Approved Minutes of the Regular Meeting of
The San Francisco Ethics Commission
Friday, September 20, 2019
Room 416 – City Hall
1 Dr. Carlton B. Goodlett Place
San Francisco, CA 94102
(Approved October 18, 2019)
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1. Call to order and roll call.
Chair Daina Chiu called the meeting to order at 2:00 pm.
COMMISSION MEMBERS PRESENT: With Chair Daina Chiu, Vice-Chair Noreen Ambrose, and Commission Members Yvonne Lee, Fern M. Smith, and Lateef Gray in attendance, a quorum was present.
STAFF PRESENTING: LeeAnn Pelham, Executive Director; Jeffrey Pierce, Director of Enforcement and Legal Affairs; and Patrick Ford, Senior Policy Analyst.
REPRESENTATIVES OF THE OFFICE OF THE CITY ATTORNEY PRESENT: Jenica Maldonado, Deputy City Attorney.
- Draft Minutes for the August 16, 2019 regular meeting.
- Monthly Staff Enforcement Report dated September 16, 2019 and attachments.
- Staff memo dated September 16, 2019 on preliminary outline for revisions of Commission’s Fixed Penalty Policy.
- Monthly Staff Policy Report dated September 16, 2019.
- Executive Director’s Report dated September 16, 2019 and attachments.
2. Public comment on matters appearing or not appearing on the agenda.
Chair Chiu provided the opportunity for public comment. No public comment was provided.
3. Consent Calendar
Chair Chiu provided the opportunity for public comment on the Consent Calendar. No public comment was provided.
Commissioner Lee made a motion to approve the Consent Calendar, Item 3, Draft Minutes for the Commission’s August 16, 2019 regular meeting, and Commissioner Smith seconded the motion. Motion passed unanimously 5-0.
Motion 190920-01 (Lee/Smith): Moved, seconded and passed unanimously (5-0) that the Commission adopt its Consent Calendar item.
4. Discussion of Staff Enforcement Report.
Director of Enforcement & Legal Affairs Jeff Pierce presented the Enforcement Report. He introduced Department of Human Resources (DHR) Deputy Director of Employment Services Anna Biasbas and DHR Client Services Manager Shawn Sherburne to provide an overview of the City’s oversight of outside or secondary employment by City officials and employees.
Sherburne stated that the Campaign and Governmental Conduct Code and the City’s Civil Services Rules both speak to secondary employment. Sherburne noted that DHR endeavors not to approve employment with any conflict with an employee or officer’s duties. Items reviewed in the process seek to ensure the requirements of the outside employment do not impede the performance of an individual’s City duties, and that the activities are not incompatible or inimical with the duties in their department. He added that DHR seeks to ensure the work does not impede the City employees regular work schedule and that DHR works actively with departments to ensure employees do not take vacation or take leave to conduct outside employment. He noted that employees seek Advanced Written Determinations, or “AWDs” from their department heads as to whether proposed outside employment presents any issues under a Department’s Statement of Incompatible Activities. He stated DHR recommends that department heads and other high-level officers work in coordination with the Ethics Commission to seek an AWD.
Sherburne noted that requests for approval of secondary employment should be truly prospective and that DHR takes an interest in the amount of secondary compensation identified. He noted consultancy as an example, for which a high level of income might trigger closer scrutiny by DHR to determine what exactly the individual proposes to provide consulting on and to ensure that the work is taking place only outside of the individual’s City work hours. Sherburne exhibited DHR’s additional employment request form and pointed out that the outside employer must sign the form noting that the outside employment is not incompatible with that individual’s City duties and that approval of the individual’s appointing officer must also be noted.
Chair Chiu asked whether the Department has received more requests in the gig economy and what happens when someone has received an advanced approval. Sherburne confirmed that DHR has seen more outside employment requests in the last two to three years. When an employee is discovered to have unapproved outside employment, Sherburne stated that the employee’s department is advised. He noted that the Whistleblower Program frequently receives complaints on this issue and sometimes requires an employee to come into compliance at the result of its investigation. Sherburne noted that individuals who have repeatedly taken on outside employment without approval may face disciplinary action.
