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Minutes – May 27, 2015

Minutes of the Special Meeting of
The San Francisco Ethics Commission
May 27, 2015
Room 416, City Hall
1 Dr. Carlton B. Goodlett Place
San Francisco, CA 94102

I. Call to order and roll call.

Chairperson Renne called the meeting to order at 5:44 PM.

COMMISSION MEMBERS PRESENT: Paul Renne, Chairperson; Brett Andrews, Vice-Chairperson; Beverly Hayon, Commissioner; Ben Hur, Commissioner; Peter Keane; Commissioner.  Chairperson Renne apologized for the delay.

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

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

OTHERS PRESENT: Joe Kelly, Jr.; Larry Bush; David Pilpel; Robert van Ravenswaay; Charles Marsteller; Elena Schmidt; Paul Melbostad; Vivien; Anita Mayo, Pillsbury Winthrop Shaw Pittman; Armeen Komeili, Nielsen Merksamer; Joan Wood; Rebekah Krell, Deputy Director, Arts Commission; and other unidentified members of the public.


– Staff Memorandum to Ethics Commission members regarding Hearing on Ethics Complaint 03-150127, Report and Recommendation on Ethics Complaint 03-150127 and attachments, Complainant’s Response, Respondent’s Response, Letter from the Office of the City Attorney to Ethics Commission regarding Ethics Complaint 03-150127, dated April 20, 2015, Letters from David Pilpel to Ethics Commission regarding Ethics Complaint 03-150127;
– Department of Human Resources Proposal to recruiters seeking assistance in selecting an Executive Director;
– Commissioner Keane’s “Report on Recommendations for Both a Rewrite of The Language of Proposition J and For a Restoration of the Commission’s Oversight of ‘Expenditure Lobbying’ in Ballot Measures for Upcoming Elections,” dated May 13, 2015;
– Proposed Draft of Amendments to Lobbying Ordinance;
– Draft Minutes of the Ethics Commission’s Regular Meeting of April 27, 2015;
– Executive Director’s Report;
– Proposal from Alliance Resource Consulting LLC re: Executive Recruitment Search, dated May 20, 2015;
– E-mail from Jesse Mainardi to Commissioners, Executive Director, and DCA Shen re: Expenditure Lobbyist Feedback, dated May 27, 2015;
– Draft of Amendments to Lobbying Ordinance, provided on May 27, 2015.

[Larry Bush distributed a binder to each of the five Commissioners, but did not provide additional copies for the public.]

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

Joe Kelly Jr. stated that the agenda did not include an item regarding the forfeiture letter.  Chairperson Renne stated that the complainant’s lawyer asked for a continuance to the June 5 special meeting.

Larry Bush asked that the June 5 discussion include a discussion about whether the statute of limitations applies.

III. Discussion and possible action on a matter submitted under Chapter Three of the Ethics Commission Regulations for Violations of the Sunshine Ordinance.

a. Ethics Complaint No. 03-150127, hearing regarding alleged violation of the Sunshine Ordinance.
Complainant: Paula Datesh
Respondent: Rebekah Krell, Arts Commission Deputy Director

Chairperson Renne stated that the matter had been before the Commission during its April 2015 meeting.

Commissioner Keane stated that he had previously asked to be recused from this matter and stated that he would leave the dais.  Prior to leaving, he noted for the record that, since the April meeting, he had received eight telephone messages from Ms. Datesh.  He stated that he did not listen to them and deleted them.  Commissioner Keane left the dais.

Chairperson Renne stated that Commissioner Hur had asked to continue the matter from the April meeting to review an e-mail.  He also noted that the complainant was not present during the meeting and had agreed that the Commission hear the matter in her absence.  Commissioner Hur stated that he reviewed the e-mail and a memorandum provided by the City Attorney’s Office.  He stated that the Commission should find that there was not a violation of 67.21(b); that sections 1040 and 1041 of the Evidence Code provide privileges; and that the e-mail was properly withheld the e-mail.

Motion 15-05-27-01 (Hur/Andrews): Moved, seconded, and passed (4-0, Keane recused) that the Commission find no violation of Sunshine Ordinance section 67.21(b).

Public Comment:
David Pilpel stated that none of the conditions in Chapter 3, section 1.A of the Commission’s regulations were satisfied.  He stated that the complainant did not satisfy the conditions to bring the matter before the Commission.  He agreed with the motion and asked the Commission to make the City Attorney’s memorandum available to the public.

Commissioner Keane returned to the dais.

