Draft Minutes – January 14, 2022

Draft Minutes of the Regular Meeting of
The San Francisco Ethics Commission
Friday, January 14, 2022
Remote Meeting Held Online via WebEx and aired live on SFGovTV
(Approved __, 2022)

Note: SFGovTV provides a continuous archive of audio, video, and Caption Notes recordings of Ethics Commission meetings that allows viewers to watch those meetings online in full at the viewer’s convenience. These archives of Ethics Commission meetings may be accessed at SFGovTV at http://sanfrancisco.granicus.com/ViewPublisher.php?view_id=142.

(Note: A complete video recording of this meeting is available at SFGovTv.)

Item 1. Call to order and roll call.

Acting Chair Yvonne Lee convened the meeting at 9:57 am and stated that the meeting is being held by Teleconference Pursuant to the Governor’s Executive Order N-29-20 and the Twelfth Supplement to Mayoral Proclamation Declaring the Existence of a Local Emergency Dated February 25, 2020. Online Meeting Moderator Ronald Contreraz summarized procedures for remote participation by members of the public.

COMMISSION MEMBERS PRESENT: With Chair Yvonne Lee and Commissioners James Bell, Larry Bush, Daina Chiu, and Theis Finlev attending, a quorum was present.

STAFF PRESENTING: LeeAnn Pelham, Executive Director; Michael Canning, Policy Analyst; Ronald Contreraz, Online Meeting Moderator.

REPRESENTATIVES OF THE OFFICE OF THE CITY ATTORNEY PRESENT: Andrew Shen, Deputy City Attorney.

REPRESENTATIVES OF THE DEPARTMENT OF HUMAN RESOURCES PRESENT: Carol Isen, Director of Human Resources.

MATERIALS DISTRIBUTED:

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

Markos Major discussed being a former City employee and now nonprofit director that works on grants with 4 or 5 depts. Caller thanked Ethics for their work on this topic but is concerned about this type of legislation being proposed. Caller wondered if the right intention was being targeted, wondered if it was correct to fine nonprofits and partners for violations and instead to look at money laundering and larger offenses, and questioned reporting requirements and stated it was easier to report to the state.

CONSENT CALENDAR ITEMS

Item 3. Draft Minutes of the Commission’s December 10, 2021 regular meeting.

Commissioner Chiu moved, and Commissioner Bell seconded, to approve the draft minutes. The motion passed 4-0. Commissioner Finlev abstained as he was not a Commissioner at the prior meeting.

No public comment was received.

Motion 220114-01 (Chiu/Bell): Moved, seconded, and passed (4-0) to approve the December 10, 2021 regular meeting minutes as drafted.

Item 4. Resolution on Continuation of Remote Commission Meetings.

No comments from Commissioners.

Public comment

Caller stated that they had tried to get on to speak at meeting but was unable to get through. Voiced their desire to participate in these discussions and said the public needed to be able to participate. Stated they tried to give comment on the first three items and wondered if there needed to be a continuation because of this.

Bob Planthold, former Ethics Commissioner, stated that the sound is cutting in and out. Regarding the approval of the meetings, said that the Sunshine Ordinance does not allow for abstaining from the approval of the minutes. Asked that it be taken into consideration that a state allowance for abstaining cannot be used at these meetings and asked that the issues with the sound be addressed.

Commissioner Bush asked if a commissioner could recuse as opposed to abstain. Deputy City Attorney Andrew Shen said it was correct that a Commissioner could not abstain from the vote and suggested that the Commission go back and vote on the item again.

Commissioner Bell stated he did the same thing when he started, was told he could not abstain but did not remember what he did and stated that he was in the same position as Commissioner Finlev.

Motion 220114-02 (Chiu/Bush): Moved, seconded, and passed (5-0) to approve the resolution to continue meeting remotely.

Chair Lee asked Shen how to proceed regarding the prior vote on the minutes. Shen advised that the Commission vote to rescind the prior vote and vote again on Item 3. Commissioner Bush moved to rescind the prior vote on the minutes. Motion seconded by Chair Lee.

Motion 220114-03 (Bush/Lee): Moved, seconded, and passed (5-0) to rescind the prior vote on Item 3.

Chair Lee asked for a motion to approve the minutes. Commissioner Chiu so moved, and Chair Lee seconded the motion.

Motion 220114-04 (Chiu/Lee): Moved, seconded, and passed (5-0) to approve the December 10, 2021 regular meeting minutes as drafted.

