Ethics Commission
City and County of San Francisco

Minutes – December 13, 2010

Minutes of the Regular Meeting of
The San Francisco Ethics Commission
December 13, 2010
Room 408, City Hall
1 Dr. Carlton B. Goodlett Place
San Francisco, CA 94102

1. Call to order and roll call.

Chairperson Studley called the meeting to order at 5:38 PM.

COMMISSION MEMBERS PRESENT:  Jamienne Studley, Chairperson; Eileen Hansen, Commissioner; Benedict Y. Hur, Commissioner; Charles Ward, Commissioner.  Commissioner Susan Harriman resigned from the Commission on November 18, 2010.

STAFF PRESENT:  John St. Croix, Executive Director; Mabel Ng, Deputy Executive Director; Catherine Argumedo, Investigator/Legal Analyst.

OFFICE OF THE CITY ATTORNEY:  Andrew Shen, Deputy City Attorney.

OTHERS PRESENT:  An unidentified member of the public.

MATERIALS DISTRIBUTED: 
– Staff memorandum re: Proposed Amendments to the Campaign Consultant Ordinance, dated December 3, 2010. 
– Draft Campaign Consultant Ordinance amendments, dated December 2, 2010.
– Current Campaign Consultant Ordinance, San Francisco Campaign and Governmental Conduct Code section 1.500 et seq.
– Chart regarding changes between existing and proposed Campaign Consultant Ordinance.
– Copy of Proposition G from Voter Information Pamphlet from Consolidated Municipal Election on November 4, 1997.
– Minutes of the Special Meeting of the San Francisco Ethics Commission on October 18, 2010.
– Executive Director’s Report to the Ethics Commission for the Meeting of December 13, 2010.
– Staff memorandum to the FPPC re: comments regarding proposed reform topics, dated November 30, 2010.

II. Public comment on matters appearing or not appearing on the agenda that are within the jurisdiction of the Ethics Commission

None.

III. Consideration of possible amendments to the Campaign Consultant Ordinance, San Francisco Campaign and Governmental Conduct code section 1.500 et seq. 

Chairperson Studley thanked staff for its proposal and background of the Ordinance.  She stated that the item may need to be divided into two meetings.
Decision Point 2
Commissioner Ward stated that this decision point may be the most significant of all of the changes.  He asked for the compelling reason to make the change.  Deputy Director Ng stated that the process for making legislative changes is easier with a super-majority at the Commission level and also at the Board of Supervisors.  She stated that the same time-saving changes had been made to both the campaign finance reform ordinance (CFRO) and the Government Ethics Ordinance (GEO).

Commissioner Ward then asked how the item(s) would be presented to the voters.  Ms. Ng stated that the proposal would most likely be submitted as one item and the voters would vote yes or no.  Executive Director St. Croix stated that the Commission makes frequent changes to CFRO.  He stated that if the Commission did not have the authority to amend, all amendments would need to wait for the next election.  Chairperson Studley asked what the limitations of the scope of changes the Commission would be permitted to make.  Deputy City Attorney Shen stated that there is no limitation, unless the Commission chooses to restrict itself.  Commissioner Hansen stated that she did not support taking the ability to amend this ordinance away from the voters.  Commissioner Ward agreed with Commissioner Hansen.  Chairperson Studley asked whether the Commission would be able to present alternatives to the voters, rather than one yes-or-no item.  DCA Shen stated that the Commission would be able to do so, although he stated that voters may be confused by two similar items on the ballot.

The Commission suspended discussion of this decision point until the end of the item.

Decision Point 3a
Commissioner Hur stated that part of the definition of “campaign consultant” was ambiguous.  He stated that the provision on page 3, line 3 is fine without the added phrase, regarding employees of a campaign consultant.  Staff agreed that the sentence would read “[t]he term “campaign consultant” does not include employees of a campaign consultant, attorney who provide only legal services…”

Commissioner Hansen did not agree with increasing the amount of economic consideration from $1,000 to $5,000.  Ms. Ng stated that staff was recommending a flat fee for all campaign consultants and any consultant that earns $1,000 would be required to pay a $500 fee.  She stated that very few consultants earn less than $5,000 in a calendar year.  Ms. Argumedo stated that three consultants out of 47 registered consultants earned less than $5,000 in 2010.  Commissioner Hur stated that the change to $5,000 was appropriate.  Commissioners Ward and Studley agreed.

Motion 10-12-13-1 (Hur/Ward): Moved, seconded and passed (3-1; Hansen dissent) that the Commission adopt decision point 3a, except to exclude the phrase on line 3, page 3.

Public Comment:
None.

Decision Point 5a
Commissioner Ward asked what the original intent was for having a campaign consultant register with the Tax Collector.  Ms. Ng stated that she researched the question but did not find an answer.   