IV. Discussion and possible action on Executive Director recruitment process.

Chairperson Renne stated that there was only one response from the six vendors approached and it came from Alliance Resource Consulting.  He stated that one other vendor may consider a response if the Commission were to grant an extension.  Deputy Executive Director Mainardi excused himself from this item and sat with the public.  Executive Director St. Croix stated that approximately $18,300 had been identified for this recruitment expense and that an additional $1,600 would be encumbered from funds for the next fiscal year.

The Commissioners discussed the amount of funds to be used for the recruitment and agreed that $20,000-25,000 would be an acceptable range, but that the Commission may be open to increasing the amount as well.  Commissioner Andrews stated that there would be room for negotiation depending on the scope of work.  The Commissioners agreed to follow the suggestions of the Committee, made up of Chairperson Renne and Vice-Chairperson Andrews.  The Commissioners also discussed the projected timeline for the recruitment.

Motion 15-05-27-02 (Hur): Moved and not seconded that the Commission retain a recruitment firm for the Executive Director position, presuming that the Chairperson and Vice-Chairperson find one that is suitable.

Public Comment:
Larry Bush stated that it could be difficult for the Commission to recruit for a Director due to the stated lower salary.  He stated that the proposal is inadequate and disagreed with the proposal’s description.

Robert Van Ravenswaay stated that the actual fees for the proposal are higher than those discussed.  He stated that the Commission may be required to pay for additional expenses, such as travel expenses for candidates.

David Pilpel stated that the proposal had only been available to the public for an hour.  He agreed that the total cost in the proposal may be $28,500.  He stated that he had issues with the proposal and the approach of the recruitment, but that he did not object to the Commission using a firm in concept.

DCA Shen stated that Alliance had previously performed searches for three City department heads: Civil Service Commission, Department of the Environment, and Department of Building Inspection.

Charles Marsteller stated that the low salary amount was not reasonable.  He asked why the salary could not be raised.

Elena Schmidt stated that, during a pervious IP meeting, it was stated that the public would have another opportunity to provide input regarding the Director’s job responsibilities.  She noted that the proposal allowed only one week’s time for this input.

Chairperson Renne stated that he agreed that one week was an unrealistic timetable.  He noted that salary had been mentioned in Alliance’s proposal, but that he did not see it mentioned in the DHR request that went to the vendors.  He stated that his view was that salary would be negotiated based on budget and level of expertise of the individual being interviewed.  He stated that he did not see a limitation on the document that DHR sent to the vendors.  He also stated that criticism of the proposal is premature.  He stated that drafting a job description is a next step, after choosing the recruitment firm.  He stated that a draft would be discussed with the public.

DCA Shen stated that a new RFP process, seeking proposals from beyond just the six previously-approved vendors, would take approximately four months.  He stated that would need to happen before a job profile was drafted and before it would go out to possible candidates.

Commissioner Keane stated that he was pleased to hear that the job description is not yet complete.  Commissioner Hayon suggested contacting similar organizations and finding a firm with experience in this area.  She stated that the amount of time it may take to vet a recruitment firm that has not worked with the City is important and that the Commission has competent staff.  She stated that things that should be taken care of will be taken care of and suggested that the Commission do the recruitment search well.

The Commissioners discussed whether it would extend the deadline for the five other vendors who did not previously respond to DHR’s request.  The Commissioners preferred the idea of having more than one proposal.  The Commissioners discussed extending the deadline for the other vendors and also possibly reaching out to other similar agencies to find if recruitment firms were used in searches for the Executive Director of those bodies.  DCA Shen stated that, in terms of reaching out beyond the six firms who have already been approached, any firm would be able to apply and would be subject to the normal competitive process.  He stated that there may be restrictions on telling certain firms to apply or suggesting that certain firms be offered the opportunity.  The Commissioners then discussed the deadline for the extension.

Motion 15-05-27-03 (Hur/Keane): Moved, seconded, and passed (5-0) that the Commission extend the deadline for submission for proposals from recruiting firms from the original six firms and, concurrently, that the Chairperson and Vice-Chairperson reach out and have some informative informal interviews with other like bodies.

Public Comment:
Larry Bush suggested that the Commission request supplemental funds from the Mayor’s Office.

Charles Marsteller stated that the Commission should provide a one-week extension.  He stated that Bob Stern will be at the June 5 special meeting.

David Pilpel stated that he agreed with a one-week delay so that the Commission could take further action at its June 5 special meeting.