NON-CONSENT CALENDAR ITEMS

Item 5. Discussion and Possible action to adopt Ethics Commission Regular Meeting Schedule for Calendar Year 2022.

Executive Director LeeAnn Pelham stated this item was continued from the Commission’s December meeting so as to make a change to the October meeting time. She clarified that the Commission by-laws requires the date and time of the meeting. The resolution includes the remote meetings and if the city changes how meetings are being held the resolution could be changed then.

Commissioner Bush noted that he will be seeking a change in the by-laws to start the meeting time at 10:00 am and not 9:30 am. He said that he can provide an explanation when needed. Bush stated he did not believe a 9:30 start time allowed the public enough time to attend meeting. He stated he intended to vote no on this item and also stated that he did not believe issuing the agenda three days before a meeting was sufficient and it should be a week so the public has adequate time to deliberate and address items they may want to comment on.

Director Pelham clarified that the Commission typically posts the agenda a week in advance but thanked Commissioner Bush for the feedback.

Commissioner Bell moved, Commissioner Chiu seconded, to approve meeting schedule.

Public Comment

Bob Planthold, responding to Commissioner Bush’s suggestion of changing the by-laws, stated that individuals that require assistance or need to care for family cannot be prepared to attend the meeting by 9:30.

Francisco DeCosta said he spent many years watching corruption in the city and that the Ethics Commission is kicking the can down the road. He stated that individuals report to the Whistleblower Program who in turn give the information to the City Attorney who now is in charge of the SFPUC. He also said that the start time should be 10am and said the City is in dire straits and that he sends his articles to a Commissioner but did not know if they are distributed to all the Commissioners.

Chair Lee said until the by-laws are addressed she understood the meeting could be changed if it was made more than 7 days before the meeting. Chair Lee recommended changing next week’s special meeting to a later start time. Director Pelham asked if there needed to be an amendment to the resolution for next week’s meeting.

Commissioner Chiu made a motion to approve the calendar as proposed with an amendment to change the January 21st meeting start time to 10:00 am. Commissioner Bush seconded.

Motion 220114-05 (Chiu/Bush): Moved, seconded, and passed (5-0) to approve the Ethics Commission Regular Meeting Schedule for Calendar Year 2022.

Item 6. Discussion and possible action on proposal regarding a possible June 2022 ballot measure and regulation amendments to enact recommendations contained in “Report on Gift Laws Part A: Gifts to Individuals,” dated August 2, 2021, “Report on Gift Laws Part B: Gifts to City Departments,” dated September 29, 2021, and “Report on Strengthening Basic Ethics Provisions,” dated December 6, 2021.

Chair Lee introduced the item and asked Deputy City Attorney Shen to remind the Commission of the timeline for submitting a measure to the ballot. Shen stated it must be submitted 95 days prior to the election and said it would then be due by Friday, March 4 in order to be placed on the June 7, 2022 ballot.

Director Pelham gave background on the item and the process that had already been undertaken. Pelham described that the Mayor had asked her to present at the monthly department head meeting on December 15th regarding the ongoing policy project. At the meeting some department heads spoke after Pelham’s presentation and conveyed that several of the laws on the books already address bad conduct and individuals have been caught and are being investigated and therefore no laws need to be changed. Pelham said that others asked why changes to the laws are needed at all. Pelham said that staff’s research has found areas of the law that are not adequately addressing known issues and need to be strengthened. Pelham stated that department heads and others have acknowledged that ethics laws are important, but may seem to share a belief that individuals being arrested demonstrates that the existing laws are working. This is like saying that after a fire happens there is no need to talk about fire safety. Multiple City officials have violated the law and public trust. Multiple department heads have been arrested or have resigned because of the federal public corruption investigation. We cannot ignore this at a time when people are so concerned about the integrity of government.

Pelham said that some department heads also conveyed that the proposals would negatively impact organizations that currently benefit from their department’s and staff’s support and that there is an equity issue. Pelham stated that strong ethics laws are also needed to address inequities. Pay-to-play causes inequity when people lose out on opportunities because they didn’t make certain payments or when they feel like they have to make certain payments. as the Commission said in its budget statement last year “Equity is not advanced when the public loses faith in the legitimacy of government and opts out of participating.” Undue influence and unfair advantage are inequities as well. This results in government favoring those with resources and connections over those without or who are unwilling to use them to seek favorable outcomes. Ethics promotes equity, and corruption destroys it.

