Ethics Commission
City and County of San Francisco

Minutes – June 23, 2014

Minutes of the Regular Meeting of
The San Francisco Ethics Commission
June 23, 2014
Room 400, 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 5:32 PM.

COMMISSION MEMBERS PRESENT: Benedict Y. Hur, Chairperson; Paul Renne, Vice-Chairperson; Beverly Hayon, Commissioner. Brett Andrews, Commissioner (absent, excused); Peter Keane, Commissioner (absent, unexcused).

STAFF PRESENT: John St. Croix, Executive Director; Jesse Mainardi, Deputy Executive Director; Garrett Chatfield, Investigator/Legal Analyst.

OFFICE OF THE CITY ATTORNEY: Josh White, Deputy City Attorney (DCA).

OTHERS PRESENT: Patrick Monette-Shaw; Ray Hartz; Allen Grossman; John Nulty; Hope Johnson; Gilbert Chriswell [phonetic]; Michael Nulty; Anita Mayo; and other unidentified members of the public.

MATERIALS DISTRIBUTED:
– Staff Memorandum re: Pending Amendments to the City’s Lobbyist Ordinance, dated June 18, 2014;
– Order to Show Cause, Court Docket and Appellate Briefs for Grossman v. John St. Croix, Executive Director, and San Francisco Ethics Commission, San Francisco County Superior Court, Case No. CPF-13-513221; California Court of Appeal 1st Dist., Case No. A140308;
– Draft minutes of the Commission’s Special Meeting of May 28, 2014;
– Executive Director’s Report.

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

Patrick Monette-Shaw stated that he filed a complaint against David Pilpel with the Clerk of the Board for an alleged Statement of Incompatible Activities violation. He stated that he also copied the Ethics Commission on the complaint. He stated that Mr. Pilpel held himself out as representing the entire Sunshine Ordinance Task Force to the Ethics Commission at its April 2014 meeting.

Ray Hartz stated that several comments made by Ethics Commission members at its May 2014 meeting regarding the Sunshine Ordinance were inappropriate. He stated that the Executive Director uses his position to manipulate the outcome of hearings. He stated that the public has a right to see documents that are not prohibited from disclosure.

The following written summary was provided by the speaker, Ray Hartz, the content of which is neither generated by, nor subject to approval or verification of accuracy by, the Ethics Commission:

I request that each member of the Ethics Commission review the recording for its May 28, 2014 meeting. When members of the public raised the issue regarding documents provided to the members of the commission and yet not to the public, some of the comments made by the members of the commission were completely inappropriate! The Sunshine Ordinance, which like it or not this Ethics Commission has an obligation to enforce, requires that such documents be provided to the public. My personal concern about such documents is St. Croix, using his position as Executive Director, to manipulate hearings held before this commission. He determines in advance the desired outcome and then presents “evidence” that will support that outcome and either marginalizes and/or omits “evidence” that will not! The public has a right to see documents that you consider in open or closed session that are not specifically prohibited from disclosure.

Allen Grossman stated that many public records related to agenda item number six were not provided to the Commission. He stated that the matter referenced in that agenda item began in 2012. He stated that there is not a case pending at the court because the only thing left to happen is for the Court of Appeal to issue its decision. He stated that there is no defendant, because the Executive Director and Ethics Commission were named respondents in the superior court action and the Ethics Commission is the petitioner in the appeal. He stated that he is baffled as to what action the Ethics Commission could take regarding this matter at this point.

John Nulty stated that he wanted to request that the Commission direct staff to accept his Statement of Participation or Non-Participation in Public Financing Program Form SFEC-142(a). He stated that the Ethics Commission should have a check-off list for candidates like other departments, and that the Ethics Commission is not functional.

Hope Johnson stated that agenda item six should be heard in open session. She stated that the Sunshine Ordinance does not allow for the attorney-client privilege. She stated that the Sunshine Ordinance Task Force was shut out of the Ethics Commission’s deliberations regarding the Ethics Commission’s adoption of its regulations to handle Sunshine Ordinance complaints. She stated that the City Attorney cannot assist departments in withholding documents.

