By Kevin O'Brien
July will mark the conclusion of a three-year pilot program focused on the electronic submission of the Conflict of Interest Code and Statement of Economic Interest Form, more commonly known as the Form 700. This form is a means of declaring potential conflicts of interest, which is required for elected local and state officials, judges, and state employees in decision-making positions. However, as essential as the Form 700 is, it is also a notoriously tedious and confusing document to the extent that it was often neglected. In 2002, the software development company SouthTech Systems developed DisclosureDocs, a program that automated and eased the management of the Form 700. SouthTech Systems accomplished this by crafting a program that was intuitive and user-friendly. The next step in improving the process, one which imparts essential transparency to the political process, was facilitating the submission of the Form 700 between the filer and the city and/or county clerks that processed the Form 700.
The three-year pilot program that authorized the general trial-use of electronic submission software was the product of AB 1921. SouthTech Systems was selected by Orange County to assist with the resulting pilot program, especially in light of Orange County’s success with the initial implementation of DisclosureDocs. Originally the DisclosureDocs program only involved the preparation of Form 700. Under the pilot program, Orange County selected SouthTech Systems to expand DisclosureDocs to incorporate electronic submission. Cities and counties will be permitted to continue (or begin) submitting the Form 700 if the program is deemed a success.
California City News spoke with two veterans of the city and county clerk offices, the City Clerk of Long Beach, Larry Herrera, and Maria Marinos, Clerk of the Board of the County of Santa Clara.
Herrera began by elucidating a number of issues with the analog filing process associated with Form 700. Herrera indicated that these issues were rectified with the implementation of DisclosureDocs during the course of the pilot program. Herrera stated, “What existed before was a lack of understanding by filers as to what the law required, why they were supposed to file, what the requirements for assuming and leaving office were, and what the annual requirements were. The Form 700 was … mysterious.”
The pervasive lack of understanding of the Form 700 and its requisite filing procedures made completing it laborious, leading to widespread noncompliance. Herrera continued that “The ability to comply and fill out these paper forms in the past was viewed as tedious, so compliance by users was an issue that we faced.”
The high noncompliance rate required clerks across the state to police their respective filers, a responsibility that squandered tens of thousands of man-hours. Herrera reinforced this point, stating that “With a paper system, when someone is incompliant you have to keep tabs on them [and] you would spend a lot of time. If you had 1200 people and you had 100 people that were incompliant, you would have to file for each one of those 100 people, imagine trying to keep track of the details.” This workflow not only consumed time and capital but also mudded a process that’s original intention was political transparency.
Marinos substantiated Herrera’s observations with her own experience in Santa Clara County. Marinos stated, “We manage approximately 5,000 Form 700 filings annually, while coordinating with over 200 agencies/departments, special districts, and school districts. Filing Officers are required to send out notices, supply forms, log each statement, send at least two written notifications to non-filers, report violations to the appropriate enforcement agency, maintain logs with copies of each notification, review statements for compliance and requesting amendments, impose late filing penalties, and provide public access ... It was difficult to efficiently manage the high volume of paper received annually and throughout the year.”
These issues that Herrera and Marinos presented, in their opinion, are rectified by the production and electronic filing provided by DisclosureDocs. Herrera concluded that “Before, you had problems with compliance, a lack of understanding, no business rules, a tedious enforcement process, and while partly transparent [also] somewhat cumbersome. That has all changed with this new system.”
Marinos echoed Herrera’s conclusion, stating that “Implementation of DisclosureDocs/eDisclosure has allowed our office to more effectively interact with filers, filing officials and the public. We are able to provide instant access to information and be more proactive in dealing with late filers. The system has allowed our department to streamline work, which has increased productivity. We have significantly reduced the number of staff hours dedicated to processing forms and reduced the number of errors in reviewing and processing forms … The system also allows filers to complete automated reviews prior to submittal to avoid mistakes. This allows our staff to devote their time to other important functions which ultimately saves time and money.”
Originally only the counties of Los Angeles, Merced, Orange and Stanislaus were authorized under the pilot program; however, in 2010 the counties of Ventura, Santa Clara and the city of Long Beach were added. Should the pilot program be approved and electronic preparation and filing process of the From 700 be allowed to propagate across the state, a fiscal benefit for the state could emerge. Considering California’s economic climate, the compounded savings in man-hours and tax-dollars could prove helpful. The efficiency offered by eDisclosure and DisclosureDocs is an example of innovative solutions being implemented at the local level. The effects have been a coup for the democratic process through the promotion of transparency in local government and a benefit to the taxpayer with a more economical political process.
Marinos concluded her interview with a comment to this greater point: “The purpose of financial disclosure is to improve transparency in government by keeping a record of potential conflicts of interests of persons in decision-making positions. Electronic submission supports that goal. It assists the filer in knowing the, ‘who, what, when’ of how to file. It also improves the filing officer’s ability to enforce regulations and filing requirements in an efficient and cost-effective manner. The system goes a long way to increase transparency and accessibility of information while simultaneously reducing costs for local governments and individual filers. I believe the current pilot will provide the legislature with significant evidence to support broadening the legislation to authorize statewide participation and allow the State of California to continue to serve as a leader in innovation and progressive thought.”
If Marinos’ prediction is confirmed by the legislature, it is clear that California cities and counties stand to benefit.
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