City and County of San Francisco
Ethics Commission

1. Call to order and roll call.

Chairperson Renne called the meeting to order at 5:31 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; Bob Planthold; Michael Petrelis; Charlotte Hill; Morgan; Helen Grieco; Debbi Lerman; David; Jonathan Mintzer; Alex Kaplan; Elena Schmid; Anita Mayo; Joshua; Greg; Lee Hepner, Legislative Aide to Supervisor Peskin; Bob Dockendorff; and other unidentified members of the public.

MATERIALS DISTRIBUTED:
– June 27, 2016 draft minutes;
– July 15, 2016 staff memorandum re: AGENDA ITEM 4 – Proposals for November 2016 Ballot Measure to Restrict Lobbyist Gifts, Campaign Contributions and Bundles Contributions, and attachments;
– July 21, 2016 staff memorandum re: AGENDA ITEM 4 – SUPPLEMENTAL MEMO AND REVISED LANGUAGE: Proposals for November 2016 Ballot Measure to Restrict Lobbyist Gifts, Campaign Contributions and Bundled Contributions, and attachments;
– July 15, 2016 staff memorandum re: AGENDA ITEM 5 – Ordinance introduced by Supervisor Peskin to require members of City Boards and Commissions to file behested payment reports regarding the solicitation of charitable contributions, and attachments;
– Item 5 – Supplemental Attachment;
– July 15, 2016 staff memorandum re: AGENDA ITEM 6 – Discussion and possible action on proposed amendment to the Ethics Commission’s bylaws to establish a process regarding requests for public records directed toward Members of the Ethics Commission and a notification requirement for its Executive Director, and attachment;
– Item 6 – Supplemental Attachment;
– Executive Director’s Report for the July 25, 2016 Commission Meeting, dated July 21, 2016, and attachments;
– Public comment.

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

Charles Marsteller alerted the Commission to a KQED news article regarding the Lennar corporation and developments. He offered to forward it to the Director so that she could forward it to the Commissioners.

Bob Planthold commented about the pending Whistleblower Ordinance introduced by Supervisor Breed. He stated that he wanted the proposed ordinance to include mandatory training for all City employees. He stated that many employees do not know about their rights.

Michael Petrelis expressed support for the creation of a public advocate. He stated that one is needed because of the failures of the Commission. He mentioned a complaint he filed in February and another that against Steve Kawa. He stated that a Public advocate would get some answers.

3. Discussion and possible action on draft minutes for the Commission’s June 27, 2016 regular meeting.

Chairperson Renne noted an error in the spelling of Represent.Us and asked that it be corrected for the final version of the minutes.

Public Comment:
None.

Motion 160725-01 (Keane/Chiu): Moved, seconded, and passed (4-0) that the Commission approve the minutes for the Commission’s June 27, 2016 regular meeting, as amended.

4. 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 LeeAnn Pelham introduced the item and stated that staff had provided amended documents, after documents were originally circulated on July 15, 2016. She stated that staff received public comment and input and made further revisions, which were included with staff’s July 21, 2016 memorandum to the Commission. She stated that the most current language is found in Attachments 2 and 3 of the July 21, 2016 memorandum – “revised June approach” and the “revised July alternative.”

Motion 160725-02 (Keane/Hayon): Moved and seconded that the Commission approve the “revised July alternative” from Supplemental Attachment Three.

Before taking public comment, Chairperson Renne asked various questions regarding the “revised July alternative.” He asked why independent committees in support of or in opposition of a particular candidate are not included. DCA Shen stated that a proposal including limits on independent expenditures committees would not be defensible, pursuant to case law. Chairperson Renne noted on page 11, line 23, that the proposal referenced “contact lobbyists” when it should apply to both. DCA Shen agreed that the word “contact” should be deleted on that line.