Commissioner Smith asked how often DHR denies approval. Sherburne noted that his response would be largely anecdotal and cited two or three recent instances that had reached his desk. Regarding how many individuals are discovered to have unapproved outside employment, Sherburne noted that he receives two to three calls a week from the Whistleblower Program inquiring whether an individual had prior approval.
Commissioner Lee asked Sherburne to explain in greater detail how DHR identifies conflicts of interests and incompatible activities. She cited as an example an employee who works in Planning who seeks to work in permit consulting. Sherburne noted that individual departments have their own Statement of Incompatible Activities that generally sets out the specific conduct that an employee of that department cannot undertake.
Commissioner Lee asked whether different rules apply when an employee owns (but doesn’t work for) another business, or whether they work in a limited capacity for a family-owned business. Sherburne noted that the rules are identical irrespective of the circumstances. He noted that they do receive many requests regarding ownership of outside businesses.
Commissioner Lee asked whether candidates applying for City employment are asked whether they have outside employment. Sherburne stated that it’s not possible to ask candidates that question, but that during the onboarding process employees are notified of these obligations. Biasbas noted that DHR normally handles secondary employment during the employment stage, but she further noted that if an applicant had stated on their job application that they have outside employment DHR does not prohibit interview panels from asking applicants about that outside employment.
Chair Chiu asked whether being a shareholder receiving dividends would trigger the need of applying for approval. Sherburne noted that in consultation with the City Attorney’s Office, DHR has distinguished between passive income and compensation from active employment.
Commissioner Ambrose asked about discretion that the Department Head might have to include in a Statement of Incompatible Activities a provision prohibiting outside activities with an appearance of incompatibility. Sherburne stated that DHR considers the Statement of Incompatible Activities as only one way that DHR evaluates compatibility. He noted that in the City’s labor agreement with SEIU, an explicit provision exists that its members have a right to outside employment unless there is an affirmative finding of a conflict. He stated his belief that that provision is unique to that MOU.
Commissioner Ambrose asked if an appeals process exists if DHR denies an outside employment application. Sherburne stated that an applicant can appeal to the Civil Service Commission.
Commissioner Gray asked what form a denial takes. Sherburne stated that DHR defers to the appointing authority as to what form that denial takes but observed that it often takes the form of a letter. Commissioner Gray further asked how long an applicant has to appeal a denial. Sherburne stated the applicant has five business days to appeal from the date of receipt.
On other items noted in the monthly Enforcement report, Peirce reviewed current caseload statistics and noted that staff will be reviewing all open complaints against applicable discretionary factors beginning in the next week to assess prioritization and status accordingly.
No public comment was received and no action was taken on the item as it was provided for informational purposes only.
5. Discussion and Possible Action on preliminary outline for revisions of Commission’s Fixed Penalty Policy.
Director of Enforcement & Legal Affairs Jeff Pierce introduced the September 16, 2019 Staff memo, which Staff prepared in response to the Commission’s request at the August regular meeting that Staff present an overview regarding the possible expansion of the Fixed Penalty Policy.
Pierce highlighted the existing policy at Attachment 1 of the Staff report. He noted this is an opportunity to review the policy both substantively and procedurally, including what potential kinds of new provisions may be added for coverage under the policy. He highlighted the planned process for gathering feedback and noted Staff already has begun to evaluate the process in discussions with peer agencies and internally with Commission staff for greater insights. He noted two “interested persons” sessions are also planned, following which Staff would draft a proposed revised policy for the Commission’s consideration and action.
Chair Chiu clarified if the Fixed Penalty Policy is part of the Commission’s Enforcement Regulations. She asked whether an initial draft would make sense to bring to the Commission after the first interested persons meeting for further comment. Pierce confirmed Staff will bring back an initial document in that sequence for the Commission’s information. In response to a question by Commissioner Gray about the expected length of the entire process, Pierce responded that a final revised policy could be in place within six months.
Deputy City Attorney Jenica Maldonado added that there is no current reference in the Commission’s Enforcement Regulations regarding the fixed penalty policy.
No public comment was received. No action was taken on the item as it was provided for informational purposes only.
