Minutes – July 11, 2011 – San Francisco Ethics Commission

Minutes of the Regular Meeting of
The San Francisco Ethics Commission
July 11, 2011
Room 408, City Hall
1 Dr. Carlton B. Goodlett Place
San Francisco, CA 94102

I. Call to order and roll call.

Chairperson Hur called the meeting to order at 5:33 PM.

COMMISSION MEMBERS PRESENT: Benedict Y. Hur, Chairperson; Jamienne Studley, Vice-Chairperson; Beverly Hayon, Commissioner; Dorothy S. Liu, Commissioner; Charles Ward, Commissioner.

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

OFFICE OF THE CITY ATTORNEY: Jon Givner, Deputy City Attorney.

OFFICE OF THE OAKLAND CITY ATTORNEY: Mark Morodomi, Supervising Attorney.

OTHERS PRESENT: Sue Cauthen, Jewelle Gomez, Dr. Maria Rivero, Luis Herrera, Dr. Derek Kerr, Judith Rosen, Richard Knee, Hope Johnson, Thomas Picarello, Zack Stewart, Peter Warfield, Kimo Crossman, Ray Hartz, David Pilpel, Bruce Wolfe, Charley Marsteller, Patrick Monette-Shaw, Larry Bush, David Looman, Chris Wright, Bradley Hertz, Vince Courtney, Ken Cleveland, and other unidentified members of the public.

MATERIALS DISTRIBUTED:
– Staff memorandum regarding Ethics Complaint No. 01-100115, dated July 6, 2011.
– San Francisco Civil Grand Jury Report – San Francisco's Ethics Commission: The Sleeping Watch Dog.
– Draft Response to the San Francisco Civil Grand Jury Report.
– Staff memorandum regarding possible amendments to the Campaign Finance Reform Ordinance, dated July 7, 2011.
– Draft Ordinance amending section 1.144 of the Campaign and Governmental Conduct Code, dated July 6, 2011.
– Legislative Digest and draft Ordinance amending section 1.144 of the Campaign and Governmental Conduct Code, dated July 11, 2011.
– Draft Minutes of the Regular Meeting of the San Francisco Ethics Commission on June 13, 2011.
– Draft Minutes of the Special Meeting of the San Francisco Ethics Commission on June 28, 2011.
– Executive Director's Report to the Ethics Commission for the Meeting of July 11, 2011.

II. Public comment on matters appearing or not appearing on the agenda that are within the jurisdiction of the Ethics Commission Chairperson Hur stated that each speaker would be permitted three minutes to speak. He noted that he wanted to ensure everyone was afforded the opportunity to speak.

Dr. Maria Rivero stated that she was a whistleblower and driven out of her job. She stated that she had reported a potential conflict of interest in September 2009 regarding a contract between Health Management Associates and Mitch Katz, the former Director of the Public Health Department. She alleged that Mr. Katz had a conflict of interest due to his consulting work for HMA and that the complaint was still under consideration.

Patrick Monette-Shaw stated that the Ethics Commission was a complete mess and that the Civil Grand Jury's report barely scratched the surface. He suggested changing the regulations and scheduling hearings on all referrals to Ethics. He stated that the Commission's duty was to protect the citizens of San Francisco.

Ray Hartz stated that he had attended the hearing for Mr. Shoemaker. He stated that he had been in the military for over 10 years. He stated that no one has the right to tell him that he cannot talk about something. He stated that members of the Ethics Commission have taken an oath to support and defend the United States and California Constitution.

Judith Rosen stated that she was speaking on behalf of her sister, who lives down the street from her. She claimed that her sister had been subject to a retaliatory complaint regarding visible trash cans. She stated that her sister and her sister's partner are both City employees. She stated that she had two different violations of whistleblower complaints and that would like to discuss them privately.