Gilbert Chriswell [phonetic] of New District 8 stated that the names of the Ethics Commission members should appear on the agenda. He stated that he ran for elective office in 2000 and he did not receive public financing. He stated that he has heard of candidates having problems knowing when to report for public financing. He stated that in 2000 the Ethics Commission had a calendar of dates to assist candidates.

Michael Nulty stated that he filed as a candidate and set up an online filing account. He stated that he attempted to file his Statement of Participation or Non-Participation in Public Financing Program SFEC-142(a) with the Ethics Commission on June 13, June 17, and June 19, and was told each time that he could not file that form. He stated that Ethics Commission staff told him that the form could not be accepted after June 10. He stated that Ethics Commission staff failed to tell him what procedures to take. He stated that the form was not handed to him with the rest of the documents that he received when he initially filed.

III. Discussion regarding legislation passed by the Board of Supervisors on June 17, 2014, which amends the City’s Lobbyist Ordinance to, among other things: (1) change the lobbyist qualification threshold; (2) increase the number of City officials covered by the ordinance; (3) modify certain exemptions from the lobbyist registration requirement; (4) impose certain Commission mandates; (5) add new enforcement provisions; and (6) require reporting by certain permit expediters and developers.

Deputy Executive Director Mainardi introduced the item and highlighted that the most significant change to the Lobbyist Ordinance was to the registration threshold, and the addition of permit expediters.

Vice-Chairperson Renne asked how the Commission will reach out to educate the public on the changes to the Lobbyist Ordinance. Deputy Director Mainardi responded stating that the Commission will update its information online, and to the lobbyist manual.

Vice-Chairperson Renne asked if the changes would require that any individual member of the public who reaches out to a City official will now be considered a lobbyist. Deputy Director Mainardi responded stating that there is still a monetary threshold to register as a lobbyist and that the changes reduce that amount to compensation of one penny.

Responding to a question from Chairperson Hur, Deputy Director Mainardi responded stating that the changes will likely cause an increase in the number of registered lobbyists which will take additional resources to administer. He continued stating that the addition of a new disclosure category of permit expediter will also increase costs to put those forms online, along with increased costs to the Commission to perform the now mandatory audits of reported lobbyist activity.

Chairperson Hur stated that the new law only requires one audit per year, but that he would like the Commission to perform more than that each year.

Public Comment:

Ray Hartz stated that the conversation he just heard is disturbing. He stated that the Ethics Commission is treating these changes as a “fait accompli” imposed by the Board of Supervisors. He stated that the Ethics Commission has an obligation to review these changes, and that he will be carefully following the implementation of this law. He stated that with the new threshold contact requirement, a lobbyist could contact City officials 48 times a year without triggering the registration requirement. He stated that the exemption for non-profits is inexcusable, and that the Commission should perform at least 20 audits a year. He stated that this is just “Chiu” legislation to hide how many times he meets with lobbyists.

The following written summary was provided by the speaker, Ray Hartz, the content of which is neither generated by, nor subject to approval or verification of accuracy by, the Ethics Commission:

I will be following very carefully the discussion regarding this agenda item and any subsequent action that might be recommended or taken. In section 1, as long as contacts with elected officials are through an in-house “lobbyist,” contacts can exceed 50 48 per year without triggering the threshold. In section 3, adding an exemption for “nonprofit organizations,” is wholly unacceptable! Such groups receive many millions of dollars per year as a result of their contacts with city officials. Such contacts must remain subject to public scrutiny. In section 4, “random audits of at least one lobbyist per year,” is nothing but a joke! “The Chiu legislation” is nothing but an effort by David Chiu to hide some of the 597 contacts with lobbyists documented by Supervisor Campos campaign. The BOS will pass these amendments to hide the overwhelming impact lobbyists have on our city officials, particularly members of the BOS.
Patrick Monette-Shaw stated that the Ethics Commission has an ethical imperative, but has problems with doing that. He stated that the one audit requirement is ridiculous. He stated that private citizens should not be considered lobbyists. He stated that the Ethics Commission should urge the Mayor to send this legislation back to the Board of Supervisors to make it clear that this law will not apply to private citizens.