Motion 15-05-27-04 (Hur/Keane): Moved, seconded, and passed (5-0) that the Commission delegate the decision of choosing the search firm to the Chairperson and Vice-Chairperson.

Public Comment:

V. Discussion and possible action on Commissioner Keane’s “Report on Recommendations for Both a Rewrite of The Language of Proposition J and For a Restoration of the Commission’s Oversight of ‘Expenditure Lobbying’ in Ballot Measure for Upcoming Elections.”

Commissioner Keane introduced the item.  He stated that a ballot measure related to Proposition J will be postponed for the 2016 election.  He thanked those who assisted in drafting the language for “expenditure lobbying” and stated that Deputy Director Mainardi added input.  He requested that the Commission authorize him to continue the dialogue with staff over the next month in order to finalize the language for the measure.  He stated that he would present the final language during the Commission’s regular June meeting and then the Commission could decide whether it would like to propose the measure for the 2015 ballot.  Chairperson Renne asked whether the Commission could proceed without having Interested Persons meetings or additional hearings.  DCA Shen stated that there was no specific legal requirement to have a hearing, although it would be in keeping with the Commission’s past practices for any legislation it has proposed.

Commissioner Hur thanked Commissioner Keane for his work and agreed that the Commission take action.  He stated that he believed the specific language was too broad and that various definitions would also be too difficult to enforce.  He also had questions about the registration requirements.  He also voiced concerns about the process, as staff is typically responsible for drafting legislation and they provide analysis regarding why changes need to be made.  He stated that if it goes to the ballot, more work needs to be done and that the Commission needs to hear from staff and the regulated community.  He also stated that if the legislation went through the Board of Supervisor, it would be more easily amended.  He also stated that he would not be able to attend the regular June meeting.

Chairperson Renne asked Commissioner Keane for an example of an “expenditure lobbyist.”  Commissioner Keane stated the following: “You want Supervisor X to favor a particular position for you.  You then go ahead and have a conference in the Four Seasons Hotel in Nice, France that you sponsor and Supervisor X is someone and there are a number of individuals who will speak on various types of topics.  Supervisor X is someone who is invited.  You have had no contact with Supervisor X, but Supervisor X just by coincidence is spending 2 weeks in the south of France in beautiful weather, enjoying the amenities of the Four Seasons.  Then, he comes back.  You have had no dealings with Supervisor X.  You haven’t asked him to do anything, but you are doing it clearly to influence his legislation.   That is an expenditure lobbyist.”

Motion 15-05-27-05 (Keane/Hayon): Moved, seconded, and passed (4-1; Hur dissented) that Commissioner Keane continue drafting the measure with staff and other interested members of the public and return with a proposed ballot initiative for the Commission to vote on it.

Public Comment:
Larry Bush provided an example of “expenditure lobbying” from a recent DCCC meeting.

Paul Melbostad stated that the public depends on the Commission to take leadership and the Commission should put the measure on the ballot, rather than presenting it to the Board of Supervisors first.  He stated that all Board members have supporters that would do things for them and do not want to have to report them.

Vivien stated that she strongly supported moving forward with the ballot measure.  She stated that powerful forces are behind what seem to be grassroots action.  She stated that any resistance to full disclosure is suspect in itself.

Charles Marsteller stated that so-called grassroots efforts are sponsored by lobbying organizations.

Anita Mayo, Pillsbury Winthrop Shaw Pittman, stated that various other jurisdictions require disclosure of similar activity.  She noted that the proposed definition of “expenditure lobbyist” is not the typical definition and will create confusion.  She stated that the registration requirements deviate from the other jurisdictions.  She stated that this rule was not needed, but that if the Commission chooses to proceed, urged the Commission to adopt similar rules to those of Sacramento, San Jose, or the State of California.

Armeen Komeili, Nielsen Merksemer, was concerned with the ballot measure process, as it would prevent the Commission from adopting any clarifying amendments.  His also stated that one organization could be required to file multiple reports with the same information.  He requested that the Commission proceed through the legislative process and provide additional opportunities for review.

Robert van Ravenswaay suggested that the Commission include language in the proposed ballot measure that would permit amendments to be made when there is a super-majority of both the Commission and Board, similar to what is in CFRO and the Conflict of Interest Code.

David Pilpel stated that there are issues with the definition and how to track expenditures and how to regulate and enforce.  He agreed with the suggestion of including the super-majority language for clarifying amendments.

Joan Wood asked the Commission to permit Commissioner Keane to continue his work.