Richard Knee identified himself as the immediate past Chair for the Sunshine Ordinance Task Force ("Task Force"). He stated that he appreciated the Commission's patience on the proposed guidelines for the Ethics Commission's regulations on Sunshine complaints. He stated that he anticipated the Task Force would send its comments within a month or two.

Dr. Derrick Kerr stated that, after 20 years, he became a whistleblower and lost his job. He stated that he had reported a conflict of interest regarding a City contract that was awarded to Davis Ja and Associates. He stated that Health Department employee Deborah Sherwood resided at the same address as Davis Ja and co-owned property with him and that she failed to disclose a personal and business relationship with Ja and Associates. He stated that staff's investigation is ongoing.

Thomas Picarello stated that the agenda had too many items and suggested that the Commission hold a special meeting to discuss the Civil Grand Jury Report and response.

Kimo Crossman agreed with Mr. Picarello. He stated that scheduling the item for a separate meeting would allow for a full discussion.

Sue Cauthen, a member of the Task Force, stated that she had not read the Civil Grand Jury Report in its entirety. She stated that she agrees with some of the recommendations in the report.

III. Consideration of Ethics Complaint No. 01-100115.

Investigator Garrett Chatfield stated that this discussion was regarding the applicability of section 67.34 of the Sunshine Ordinance and that it was not a probable cause hearing. He played a video of the Library Commission meeting in question. He stated that staff believed a violation occurred and that the issue is whether section 67.34 applies to either Sue Blackman or Jewelle Gomez. He stated that Ms. Gomez was appointed by the Mayor and that Ms. Blackman was neither an elected official nor a department head.

Ms. Cauthen stated that she believed that at issue is not only the application of section 67.34, but also the proper treatment of the public. She stated that the government should treat people with respect.

Mr. Knee stated that he had chaired the hearing of the Task Force where this matter was heard. He stated that the Task Force had found Ms. Gomez violated the Sunshine Ordinance.

Jewelle Gomez, President of Library Commission, stated that she felt compelled to add context to the deliberations. She stated that the video was not complete and that she had asked the previous speaker to sit down as well. She stated that "willful" implies a deliberate attempt to violate the Brown Act. She stated that she had followed all procedure as it had been at all previous hearings. She stated that the Library Commission had never traditionally covered an item both in general public comment and again during a specific agenda item. She stated that Ms. Cauthen had refused to stop speaking and that she was assured by the Deputy City Attorney (DCA) that she was correct in asking her to wait for the agenda item. She stated that Ms. Cauthen had showed great disrespect to the Commission. Ms. Gomez stated that what was willful was the Task Force's deliberate scheduling of the matter when neither she nor the Commission secretary would be able to attend the Task Force meeting. She stated that she testified and acknowledged that the wording of the Commission's agenda may have been misleading and so the Commission changed the wording on the agenda. She stated that the new wording on the agenda was approved by the DCA. She stated that it has been an honor for her to serve on the Library Commission.

Commissioner Ward stated that he saw something on the video that differed from what Ms. Gomez stated. He stated that it appeared to him that Ms. Cauthen was trying to explain what she was hoping to say during public comment. He stated that it was hard for him to understand how someone sitting in the chair would treat a member of the public in that way. He stated that her actions were unconscionable.

Chairperson Hur asked whether Ms. Cauthen was able to express her views under the later agenda item. Ms. Cauthen stated that she was not. She stated that what she was going to say was not related to the later agenda item, since it was about the preservation of libraries city-wide.

Commissioner Ward asked whether Ms. Gomez had ever apologized. Ms. Cauthen stated that she had not. She stated that she was shocked that Ms. Gomez lost control and yelled at her, as she had been attending Library Commission meetings since 1988. She stated that it created a chilling effect on her and some other people who attended the meeting. She stated that neither Ms. Gomez nor any of the Library Commissioners has mentioned the subject.