Anita Mayo stated that the Commission should reach out to lobbyists and developers regarding the changes, particularly because the new law imposes joint liability on the lobbyist and employer.

IV. Discussion and possible action regarding proposed stipulation, decision and order in connection with a complaint initiated or received by the Ethics Commission. Closed Session.

Executive Director St. Croix stated that the Commission will take separate public comment and vote on each of agenda items four, five, and six, and then hold one closed session. DCA White stated that is permissible.

Public Comment:
Ray Hartz stated that under the Sunshine Ordinance, agenda items must be sufficiently clear and specific to alert a person of average intelligence and education whose interests are affected by the item so that he or she would know to attend. He stated that the agenda item description for this item fails to do that. He stated that the Ethics Commission should hold this item in open session. He stated that the Ethics Commission could be discussing something about him in closed session, and he would not know.

The following written summary was provided by the speaker, Ray Hartz, the content of which is neither generated by, nor subject to approval or verification of accuracy by, the Ethics Commission:

Sunshine Ordinance section 67.7(b) reads as follows: “A description is meaningful if it is sufficiently clear and specific to alert a person of average intelligence and education whose interests are affected by the item that he or she may have reason to attend the meeting or seek more information on the item.” How would anyone know if their interests are affected by this description? It says nothing more than a discussion of “anticipated litigation.” Telling the public some information, such as the specific case to be discussed, would not in any way breach confidentiality or compromise attorney-client privilege. It would, on the other hand, alert a person whose interests are affected by the item, which is a requirement of the law. I sincerely hope this commission will not attempt to dismiss out of hand the public’s very real concern that matters be considered in full view of the public.
Patrick Monette-Shaw stated that the descriptions for agenda items four, five, and six should be broader. He stated that the Commission could list the type of case to be discussed in closed session in the description.

Allen Grossman stated that the agenda item description is not in compliance with the Brown Act. He stated that the Commission has the burden to demonstrate that disclosing the name of the case to be discussed would prejudice the outcome.

DCA White advised the Commission that under the City Charter, agenda items four and five must be conducted in closed session. He stated the Commission has the discretion to discuss item six in open session if it so chooses, but that item six is indeed pending litigation.

Vice-Chairperson Renne stated that the Ethics Commission has informed each respondent in a complaint of the matter. He stated that to protect a respondent’s right to privacy, the Commission must determine if there is probable cause to believe a violation of law occurred in closed session. He stated that if the Commission determines that there is probable cause to believe a violation of law occurred, the Commission makes that announcement in open session immediately following the closed session.

Motion 14-06-23-01 (Renne/Hayon) Moved, seconded and passed (3-0, Andrews absent, excused; Keane absent, unexcused) that the Ethics Commission go into closed session for agenda item four.

V. Discussion and possible action regarding probable cause determinations in connection with complaints received or initiated by the Ethics Commission. Closed Session.

Public Comment:
Ray Hartz stated that Commissioner Renne did not tell the truth that all parties involved in a hearing are noticed and aware of the hearing date. He stated that the Ethics Commission scheduled a hearing that he was a party to while he was out of town and he did not receive notice until he returned, which was after the hearing date. He stated that for this agenda item, three cases will be discussed that no one knows anything about. He stated no documents were provided to the public, so legally the Commissioners should not have received any documents.

The following written summary was provided by the speaker, Ray Hartz, the content of which is neither generated by, nor subject to approval or verification of accuracy by, the Ethics Commission:

Here we have the same issue, only in triplicate! We have three cases about which no one has any idea, apparently including the members of this commission, regarding what cases will be discussed. Of course, I’m assuming that since no documents whatsoever were provided for the public, that the commissioners received nothing in advance. What the public is asked to believe is: you’re going to discuss three cases without any advance consideration or preparation. Don’t know what the cases are, don’t know the scope of the discussion, damn, don’t have any idea at all! If that is the case, you actually can have no idea whether to go into closed session or not. If you don’t know what you’re going to discuss how can you rationally decide that a closed session is required? Sunshine ordinance [sic] section 67.8 states that the agenda disclosure shall “specifically identify a case under discussion.”