Commissioner Hur asked about the added language in section 1.515(a)(4), “any other employee of the campaign consultant’s employer.”  He asked who was intended to be affected by the language.  Commissioner Ward stated that he could envision a scenario where someone works for a firm that is not a campaign consultant firm and is running someone else’s campaign.  Commissioner Hur stated that raising the threshold for campaign consultant registration may alleviate some of the burden, as the requirement may be unduly onerous.  He stated that the requirement may have a deterrent effect on someone performing as a campaign consultant as a side job.  Commissioner Hansen stated that the requirement should remain in place, as the connections between campaign consultants and lobbyists are important ones.

Commissioner Hur suggested removing the phrase “or any other employee of the campaign consultant’s employer” in line 15 on page 5 of the proposed ordinance.

Motion 10-12-13-2 (Hur/Ward): Moved, seconded and passed (3-1; Hansen dissent) that the Commission adopt decision point 5a, as amended.

Public Comment:
None.

Decision Point 5b-1
Chairperson Studley asked about the attendance at the interested persons’ meetings.  Ms. Ng stated that two individuals attended, but that no one raised any comments regarding monthly reporting. 

Motion 10-12-13-3 (Hansen/Ward): Moved, seconded and passed (4-0) that the Commission adopt decision point 5b-1.

Public Comment:
None.

Decision Point 5b-2
Commissioner Hansen raised concerns regarding deletions from the current ordinance.  She stated that the majority of the deletions occur under decision point 5d.

Motion 10-12-13-4 (Hur/Ward): Moved, seconded and passed (4-0) that the Commission adopt decision point 5b-2.

Public Comment:
None.

Decision Point 5d
Chairperson Studley asked how the fees compare to the lobbyist fees.  Ms. Ng stated that the lobbyists fees are $500 and that the Commission had lowered the amount in its initial proposal, but that the Board of Supervisors raised the fees to $500.  Ms. Ng stated that staff had debated whether to increase the threshold to $10,000 rather than $5,000, but decided on $5,000 after the interested persons’ meetings.  She suggested requiring different fees based on the consultant’s earnings.

Commissioner Hansen asked the reason for removing the client fee from the Ordinance.  She stated that all consultants should pay a fee.  Commissioner Ward stated that removing the client fee would not create a loss of revenue, as most consultants earn much higher than the proposed threshold.  Ms. Ng stated that the client fees do not raise that much money.  Commissioner Hansen suggested raising the fees to $1,000, $500, and $250, based on the current three tiers for earnings.  Commissioner Ward stated that the fees should have some relationship to the cost of administering the program.  Ms. Argumedo stated that most consultants have one or two clients.  She also stated that 17 consultants that have already reported receiving over $20,000 this year.  Commissioner Hur suggested a $200 fee for consultants making below $10,000 and $500 for consultants making more than $10,000 in a calendar year.  

Motion 10-12-13-5 (Hur/Ward): Moved, seconded and passed (4-0) that the Commission adopt decision point 5d, except that those campaign consultants who earn $10,000 or less per calendar year pay a $200 registration fee and those campaign consultants who earn over $10,000 pay a $500 registration fee.

Public Comment:
None.

[Break at 7:20 PM.] 

[Return from break at 7:28 PM.]

Decision Point 6

Motion 10-12-13-6 (Hansen/Ward): Moved, seconded and passed (4-0) that the Commission adopt decision point 6.

Public Comment:
None.

Decision Point 8
Commissioner Hur asked for a clarification of the second sentence of proposed section 1.530.  Ms. Ng stated that this section would apply to all consultants.  Mr. St. Croix suggested adding that “the Executive Director shall report any additional training to the Commission.”

Motion 10-12-13-7 (Hansen/Ward): Moved, seconded and passed (4-0) that the Commission adopt decision point 8, as amended.

Public Comment:
None.

Decision Point 9

Motion 10-12-13-8 (Hansen/Ward): Moved, seconded and passed (4-0) that the Commission adopt decision point 9, without discussion.

Public Comment:
None.

Decision Point 16

Motion 10-12-13-9 (Hansen/Ward): Moved, seconded and passed (4-0) that the Commission adopt decision point 16, without discussion.

Public Comment:
None.

Decision Point 5f
Ms. Ng stated that staff suggested deleting this provision because the restricted source rule generally does not apply to campaign consultants.  She also stated that there is no state or local law that bans giving a gift that is worth $420 or less.  She stated that all office-holders are required to report gifts received with a value of $50 or more.  She stated that only two gifts have ever been reported.  Commissioner Hansen stated that campaign consultants should not be permitted to give gifts.
  
Motion 10-12-13-10 (Hur/Ward): Moved, seconded and passed (3-1; Hansen dissents) that the Commission adopt decision point 5f.

Public Comment:
None.