Ms. Gomez stated that Ms. Cauthen had indicated that she was going to talk about North Beach and I told her to wait for that item. She stated that what occurred may have been indecorous, but she felt assaulted by her. She stated that, as Chair, when you ask someone to sit down, they sit down. She stated that Ms. Cauthen was disrespectful to the Commission, but admitted that she should not have snapped at her. She provided a public apology, saying that her great-grandmother would not approve, but that her point was still on target.

Commissioner Liu agreed with Commissioner Ward and stated that she did not see any assault or disrespect. She stated that she did not understand Ms. Gomez's reaction. She stated that it was a willful violation of the Sunshine Ordinance. Commissioner Studley stated that she agreed with both Commissioners as well. She stated that she was troubled by the jurisdictional issue, as the Commission may not have the tools to address it given the statute. Chairperson Hur agreed and stated that he did not find the notion that the Chair felt disrespected to be credible.

Commissioner Ward suggested that the Commission write a letter to her appointing authority expressing the Commission's view of what occurred and requesting that that person reconsider her service on the Library Commission. Chairperson Hur suggested adding a statement that her conduct willfully violated section 67.15 of the Sunshine Ordinance.

Executive Director St. Croix stated that there may have been a drafting error in section 67.34, but that the Commission could determine what the policy would be. He stated that the policy could not be changed immediately, but that the Commission could request that staff work on it.

DCA Givner stated that the Sunshine Ordinance itself leaves a lot of blanks for Ethics Commission enforcement. He stated that the proposed regulations that the Commission was considered last year addressed some of those issues. He stated that the Commission could not impose penalties until those regulations have been adopted. Mr. St. Croix stated that staff's memorandum addressed the alternatives under the current regulations.
Public Comment:
Patrick Monette-Shaw stated that the sentence in section 67.34 clearly says that it applies to "managerial employees." He stated that the Commission does not need to discuss jurisdiction, as the Task Force already found a violation. He stated that section 67.34 need to be clarified by the Task Force revisions. He stated that the Commission should rule that section 67.34 was violated.

Peter Warfield stated that he had attended Library Commission meetings for more than a decade. He stated that he was the speaker after Ms. Cauthen at the meeting in question. He stated that speaker prior to Ms. Cauthen was allowed to speak longer than Ms. Cauthen before being told to hold her comment until the later agenda item. He stated that Ms. Cauthen was forced to sit down.

A member of the public stated that what occurred at the meeting in question occurs frequently at the Library Commission meetings. He stated that the Library Commission does not want accountability in the future and that there are moneyed interests involved that are suppressing the truth. He suggested that the Ethics Commission honor Sue Cauthen, as it takes a lot for someone to stand up to the ruthless crooks.

Ray Hartz asked why Ms. Blackman was included, since her actions were not in question. He stated that he thought it was a willful violation as it occurred in 2009. He stated that Ms. Gomez could have spoken to Ms. Cauthen and apologized, but she never did that. He stated that Ms. Gomez had a total disregard for the citizens of the City. He stated that Ms. Cauthen would have been generous.

A member of the public stated that she had attended the Library Commission meeting that night and that Ms. Gomez was yelling at Ms. Cauthen. She stated that it was more than indecorous. She stated that she has attended many public meetings and frequently members of the public will get out of control. She stated that no one expected the person in authority to do that. She stated that she had written a letter to the Mayor about two years ago regarding this incident.

Kimo Crossman stated that it was the Ethics Commission's duty to enforce, as the Task Force is given the power to adjudicate. He stated that the Task Force found a willful violation and that it was referred for enforcement. He stated there was no reason to readjudicate everything from the Task Force. He recommended taking strong action against this person.

Thomas Picarello stated that the Commission has now denied 19 Orders of Determination from the Task Force. He stated that the Ethics Commission has to have accountability as there was a serious and willful violation of the Sunshine Ordinance. He would like the Commission to reconsider the motion and refer to the Mayor's office.

