Ethics Commission
City and County of San Francisco

Minutes – June 27, 2016

Minutes of the Regular Meeting of
The San Francisco Ethics Commission
June 27, 2016
Room 400 – City Hall
1 Dr. Carlton B. Goodlett Place
San Francisco, CA 94102

1. Call to order and roll call.

Chairperson Renne called the meeting to order at 5:30 PM.

COMMISSION MEMBERS PRESENT: Paul Renne, Chairperson; Peter Keane, Vice-Chairperson; Daina Chiu, Commissioner; and Beverly Hayon, Commissioner.
STAFF PRESENT: LeeAnn Pelham, Executive Director; Catherine Argumedo, Investigator/Legal Analyst.
OFFICE OF THE CITY ATTORNEY: Andrew Shen, Deputy City Attorney (DCA).
OTHERS PRESENT: Charles Marsteller; Ray Hartz; David Pilpel; Dr. Derek Kerr; Elena Schmid; Helen; Bob Planthold; Charlotte Hill; Morgan; David; Tyler; Debbi Lerman; Greg Ryan; Jonathan Mintzer; Lee Hepner, Legislative Aide to Supervisor Peskin; and other unidentified members of the public.
MATERIALS DISTRIBUTED:
– May 23, 2016 draft minutes;
– June 22, 2016 staff memorandum re: AGENDA ITEM 4 – Potential waiver of attorney-client privilege regarding a public records act request for the audio recording of Ethics Commission’s closed session held on June 23, 2014, regarding Agenda Item VI, and attachments;
– June 22, 2016 staff memorandum re: AGENDA ITEM 5 – Proposed November 2016 Ballot Measure to Restrict Lobbyist Gifts, Campaign Contributions and Bundling, and attachments;
– June 22, 2016 staff memorandum re: AGENDA ITEM 6 – Proposal by Supervisor Peskin to prohibit City elected officials from establishing candidate-controlled general purpose committees, and attachments;
– June 22, 2016 staff memorandum re: AGENDA ITEM 7 – Proposal by Supervisor Peskin to require members of City Boards and Commissions to file behested payment reports regarding the solicitation of charitable contributions, and attachments;
– June 22, 2016 staff memorandum re: AGENDA ITEM 8 – Proposed Ethics Commission Annual Policy Plan for FY2017 and attachment;
– June 22, 2016 staff memorandum re: AGENDA ITEM 9 – Discussion of possible amendment to the Ethics Commission’s bylaws establishing a process for the Commission to respond to public records requests, and attachment;
– June 22, 2016 staff memorandum re: AGENDA ITEM 10 – Executive Director’s Report for the June 27, 2016 Commission Meeting, and attachments.
– Public comment on Agenda Items 5-8.

2. Public comment on matters appearing or not appearing on the agenda.

Charles Marsteller, from Friends of Ethics, stated that his group has had discussions with Supervisor Breed regarding the amendment to the Whistleblower Ordinance. He stated that her office is seeking guidance on how to organize the hearing regarding the amendments. He stated that the group would send their suggestions about notifications.

Ray Hartz, SF Open Government, stated that his complaints had been dismissed. He stated that he had been dissuaded from filing complaints and that there is no impartiality. He stated that he has been denied a public hearing and that the Commission is a meaningless farce and is powerless.

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:

The “so-called investigations” are something I completely understand. The sole purpose was to dismiss the complaints and deny me a public hearing. A public hearing would result in serious consequences for both Supervisor Mark Farrell and the San Francisco Public Library. As far as Mark Farrell goes you will know that he would never even show up for a hearing! In fact, he would probably thumb his nose at you just as he did to the SOTF in not even send someone to the hearing. While embarrassing for you, it would be very instructive of the citizens of San Francisco that while you may be able to “bully” non-City persons or groups, City agencies treat you as the joke you are. Neither the Mayor, Board of Supervisors, or any other City agency would even deign to reply to your findings let alone enforce them. This body is a meaningless farce!

3. Discussion and possible action on draft minutes for the Commission’s May 23, 2016 regular meeting.

Public Comment:
Charles Marsteller stated that he had been misquoted on page 6. He stated that he meant that the Commission encouraged Supervisor Farrell to appear.
Ray Hartz stated that there are frequent misrepresentations in the minutes and that the Commission should be ashamed. He stated he was tired of people lying about his public comment and that commissions try to keep anything negative out of the minutes.