Patrick Monette-Shaw stated that at the last Commission meeting, DCA White told Commissioner Keane that because documents were not provided for the public, the Grossman discussion needed to be postponed. He stated that this agenda item also violates the Brown Act and he requested that DCA White comment on whether the Commission can hear this item.

Allen Grossman stated that the description for this agenda item is confusing. He stated the public cannot ascertain what will be discussed. He stated that the Brown Act requires that an agency name the litigation unless doing so will jeopardize the agency’s ability to conclude existing settlement negotiations.

Motion 14-06-23-02 (Renne/Hayon) Moved, seconded and passed (3-0, Andrews absent, excused; Keane absent, unexcused) that the Ethics Commission go into closed session for agenda item five.

VI. Discussion regarding the status and background of pending litigation as defendant, Grossman v. John St. Croix, Executive Director, and San Francisco Ethics Commission, San Francisco County Superior Court, Case No. CPF-13-513221; California Court of Appeal 1st Dist., Case No. A140308. Partial Closed Session.

Public Comment:
Ray Hartz stated that he had been waiting with anticipation on whether or not the Ethics Commission will go into closed session for this item. He stated that he predicts that Commissioners Hur, Renne, and Hayon will vote to go into closed session and that Commissioners Keane and Andrews will vote to hold the discussion in open session. He stated that Executive Director St. Croix hides as much as possible. He stated that many people do not attend these meetings because they know the Ethics Commission is a bunch of politicos.

The following written summary was provided by the speaker, Ray Hartz, the content of which is neither generated by, nor subject to approval or verification of accuracy by, the Ethics Commission:

I’ve been waiting with keen anticipation for the result of the discussion whether to handle this agenda item in “full view of the public.” Hell, I’m curious as to whether you let the public have any opportunity to observe your discussion? I’m going to go out on the limb: Hur, Rennie [sic] and Hayon will vote to hide and Keane and Andrews will vote to let the Sunshine in. I win either way! Either I’m right and you choose to hide or I’m wrong and you choose to be open. I doubt I will be, but, I sincerely hope I’m wrong! John St. Croix’s pattern of hiding as much as possible is getting truly tiring: not placing items properly on the agenda, not providing supporting documents, etc. etc. etc. I believe the members of this Ethics Commission need to give the Executive Director clear instructions to be as open as possible.

Patrick Monette-Shaw stated that the memory of the Ethics Commission has slipped. He stated that the Ethics Commission is not the defendant in this case. He stated that in the last meeting Commissioner Keane wanted to ignore the advice of DCA White which was to postpone the item. He stated that this item is not really pending litigation.

Allen Grossman stated that following the last meeting, he made a records request to the Commission for the documents that were provided to the Commission members, and that one of the records was withheld citing the attorney-client privilege. He stated that even if the Ethics Commission prevails at the appellate level, this case is going to the Supreme Court. He stated that the Ethics Commission bylaws require that it comply with the Sunshine Ordinance.

Hope Johnson stated that the Commission should discuss this item in open session. She stated that for four years the Commission issued memoranda that stated Sunshine Ordinance Task Force referrals were not valid. She stated that the Sunshine Ordinance was approved by the voters and that City departments belong to the people, so records are presumed to be public.

Chairperson Hur stated that the Commission could hold an open session discussion to get an update on the litigation and then go into closed session to obtain legal advice.

Vice-Chairperson Renne proposed waiving the attorney-client privilege and discussing the entire matter in open session.

Commissioner Hayon stated that she would be fine with an open session discussion to get an update on the litigation, but is not willing to waive the attorney client privilege.

Motion 14-06-23-03 (Hayon/Renne) Moved, seconded and passed (3-0, Andrews absent, excused; Keane absent, unexcused) that the Ethics Commission receive a status update on item six in open session then go into closed session for agenda item six to recieve attorney advice.

Executive Director St. Croix gave a brief outline of the litigation to date. He also stated that Commissioner Keane requested a discussion on the matter related to the appeal and that was why the Commission was only provided with the appellate documents.