Zack Stewart stated that he has been appearing in public meetings for fifty years. He stated that a friend of his had warned him about the Library Commission. He stated that he does not waste his time at the Library Commission anymore, as it is loaded with money. He stated that they crush anyone that does not agree with them. He supported the Ethics Commission's finding a violation.

Luis Herrera, City Librarian, stated that he wanted to speak on behalf of President Gomez. He stated that she had been appointed by Mayor Newsom and elected President of the Commission since 2008. He stated that she has earned the respect of the Commissioners, Library staff, and the community. He stated that he has been City Librarian during her entire tenure that she has been fair and professional. He stated that what the Commission saw on the video was not the Commissioner Gomez he knew. He stated that any action taken by the Ethics Commission would diminish her activities to San Francisco.

Ms. Cauthen stated that she agreed with Mr. Hartz. She stated that if Ms. Gomez had not yelled, she may have let it go. She stated that she was present during the drafting of the Sunshine Ordinance and that the intent was to give the Ethics Commission the authority to enforce violations of the Ordinance. She asked the Commission to send a letter to the Mayor.

An anonymous man stated that everyone makes mistakes. He stated that this conversation occurred two years ago. He suggested that this type of behavior should not be permitted.

Commissioner Liu asked whether the Commission would be able to enforce a violation against Ms. Gomez. Mr. Chatfield stated that Ms. Gomez does not fall into any of the three categories mentioned in section 67.34. Commissioner Studley stated that this situation is akin to a member of the audience stopping another member of the audience from speaking. She stated that it would be unfortunate and willful, but that it would not fall within the powers of the Ethics Commission. She suggested bringing it to the attention of the Mayor.

Motion 11-07-11-01 (Ward/Liu): Moved, seconded, and passed (5-0) that the Commission send a letter to the Mayor stating that Jewelle Gomez, Chair of the Library Commission, willfully violated section 67.15 of the Sunshine Ordinance, include a copy of the video, and recommend that the Mayor consider removing Ms. Gomez as his appointee to the Library Commission.

Mr. St. Croix suggested that staff draft the letter to the Mayor and Chairperson Hur have final approval.

IV. Consideration of possible response to the 2010-2011 Civil Grand Jury Report.

Executive Director St. Croix stated that a response to the Civil Grand Jury Report is required and that the Commission is required to respond to all seven findings. He stated that he had drafted a response for consideration.

Commissioner Ward agreed that this item should be scheduled for a special meeting in order to have more time to discuss and weigh public comment on the response. He asked what would happen if the Commission missed the August 15, 2011 deadline. DCA Givner recommended not missing the deadline.

Commissioner Studley agreed that there were several policy issues that the Commission may want to address, but asked to discuss the findings tonight as well. Commissioner Hayon agreed and stated that the Commission has the opportunity to provide an educational opportunity to the public. She stated that the Commission could discuss the report and hear from the public at a special meeting. Chairperson Hur stated that the purpose of placing this item on the agenda at this meeting was because of the deadline. He stated that he had concerns of setting a special meeting, as the Commission may not get the same attendance. He suggested discussing it and continuing to the next regular meeting on August 8, 2011. The Commissioners agreed.

Finding One
Commissioner Studley stated that this issue has been of interest to the Commissioners and that it needs attention. Chairperson Hur agreed. Commissioner Liu asked what guidelines were used. Mr. St. Croix stated that staff looks at similarities with prior cases, and when nothing is comparable, staff uses a balancing test with public harm and prior history of the actors involved.

Finding Two
Chairperson Hur proposed omitting the sentence following the italicized Task Force. He stated that these issues were a concern and that the Commission would like to address them.

Finding Three
Chairperson Hur agreed with the proposal and stated that the Commission should look into it.

Finding Four
Commissioner Studley and Chairperson Hur agreed that this finding is up to the determination and judgment of the voters.