Decision Point 5g

Motion 10-12-13-11 (Hansen/Hur): Moved, seconded and passed (4-0) that the Commission adopt decision point 5g, without discussion.

Public Comment:
None.

Decision Point 5h

 Motion 10-12-13-12 (Hansen/Hur): Moved, seconded and passed (4-0) that the Commission adopt decision point 5h.

Public Comment:
None.

Decision Point 5i
Commissioner Hansen suggested clarifying the language rather than deleting the provision.  Commissioner Ward stated that he would not delete this provision at this time.  Ms. Ng asked that the Commission adopt regulations in the future to clarify this provision. 

Decision Point 5j
Commissioner Hur stated that it would be useful for the public to know whether a City officer was being employed by a consultant to promote a ballot measure.  Commissioner Hansen agreed.  DCA Shen stated that the office-holder would be required to report any income over $500.  Commissioner Hur stated that the report is annual and voters may not know until after an election.

Decision Point 5k
Commissioner Hansen stated that there is a public interest in knowing information about City contracts, even if it is unlikely and reported elsewhere.  Commissioner Ward agreed.

Decision Point 5l
All four commissioners agreed to retain this requirement.

Chairperson Studley stated that the remaining decision points are 1, 3b, 3c, 3d, 5c, 5e, 7, and 10-15.  Commissioner Ward stated that he would like to discuss decision point 10.  Commissioner Hur stated that he would like to discuss decision points 7 and 10.  Commissioner Hansen stated that she would like to discuss decision points 3b, 3c, 7, and 10. 

Decision Point 3b
Commissioner Hansen stated that she would like to include City officers running for state offices.  Ms. Ng stated that staff would return with an updated definition of “candidate” at the next meeting.

Chairperson Studley suggested that the commissioners e-mail staff or the Executive Director with any questions on the remaining decision points to discuss at the next meeting. 

Decision Points 1, 3c, 5c, 5e, 11-15

Motion 10-12-13-13 (Hansen/Hur): Moved, seconded and passed (4-0) that the Commission adopt decision points 1, 3d, 5c, 5e, and 11-15.

Public Comment:
None.

The Commission will discuss decision points 2, 3b, 3c, 7, and 10 at its next meeting.

IV. Election of Vice-Chair.

Chairperson Studley stated that Commissioner Harriman has resigned, as she now resides outside of San Francisco.  She stated that former Commissioner Harriman was a wonderful commissioner and a thoughtful chair.  She stated that her clarity helped the Commission to handle matters and think about procedure for those issues.  Commissioner Hur read a statement from former Commissioner Harriman.  Former Commissioner Harriman thanked the Commission and was grateful for having the opportunity to work with the commissioners and staff.  She stated that each commissioner has the qualities that each San Francisco resident would want for a commissioner.

Chairperson Studley stated that her resignation left a vacancy and suggested electing a vice-chair.  Commissioner Ward nominated Commissioner Hur.   Chairperson Studley nominated Commissioner Hansen.  She stated that Commissioner Hansen’s term was ending in two months and her long service has not been recognized.  Commissioner Hur stated his appreciation for Commissioner Ward’s nomination, but stated that he would defer to Commissioner Hansen.  Commissioner Hansen deferred to Commissioner Hur, as he would remain on the Commission.

No action was taken.

Public Comment:
None.

V. Minutes of the Commission’s special meeting of October 18, 2010. 

Motion 10-12-13-14 (Hansen/Hur): Moved, seconded and passed (4-0) that the Commission adopt the minutes of the Commission’s special meeting of October 18, 2010.

Public Comment:
None.

VI. Executive Director’s Report.

Executive Director St. Croix stated that all departments have been ordered by the Mayor’s Budget Office to reduce each budget by 10%, plus an additional provisional 10% reduction. 

He stated that there will be changes to the public financing program that the Commission will need to discuss.  He also stated that there have been four new complaints from the October meeting to the current meeting.

He also discussed the interested persons’ list.  He stated that staff has converted to a new and better system.

Chairperson Studley asked to discuss the public financing program at a future meeting.

Commissioner Hansen had several budget questions for a future meeting and asked about the Sunshine Ordinance Task Force.  She asked whether there would be another joint meeting.  She also asked about an attached FPPC letter.

VII. Items for future meetings.

Chairperson Studley stated that the commissioners should e-mail her or Mr. St. Croix with items for future meetings.

VIII. Public comment on matters appearing or not appearing on the agenda that are within the jurisdiction of the Ethics Commission.

None.

IX. Adjournment.

Motion 10-12-13-15 (Hansen/Hur): Moved, seconded and passed (4-0) that the Commission adjourn.

Public Comment:
None.

Meeting adjourned at 8:23 PM.

Respectfully submitted,

_________________
Catherine Argumedo

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