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 would like anybody reviewing these minutes to notice that I am the only citizen in San Francisco whose Constitutionally protected political free speech actually makes it into the minutes in any meaningful fashion. In Citizens United the Supreme Court wrote: “By taking the right to speak from some and giving it to others, the government deprives the disadvantage person or class of the right to use speech to strive to establish worth, standing, and respect for the speaker’s voice. The government may not by these means deprive the public of the right and privilege to determine for itself what speech and speakers are worthy of consideration. The First Amendment protects speech and speaker, and the ideas that flow from each.” This body is desirous of producing an Orwellian “1984 New-Speak” record, with comments from other speakers, especially those voicing criticism, being reduced to meaningless misrepresentations. You should be ashamed!

Motion 160627-01 (Keane/Hayon): Moved, seconded, and passed (4-0) that the Commission approve the minutes for the Commission’s May 23, 2016 regular meeting.

4. Discussion and possible action, including potential waiver of attorney-client privilege, regarding public records act request for the audio recording of Ethics Commission’s closed session held on June 23, 2014, regarding Agenda Item VI.

Allen Grossman stated that the facts were clear and that the Commission voted to keep the City Attorney’s advice secret and he had never seen records. He stated that the Sunshine Ordinance is clear. Neither staff nor the City Attorney’s Office added anything, other than confirming this decision was within the Commission’s discretion.

Motion 160627-02 (Keane/Hayon): Moved, seconded, and passed (4-0) that the Commission release the closed session recording regarding Agenda Item VI to Mr. Grossman.

Public Comment:
Ray Hartz stated that Mr. Grossman’s request is reasonable and justified. He stated that the government is supposed to be in full view of the public. He stated that most of what the Commission wants to hide is that it is doing something wrong.

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:

Pres. James Madison wrote the following: “The genius of Republican liberty seems to demand…not only that all power should be derived from the people, but that those entrusted with it should be kept in dependence on the people.” Mr. Grossman’s request that this body waive the attorney-client privilege and release the recording of the closed session is both reasonable and justified. This body does more to hide its activities from the public than any other whose meetings I have attended. Only through the actions of individual citizens are body such of this held to any level of accountability. This body has shown by its behaviors to be totally unwilling and/or unable to enforce open government laws. The very least it can do is disclose to the public, when confidentiality is no longer required, the secret machinations conducted out of the public view. Show you have some sense of integrity!

David Pilpel stated that he was not sure how he would vote on this motion. He stated it was unusual and that the Commission should be careful about what it would mean for the City going forward.

Dr. Derek Kerr stated he was grateful to Mr. Grossman for his years in public interest litigation. He stated that providing the recording is an opportunity to get closer to the public by removing an unnecessary barrier.

5. Continued discussion and possible action on proposal regarding a possible November 2016 ballot measure to restrict lobbyist gifts, campaign contributions, and bundled contributions.

Executive Director Pelham introduced the item and discussed the proposals to restrict lobbyist gifts, campaign contributions, and bundled contributions. Chairperson Renne asked whether taking the state approach would be a safer approach from a constitutional point of view. DCA Shen stated that narrower is almost always safer in terms of facing legal challenges, but it is up to the Commission and staff to weigh the risks and benefits. He stated that a new draft could be prepared for the Commission’s July meeting if the Commission wanted to add language to parallel the state’s language. Executive Director Pelham agreed that it would be helpful to have more time to craft additional language. She also stated that changes would be necessary to the online filing system, if the proposal paralleled the state law. DCA Shen stated that the current lobbyist ordinance does not require lobbyists to indicate who lobbyists are going to lobby prior to doing it. Commissioner Chiu expressed concerns with additional reporting requirements without staff or the lobbyist system being able to support the changes.

Public Comment:
Elena Schmid urged the Commission to use the state law as a model. She stated that it would easily fit with current law.

Charles Marsteller asked the Commission to look at the state law. He stated that local and state would go together without too much difficulty.

Helen from Common Cause stated that the Board did not have time to make a formal decision on the proposal, but mentioned that a comment had been raised about why the Commission did not parallel state law.

Ray Hartz stated that the Commission is updating a law, but it will not enforce the laws in any meaningful way. He stated that the Commission is ineffective and that this conversation has been going on for months.