Finding Five
Commissioner Studley stated that she had discussed this issue with the Grand Jury when she met with them. She stated that they raised some interesting points and that she would be interested in returning to this item. She stated that she would like to look at the process, but added that the recommendations they have been receiving are well substantiated.

Chairperson Hur asked Mr. St. Croix and staff to look at possible alternative mechanisms with dealing with complaints. He suggested removing the language following "decisions" in the second to last sentence of the last paragraph on page 3.

Finding Six
Chairperson Hur agreed with the proposed response.

Finding Seven
Commissioner Liu asked why Commission meetings were not televised. She stated that, if the Commission can get the funding, it would be a good idea for public perception and other reasons. Mr. St. Croix stated that the main reason the meetings are not televised is the budget. He stated that the Commission is frequently ordered to make budget cuts and if he is able to make a request for a budget recommendation, it is always staff-driven. He stated that the Commission has never been fully staffed.

Public Comment:
Kimo Crossman stated that many departments pay nothing for SFGTV and that he was surprised to hear the reason is budgetary. He stated that he was not aware of the Director requesting an estimate for the service recently. He stated that Finding Two is important, as the Commission has not addressed 18 cases that have come from the Task Force.

Ray Hartz stated that Finding Two was his biggest interest. He stated that tonight's scheduling of a Sunshine matter seemed convenient to him. He stated that the Ethics Commission was to enforce Task Force's findings. He stated that the Commission had no intention of doing anything.

Patrick Monette-Shaw stated that the response for Finding Two was terrible. He stated that the Director had refused to release records to him and that the Task Force had ordered him to release them. He stated that the Commission was not supposed to retry and that the Commission is not supposed to go digging whether or not there were enough facts.

David Looman, a campaign treasurer, stated that he wanted to respond to the report. He stated that the report was flawed. He stated that about 4-5 people perform about 80% of the treasury work in the City and about 99% of those who perform continuing treasury work. He stated that not one of the treasurers was interviewed or even contacted by the Grand Jury. He stated that none of their conclusions about campaign finance will stand up to actual facts and that the report was an ignorant set of conclusions.

Hope Johnson spoke about Finding Two and mentioned that she was the newly elected Chair of the Task Force. She stated that she looked forward to working with the Commission during this year and that they have had a hard time coming to agreement regarding the proposed guidelines. She commended Chairperson Hur for striking the language in the proposed response. She stated that the cases deserve to be heard in public. She also stated that the Commission's website does not list Sunshine as part of its duties.

Chris Wright from the Committee on Jobs spoke about Finding Four. He stated that the Grand Jury suggested that members should be appointed from the San Francisco Labor Council. He stated that the Council and 90% of its members have failed to file lobbyist reports. He stated that the Commission should look at members of the business community, as the law requires.

Charley Marsteller stated that the tenor of the rebuttal should be positive. He stated that improvements can be made in enforcement and that the Commission should look at it, such as the technical training of staff and what qualifications the employees have. He suggested thanking the Grand Jury for their work, even though it may not be perfect.

Thomas Picarello stated that he applauded the removal of the language in Finding Two. He stated that if the Commission enforced campaign finance violations, the Commission could afford to televise twice a week as they would collect more than enough money from the committees that violate CFRO.

Peter Warfield stated that he agreed with continuing this item to the next meeting. He stated that it was important that City agencies provide a prompt and timely response to requests for information. It is not timely if the Commission takes over a year. Regarding the prior item, he asked what authority the Commission had in dismissing a violation that had already been found by the Task Force.

Larry Bush recommended that the Commission reach out to former Commissioners and other who have been involved in the past regarding the continuation of this item. He stated that televising meetings generally costs $1,000/hour.

David Pilpel stated that he agreed with some comments, but not all. He stated that the report was thin and did not understand the nature of the work or the constraints that the Commission is under. He suggested attaching the latest Annual Report to the response to the Grand Jury. He stated that there may be policy disagreements but that the Commission is not broken.

