30 Van Ness Avenue, Suite 3900
San Francisco CA 94102
Phone 581-2300 Fax 581-2317
SAN FRANCISCO ETHICS COMMISSION AUDIT REPORT:
SAN FRANCISCO LATE NIGHT COALITION
This Audit Report summarizes the results of the audit of the committee, San Francisco Late Night Coalition, Identification Number 991861 (“the Committee”), for the period from January 1, 2001 through December 31, 2002. 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 $26,865 in contributions and incurred reportable expenditures of $11,057. There were three material findings with respect to this Audit: (1) the Committee failed to retain complete campaign records, in violation of Government Code section 84104 and S.F. C&GC Code section 1.106; (2) the Committee failed to disclose complete contributor information for two contributions, in violation of S.F. C&GC Code section 1.114(e); and (3) the Committee failed to itemize 19 expenses of $100 or more totaling $7,060.12, in violation of Government Code section 84211(k) and S.F. C&GC Code section 1.106.
II. Committee Information
The Committee is a general purpose committee that was formed prior to the period covered by the audit. John Wood is the Committee’s current treasurer. During the period covered by the audit period, Robert Kahn was the Committee’s treasurer from 2001 to April 2002 and Grant David served as treasurer from April 2002 to October 2004. The Committee’s treasurer was responsible for the accounting procedures related to the receipt and disbursement of the campaign funds, maintaining the Committee’s records, reconciling the Committee’s books, and preparing the campaign statements that were filed.
III. Audit Authority
San Francisco Charter section C3.699-11 authorizes the Ethics Commission to audit campaign statements that are filed with the Commission and other relevant documents to determine whether the Committee complied with applicable requirements of State and local law. The Ethics Commission, by a random process, selected the Committee for audit.
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; and
- Compliance with all record-keeping requirements.
V. Summary of Applicable Law
Government Code Section 84104 and S.F. C&GC Code Section 1.106: Recordkeeping
Government Code Section 84104 states that it is the duty of each candidate, treasurer and elected officer to maintain detailed accounts, records, bills and receipts that are necessary to prepare campaign statements, and to retain the documents for a period of four years following the date the appropriate campaign statement is filed. Section 84104 is incorporated into the Campaign Finance Reform Ordinance at S.F. C&GC Code section 1.106.
S. F. Campaign and Governmental Conduct Code Section 1.114(e): Contributor Information Required
S. F. C&GC Code section 1.114(e) 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 street 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. Contributions that are deposited without obtaining the required contributor information must be forfeited to the City. C&GCC §1.114(f).
Government Code Section 84211(k) and S.F. C&GC Code Section 1.106: Requirement to Disclose Each Expenditure of $100 or More
Government Code section 84211(k) states that for each person to whom an expenditure of $100 or more has been made during the period covered by the campaign statement, all of the following information must be obtained and reported on the campaign statement: (1) his or her full name; (2) his or her street address; (3) the amount of each expenditure; and (4) a brief description of the consideration for which each expenditure was made. Section 84211(k) is incorporated into the Campaign Finance Reform Ordinance at S.F. C&GC Code section 1.106.
VI. Material Findings
Government Code Section 84104 and S.F. C&GC Code Section 1.106: Recordkeeping
The Committee did not maintain all required records such as copies of contribution checks regarding contributions totaling $7,765.04, which represented 28 percent of the total contributions received during the audit period. In addition, a review of the payment records demonstrated that the Committee failed to maintain invoices for payments totaling $7,783.16, which represented 17 percent of total expenditures during the audit period.
S. F. Campaign and Governmental Conduct Code Section 1.114(e): Failure to Obtain and Disclose Contributor Information
As explained above, under S.F. C&GCC sections 1.114(e) and 1.114(f), contributions that are deposited without the required contributor information must be forfeited to the City, in addition to any other penalties. 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.
For the period covered by the audit, the Committee received and disclosed 36 itemized contributions, each totaling $100 or more on its campaign statements. A review of the 36 itemized contribution entries revealed that four contributions of $100 or more lacked the required contributor information, in violation of Section 1.114. The Commission assessed forfeitures for two of these contributions, which the Committee has already paid. Forfeiture relating to the other two contributions will be assessed. The Committee is required to forfeit $85.02 in contributions, in addition to any other penalties.
Government Code Section 84211(k) and S.F. Campaign and Governmental Conduct Code Section 1.106: Requirement to Disclose Each Expense of $100 or More
During the period covered by the audit, the Committee incurred 19 expenditures of $100 or more totaling $7,060.12 that were not itemized on the Committee’s campaign statements. The Committee’s failure to itemize the 19 expenses totaling $7,060.12, which represents 62 percent of total expenses, is in violation of Section 84211(k) and C&GCC §1.106.
VII. Committee’s Response to Findings
The Committee was provided with an opportunity to review and comment on this audit report. The Committee made the following comments:
The Late Night Coalition is a grassroots organization which is composed primarily of club promoters, DJ’s and individuals under thirty who support nightlife in San Francisco, and none of these members were professional political consultants familiar with campaign finance regulations. For most involved, their participation in the Committee was their first foray into political activism. The Committee’s records were kept with volunteers who acted in the capacity of treasurer; some coalition financial documentation had been lost in the transition between various treasurers; and the previous acting treasurers were not aware of the requirement to make copies of all checks deposited into coalition accounts. The audit findings resulted from a combination of poor record keeping, high turnover of committee officers and a simple un-awareness of city ethics guidelines and compliance processes, which the Committee believes to be common to most if not all grassroots political organizations. In no way did the coalition act without “ethical” guidelines or values in achieving or pursuing any of its goals but has only faltered in the compliance process set forth by the Ethics Commission and the City of San Francisco.
