City and County of San Francisco
Ethics Commission

English

SAN FRANCISCO ETHICS COMMISSION AUDIT REPORT:

FIONA MA FOR SUPERVISOR

I.           Introduction

This Audit Report summarizes the results of the audit of the committee, Fiona Ma for Supervisor, Identification Number 1238185 (“the Committee”), for the period from January 1, 2001 through January 31, 2003.  The audit was conducted to determine whether the Committee materially complied with the requirements of 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., respectively).

For the period covered by the audit, the Committee received $278,061 in contributions and $57,200 in public funds, and incurred expenditures of $352,031.  The CFRO provides that any candidate who receives public funds must return unexpended campaign funds to the Election Campaign Fund up to the amount of public funds received by the candidate.  The auditor determined that the Committee had no unexpended funds to return to the Election Campaign Fund.[1]

There were three material findings with respect to this Audit: 1) 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); 2) the Committee accepted contributions from four contributors that exceeded the contribution limits in violation of San Francisco Campaign and Governmental Conduct Code section 1.114 (a) and (b); and 3) the Committee failed to file itemized disclosure statements for two mass mailings and amendments for three mass mailings in violation of S.F. Campaign and Governmental Conduct Code section 1.161.

II.         Committee Information

The Committee was formed in September 2001 to support the election of Fiona Ma to Member, Board of Supervisors, District 4, in the November 5, 2002  general election and December 10, 2002 run-off election.  Malcolm Heinecke is the Committee’s treasurer.  As stated above, the Committee received public funds for Fiona Ma’s 2002 supervisorial campaign. 

III.       Audit Authority

San Francisco Charter Section C3.699-11 authorizes the Ethics Commission to audit campaign statements that are filed with the Commission.  Section 1.150(a) of the Campaign Finance Reform Ordinance requires the Commission to audit all candidates who receive public funds.  Audits of publicly financed candidates include a review of campaign statements and other relevant documents to determine whether the candidate complied with applicable requirements of 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

Section 1.114(d) of the CRFO provides that if the cumulative amount of contributions received from a contributor is $100 or more, the committee treasurer may 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.  Section 1.114(e) provides that each treasurer who receives a contribution that does not comply with the requirements of section 1.114 must pay promptly, from available campaign funds if any, the amount received in access of the amount permitted for deposit in the General Fund of the City and County.

S.F. Campaign and Governmental Conduct Code Section 1.114 (a) and (b): Limits on Contribution to Candidates in the General and Run-Off Elections

Section 1.114 of the CFRO prohibits any candidate or campaign treasurer from soliciting or accepting any contribution that will cause the total amount contributed by any person to such candidate to exceed $500 in the general election and $250 in the run-off election.  Ethics Commission Regulation 1.114-1(b) further provides that when a candidate qualifies for a run-off election, and the candidate has expenses accrued before the date of the general election, the candidate may, subject to the $500 contribution limit, continue to solicit and accept contributions to pay for those accrued expenses.  Once the candidate has raised sufficient funds to pay for those accrued expenses, all contributions accepted by the candidate are subject to the $250 contribution limit.  Under Section 1.114(e) of the CFRO, in effect until July 27, 2003, each treasurer who receives a contribution that exceeds the limits must pay promptly from available campaign funds if any, the amount received in excess of the amount permitted by the CFRO for deposit in the General Fund of the City and County.[2]

S.F. Campaign and Governmental Conduct Code Section 1.161: Filing of Itemized Disclosure Statement for Mass Mailings

The Political Reform Act defines mass mailings as 200 substantially similar pieces of mail sent within a calendar month.   Section 1.161 of the CFRO requires any candidate for City elective office who pays for a mass mailing that advocates for or against candidates for City elective office to include on the mailing the statement “paid for by ______(insert candidate’s name and street address)” in not less than 14-point type and in a color or print which contrasts with the background so as to be easily legible.  The candidate must also file with the Ethics Commission a clearly legible original or copy of the mass mailing and an itemized disclosure statement within five working days after the date of the mailing.

VI.        Material Findings

S. F. Campaign and Governmental Conduct Code Section 1.114(d): Failure to Obtain and Disclose Contributor Information

The Committee reported 1,161 contributions of $100 or more on its campaign statements.   Complete contributor information was not provided for 34 of the 1,161 contributions.  The missing information included the contributors’ street addresses, occupation and/or employer information.  Section 1.114(e) of the CFRO requires that a contribution deposited without the required contributor information be forfeited to the City.  The amount of the Committee’s contributions that is subject to forfeiture is $5,150.20.  (The first $99.99 of each forfeitable contribution is exempt from forfeiture.)

After the auditor identified the contributions that are subject to forfeiture, the Committee provided a detailed list of the contributor information.  The Committee stated that in the past the Ethics Commission allowed the Committee to supply the missing contributor information for contributions that were identified for forfeiture.  The Fines Collection Officer of the Ethics Commission will review the contributor information provided by the Committee.  If the Commission determines that the Committee did not have the information at the time it deposited the contribution, the Committee will be required to forfeit the contributions for which it did not have the required information.

S.F. Campaign and Governmental Conduct Code Section 1.114 (a) (b): Violation of Contribution limits

The total amount that any single contributor could have given the Committee was $750 ($500 general election contribution limit and $250 run-off election contribution limit).  The Committee accepted contributions in excess of $750 from four contributors, as follows:

Contributor	Total Contribution Received	Amount That Exceeds Contribution Limits
May Novak	$850	$100
Transworld Construction, Inc.	$800	$50
UCPCM/PAC	$1,250	$500
Cathy Tsang	$800	$50

The Committee deposited the above-referenced contributions in violation of the law. 

S.F. Campaign and Governmental Conduct Code Section 1.161: Failure to File Some Itemized Disclosure Statements for Mass Mailings

The Committee filed itemized disclosure statements for eight mass mailings.   From a review of the invoices and receipts, the auditor determined that there were two mass mailings for which itemized disclosure statements were not filed, and three mass mailings for which amendments were required but not filed. 

With respect the above-referenced finding, the Committee provided the following comments:

We believe we filed the necessary disclosures, which listed the total amount paid for a particular mailing versus filing a separate form for each time we dropped the same piece.

VII.      Conclusion

Through the examination of the Committee’s records and campaign disclosure statements, the auditor identified three material findings: 1) 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); 2) the Committee accepted contributions from four contributors that exceeded the contribution limits in violation of San Francisco Campaign and Governmental Conduct Code section 1.114 (a) and (b); and 3) the Committee failed to file itemized disclosure statements for two mass mailings and amendments for three mass mailings in violation of S.F. Campaign and Governmental Conduct Code section 1.161.

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:  November 4, 2003

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