Pelham said it is within the Commission’s mandate to strengthen laws that prevent restricted sources from gaining undue influence. And, it is within the Commission’s mandate to place issues on the ballot for direct voter action. The voters gave the Commission this power in recognition of how hard culture change is and how deeply the culture runs. Voter action on ethics laws is an appropriate way to accomplish needed changes.

Pelham said the Commission’s process in this project has been about listening and responding, and strengthening and clarifying existing laws. These laws ensure healthy government that serves everyone in an equitable way and that builds trust with the public.

Commissioner Finlev asked about the unintended consequences and asked if that would be address and Director Pelham stated it would.

Michael Canning gave an update on the status of the ballot measure as well as phases 2 and 3 of the policy project. He stated that the meet and confer process did not conclude after yesterday’s session so there is no action that can be taken by the Commission today. He gave background on the meet and confer process. He said that the Municipal Executives Association (MEA) asked to continue meet and confer just before the December meeting. Caning named five departments that Commission met with to try to address issues.

DHR Director Carol Isen gave background on the meet and confer process. She explained what can be spoken about publicly, but said that she cannot discuss the position of unions publicly so it would have to be discussed in closed session. Chair Lee asked why, and Isen said that it was typical to discuss such matters in closed session. She said it would be atypical to discuss the union’s position in public.

Commissioner Bush said it was his understanding that meet and confer does not require the approval of the union to move forward. Isen said we have not completed the meet and confer process and gave a description of meet and confer, negotiating in good faith, and in the end if the parties do not reach an agreement and are divided over certain matters and an impasse is reached, unions can then exercise their right to have a fact finding process, a fact finder appointed and a panel called. Isen said that process can happen quickly or take a long time.

Commissioner Bush said there have been three meetings, and Isen said again this was the early process of meet and confer. Commissioner Bush asked if the depts waited until the last day to extend the process. He said dragging this out will push the issue to the November ballot and called shame on the departments for making this take longer.

Commissioner Finlev said he would want to hear from the stakeholders so he would like the opportunity to meet in closed session to hear these issues. He asked if other bargaining units would be affected or if it was just MEA who were involved. Isen said that is something she could address in closed session.

Public comment

Francisco DeCosta said the Ethics Commission needs to look at DHR and the changes in executive staff. He said Commission needs to look into issues raised by the Sunshine Ordinance Task Force and that many of the departments that control the city are corrupt and things are not being addressed. He said the Ethics Commission does not have the talent or the resources to address corruption and look to the City Attorney when in a bind.

Debbie Lerman thanked the Commission for its work to address corruption. She said she did not agree with a prohibition that would interfere with City staff attending nonprofit fundraisers to observe the event. She said city officials give credibility to nonprofits, build relationships. She said the ordinance’s definition of restricted source includes overly broad language and it should mirror the language included in the board’s legislation on behested payments. She said super majority approval for changes to the law in concerning because it blocks smaller units from being able to address changes in law.

Commissioner Finlev said it was his understanding that staff proposed amendments to the unions to address their concerns and would want to hear more from her about that if she can provide further public comment.

Commissioner Chiu asked for an explanation of the super majority requirements. Shen explained what the supermajority legislative amendment approval requirements were. Commissioner Chiu stated it was her belief that the supermajority requirements be included in the laws so that they cannot be changed legislatively without Ethics Commission approval.

Shawn Rosenmoss with the Department of the Environment asked how many city departments and staff will this impact. She wondered how much city time will this take, nonprofits that this will impact, who will be the most burdened by this legislation and that as a city employee and public servant she is afraid this will make it more difficult for city employees to work together with nonprofits. She is worried these changes will make the jobs of city employees harder than they need to be.

Ralph Remmington of the SF Arts Commission said there can always be training in ethics, believes comparing the training to fire training is not accurate because it would be more akin to arson. Believes the laws have caught individuals they were intended to and believes the laws are overly broad. He said he will have more comments at future meetings.

Bob Planthold said not all bad actors have been caught, according to Department of Justice statements regarding ongoing investigations. Regarding meet and confer, he said he is worried about how the meet and confer process is being done in secret. He also addressed that public comment should not be interrupted and questions asked of public commentors. Commissioners cannot ask public commentors to come back and speak again because they were giving preference to their comments over others. He asked that a list of the topics addressed be created.