Through the examination of the Committee’s records and campaign disclosure statements, the auditor identified three material findings: (1) the Committee failed to retain complete campaign records, in violation of Government Code section 84104 and S.F. C&GC Code section 1.106; (2) the Committee failed to disclose complete contributor information for two contributions, in violation of S.F. C&GC Code section 1.114(e); and (3) the Committee failed to itemize 19 expenses of $100 or more totaling $7,060.12, in violation of Government Code section 84211(k) and S.F. C&GC Code section 1.106.
Audit reports are posted to the Commission’s web site and are forwarded, in cases of apparent violations of law, to the appropriate enforcement agency.
Date: August 2, 2005
Attachment 1 List of Expenses that the Committee Failed to Report on Schedule E of Form 460
|Date per check register||Check No.||Payee||Description||Politically Related Expenses||Reported on Schedule E of Statement Period||Not Itemized Expenses|
|02/20/01||1111||Sophie Maxwell for Supervisor||Initial and run-off contributions made||750.00||1|
|04/03/01||1120||H. Slater West||2,500 Buttons||738.63||1|
|06/08/01||1207||Shimako Dominguez, LLC||Dufty-Thank you…||53.96||1|
|08/20/01||1221||Ethics Commission||Late Fine||110.00||2|
|09/24/01||1228||Golden Gate Restaurant Association||Contribution Made||300.00||2|
|10/25/01||1239||Golden Gate Restaurant Association||Yearly membership||240.00||Not reported in 2||240.00|
|12/03/01||1251||Kimiko Burton for Public Defender||Contribution Made||500.00||2|
|12/27/01||1260||Dennis Herrera for City Attorney||Contributions Made||750.00||Not reported in 2||750.00|
|01/21/02||1262||Shimako Dominguez, LLC||Mark Leno Invite||612.56||3|
|02/18/02||1268||Alice B. Toklas Democratic Club||Contribution Made||175.00||Not reported in 4||175.00|
|03/01/02||1269||Rebecca McBride||Photography for 2/21/02 Party||139.60||Not reported in 4||139.60|
|03/01/02||1271||Shawn Trudeau||Leno Mailer Design||150.00||Not reported in 4||150.00|
|03/01/02||1272||Committee to Elect Wade Crowfoot||Contribution Made (Democratic Party Central Committee)||200.00||Not reported in 4||200.00|
|03/01/02||1273||Barnes for DCCC||Contribution Made (Democratic Party Central Committee)||200.00||Not reported in 4||200.00|
|03/01/02||1270||NOMAD Printing||20,000 Leno Mailer||1,623.16||Not reported in 4||1,623.16|
|03/07/02||1275||Ivan Barnes||Mark Leno flyer Prom||60.00||Not included in Misc. in 4|
|03/07/02||1276||Angelica Kuehl||Mark Leno flyer Prom||140.00||Not reported in 4||140.00|
|03/07/02||1274||John Wood||Mark Leno flyer Prom||200.00||Not reported in 4||200.00|
|03/08/02||1277||Nick Fynn||Mark Leno flyer Prom||150.00||Not reported in 4||150.00|
|04/08/02||1283||California Parking||Valet parking for 2/21/02 fundraiser for Mark Leno||641.00||Not reported in 4||641.00|
|05/07/02||1284||Alice B. Toklas LG Democratic Club||Yearly due-John Wood||30.00||Not included in Misc. in 4|
|05/07/02||1285||Alice B. Toklas LG Democratic Club||Yearly due-Terrance Alan||30.00||Not included in Misc. in 4|
|05/07/02||1286||John Wood||Campaign Literature (Draft copies of Entertainment Commission)||211.36||Not reported in 4||211.36|
|05/17/02||1287||Harvey Milk Democratic Club||Contribution Made||500.00||Not reported in 4||500.00|
|05/22/02||1290||Chris Daly for Supervisor||Contribution Made||500.00||Not reported in 4||500.00|
|10/15/02||1004||Dept of Elections||Ballot Augment||490.00||Not reported in 5||490.00|
|10/18/02||1021||Ethics Commission||Late Fine of 460 filings||110.00||6|
|10/18/02||1018||Ethics Commission||Contributor fine||300.00||6|
|11/07/02||1005||360 Fish Consulting||Web/Computer consulting (contribution made to Entertainment Commission)||465.00||7|
|11/26/02||1027||Fiona Ma||Contribution Made||750.00||Not reported in 8||750.00|
|11/29/02||1029||John Wood||Leno Send off @SF LGBT (going away party for Mark months after he won the Assembly election)||204.23||8|
|Note:||Statement Period 1||01/01-06/30/01|
|Statement Period 2||07/01-12/31/01|
|Statement Period 3||01/01-02/16/02|
|Statement Period 4||02/17-06/30/02|
|Statement Period 5||07/01-09/30/02|
|Statement Period 6||10/01-10/19/02|
|Statement Period 7||10/20-11/23/02|
|Statement Period 8||11/24-12/31/02|
 Some general purpose committees are required to report only politically related contributions and expenses on the campaign statements. The Committee disclosed politically and non-politically related items on the campaign statements.
 During the period covered by the audit, current section 1.114(e) was codified as section 1.114(d).