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SAN FRANCISCO ETHICS COMMISSION AUDIT REPORT:
BEVAN DUFTY FOR SUPERVISOR
This Audit Report contains information pertaining to the audit of the committee, Bevan Dufty for Supervisor, Identification Number 1245259 (“the Committee”), for the period from January 1, 2002 through January 31, 2003. The audit was conducted to determine whether the Committee materially complied with the requirements and prohibitions imposed by the Political Reform Act (“the Act”) (California Government Code Section 81000, et seq.) and San Francisco’s Campaign Finance Reform Ordinance (“CFRO”) and Electronic Filing Ordinance (S.F. Campaign and Governmental Conduct Code Sections 1.100, et seq., and 1.300, et seq.).
For the period covered by the audit, the Committee received total contributions of $143,169 and incurred expenditures of $143,332. There was one material finding with respect to this Audit: the Committee failed to obtain and disclose contributor information for some contributions, in violation of San Francisco Campaign and Governmental Conduct Code Section 1.114(d).
II. Committee Information
The Committee was formed in June 2002 to support the election of Bevan Dufty for Member, Board of Supervisors, District 8, in the November 5, 2002 general election and December 10, 2002 run-off election. Herbert Cohn is the Committee’s treasurer. Supervisor Dufty applied for and was eligible to receive pubic financing, but he declined to receive public funds. The Committee terminated on July 31, 2003.
III. Audit Authority
San Francisco Charter Section C3.699-11 authorizes the Ethics Commission to audit campaign statements that are filed with the Commission. San Francisco Campaign and Governmental Conduct Code Section 1.150(a) requires the Commission to audit all candidates who receive public financing. Because the candidate applied for public financing and was certified by the Ethics Commission to participate in the public financing program, the Commission audited his campaigns statements and other relevant documents to determine whether the candidate complied with applicable requirements and prohibitions imposed by State and local law.
IV. Audit Scope and Procedures
This audit was performed in accordance with generally accepted auditing standards. The audit involved a thorough review of the Committee’s records for the time period covered by the audit. This review was conducted to determine:
- Compliance with all disclosure requirements pertaining to contributions, expenditures, accrued expenditures, and loans, including itemization when required;
- Compliance with applicable filing deadlines;
- Compliance with restrictions on contributions, loans and expenditures;
- Accuracy of total reported receipts, disbursements and cash balances as compared to bank records;
- Compliance with all record-keeping requirements; and
- Compliance with all provisions related to the Commission’s public financing program.
V. Summary of Applicable Law
S. F. Campaign and Governmental Conduct Code Section 1.114(d): Requirement to Obtain and Disclose Contributor Information
S. F. Campaign and Governmental Conduct Code (“S.F. C&GCC”) Section 1.114(d) states that if the cumulative amount of contributions received from a contributor is $100 or more, the committee treasurer must not deposit the contribution unless the committee treasurer has the following information: the contributor’s full name; the contributor's address; the contributor’s occupation, and the name of the contributor’s employer or, if the contributor is self-employed, the name of the contributor’s business. S.F. C&GCC Section 1.114(e) states that each treasurer who receives a contribution that does not comply with the requirements of this Section must forfeit the contributions to the City and County for deposit in the General Fund.
VI. Material Findings
S. F. Campaign and Governmental Conduct Code Section 1.114(d): Failure to Obtain and Disclose Contributor Information
A review of the Committee’s campaign statements indicated that the Committee itemized 1,207 contributions of $100 or more. Of the 1,207 itemized contributions, contributors’ information was not fully or properly disclosed for 124 contributions; i.e., missing street addresses, contributors’ occupation and/or employer information.
As explained above, under S.F. C&GCC §1.114(e) contributions that are deposited without the required contributor information must be forfeited to the City. The amount that is subject to forfeiture is the amount that exceeds the first $99.99 of a contributor’s contribution; i.e., on a $100 contribution that lacks the required contributor information, the amount subject to forfeiture is one cent. Of the 124 contributions, 110 contributions were each $100. Thus the amount subject to forfeiture in regards to each of these 110 contributions is one cent. It has been the Commission’s policy not to pursue forfeitures that are only one cent due to the administrative costs involved. The remaining 14 contributions were also $100 each, but represented contributions from seven contributors who each contributed $200 in cumulative amount. Thus, with respect to each of these seven contributors, the amount subject to forfeiture is $100.01. In this manner, the total amount of contributions that is subject to forfeiture under local law is $700.07.
The audit staff recognizes that under state law, the first $99.99 is not exempt from forfeiture with regards to contributions that lack required contributor information. Before proceeding with enforcement of this provision of state law, the Commission will wait for guidance from the Fair Political Practices Commission, since that agency has not yet established its standards and policies regarding this requirement.
With respect to the above-referenced finding, the Committee provided the following comments:
We are gratified to learn that our records were so complete. Of the 7 contributions that were identified as possible forfeiture candidates, 6 of them turn out to be non candidates in that the required information was on hand on the deposit date in question. The remaining contribution of $ 100.01 we will agree to forfeit. For a campaign that raised over $140,000 in contributions of $100 or less, we think that one small oversight is an amazing accomplishment.
The Committee has indicated to audit staff its intention to request further review of the matter regarding contributor information for six of the seven contributors. The request is under review by the Commission’s fine collection staff.
Through the examination of the Committee’s records and campaign disclosure statements, the auditor identified one material finding: the Committee failed to obtain and disclose contributor information for some contributions, in violation of San Francisco Campaign and Governmental Conduct Code Section 1.114(d).
Audit reports are posted to the Commission’s web site and are forwarded to the Members of the Ethics Commission and, in cases of a violation of law, to the appropriate enforcement agency.
Date: August 12, 2003
Government Code §85700 states that contributions of $100 or more require the name, address, occupation and employer of the contributor. Contributions can be deposited without all of the required information as long as the information is obtained within 60 days from the date on which the committee had possession of the contribution. Once the information is obtained, an amended campaign statement must be filed within 70 days from the closing date of the campaign statement on which the contribution was originally reported. If the required information is not obtained within 60 days, the contribution must be forfeited.
 The Committee claims that it possessed the contributor information for six of the seven contributors at the time of deposit.
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