Responding to Chairperson Hur, DCA White stated that the superior court judge did not review the withheld documents. He stated that both parties agreed that the central issue was the applicability of the Sunshine Ordinance provision that removes the attorney-client privilege for any communication to City departments concerning the California Public Records Act, the Brown Act, the Political Reform Act, any San Francisco governmental ethics code, or the Sunshine Ordinance.

Commissioner Renne stated that in relation to this item, all documents were provided to the public with the exception of a memorandum to the Commission from the City Attorney.

Public Comment:
Ray Hartz stated that the Ethics Commission is a “piece of work.” He stated that this discussion did not provide the public any insight into this matter. He stated that the Commission will now just go into closed session to have the real discussion.

Patrick Monette-Shaw stated that he read every brief filed in the court case, and that he was appalled by each brief written by the City Attorney. He stated that the analysis of the City Attorney was nothing more than “fairy dust.” He stated that Mr. Grossman’s lawyer shredded DCA Shen’s garbage. He stated that there is no provision in the City Charter that protects the attorney-client privilege.

Allen Grossman stated that he was baffled about what would be discussed in closed session. He stated that the Ethics Commission cannot assert the attorney-client privilege, and that the Brown Act requires that he be given all documents related to this agenda item.

Hope Johnson stated that the Sunshine Ordinance provision at issue does not allow for the attorney-client privilege to be asserted, and that any advice by the City Attorney regarding the Sunshine Ordinance cannot be privileged.

Commissioner Hur stated to Ms. Johnson that the purpose for closed session on item six was to discuss litigation.

The Commission went into closed session for items four, five, and six at 7:00 PM. All members of the public left the hearing room. Chairperson Hur, Vice-Chairperson Renne, Commissioner Hayon, Executive Director St. Croix, Deputy Executive Director Mainardi, Ethics Commission staff member Garrett Chatfield, and DCA White all remained in the hearing room during closed session.

The Ethics Commission came out of closed session at 7:55 PM. Ray Hartz returned to the hearing room.

Executive Director St. Croix read an announcement related to agenda item four. He announced that during closed session the Commission approved a Stipulation, Decision and Order and a penalty of $9,000 with respect to Ethics Complaint No. 12-130819.

Executive Director St. Croix read the following three announcements related to agenda item five:

Executive Director St. Croix announced that during closed session the Commission found probable cause to believe that Bob Squeri, a former candidate and the treasurer of the Bob Squeri for District 7 Supervisor 2012 committee, committed two violations of the San Francisco Campaign Finance Reform Ordinance by failing to include a disclosure statement in the required font size on campaign advertisements.

Executive Director St. Croix announced that during closed session the Commission found probable cause to believe that Melissa Apuya, a former candidate and the treasurer of the Melissa A. Apuya for Democratic Central Committee, 13th District committee, committed five violations of the San Francisco Campaign Finance Reform Ordinance by failing to file campaign statements.

Executive Director St. Croix announced that during closed session the Commission found probable cause to believe that Wendy Aragon, a former candidate and the treasurer of Committee to Elect Wendy Aragon to Democratic County Central Committee, committed two violations of the San Francisco Campaign Finance Reform Ordinance by failing to file campaign statements.

Chairperson Hur stated that prior to the Commission moving into closed session, Hope Johnson still had approximately one minute of public comment time. He stated that Deputy Executive Director Mainardi asked her if she wanted to return to the hearing room to complete her public comment, and she declined. Chairperson Hur apologized to Hope Johnson and stated that it was rude of him to interrupt her comment.

Motion 14-06-23-04 (Hayon/Renne) Moved, seconded and passed (3-0, Andrews absent, excused; Keane absent, unexcused) that the Ethics Commission not disclose attorney advice it received during closed session for agenda item six.

Public Comment:
Ray Hartz stated that the agenda could have at least included what the violations of law were without compromising any confidentiality.

VII. Discussion and possible action on the minutes of the Commission’s meeting of May 28, 2014.

No discussion.