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:

It is all well and good to get the citizens of San Francisco an opportunity to update the laws on lobbyist gifts, campaign contributions and bundled contributions. However let’s not deceive them into thinking that you’re actually going to enforce these laws in any meaningful way. As we’ve seen recently with your decision relating to supervisor Mark Farrell, you are unable to enforce these laws as relates to anyone in the “City Family.” In that case, as in a number of others, “you go into hiding” or “closed session” so the public will not realize how totally ineffective you are! No one in San Francisco government will back up your findings unless they have a political agenda in doing so. You can “bully” the powerless but are continually bullied by the powerful. An old Southern expression sums it up well: “You’re about as useful as tits on a boar hog.”

Bob Planthold, Friends of Ethics, stated that it is essential that the Commission authorize the ballot measure. He asked that the Commission consider applying the proposal to expenditure lobbyists.

Charlotte hill from Represent.Us spoke about the contribution limit versus a contribution ban. She stated that a similar low limit was upheld in New York City and that the Commission should determine that the proposal would also apply to expenditure lobbyists.

Morgan from Represent.Us thanked the Commission for its consideration. He asked that the Commission consider a low limit rather than complete ban.

David from Represent.Us stated that people are thirsty for common sense reforms like these. He asked the Commission to fight for City integrity.

Tyler from Represent.Us stated that the proposed restrictions are good for instilling public confidence and would allow lobbyists to do their job more effectively.

Debbi Lerman from the Human Services Network stated that she participated in IP meetings and is disappointed that some of the concerns raised have not been addressed. She stated that she would like the Commission to consider some common sense exemptions regarding the gift limits and when public officials attend conferences. She proposed a narrow dollar limit and provided a May 20 letter she had previously written.

Greg Ryan from Represent.Us stated that this proposal should be on the November ballot. He stated his strong support for the legislation.

Chairperson Renne suggested that if lobbyists do not identify who they are going to lobby, then there should be a provision stating that the presumption will be that the lobbyist is lobbying all public officials. DCA Shen stated he would look into it and discuss it at the Commission’s next meeting. He asked for clarification regarding the proposal before the Commission, as the state law has a total prohibition and the current proposal has a lowered limit. Chairperson Renne asked for an alternative to the proposal, so that the Commission could consider both at its July 25, 2016 meeting. The Commissioners confirmed there were no scheduling issues with that date.

DCA Shen also clarified that the proposal presented includes both expenditure and contact lobbyists, but that one reference that needs to be removed remained on page 4, line 15.

Vice-Chairperson Keane commended the Executive Director and City Attorney for their excellent effort. Commissioner Chiu asked that staff provide a brief summary, with respect to the outright ban and limits, in terms of any resource restraints that would affect either course.

The Commission moved through the proposed recommendations in staff’s memorandum. There were no objections to Recommendations 1 and 2. The Commission requested that, regarding Recommendation 3, that staff provide a list of exemptions to the definition of “gift” under state rules and the Commission will discuss whether it will exclude certain parts from local definition of “gift” during its July meeting. The Commissioners expressed support for a $100 contribution limit in Recommendation 4.

The Commissioners discussed an alternative to what was presented in Recommendation 5. They asked that the proposal in Recommendation 5 be presented again during its July 25, 2016 meeting, but they also requested an alternative.

Executive Director Pelham clarified the request as follows:

Lobbyists would identify the officials they will lobby. These lobbyists would be prevented from contributing to those officers and/or candidates. They would also be prohibited from bundling contributions to candidates for those offices. If a lobbyist indicates that s/he will lobby a particular official or officials, then that lobbyist is able to contribute at the $500 limit (to officials they have not indicated they will lobby) and there is no limitation on bundling as those lobbyists are not in the practice of lobbying those they have not indicated they will lobby.

The Commission expressed support for Alternative 6.2 within Recommendation 6 and Recommendation 7, as long as it was clear that any regulations would not establish exceptions.

Public Comment:
Debbi Lerman stated that it is important to get it correct, as any exemptions must be included in the measure itself. She mentioned events that are open to the general public and the potential definition of “gift” under the proposal.

A member of the public stated that new enforcement mechanisms may be necessary, as new activities may occur under the proposal. He stated that the Commission should be careful of going down a rabbit hole.

Jonathan Mintzer from the Sutton Law Firm stated that there is a fear that, in some situations, the Commission has taken the approach of regulating for regulation’s sake. He stated that including expenditure lobbyists is one example. He stated that there is no public policy reason for including them at this time. He stated that the Commission should use the state definition of “gift” for simplicity’s sake.