DCA Shen stated that the City Attorney’s Office is happy to work with Commissioner Keane and staff on final language.  He also reminded the Commission that approval would require four votes at the regular June meeting, meaning a unanimous vote since Commissioner Hur will be absent.

Commissioner Keane stated that DCA Shen has already been included in the process of the drafting.  He also disagreed with sending the legislation to the Board first.  He stated that the Board has its own constituency, own payoffs, and that they are not a group that could look at this neutrally.  He stated that it would be like asking the fox to guard the chicken coop.  He stated that the Board would grind it up like hamburger or put it in the wastebasket or just let it sit there.  He stated that the Commission has an obligation to put it on the ballot.

Commissioner Hur asked about the super-majority language mentioned earlier.  DCA Shen stated that the clause allows for later legislative fixes, so long as those changes carry out or fulfill the purposes of the legislation.   He stated that he had no opposition to Commissioner Keane’s proposal, but that he would not be present at the June 22 meeting.

Deputy Director Mainardi asked whether staff should prepare a memorandum on this item for the June 22 meeting.   Chairperson Renne stated that staff would provide input on the draft.  Commissioner Keane stated that he had been appointed by the Commission to report and make recommendations.  Commissioner Hur stated that it was an unusual process and stated that staff needs a big role and heavy involvement.   Chairperson Renne stated that a draft would be submitted to the City Attorney’s Office to draft a final document in order to present it to the Commission at its June 22 meeting.  He asked the City Attorney’s Office to focus on the enforcement provisions in that statute.  Deputy Director Mainardi referenced the previously-approved staff work calendar.

VI. Discussion and possible action regarding complaints received or initiated by the Ethics Commission concerning: (1) California Government Code section 84104 and San Francisco Campaign & Government Conduct Code section 1.109(a) (failure to maintain required committee records), California Government Code section 84300(b) (making cash expenditures), and San Francisco Campaign and Governmental Conduct Code sections 1.114(a) (exceeding contribution limits); and (2) San Francisco Campaign and Governmental Conduct Code section 2.110(c) (failure to disclose lobbying contacts). Closed Session.

Public Comment:

Motion 15-05-27-06 (Hur/Andrews): Moved, seconded, and passed (5-0) that the Commission move into closed session.

Public Comment:

Deputy Executive Director Mainardi stated that he would recuse himself for one of the two matters.

The Commission moved into closed session at 7:43 PM.  All members of the public and Deputy Executive Director Mainardi left the hearing room.  The Commission members, Executive Director St. Croix, DCA White, and Ms. Argumedo remained in the hearing room during closed session.  The Commission returned into open session at 7:54 PM.

Motion 15-05-27-07 (Andrews/Hayon): Moved, seconded, and passed (5-0) that the Commission not disclose its closed session deliberations re: anticipated litigation.

Public Comment:

VII. Discussion and possible action on Commission’s April 27, 2015 draft meeting minutes.

Public Comment:
David Pilpel suggested two changes: one on page 6, regarding the motion to recuse Commissioner Keane and the other on page 10, regarding adding a clarifying sentence about this special meeting.

Motion 15-05-27-08 (Hayon/Andrews): Moved, seconded, and passed (5-0) that the Commission approve the April 27, 2015 minutes, as amended.

VIII. Discussion of Executive Director’s Report.

Executive Director St. Croix noted that the Commission had held five IP meetings.  He also stated that staff has received 21 records requests and has been working hard in its responses.  Deputy Director Mainardi stated that the report also included a project calendar, per Commissioner Hur’s request.  He stated that he anticipates that the regulation regarding the Form 700s will be on the June 22 meeting.  He also stated that he anticipated further meetings on candidate-controlled committees.

Public Comment:
David Pilpel noted two items in the second paragraph under Item 7, regarding percentage of filers or those who have completed training.  He asked staff to confirm that the figures were accurate.  He approved of the project calendar and asked for it to be updated.

IX. Items for future meetings.

Commissioner Hur asked that the packet for the proposed legislation for expenditure lobbyists include definitions of expenditure lobbyists that are used by other jurisdictions.  Chairperson Renne asked that the recruitment process for the Director be included on the agenda for the June 5 special meeting.

Public Comment:

X. Adjournment.

Motion 15-05-27-09 (Andrews/Hayon):  Moved, seconded and passed (5-0) that the Ethics Commission adjourn.

Public Comment:

The Ethics Commission adjourned the meeting at 8:03 PM.

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