6. Discussion of Staff Policy Report.
Senior Policy Analyst Pat Ford presented the item. Ford reported that the Board of Supervisors had unanimously approved the “Phase II” ordinance of the Commission’s efforts to revise the Public Financing on first reading on September 17 and that it was agendized for final action by the Board on Tuesday, September 24 as item 1. Chair Chiu confirmed that should the Board approve the ordinance the Mayor has 10 days to sign it. Ford noted he has been in communication with the Mayor’s staff regarding the pending ordinance. Ford added that two reports on the item were issued from the Budget and Legislative Analyst (“BLA”) that were part of the Committee’s consideration to summarize the issues contained in the ordinance. Ford noted that January 1, 2020 would be the operative date of the ordinance if it is enacted. He added that there are presently six co-sponsors of the Ordinance.
Chair Chiu asked about the sufficiency of funding in the Election Campaign Fund to accommodate the changes. Ford responded that based on Staff’s analysis given recent participation levels, funding in the Fund would be sufficient. Both staff and the BLA concluded that funding could be strained if significant growth occurs in the number of candidates qualifying for public funds. He noted that under the new program applicants would submit more contributions of smaller amounts, which could mean auditors spend more time evaluating matching requests, but that overall the provisions of the ordinance did not indicate significantly new workloads for Staff.
Regarding the project to extend e-filing of Form 700 to all designated filers, Ford stated that he had drafted a prospective timeline accounting for both the meet and confer obligations and the state requirement in 2020 to conduct a biennial code review. Chair Chiu asked whether linking those two items would affect the pace of accomplishing the project, and Ford clarified that Staff intended to treat them separately to help ensure the biennial code review would not delay progress on the eFiling project.
Ford updated the Commission on status of AB1107, which the Commission had communicated its support of in 2016 to the City’s State Legislative Committee and which had recently been the subject of a ruling by the Third District Court of Appeal. Commissioner Ambrose noted that a 2016 letter from Common Cause that Ford had attached made clear that early in the legislative process the State Legislature had likely been advised, and had intended, to bring the exception back to the voters as the safer course. She further noted that AB1107 had included a provision that prohibited foreign individuals and corporations from making contributions in state and local races and asked whether that provision had survived judicial review. She likewise asked whether, if it did, such prohibitions apply in Charter cities like San Francisco. Ford stated Staff would research those questions.
Chair Chiu asked how much it would cost to administer the Sunlight on Dark Money initiative if that measure on the November 2016 ballot were to be adopted by San Francisco voters. Executive Director Pelham responded that if there is no appropriation in the measure the Commission would have to absorb the cost.
Chair Chiu called for public comment. No public comment was received. No action was taken on the item.
7. Discussion of Executive Director’s Report.
Executive Director LeeAnn Pelham provided highlight from the September Executive Director Report. She referenced an overview on the implementation of the Anti-Corruption and Accountability Ordinance that she presented at the request of the Mayor’s Office at its most recent monthly Department Head meeting. Pelham also verbally highlighted a number of staffing changes that were slated to take effect on September 21 and would be detailed in the October Executive Director’s report. Chair Chiu extended her congratulations to those taking on new roles and expressed appreciation for the ongoing work they have been providing on the Commission’s behalf.
Chair Chiu asked about the kind of campaign disclosure data outreach that Staff have engaged in, noting that at the August meeting a journalist from a Chinese-language newspaper had attended and expressed interest in the Commission’s public disclosure tools. She asked that a member of the Electronic Disclosure and Data Analysis team present the dashboards before the Commission at an upcoming meeting and Pelham agreed Staff would provide one after the initial pre-election reporting period for the November election.
No public comment was received. No action was taken on the item as it was provided for informational purposes only.
8. Discussion and possible action on items for future meetings.
Chair Chiu provided the opportunity for public comment and no public comment was received. No items were discussed and no action was taken on the item.
9. Additional opportunity for public comment on matters appearing or not appearing on the agenda pursuant to Ethics Commission Bylaws Article VII Section 2.
Chair Chiu provided the opportunity for public comment and no public comment was received.
Chair Smith moved to adjourn the meeting and Vice-Chair Ambrose seconded the motion. The motion was adopted unanimously 5-0.
Motion 190920-02 (Smith/Ambrose): Moved, seconded and unanimously adopted that the Commission adjourn the meeting.
The Commission adjourned at 3:38 pm.