Chairperson Hur thanked everyone for their comments. He also thanked the Director and staff for their hard work and the services they provide. Commissioner Studley asked that Sunshine-related enforcement be added as one of the Commission's responsibilities on the website.

V. Closed session.

Motion 11-07-11-02 (Ward/Studley): Moved, seconded, and passed (5-0) that the Commission move into closed session.

Public comment:
Ray Hartz stated that he regularly attends Police Commission meetings. He stated that over 60% of their time is spent in closed session, so that they can do whatever they want with absolutely no public review. He stated that the public needs to know what is going on. He stated that he has seen people sitting on commissions who were not qualified.

Charley Marsteller asked whether the Commission could rearrange the order of the agenda, so that the next item could be heard prior to closed session.

Bruce Wolfe, a member of the Task Force, reminded the Commission that the closed session must be recorded.

Thomas Picarello stated that too many things are being heard in closed session. He stated that he did not understand why a discussion of the Arizona case needed to be discussed in closed session. He stated that the public have a right to hear the discussion and then comment on the matter.

David Pilpel stated that he disagreed with Mr. Picarello and that he saw the need for closed session.

The Ethics Commission entered into closed session at 7:44 PM.

[Break at 7:44 PM.]
[Return from break at 7:54 PM.]

The Ethics Commission returned to open session at 8:33 PM.

VI. Discussion and vote regarding closed session action and deliberations.

Motion 11-07-11-03 (Studley/Ward): Moved, seconded, and passed (5-0) that the Commission maintain as confidential the discussion it had in closed session re: anticipated litigation as a plaintiff and possible litigation as a defendant.

Public comment:
None.

The Executive Director read the following announcement:

Finding of Probable Cause for Ethics Commission Complaint 12-100726

At its regular meeting of July 11, 2011, in the matter of Ethics Complaint Number 12-100726, the Ethics Commission made a determination that there is probable cause to believe the following violations of the San Francisco Campaign and Governmental Conduct Code; and that the Respondent, Regina Carey, committed them:
1) Two violations of San Francisco Campaign and Governmental Conduct Code section 1.510 for providing campaign consulting services, or accepting any economic consideration for the provision of campaign consulting services, without first registering with the Ethics Commission and complying with the reporting requirements specified in Section 1.515;
2) Violation of San Francisco Campaign and Governmental Conduct Code section 1.515(a) for failing to file a campaign consultant registration report;
3) Violation of Francisco Campaign and Governmental Conduct Code section 1.515(c) for failure to pay campaign consultant registration and client fees;
4) Violation of San Francisco Campaign and Governmental Conduct Code section 1.515(d) for failure to file campaign consultant client authorization statement;
5) Three violations of San Francisco Campaign and Governmental Conduct Code section 1.515(e) for failure to file campaign consultant quarterly reports.
Each Commissioner who participated in a decision to find probable cause must certify on the record that he or she personally head or read the testimony, reviewed the evidence, or otherwise reviewed the entire record of the proceedings. (Ethics Commission Regulations for Investigations & Enforcement § VIII.B.2.)
The Respondent is presumed to be innocent unless and until such time that the allegations are proved in a subsequent hearing on the merits. (Ethics Commission Regulations for Investigations & Enforcement Proceedings § VIII.B.5.)
The Executive Director shall issue an accusation in accordance with the San Francisco Ethics Commission Regulations for Investigations and Enforcement Proceedings. (Ethics Commission Regulations for Investigations & Enforcement Proceedings § IX.A.)
Each Commissioner certified on the record that he or she had personally heard or read the testimony, reviewed the evidence, or otherwise reviewed the entire record of the proceedings.

VII. Consideration of possible amendments to the Campaign Finance Reform Ordinance (CFRO), San Francisco Campaign and Governmental Conduct Code section 1.100 et seq.

Executive Director St. Croix stated that a successful challenge had been made to the Arizona public finance system and staff presented possible amendments to the City's public finance program.