Chairperson Renne and Vice-Chairperson Keane discussed bundling contributions and expressed an interest in a complete prohibition on bundling contributions. DCA Shen stated that the rationale for this proposal is that the lobbyists are making a contact with a particular officer/candidate and that lobbyist bundling contributions for that officer/candidate may make that officer/candidate more receptive to what the lobbyist is proposing or opposing. Executive Director Pelham added that the rule could also apply to others who are not lobbyists. She stated that this discussion has been built on the idea that the lobbyists are spending money to access and/or have contacts with City officials. She stated that, if the Commission were to remove the communication piece, then there would be a broader approach that needs to be reviewed.

Public Comment:
Bob Planthold, member of Friends of Ethics, spoke in support of July revision. He stated that there is a benefit to keeping the prohibition regarding bundling. He stated that bundling can be hard to verify.

Charlotte hill, the Communications Director for Represent.Us, is pleased and grateful to see this initiative being considered for the November ballot. She stated that Represent.Us fully supports the July alternative and thanked the Commission for considering the ban.

Morgan from Represent.Us thanked the Commission for its hard work. He stated that he was excited that it is being considered for the November ballot.

Helen Grieco from California Common Cause thanked the Commissioners and the Executive Director. She stated that her group endorses the July alternative.

Debbi Lerman, SF Human Services Network, stated she had provided a memo earlier regarding the proposed ballot measure. She thanked the Commission for the exception for gifts of food or refreshment. She mentioned that there may need to be language regarding CPI adjustment in the proposal.

David from Represent.Us thanked the Commission and stated that Represent.Us is attempting to make sure that everyone has an equal voice. He stated that he was glad that the Commission is trying to pass legitimate reforms.

Jonathan Mintzer suggested that the Commission apply the proposal only to contact lobbyists. He stated expenditure lobbyists are indirectly urging others to contact City officials. He also stated that there is a current corporate ban in San Francisco on contributions.

Michael Petrelis stated that he supports this proposal. He expressed concerns that, if approved, it will not go until effect until 2018.

Alex Kaplan, Policy Director for Represent.Us, thanked the Commission and its staff. He stated that there had been an open process in drafting this proposal. He also noted a typographical error on Page 12, line 11 – where the word “less” appears twice. He urged the Commission to retain the gift ban and asked the Commission to consider applying the travel gift restriction earlier than 2018.

Elena Schmid, Friends of Ethics, thanked the Commission. She stated that getting public input makes a difference.

Charles Marsteller discussed aggregate limits and suggested a separate item be placed on the agenda.

Anita Mayo provided a letter for the Commissioners. She stated that the proposed changes are not needed and suggested that the Commission not impose a ban on bundling contributions.

Joshua from the Artists Alliance with Democracy thanked staff and the Commission for taking up the measure. He stated that citizens do not have full confidence in city government. He stated that the Commission should know how the Commission and its ethics laws have failed.

Greg from Represent.Us thanked the Commission for its work.

Chairperson Renne stated that the Commission would correct the grammatical error on page 12, line 11 – to delete the word “less.”

Motion 160725-03 (Keane/Hayon): Passed (4-0) that the Commission approve the “revised July alternative” from Supplemental Attachment Three, as amended.

Vice-Chairperson Keane stated that the City owes a debt to Represent.Us and suggested that they keep up the work and effort. Commissioner Hayon seconded his comments. She stated that neither the Commission nor staff can do its work properly unless there is full involvement from the community. She stated that a challenge now is to make sure the average voter understands this proposal, as there will be about 30 ballot measures on the November ballot. Chairperson Renne agreed and stated that the proposal would first go to the Ballot Simplification Committee regarding the wording in the Voter Handbook. He stated that the Commissioners would not be able to urge voters to vote for it and asked that members of the public continue to support the matter so that voters will vote for it.

Vice-Chairperson Keane suggested that all Commissioners be empowered to go to the various political club meetings to provide information regarding the proposed ballot measure. Chairperson Renne agreed and stated that the Executive Director should also be authorized to attend the meetings.

Motion 160725-04 (Renne/Keane): Moved, seconded, and passed (4-0) that the Chairperson may assign any member of the Commission or its Executive Director to attend any political club meetings and to provide information regarding the proposed ballot measure.

