To: Members of the Ethics Commission
From: LeeAnn Pelham, Executive Director
Subject: Agenda Item 7 – Executive Director Report for January 2022
Summary and Action Requested
This report provides various programmatic and operational highlights since the last Executive Director’s
Report. No action is required by the Commission, as this item is for informational purposes only.
Program and Operational Updates
The end of the calendar year continued to be a busy time at the Commission. As a new year gets underway, we have a number of operational and programmatic developments to report.
New Ethics Commissioner Appointed
We are pleased to formally welcome Commissioner Theis Finlev to the Ethics Commission this month. Commissioner Finlev was appointed effective December 16, 2021 by City Attorney David Chiu to complete the term of office vacated by Commissioner Noreen Ambrose, who resigned last July. Commissioner Finlev is an attorney with the Security and Exchange Commission (SEC). He formerly served as an Assistant District Attorney in the San Francisco District Attorney’s Office, where he led investigations into violations of state and local public integrity laws. Commissioner Finlev’s prior experience also includes advocacy and legislative work on public integrity issues while at California Common Cause and at the California Fair Political Practices Commission. Commissioner Finlev’s term of office will expire on February 1, 2026.
New Job Posting
We have now opened the recruitment process for the Ethics@Work Program Manager position (Job Class 1824). Ethics@Work is a new outreach and training program to strengthen governmental integrity by equipping city officials, employees, contractors, and other key stakeholders with practical information and tools to effectively navigate ethical challenges in public service. This new position will lead a new team of three senior program specialists in developing and conducting training and outreach and will have responsibility to develop and execute comprehensive communication and training plans and to design and deliver cohesive and engaging learning content across a diverse range of audiences, organizations, and settings. Applications for this position are being accepted through January 31.
Information about the three Ethics@Work Senior Program Specialists for training, technology, and program content (Job Class 1823) will be available on our Ethics Commission jobs page in the coming weeks.
New Form 700 E-filing Process for Designated COI Filers Now Launched
The new e-filing process for all Conflict of Interest Code-designated Form 700 filers has now been successfully launched. This means that all persons occupying positions that are designated in the City’s Conflict of Interest Code to file a Statement of Economic Interests (Form 700), must now submit those statements online using the Ethic Commission’s e-filing system (NetFile), and paper filings will no longer be accepted for these filers.
To facilitate this new filing process for City departments and receive their system log-in credentials, all Departmental Filing Officers were required to take a tailored training module in SF Learning that was developed by our Engagement & Compliance Team. Staff shared additional resources through a series of pre-launch communications over the past several months, including new online information, workflow process tools, fact sheets, and self-help articles. In addition, the team created a dedicated From 700 Support Portal to help ensure every support request is tracked and addressed.
We are very excited to see this new project launch and we look forward to providing further updates and information about its progress in the coming Form 700 annual filing season.
New Behested Payments Law Takes Effect This Month
On December 14th, the Board of Supervisors unanimously approved File No. 201132. This ordinance prohibits all City officials and employees who are required to file the Form 700 Statement of Economic Interests from soliciting behested payments from those who have official business before their department or who have otherwise sought to influence them. This legislation enacts the Commission’s recommendation of November 2020 that behested payment be regulated in this manner, and Policy Staff were engaged throughout the legislative process to represent the Commission’s policy perspectives.
The Mayor returned the ordinance unsigned on December 24th, which means that the law will go into effect on January 23rd. The Engagement and Compliance, EDDA, and Policy divisions are currently collaborating on an implementation and education plan for the new behested payment rule.
Operational Updates: On-site Office Services and On-site Commission Meetings
On December 23, as the Omicron variant of COVID-19 began to spread rapidly throughout the Bay Area and country, the City’s Department of Human Resources (DHR) Director authorized and strongly recommended City departments to expand telecommuting for all non-essential workers through January 18, 2022. On January 7, 2022, due to the continuing Omicron surge globally and throughout the Bay Area, DHR notified departments that the City has authorized another extension of flexible scheduling and remote work for all non-essential employees to the extent possible, through February 14, 2022.
Based on this DHR guidance, our office temporarily expanded our telework program effective December 24th for all Commission Staff to help protect the health and safety of our communities and employees. As a result, the Commission’s physical office is temporarily closed and we continue to provide services online, by phone, and by appointment on request.
Separately, at this time plans remain underway for the City’s policy bodies to resume on-site meetings in City Hall beginning February 28, 2022. Staff are gathering planning and logistical information and we will share further detailed updates based on the latest information and guidance from the City Administrative Officer as developments warrant.