David Pilpel stated that Chair Renne properly raised constitutional issues. He stated that the state model is quite different from how the current local lobbyist law is structured and that the entire regulatory scheme may need to be rewritten. He stated that the proposal would change the way lobbyists would register and report.

6. Discussion and possible action on proposal by Supervisor Peskin to prohibit City elected officials from establishing candidate-controlled general purpose committees.

Executive Director Pelham stated that the item was introduced by Supervisor Peskin on June 14 and he requested that the Commission schedule the item to review. She stated that a member of Supervisor Peskin’s staff was present to speak on the item.

Lee Hepner, from Supervisor Peskin’s office, thanked the Commission for scheduling agenda items 6 and 7. He stated that the proposal was a clean government measure and that these types of general purpose committees can create a special relationship with a candidate or officeholder that is controlling the committee. He stated that these committees do not have contribution limits and may be used as slush funds. He stated this proposal seeks to stop that. He stated that Supervisor Peskin is seeking support from the Commission and stated that the preference would be to handle this issue legislatively, rather than putting on the ballot.

Motion 160627-03 (Keane/Renne): Moved, seconded, and passed (4-0) that the Commission support Supervisor Peskin’s proposal.

Public Comment:

David Pilpel supported the motion.

Elena Schmid stated that Friends of Ethics strongly supports the proposal.

Ray Hartz supported the motion.

Dr. Derek Kerr supported the proposal.

7. Discussion and possible action on Ordinance proposed by Supervisor Peskin to amend the Campaign and Governmental Conduct Code to require members of City boards and commission to file behested payment reports regarding the solicitation of charitable contributions. (Board of Supervisors File No. 160478.)

Lee Hepner introduced the item. He stated that this item is less urgent than the prior item. Chairperson Renne asked Mr. Hepner to return when the Commission considers this item at its July meeting, as he would like to see a report from staff regarding its analysis and recommendation. Mr. Hepner stated that he would return and stated that the Ordinance sought transparency and is not aiming to limit or ban charitable contributions. He stated that the legislation would allow reports to be filed online and there may be a change to the disclosure deadline requirement. He stated that there may be an exemption for auctioneering and for high-level non-profit executive staff. He stated that the rule is not to discourage people from serving on boards and commissions. Commissioner Chiu whether the following contributions would need to be disclosed under this proposal: if she served as a class captain at her child’s school and she asked parents to support the school and $5,000 in contributions were actually raised. Mr. Hepner stated that those contributions would be required to be reported under the proposal.

Public Comment:
Charles Marsteller stated that the value of these charitable contributions hash more value than it has in the past. He stated that simple disclosure was a good idea.

Debbi Lerman asked that the Commission consider exemptions for those members of boards or commissions who are executive leaders in non-profit organizations. She stated that it may be that commissioner’s job responsibility to raise money for the non-profit where they are employed. She also stated that donors sometimes request confidentiality for various reasons.

David Pilpel stated that it was an interesting idea and would expand the officials disclosing from 24 to 800. He stated that disclosure was good.

The Commission entered a break at 8:02 PM and returned to open session at 8:11 PM.

8. Discussion and possible action on proposed Ethics Commission Annual Policy Plan for FY 2017.

Executive Director Pelham introduced the item and stated that she was suggesting that the proposal was a way of looking at policy issues. She stated that the Commission had previously discussed having a policy summit and suggested having one after evaluating the November 2016 election in early 2017. She stated that the policy plan would not be a static document and would allow for flexibility, as some issues may arise that are time-sensitive.

Chairperson Renne and Vice-Chairperson Keane both commended Executive Director Pelham for the plan. Commissioners Chiu and Hayon agreed.

Public Comment:
Ray Hartz stated that the Commission is failed to mention the Commission’s enforcement of the Sunshine Ordinance. He stated that the Commission remains knowingly and willfully ignorant of its requirements. He stated that the Commission’s lack of action is a mortal sin.