Lisa Bransten, Director of Partnerships at Rec and Park, said she is worried about how the laws will impact city staff and wall them off from working work the community. She asked what is a ministerial permit, what is the definition of what is necessary to do one job, why the proposed exception would allow staff to receive tickets to arts events but not other events, why not allow attendance at community events, and why no exceptions for a small gift?

Charles Head, President of Coalition for SF Neighborhoods, said he supported this ballot measure, said that the mayor does not want commissions putting things on the ballot and stated that we need this ballot measure.

John Caldon, Managing Director of War Memorial, thanked staff for their work. He said there needs to be some breathing room on the measure and need to take time to review and not rush to get on the June ballot. He said that bribery needs to be addressed and that rules on restricted source gifts will have bad effects without really creating change. He noted that oversight is important and timely oversight and noted the Commission’s concern over a stipulation from October that took five years as an example of how timely oversight is needed.

Danny Machuca-Grebe, PIO from Department of Homelessness and Supportive Housing, said that changes to laws can have an impact on the city functions and that HSH would like the opportunity to engage in authentic dialogue on this topics.

Lisa Pagan, Director of Policy at OEWD, stated that all of their partners would become restricted sources because of permits and that time is needed to understand all of the impacts of the proposed changes.

Jessica Lehman, Executive Director of Senior Disability Action, shared concerns of the impact on community organizations. She worried that the proposals will have an impact on organizations that work with underrepresented communities. She is worried about what the law would prohibit and is concerned it would make it harder to work with city employees. She is worried that tickets to fundraisers where staff members attend will impact the nonprofit organizations.

Mei Ling Hui said she manages the community gardens program at Rec and Park. She is worried about community events where individuals offer staff members an item and could offend them by refusing it. She is afraid city staff’s refusal of gifts will offend the community and will upset them and thereby make their jobs harder. She said the language in the legislation is not clear and not easy to understand and hoped the law would be easier to understand and to know what it is addressing.

Chair Lee called for a 15 minute recess at 11:42 am.

Chair Lee called the meeting to order at 11:59 am and continued with Item 6.

Shen addressed Bob Planthold’s comment. Shen clarified that he did not believe Chair Lee Finlev’s comments were inappropriate. He did not interrupt public comment, spoke after the caller, and did not appear to elevate her comments over others. Shen believed it was not inappropriate to seek further comment from a caller. Chair Lee also confirmed with Shen that there are two opportunities to provide public comment on items not on the agenda. Commissioner Chiu also asked for clarification that if more time or a second opportunity to address the commission is giver to one person it must be offered to everyone.

Chair Lee said the Commission is attempting to address a very serious issue and that the commission needs to be thoughtful about any proposed changes. She noted that March 4th is an important deadline. She has concerns over the number of community organizations that expressed concerns over the proposed changes to law. She would not be opposed to a closed session to discuss issues. Chair Lee also wanted Director Pelham to respond to these concerns either today or at another meeting in the future. She asked Shen if the rule of three commissioners being present would apply to the closed session. She asked if this item could be added to the Jan. 21 meeting.

Director Pelham said the item could be added to the Jan 21 agenda if wanted. Isen also said that would be okay to do. Commissioner Chiu asked if the list of issues raised by MEA in meet and confer could be provided ahead of the meeting, and Isen said she would be more comfortable with providing that in closed session.

Director Pelham asked Michael Canning to clarify questions that came up. Caning clarified that there were no additional reporting requirements under the proposals that would apply to nonprofit He said the proposals would not prohibit nonprofits from contracting with departments but instead would prohibit certain gifts to City officials. Canning clarified where disclosure requirements on departments to report certain payments to the department, as required by three existing laws, would be consolidated into one report. Canning provided additional clarification on other questions.

Commissioner Chiu stated that it is important for all parties to take action on this, including the regulated community. She noted that any deferred action would delay the proposals taking effect until January 2023 and that is not what she believes the community wants.

Commissioner Bush associated himself with Commissioner Chiu’s comments. He commended staff for their work and making reports available and that departments did not take the opportunity to review the documents. He also stated he was troubled that contractors and grantees are speaking on this issue when they are not impacted by it. He is also concerned about a report from the Controller’s office regarding community benefits programs.

Commissioner Bell wondered whether impacted parties did not understand the proposed changes because they may not have tried to or that they could not understand because the law is complicated. He wanted to make sure we are taking the time to ensure we are clear in what we are trying to do and changes being made. He gave an example of did everyone understand what we mean by the word “gift.”