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

Lee Hepner, aide to Supervisor Peskin, introduced the item and provided copies to the Commissioners and public of amended pieces of legislation. He thanked the Commission for hearing the item. He stated that there is some flexibility as to the reporting mechanism, which may take some resources and time. He stated that the proposal would require filing with the Ethics Commission and not with individual boards or commissions. He stated that his office would be happy to support additional funding for the Ethics Commission and would be amenable to a 01/01/2018 effective date. He stated that his office does not want to put the onus on the board member or commissioner to be the judge of what should or should not be reported. He stated that the idea is for transparency and openness and it is the public’s obligation to make the determination if a donation is suspect. DCA Shen confirmed that the report elected officials are currently required to file casts a similarly wide net regarding the information reported. Mr. Hepner also stated that his office would be amenable to a prohibition on solicitations of interested parties or to specific types of 501(c)(4) organizations, although it is not currently mentioned in the legislation. He stated that he would be grateful for any recommendations from the Commission.

Public Comment:
Charles Marsteller stated that it is important to start with disclosure so that the public can see and track the information.

Bob Planthold referenced a letter from Larry Bush and stated that disclosure of a donation is important, even if it is not specific to a particular board or commission.

Jonathan Mintzer expressed concerns from what was stated during the presentation. He stated that this proposal is a solution in search of a problem. He stated that he was scared that this is going to be a trap for the unwary. He stated there may be legal issues regarding a prohibition on behested donations.

Debbi Lerman, SF human services network, stated that non-profit members should serve on commissions and boards. She stated that non-profits should not be hamstrung on raising money, as the City is asking that they do so frequently. She stated that she would have a problem if there were a proposal to ban contributions by anyone to 501(c)(3) organizations. Vice-Chairperson Keane stated that he did not think that would be constitutional.

Bob Dockendorff stated that 501(c)(3) and (4) organizations are the issue regarding behested payments. He stated that those need to be disclosed.

Vice-Chairperson Keane stated that his opinion is that Supervisor Peskin is on the right track, but that there are some concerns and a compromise could be reached. Commissioner Chiu agreed that it was on the right track and suggested that the rule be more narrowly tailored to get to the nexus of behested payments and conflicts that arise before a commission or board. Commissioner Hayon asked whether there could be a limit to 501(c)(4) organizations and Mr. Hepner stated that that would be too narrow.

Motion 160725-05 (Renne/Keane): Moved, seconded, and passed (4-0) that the Commission support the intention of the legislation, adopt the recommendations in staff’s memorandum, and have those recommendations transmitted to Supervisor Peskin on behalf of the Commission.

6. Discussion and possible action on an amendment to the Ethics Commission’s bylaws to establish a process for Staff to notify the Commission when attorney-client privilege has been invoked in response to a request for public records.

This item was continued to the Commission’s next regular meeting.

Public Comment:
None.

7. Discussion of the Executive Director’s Report.

Executive Director Pelham introduced the item. She announced that she has hired a new Deputy Director, Jessica Blome. She introduced Ms. Blome to the Commission. She stated that Ms. Blome will begin on August 15 and has a strong record of accomplishment and a keen legal mind. She provided Ms. Blome’s background and stated that her experience will be a welcome asset. Ms. Blome stated that she was excited for the opportunity. Chairperson Renne welcomed Ms. Blome and stated that the Commission looks forward to working with her. Executive Director Pelham also noted that the number of matters under preliminary review is 56.

Public Comment:
None.

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

The Commission agreed to cancel its regular August 2016 meeting.

Public Comment:
Charles Marsteller stated that the Commissioner will still need to attend the various club meetings that will occur to discuss the proposed ballot measure.

9. 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:
None.

10. Adjournment.

Motion 160725-06 (Keane/Chiu): Moved, seconded, and passed (4-0) that the Commission adjourn.

Public Comment:
None.

The Commission adjourned at 7:45 PM.