Executive Director’s Report – October 7, 2022

October 7, 2022
To:  Members of the Ethics Commission
From: LeeAnn Pelham, Executive Director
Subject: Agenda Item 7 – Executive Director Report for October 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.

Campaign Fundraising, Spending & Public Financing in the November Election

Campaign finance dashboards for the November 8th election continue to be updated with information about candidate fundraising and spending, third party spending, and public funds disbursed to qualified candidates.

Based on third party expenditure reports filed with the Ethics Commission and as required under the law, the Individual Expenditure Ceiling (IEC) of one or more publicly financed candidates required adjustment on October 3rd for the November 8, 2022, election. This was the first required adjustment for the November election. In response, Staff notified all candidates and treasurers of this required adjustment and circulated a public announcement of the adjustment via our news page and social media.

Flexibility to adjust the spending ceilings qualified candidates otherwise agree to in exchange for the opportunity to receive public funds in their campaigns is one way that public financing programs are structured to encourage candidate participation. Like other local public financing programs around the country, the City’s public financing program is designed to serve a number of public policy goals. The program seeks to ensure that candidates with a demonstrated level of community support can secure sufficient resources to mount a viable campaign. In doing so, public financing reduces candidates’ dependence on large private contributions, which lessens the potential for and appearance of undue influence by contributors and serves to improve the public’s trust in local government. Public financing also seeks to enable candidates to spend less time fundraising and more time interacting with voters and engaging in discussions on important issues. The availability of public funds also encourages citizens to be more politically active by incentivizing and empowering small-dollar contributions. By supporting candidates who have community support, public financing can also lead to more competitive races, which is important in ensuring quality representation of constituents.

After the election, all candidates that have been certified eligible to receive public financing for their campaigns must be audited by the Ethics Commission. Commission audits determine the committees’ degree of compliance with applicable state and local laws, and result in written audit reports that detail any material audit findings. SF Campaign & Governmental Conduct Code Sec. 1.150 provides that post-election audits for publicly financed candidates are required to be initiated within 60 days after the due date of the first post-election campaign report, which is the semi-annual campaign statement due January 31 covering the period through December 31 of the election year. Currently, audit staff are working to complete two audits of publicly financed candidates from the 2019 election and have also initiated audits of six candidates from the 2020 election cycle, with two of those audits now in the testing phase. As has been our past practice, audits of the 16 publicly financed candidates in the 2020 cycle are being conducted in priority order according to how much public funds a candidate received in their campaign, with candidates who received higher total amounts being audited before those candidates who received lesser amounts.

Also after every election in which candidates qualify to receive public funds, City law requires the Commission to report to the Mayor and Board of Supervisors on the use of public funds in that election. These Ethics Commission post-election reports on the public campaign financing program are based on data reported in campaign disclosure statements covering the start of the candidates’ campaigns through December 31 of the election year. Notably, the reports are also an opportunity for the Commission to provide observations about the program and its impact, analyze any emerging trends regarding the role of public financing in city campaigns, and surface any policy issues that may warrant additional exploration by the Commission to ensure the program’s effectiveness. Staff anticipate issuing the 2022 post-election in early Spring.

Ethics@Work Program Development & Job Announcement

Since joining the Commission staff this summer, Ethics@Work program Manager Peter Lauterborn and Training and Outreach Specialist Ana De Carolis have been at work establishing the essential structural and design components of our new outreach and training program. These include developing a program work plan, assessment methods to focus training needs, program branding and communications, and writing content. A program overview of ongoing and planned work is attached for your information. Peter will be on hand at the Commission meeting to answer any questions you may have at this time.

We continue to accept applications for a second Ethics@Work Training and Outreach Specialist (1823) position. Working with Peter and Ana, this training specialist will also conduct training, outreach, and provide additional expertise in developing and implementing learning opportunities. In addition, we are now in the application review phase for the program’s Training and Design Specialist (1230) position. This position will help provide expertise in the design and execution of the program for learning opportunities in both live and digital environments.

Welcome to New Deputy City Attorney

This month’s Commission meeting marks an official welcome to Deputy City Attorney Brad Russi. Brad assumed his new assignment as the City Attorney’s legal advisor to the Ethics Commission in early September following the resignation of Deputy City Attorney Andrew Shen, who accepted a position in the private sector. We appreciate the professionalism, guidance, and counsel Andrew provided during his tenure as counsel to the Commission, and we extend our deep thanks and best wishes to him in his new endeavor.

Revenues Report

The table below reflects revenues received by the Commission for the current fiscal year as of October 7, 2022.

Account DescriptionFY22-23 Original BudgetFY22-23 Actuals as of 10/7/2022
Other General Government Charges$2,450$0
Campaign Disclosure Fines$50,000$0
Lobby Fines$2,000$1,550
Campaign Consultant Fines$2,000$50
Economic Interest Fines$1,250$0
Other Ethics Fines$7,500$23,600
Lobbyist Registration Fee$85,000$8,500
Campaign Consultant Registration Fee$7,000$2,500
Total$157,200$36,200

I look forward to answering any questions you may have at the upcoming Commission meeting.

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