Commissioner Finlev thanked Commissioner Bell. He thanked the public for their comments, commended staff for their process of engagement, and agreed with Commissioner Bush that it looked like MEA blew off staff, but does not believe we build trust with the public by cutting them off. He wants to hear what the concerns are because his read of the measure does not sound like it would be chilling participation in City processes but he wanted to hear from the concerned parties so their concerns can be understood and addressed.

Chair Lee addressed concerns over the length of time taken to address these issues and wondered if an FAQ could explain concerns. She wondered if there are ways the Commission could respond to individuals with questions ahead of next week’s meeting to address their questions.

Commissioner Bush asked the nonprofit partners and departments if they could provide a list of penalties they have issued against their employees for things such as for not filing Form 700s, late filings, or other actions to correct something they know is wrong and when. He wanted to know what things they are doing to correct these issues, addressing community benefits, unions that have separate and outside agreements with the City, and wondered if these tactics are being employed to try to delay the process.

Item 7. Discussion of Executive Director’s Report. An update of various programmatic and operational highlights of Ethics Commission staff activities since the Commission’s previous meeting. The written report is available on the Commission’s website and may cover a range of topics such as the Commission’s budget, outreach activities, campaign finance disclosure and public financing programs, audit program, lobbyist program, campaign consultant program, permit consultant program, major developer program, and future staff projects. Any of these subjects may potentially be part of the Director’s presentation or discussed by the Commission.
Attachments: Executive Director Report dated January 10, 2022.

Director Pelham gave an update on her report. She noted that e-filing of the Form 700 has begun. She noted that the new conflicts of interest review will begin shortly and the new behested payment law that will take effect on January 23. She noted that the office quickly shifted to a remote status in response to omicron and the possibility of resuming in person commission meetings may be delayed past the projected date in February. Whistleblower data was reported, and staff still plan to report on it annually, and the team looks at the data as a way to inform the way we respond and investigate those complaints. She discussed the lobbyist audit plans and how to implement the new proposed lobbyist auditing program.

Regarding the budget, Pelham said that due to a surplus the Mayor is not asking for any cuts to the budget.

Regarding hiring Pelham announced Pat Ford as the new Director of Enforcement.

Commissioner Bell congratulated Pat Ford on his appointment.

Commissioner Finlev Congratulated Ford and asked about two vacancies in enforcement and asked are those jobs posted. He also said that he used the Form 700 e-filing system and it worked flawlessly.

Commissioner Bush congratulated Ford. He asked why there may not have been an update on attempts to engage in community outreach. regarding the lobbyist audit and review, he is happy to see it, but noted that the audit documents did not include the outcome that the lobbyist sought. He noted that most lobbyist are leaving blank what outcome they are seeking and hopes the audit will remind lobbyists that they must report on this as well as the value of the outcome to the client. He wondered how many lobbyists registered after Feb 1, in comparison to last year, and what departments are they lobbying.

Commissioner Chiu congratulated the team on form 700 e filing and Pat Ford on his hiring.

Commissioner Bell noted that it is important to have community outreach and to be present for them. He worried about how laws can impact the shrinking black community in SF and want them to understand this is not something that is out to get them but want to make sure that we structure the outreach so it is more understandable at the beginning.

Public Comment

Francisco DeCosta spoke of community outreach and the community benefits program. He said he has been investigating this program for over twenty year. He has concerns over the corruption that is going on in the city.

Debbie Lerman said she supported community outreach. She noted the length of the draft measure and what it takes to understand it. She appreciated the idea of Ethics training and said while employees do receive training, more could be helpful to ensure nonprofits are in compliance with ethics laws.

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

Commissioner Bush wanted it on record that a bylaw amendment be made to allow for meetings to start at 10am. He would like to see this on the agenda.

Commissioner Finlev asked for an overview of the enforcement process, open cases, and other statistics. He said it would be beneficial to him as well as other commissioners.

No public comment was received.

Commissioner Bush noted the controller’s report on community benefits and said they are being monitored. He highlighted the FPPC report on behested payments and most of those are made for governmental purposes and not profits. He asked to look at those items while changes to laws are considered.

Chair Lee noted that February would be the last time to take action on a ballot measure for the June 7, 2022 election and listed the requests for items to also added to the agenda.

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.

Public Comment

Francisco DeCosta spoke about community benefits. The public is getting orders from the Sunshine Ordinance Task Force and have nothing done. Complaints go to the Controller’s office and go unaddressed for over two years.

Item 10. Adjournment.

The Commission adjourned at 1:15 p.m.

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