briefly describe a proceeding before the official’s agency in parenthesis in the Payor’s Name field in Section 2, or in an attachment. Example: Name: Smith Development Inc. (applied for building permit for 123 Main St pending before City of Trade City Council)

Regulation 18424.1 provides a “good faith estimate” behested payment reporting procedure when an official makes reasonable efforts and is unable to obtain the necessary payment information from a behested payment payee within the 30 days filing date. It also requires the official to amend the report with accurate data within 10 days of receiving the information from the payee.

How to Report on the Form 803

Section 4: For reporting a good faith estimate, after listing the Amount of Payment indicate in parenthesis that the amount or date is an estimate. Example: Amount of Payment: $10,000 (estimated).

Section 5: Note the reason for using an estimate. Example: Estimate provided because payee still processing event payments.

Regulation 18424.3 requires that when a behested payment is made from a donor advised fund, the behested payment report “name of the payor” must include the name of the sponsoring organization, the donor advised fund, and the donor, to the extent the information is known to the official.

How to Report on the Form 803

Section 2: In providing the name of a sponsoring organization, donor advised fund, donor, or donor’s advisor, the filer should identify each as such in parenthesis after its name. Example: Name: California Community Foundation (SO), The Smith Family Fund (DAF), Ken Smith, donor.

 

The above are examples of how a filer may comply with the new regulations using the existing Form 803. However, so long as the information required by the new regulations is included on the form in a manner reasonably likely to be understood and provide the required disclosure, the filer will be deemed to have complied with new regulations.  

Email advice@fppc.ca.gov with any questions regarding compliance with the behested payment reporting requirements.