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Executive Director’s Report – June 22, 2017

Date: June 22, 2017
To: Members of the Ethics Commission
From: LeeAnn Pelham, Executive Director
Subject: AGENDA ITEM 7 – Executive Director’s Report for the June 26, 2017 Commission Meeting 


This report provides various programmatic and operational highlights to date since the last monthly Executive Director’s Report.

Action Requested

No action is required by the Commission, as this item is for informational purposes only.

Budget Update

In a May 30 letter transmitted to the Board of Supervisors’ Budget Analyst and in comments to the Board’s Budget and Finance Committee on June 8, I conveyed our support for the Mayor’s proposed Ethics Commission budget for FY18.

In summary, the budget provides $4.52 million in funding for current projects, required funding for the Election Campaign Fund, and 24 full time equivalencies (which are shown in the Mayor’s Budget Book on page 220 as “net operating positions” of 23.25 and 23.45 for FY18 and FY19, respectively.) This includes authority for one of the two new positions we had requested, and several position reclassifications to better align those positions with the more complex knowledge, skills, and abilities required of those positions. If adopted by the full Board, next year’s budget will help ensure we can invest in needed capacity-building to improve our programs and program oversight, particularly in our engagement, compliance assistance and education, and audit work.

A copy of my transmittal letter to the Board’s Budget Analyst and the brief presentation I made on June 8 appear as Attachment 1 and 2, respectively. The full Board is expected to act on the proposed budget in July.

Annual Policy Plan

Updated for June, the Commission’s Annual Policy Plan appears at Attachment 3.  Further detailed memoranda about the policy discussions and action possible at this month’s meeting appear with Items 4 and 5 on the June meeting agenda.

In addition to policy matters that appear on the annual policy plan, on June 13, 2017, Supervisor Malia Cohen introduced an ordinance (BOS File No. 170738), assigned under the 30 day rule, that would amend Chapter 16 of the Administrative Code to require disclosure of candidate and third-party spending in Retirement Board, Health Service Board and Retiree Health Care Trust Fund Board elections.  As proposed in the ordinance, the Ethics Commission would be responsible for collecting disclosure statements submitted by candidates or third-party spenders and would likely have to develop a form or other electronic disclosure system to track these filings.  The ordinance also provides the Ethics Commission with the authority to impose late filing fees and to levy penalties on persons who fail to file the required statements. A copy of the ordinance as proposed appears as Attachment 4 .

Staff also continues to plan for the expansion of electronic filing for all designated Form 700 filers in the City.  In preparation for bringing forward policy language necessary to achieve that goal, recent activities have included meetings with officials and technology staff from the Department of Human Resources to assess possible ways to integrate the Commission’s electronic filing system with the City’s HR systems to optimize the filing process citywide. In addition, the Staff is evaluating the technical requirements, business process changes, and resources necessary to support the program’s expansion to over 3,000 designated employees.  We anticipate additional updates for the Commission at your August meeting.

Staff News

I am very pleased to announce the hiring of two new staff members, both of whom will start with the Commission on Monday, July 3.

Jeffrey Zumwalt will round out our investigative team as our new Investigative Analyst. Jeffrey has over 10 years of public service experience that has included multiple years serving in the role of Investigator. He served for four years with the Virginia Tech Police Department, including since 2016 as a Detective. He also served for five years with the Metropolitan Police Department in Washington, D.C. as a Police Officer, Investigator, and Vice Investigator. Jeffrey holds a B.A. in Criminology and Criminal Justice from the University of Maryland, and a Master’s degree in Public Administration from the University of Maryland.

Pat Ford will join our new Policy unit as a Policy Analyst.  Pat has experience as a Corporate Associate with the law firm DLA Piper in Palo Alto, where he has worked primarily on venture capital financings and merger and acquisitions. He also has previous experience with the practical side of campaign finance compliance and reporting laws as a Contribution Coordinator for statewide and county offices based in the Southern California region. Pat holds a BA in Philosophy from the University of California, Santa Barbara, and a JD from McGeorge School of Law at the University of the Pacific, where he was also a member of the Law Review.

We also congratulate our Deputy Director and Iowa-native, Jessica Blome, this month on her June 1st swearing in as a member of the California Bar.