Public Comment:
Ray Hartz stated that the minutes for the May meeting are an example of why he wanted 150 word statements included in the minutes. He stated that the public comment is summarized to the point of being meaningless. He stated that public comment is constitutionally protected free speech. He stated that the Ethics Commission just dismisses public comment and there is no attempt to put into the record what was actually said.

The following written summary was provided by the speaker, Ray Hartz, the content of which is neither generated by, nor subject to approval or verification of accuracy by, the Ethics Commission:

These minutes are perfect example is why I have fought so hard for the right to include 150 word summaries in the minutes! Using a number of rationalizations, the minutes are pared down to nothing, particularly as relates to the comments made by the public. In fact, these minutes are nothing but de facto censorship of public participation! If anyone hearing these comments believes I’m off base, I’d simply asked that they come here, speak for three minutes, and then read the summary in the appropriate minutes. See for yourself whether there is anything that you said which is represented in a meaningful fashion. And I’ll say it one more time: we are talking about constitutionally protected political free speech! The protection of that free speech extends to its representation in the public record! This is particularly true when the free speech equates to “a petition for redress of grievances!” [sic all]

Motion 14-06-23-05 (Hayon/Hur) Moved, seconded and passed (3-0, Andrews absent, excused; Keane absent, unexcused) that the Ethics Commission approve the minutes for the special meeting of May 28, 2014.

VIII. Discussion of Executive Director’s Report

Executive Director St. Croix stated that he asked the Controller’s Office for assistance with completing audits of campaign committees. He stated with that help, the Commission will be caught up with all audits by the end of the year. He stated that the California Fair Political Practices Commission held a training for staff. He stated that due to increased compliance, revenues are slightly down.

Public Comment:
Ray Hartz stated that the Executive Director’s report is always the same generic form. He stated that from now on, he will select one item to discuss each month. He stated that Luis Herrera perjured himself on his Statement of Economic Interests for years. He stated that Luis Herrera abused his position and it took members of the public to expose the wrongdoing.

The following written summary was provided by the speaker, Ray Hartz, the content of which is neither generated by, nor subject to approval or verification of accuracy by, the Ethics Commission:

This report is always a generic, one-size-fits all, check the box, evolution! To make these discussions more meaningful, each month I’m going to select one specific item to discuss. Today its item 7, on Statements of Economic Interests. For years, City Librarian Luis Herrera accepted thousands of dollars of reportable “gifts” from The Friends. He did so while ignoring his fiduciary responsibility to provide oversight for the millions of dollars raised and expended each year by that group. And, year after year, he perjured himself in denying the receipt of those “gifts!” In a quid pro quo arrangement he accepted the gifts, lied about accepting them, and looked the other way. He also abused his position as a City Department Head to withhold public records which would uncover this illegal activity in violation of both the Brown act [sic] and the Sunshine Ordinance. Members of the public had to do your job!

IX. Items for future meetings.

Vice-Chairperson Renne stated that agenda items for closed session should identify the violation so the public can be better informed as to the nature of any closed session discussion regarding complaints. Commissioner Hayon agreed.

Commissioner Hayon stated that she would like the Executive Director to look into whether or not the assertions by John Nulty and Michael Nulty receiving incorrect information from staff was true. She stated that all staff should know the correct information regarding filing deadlines and other campaign rules and candidate obligations.

Public Comment:
Ray Hartz stated that the Commission should reopen the Sunshine Ordinance referral that he had against Luis Herrera. He stated the Commission made no effort to determine why he did not attend the hearing. He stated that he was out of state and did not receive notice of the hearing until he returned. He stated Luis Herrera lied to the Commission. He stated there would be no cost to the Library Commission to allow him to use the overhead projector, as the Library Commission allows the groups they like to make overhead presentations and that is viewpoint discrimination. He stated that he was denied due process and is angry at the way the Commission handled the hearing.

X. Adjournment.

Motion 14-06-23-06 (Hayon/Renne) Moved, seconded and passed (3-0, Andrews absent, excused; Keane absent, unexcused) that the Ethics Commission adjourn.

The Ethics Commission adjourned the meeting at 8:20 PM.

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