Commissioner Studley stated that she was not happy about considering changes at all and stated her disappointment in the Supreme Court decision. She stated that she would prefer to do what the voters had initially passed. Chairperson Hur suggested a change on page 2, line 18 of the proposed amendments. Deputy Director Ng stated that the latest version of the proposed amendments corrected eight technical changes, listed as follows:

• Page 2, line 2,the text should read as subsection (c)(2), not (c)(3);
• Page 2, line 18, the text should read as subsection (c)(2)(A), not (c)(3)(A);
• Page 2, line 21, the text should read as subsection (c)(2)(B), not (c)(3)(B);
• Page 2, line 22, the word "dollar" should be singular;
• Page 3, line 16, the text should read as subsection (d)(2), not (d)(3);
• Page 4, line 9, the text should read as subsection (d)(2)(A), not (d)(3)(A);
• Page 4, line 12, the text should read as subsection (d)(2)(B), not (d)(3)(B);
• Page 6, line 10; the text should read as subsection (f), not (g).

Public Comment:
David Pilpel asked whether the amendment would require a super-majority. He stated that the staff memorandum does not cover the process. Mr. St. Croix stated that the amendments would require a super-majority of the Commission and the Board. Mr. Pilpel stated that changing the rules in the middle of the election cycle could be difficult. He stated that this was a difficult item.

Charley Marsteller stated that this issue was not ripe, as nothing has occurred in the City to trigger it yet. He stated that the Commission had three options: do nothing, repeal, or provide for remedy language that would accommodate the court's decision. He stated that Bob Stern at the Center for Governmental Studies had anticipated the court's decision. He stated that the Center was drafting language to accommodate such a change. He asked that the Commission wait to hear from the Center prior to making a change to the current law. He stated that he had asked Mr. Stern to send the draft language to the Ethics Commission.

Bradley Hertz from the Sutton Law Firm stated that his firm serves as legal counsel to several organizations that participate in local elections. He stated that these organizations are exercising their First Amendment rights. He stated that the firm had sent a letter through staff that day applauding the impact of the court ruling. He applauded the Commission and staff for acknowledging the impact of the Supreme Court ruling, but stated that the firm does not think the proposed amendments go far enough. He stated that the law, even if amended, would still violate certain court decisions.

Mr. Hertz stated that "even if the flow of public money is capped at the ceiling level if… candidates are still able to get excessive private money in response to the actions of independent expenditures or other candidates, that is the kind of 'leveling the playing field' that is not a legitimate purpose under the Constitution." Chairperson Hur asked how, if no public funds are going to that candidate above the expenditure ceiling, San Francisco would be "leveling the playing field" in that scenario. Mr. Hertz stated that if independent expenditure ("IE") spending comes in, then that lifts the spending limit. He stated that that chills the rights of those making IEs. He stated that their speech is answered by more money that is only allowed because of their speech, especially when using the multiplier effect. He stated that, in addition to amending section 1.114, section 1.143 must be amended as well as it chills speech. He suggested that there should be a decision point 3 to review the current CFRO provisions and respond more completely to the Supreme Court's concerns.

Vince Courtney, Executive Director of the Alliance for Jobs and Sustainable Growth, applauded the Commission for working late into the night. He stated that he represented many organizations that do IE campaigns. He stated that there must be a super-majority of businesses or unions in order to make a decision. He stated that one issue is that people are not willing to spend more money because they think it will be matched. He stated that an idea is to spend late, so that the money is not matched, but now more people are voting early. He agreed with the previous speaker. He stated that the only legal option was the third option.

Ken Cleveland stated that he represented the Building Owners and Managers Association (BOMA), which formed a PAC in 1987. He stated that BOMA has a PAC for IEs and one for ballot measures. He stated that BOMA has used the IE PAC very effectively, but that it has changed over the past few years with public financing. He stated that any dollars they spend will be matched and that has a chilling effect. He stated that most buildings are not owned by individuals and that organizations like his have spent less money on IEs, particularly in candidate races. He suggested no matching funds, or their freedom of expression would be severely compromised. He stated that he hoped the Commission would keep their rights as private citizens.