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:

In reviewing this proposed policy plan, I failed to find one mention of this commission’s responsibility for enforcement of the Sunshine Ordinance. Thomas Aquinas teaches: “Willful ignorance of what one out to know is a mortal sin.” I would like to say that the Ethics Commission remains knowingly and willfully ignorant of its responsibilities under that ordinance. For years it has both knowingly and willfully evaded its responsibilities under that ordinance. I believe it’s lack of action and ineptitude in carrying out its duties is not only a “mortal sin,” but knowingly and willfully unlawful. This body does not care what the citizens of San Francisco want in their government and the repeated and constant disclosures of corruption in City government are due largely in part to the inaction of this body and its members. On the whole, I believe this body to be both lacking integrity and morally deficient!

David Pilpel stated that the plan was helpful and colorful and noted that the document did not have the election of Commission officers or mention any budget discussions.

A member of the public thanked the Commission and stated that the document was step in the right direction.

Charles Marsteller – congratulated the Executive Director on the proposal.

Elena Schmid stated that the Commission should consider adding instances when a committee may be audited, such as when there are criminal proceedings.

Motion 160627-04 (Chiu/Hayon): Moved, seconded, and passed (4-0) that the Commission adopt the proposed Annual Policy Plan for FY2017.

9. Discussion of possible amendment to the Ethics Commission’s bylaws establishing a process for the Commission to respond to public records requests.

Chairperson Renne introduced the item. DCA Shen stated that records requests usually go through staff and are usually directed to the Commission as a whole. Vice-Chairperson Keane stated that the Chair should know when a privilege is being asserted in a response to a records request. Both he and Chairperson Renne stated that the Chairperson should be made aware if staff were to assert attorney/client privilege in response to a records request. Chairperson Renne stated this proposed by-law would be on the July 2016 agenda.

Public Comment:
Ray Hartz stated that the Commission had total ignorance of the Sunshine Ordinance. He stated that he has a right to a hearing a low-level bureaucrat cannot simply deny him that hearing.

David Pilpel stated this was a dangerous item. He stated that there seemed to be confusion about the Commission’s powers and duties. He stated that responses to records requests typically do not involve the Commission. He stated that this additional notification and possible approval process would be different and unusual.

10. Discussion of Executive Director’s Report.

Executive Director Pelham introduced the item and stated that the Budget Committee did not modify the Commission’s proposed budget before sending it to the full Board of Supervisors. She stated that the prepared slides for the budget presentation have been posted on the Commission’s website and were included with her report. She also stated that she had initiated interviews for the Deputy Director position.

Public Comment:
Ray Hartz stated that the Commission has failed to use the resources already available to it. He stated that there is no whistleblower protection and that Luis Herrera had perjured himself. He stated that the Board of Supervisors are dismissive during public comment.

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:

The overwhelming stench of corruption in San Francisco is due to this Ethics Commissions failure to use the resources which it has been provided! Simply “throwing more money at the problem” will be simply “throwing good money after bad!” I predict you will actually do less with more. Under one section you talk about Whistleblower Protection which is nonexistent. Under another section you discuss the Statement of Economic Interest Disclosure Program where at least one City Department head, Luis Herrera of the SFPL, committed perjury and you remained “willfully ignorant.” Under Investigation and Enforcement we against see Sunshine Ordinance complaints at the same number as always: one, solitary and alone. Lastly, under the listing for the Bureau Delinquent Revenue Accounts, we see a few “small fish” you will bully into submission and one “whale” which will never see land! Again, “You’re about as useful as tits on a boar hog!”

David Pilpel noted an error regarding the MEA. He asked that future reports include the number of matters in preliminary review.

Charles Marsteller congratulated the Commission on the budget. He agreed with the previous suggestion of including matters in preliminary review and asked about a pending matter regarding Ms. Sweet.

Executive Director Pelham stated that the July report would include matters in preliminary review and that the process with Ms. Sweet is moving forward.

11. Discussion and possible action on items for future meetings.

Public Comment:
None.

12. Additional opportunity for public comment on matters appearing or not appearing on the agenda pursuant to Ethics Commission Bylaws Article VII Section 2.

Public Comment:
Ray Hartz stated that he has been dealing with boards and commissions in the City for eight years. He stated that the City Attorney lets them break the law and then comes up with an excuse why it did not break the law. He stated that he has 24 orders from the Sunshine Ordinance Task Force and he does not trust the Commission at all.

13. Adjournment.

Motion 160627-05 (Keane/Chiu): Moved, seconded, and passed (4-0) that the Commission adjourn.

Public Comment:
None.

The Commission adjourned at 9:14 PM.

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