Program Update: Overview of Recent Whistleblower Retaliation Case Activity
Attached to this month’s report is an update regarding recent Whistleblower retaliation case activity. Acting Enforcement Director Jeffrey Zumwalt worked with Commission investigators to gather their observations about recent investigative activity to enable the team’s ongoing review of cases alleging Whistleblower retaliation and identify insights for future investigative work on cases of that nature. This process also has been used for knowledge sharing in onboarding our new Investigators about Whistleblower retaliation protections afforded under City law. It is also helping to inform development of our Ethics@Work program by surfacing general observations about areas of the law and supervisory practices that would be useful to address in training content and outreach materials. The overview appears as Attachment 1.
Program Update: Lobbying Audits Now in Implementation Phase
As reported in my November 2021 update on the status of action to implement recommendations of the Budget & Legislative Analyst through the first quarter of FY22, Staff established its FY22 Lobbying Audit Project Plan in July 2021. That plan initially targeted September 30, 2021 for the Audit division to review lobbying program elements, gather necessary information and data, design testing approaches, and create core processes and procedures. While those activities were delayed to December 31 due the engagement of departmental managers in FY22 hiring processes, the division has now completed that developmental work. Following the January 15 filing of lobbying activity reports that cover the month of December 2021, auditors will finalize the selection process and notify lobbyists selected for audit later month. An overview illustrating the implementation steps underway appears as Attachment 2. Audits and Compliance Review Manager Linda Fong will be on hand at Friday’s meeting for any questions.
Lobbying audits are being initiated with two key goals:
- Improve oversight and promote the compliance and accountability of lobbying activities by regularly conducting timely and effective audits and assessments that document and publicly report on the extent to which those subject to lobbying regulation and public disclosure demonstrate material compliance and non-compliance with applicable laws; and
- Support effectiveness of the City’s lobbying laws by evaluating findings to identify where additional training may remedy gaps in filer awareness or practices, and to assess where provisions of the law may benefit from strengthening.
Looking ahead, written lobbying audit reports issued by the Audit Division will be publicly posted on the Commission’s website. Findings of material non-compliance will be referred to the Commission’s Enforcement Division for review and any action that may be warranted. As with campaign audits conducted by the Commission Staff, findings of non-compliance that result in enforcement may be resolved by approval of a Stipulated Settlement in which the Respondent acknowledges responsibility for the violation and agrees to pay a monetary penalty, or by imposition of monetary penalties levied by the Commission as provided for under the law following a public hearing on the merits and a determination that a violation occurred.
We anticipate providing transparency about the ongoing implementation and progress of lobbying audits through updates to the Commission no less than semi-annually with the goal of providing the opportunity for continued public and Commission engagement to help ensure the effectiveness of City’s lobbying laws.
Ethics Commission Meetings on FY23 Departmental Budget
As part of a City Ordinance that took effect in 2020, departments are required to hold a public meeting concerning departmental budget priorities at which members of the public may provide input. A second public hearing must be held no later than February 14 concerning the department’s budget proposal to allow public input prior to submission of the department’s proposed budget.
On December 14, the Mayor’s Budget Office issued budget instructions to departments for FY23-24. Those instructions stated that departments will not be asked to meet any budget reduction targets this year owing to the City’s $100+ million budget surplus at this time, however Departments were asked to continue providing services within existing budget levels. Departmental budgets are due on February 22, 2022.
The Commission will hold a meeting on January 21 beginning at 9:30 am to receive public comment on departmental budget priorities. Due to the observance of the Martin Luther King Holiday on Monday January 17, materials for the Commission’s January 21 meeting will be posted no later than Friday January 14. Those materials will include required information about the agency’s divisions; budget totals and major changes including new or reduced initiatives and staffing changes; changes in service levels; projected salary savings; and how the agency is meeting budget instruction targets.
Consistent with the Commission’s past practice, the second required public hearing will provide a detailed budget proposed for public comment and consideration by the Commission at its Regular February Commission meeting, which is proposed for February 11 at 9:30 a.m. Materials for that meeting are planned for distribution by Monday February 7.
Revenues Report
The table below reflects revenues received by the Commission for Fiscal Year 2022 as of January 7, 2022.
| Account Description | FY21-22 Original Budget | FY21-22 Actuals as of 1/7/2022 |
|---|---|---|
| Other General Government | $2,450 | $500 |
| Campaign Disclosure Fines | $50,000 | $14,758 |
| Lobby Fines | $2,000 | $1,650 |
| Campaign Consultant Fines | $2,000 | $800 |
| Economic Interest Fines | $1,250 | $170 |
| Other Ethics Fines | $7,500 | $34,004 |
| Lobbyist Registration Fee | $85,000 | $18,500 |
| Campaign Consultant Registration Fee | $7,000 | $2,300 |
| Total | $157,200 | $72,682 |
I look forward to answering any questions you may have at the upcoming Commission meeting.