Chris Wright, Executive Director of the Committee on Jobs, stated that he agrees that the current law has a chilling effect, specifically the multiplier. He stated that his group was concerned about the provision and that it should be dealt with as soon as possible. He also asked the Commission to relieve groups from having to comply with the requirement to account for what portion of a slate card applies to one candidate or another.

Commissioner Liu agreed with Commissioner Studley's comments about changing the law at this time. She asked whether the Commission would be able to consider another proposal, such as what Mr. Marsteller mentioned, at a future date. Mr. St. Croix stated that the Board would be able consider two options, if the Commission decided to send two.

Decision point 1
Motion 11-07-11-04 (Liu): Moved and no second that the Commission take action to amend CFRO in response to the Supreme Court's decision.

Decision Point 2
Motion 11-07-11-05 (Hayon/Liu): Moved and seconded that the Commission adopt decision point 2.

Public Comment:
Charley Marsteller stated that the Ethics Commission is only able to amend if the amendment "furthers the purpose of the Act." He stated that a third option would present itself soon and asked the Commission to wait and see that proposal. He asked the Commission not to proceed with the vote. He stated that the Commission could just suspend the provisions pending further developments.

David Pilpel stated that, if the motion passes, he would suggest adding language as to how or why this amendment furthers the law.

Commissioner Ward asked how long the Commission was supposed to wait for this third option. Mr. Marsteller stated that it would be ready very soon. Chairperson Hur stated that there was no third option to consider and that staff's solution is workable. He stated that the Commission is furthering the purpose of the ordinance to make sure it is constitutional. Commissioner Ward suggested having a special meeting in two weeks to see whether there is a third option. Chairperson Hur stated that the Commission needed to take a workable solution. He stated that timing of this amendment was important.

David Pilpel stated that any delay would affect the effective date of any amendment, as the Board is going into recess soon.

Motion 11-07-11-06 (Hayon/Liu): Moved, seconded, and passed (4-1; Ward dissented) that the Commission adopt decision point 2, which is furtherance of the Ordinance and within the Ethics Commission's authority.

VIII. Minutes of the Commission's regular meeting of June 13, 2011 and special meeting of June 28, 2011.

Motion 11-07-11-07 (Studley/Ward): Moved, seconded, and passed (5-0) that the Commission adopt the minutes of the Commission's regular and special meetings of June 2011.

Public Comment:
None.

IX. Executive Director's Report.

Executive Director St. Croix stated that he anticipates that the full repayment to the Election Campaign Fund will be made in the final adoption of the budget.

Public Comment:
David Pilpel commented on Item 9 of the report, regarding non-filers of Statements of Economic Interests. He asked whether staff look at non-filers in previous years. He also mentioned that Chris Jackson was on the Bureau of Delinquent Revenue list and up for re-election to the College Board next year. He stated that Mr. Jackson would not be able to be a candidate or assume office following the election unless he fixed this problem.

X. Items for future meetings.

Commissioner Liu stated that she would like to discuss the Run Ed Run campaign, as there have been press reports regarding whether the committee is complying with its obligations under local and state law. She stated that it raises policy questions and asked the Director to report on the committee during the next meeting. She requested clarification on guidelines in this instance, as the effort is not supporting a declared candidate.

Public Comment:
Mr. Marsteller provided a brief statement about Bob Stern and his work over the past 35-40 years. He stated that the foundation would most likely have a recommendation regarding a CFRO amendment the following day. He urged the Commission to consider a third option for the CFRO amendment.

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

None.

XII. Adjournment.

Motion 11-07-11-08 (Studley/Hayon): Moved, seconded, and passed (5-0) that the Commission adjourn.