As we look to coming fiscal year, our work to fill all vacant positions will continue to be a top priority. To support our necessary exam development, job posting, and applicant screening processes, we have secured from DHR the continued assistance of Senior Personnel Analyst, Dorys E. Lorio through December 2017. Table 1 shows a snapshot of pending positions that will require recruitment. We are working diligently to have these positions filled by the end of this calendar year.

Table 1 -Status of Recruitments for Ethics Commission Staff Vacancies
Working Title and Division Status Type Job Class Title/No
Investigative Analyst (Enfct & Legal Affairs) Hiring complete/July 3 start New/non-exempt Admin. Analyst, 1822
Policy Analyst (Policy) Hiring complete/July 3 start New/non-exempt Admin. Analyst, 1822
IS Business Analyst (El. Discl & Data Analysis) Job posted; applications due July 5 Vacant/non-exempt IS Business Analyst, 1052
Auditor (Audits) Recruitment prep in process Vacancy/non-exempt Admin. Analyst, 1822
Chief Programs Officer (Engt/Compliance) Reclassification pending adoption of final FY18 budget Vacancy/exempt Manager I (0922) from Senior Management Assistant (1844)
Principal Admin. Analyst (Engt/Compliance) Reclassification pending adoption of final FY18 budget Vacancy/non-exempt Princ. Admin Analyst, 1824
Sr. Engagement & Compliance Officer (Engt/Compliance) Reclassification pending adoption of final FY18 budget New/non-exempt Sr. Admin. Analyst (1823)
Senior Auditor Reclassification pending adoption of final FY18 budget Vacancy/non-exempt Sr. Admin. Analyst (1823) from Admin Analyst (1822)
Senior Info Systems Business Analyst (El. Discl & Data Analysis) Reclassification pending adoption of final FY18 budget Vacancy/non-exempt Sr. IS Business Analyst (1053) from IS Business Assistant (1051)
Electronic Disclosure & Data Analyst Manager (El. Discl & Data Analysis) Reclassification pending adoption of final FY18 budget Reclassification of existing non-exempt position Principal IS Business Analyst (1054) from Senior IS Business Analyst (1053)


Our entrance meeting with the Controller’s audit team for audits of the 2016 publicly financed candidates will take place June 29. We expect one final audit report for the last remaining audit of the 10 campaign committees selected for audit from the 2015 cycle to be released next week after the Committee’s response has been incorporated.

Last month, during a staff review and close out of prior audit work in preparation for our 2016 election audit work, we determined that draft audit reports for five committees from the 2012 cycle had not been forwarded to the audited committees for their review and comment. Staff will issue these final audit reports for the five committees by the end of this fiscal year.  Records indicate that audit work on the committees started in 2014 by the Controller’s office on behalf of the Ethics Commission, and that the Controller’s draft audit findings were sent to the Commission’s Executive Director in early 2015. While further review of the draft findings appears to have been initiated in mid-2015, no draft audit reports were sent to these committees for review. Staff provided the draft audit reports to the committees in late May. We also conveyed our understanding that the committee and its representatives may not be in a position to take any action or submit any additional information at this time in response to the draft audit findings due to the length of time that had passed since the conclusion of audit work. We asked committees to provide any comments or additional records they may have so they may be incorporated in to the final audit report that will be issued. We also acknowledged that Staff’s delay in finalizing these reports will be considered a significant mitigating factor for the Committee during our enforcement reviews of any audit findings. We also noted that we are revising our operations and methods for monitoring and reporting on the status of all audits to improve the day-to-day management of our audit program and to ensure such delays are not repeated going forward.

Revenues Report

Table 2 shows the revenues received by the Commission during the fiscal year that began on July 1, 2016, as of June 15, 2017.

Table 2- Summary of FY 2016-17 Revenues as of June 15, 2017
Source Budgeted Amount FY 16-17 Receipts as of June 15, 2017
Lobbyist Registration Fees $85,000 $100,364
Lobbyists Fines $500 $2,050
Campaign Consultants Fees $10,000 $21,063
Contact Lobbyist and Other e.g., copies made by public $4,850 $917
Statement of Economic Interests Filings-Late Fees $1,500 $300
Campaign Consultant Fines $1,000 $600
Campaign Finance Fines (includes late fees and forfeitures) $23,000 $36,512
Ethics, Other/ Administrative Fines Levied by the Commission $7,500 $31,928
Total $133,350 $193,734

I look forward to answering any questions about this report at the upcoming Commission meeting.

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