Date: August 5, 2024
To: Members of the Ethics Commission
From: Patrick Ford, Executive Director
Subject: Agenda Item 4 – Executive Director’s Report
Summary and Action Requested
This report provides various programmatic and operational highlights since the last report.
No action is required by the Commission, as this item is for informational purposes only.
Budget Update
As discussed in the June report, the Mayor released her proposed City budget for FY25 and FY26 on May 31st. The Mayor’s proposed budget included funding for all of the Commission’s budget requests as described in our department’s budget letter.
I presented the Mayor’s proposed budget for the Commission at the Board of Supervisors Budget and Appropriations Committee meeting on June 12th. The Committee chose to have the Board’s Budget and Legislative Analyst (BLA) review the Commission’s proposed budget to identify potential cuts. The BLA ultimately recommended cutting all of the Commission’s position reclassifications from the proposed budget in order to achieve savings. I appeared at the Committee’s June 21st meeting to argue against the BLA’s proposed cuts. The Committee ultimately signaled that it would maintain the reclassification of the four positions within the Audits Division. However, the Committee indicated that it would deny the other four position reclassifications that the Commission had requested and the Mayor had proposed.
The board passed, and the Mayor signed on July 30th, the budget as revised by the Committee. To summarize, the budget that was approved provides for the following reclassifications and hirings:
- Reclassification of all positions in the Audit Division:
- 1824 Principal Administrative Analyst position to 1686 Auditor III
- 1822 Administrative Analyst positions to 1684 Auditor II (three positions)
- Approval to fill other positions which were previously held vacant due to budget constraints:
- 1844 Engagement & Compliance Officer
- 1840 Junior Management Assistant to support operations (this position will not be reclassified to 1844 Senior Management Assistant, as was proposed)
- 1454 Executive Secretary
The budget does not provide for the following position reclassifications:
- Reclassification of three positions in the Enforcement Division:
- Director of Enforcement from 0922 (Manager I) to 0923 (Manager II)
- 1823 Senior Investigative Analyst to 1824 Principal Investigative Analyst (two positions)
- Reclassification of one position supporting operations
- 1840 Junior Management Assistant to 1844 Senior Management Assistant (the position will be hired as 1840 Junior Management Assistant, as noted above)
Staff News
August 2nd was Peter Lauterborn’s last day of work with the Commission. Peter managed the Ethics@Work Division. Peter and his family will be moving out of state to be closer to family. Peter joined the Ethics Commission in July of 2022 and has since then built up the Commission’s ethics compliance program and helped lead the rollout of Proposition D. Peter also performed a dual role by simultaneously leading the Engagement and Compliance Division when that team was short staffed. We thank Peter for his work and wish him the best in his next chapter.
Division Reorganization
As a result of Peter’s departure, there will be a vacancy beginning this month in the Ethics@Work Manager position, which is classified as an 1824 Principal Administrative Analyst. Rather than backfilling this position to perform the same role, this position will be repurposed as a Budget and Operations Analyst position reporting to the Deputy Director. There is a serious need for more staffing resources to support the Commission’s budget and operations work, which includes the annual budget process, financial administration and reporting, personnel matters, recruitment, policy compliance, and similar functions. The Commission requested to reclassify the vacant 1840 Junior Management Assistant position to an 1844 Senior Management Assistant and fill the position to assist with budget and operations. As mentioned above, that reclassification was ultimately rejected. Assigning the newly vacant 1824 position to budget and operations instead will provide a more appropriate level of knowledge, skills, and experience to support this work. The 1840 position that was authorized through the budget will be reassigned to the Policy Division.
In tandem with reassigning the 1824 Ethics@Work Manager position to budget and operations, the three staff positions that currently constitute the Ethics@Work Division will join the Engagement and Compliance Division effective August 5th. The work performed by both divisions is largely similar, with both divisions promoting compliance with the law through trainings, the creation of educational materials, and answering advice questions. The Ethics@Work Division has largely completed its work to launch an enhanced ethics compliance program and to implement Proposition D. Combining the divisions will provide for greater cross-training, collaboration, and standardization of the Commission’s compliance programs.
Job Postings
The department has been focused on FY25 recruitment preparations over the last several months as a top priority. With the budget now approved, funded vacancies can be filled. The job postings for the following positions are now open. These positions will help expand the department’s administrative and operations capacity.
- 1824 Budget and Operations Analyst
- 1454 Executive Secretary
Latest information about job openings can be accessed on the Ethics Commission’s Jobs page.
Policy Updates
Charter Amendment Proposed to Create an Inspector General
As discussed in last month’s report, Board President Peskin and Supervisor Safai introduced a Charter amendment (File # 240549) that would establish the position of Inspector General within the Controller’s Office. This new position would be tasked with initiating and leading investigations regarding potential violations of laws or policies involving fraud, waste, abuse, or “misconduct” and would expand the authority of the Controller’s Office. The measure was referred to the Ethics Commission and other departments for comment under the 30-day rule, a procedural step for soliciting departmental feedback.
On June 25, Chair Finlev and I sent a comment letter to the Clerk of the Rules Committee and the members of the Rules Committee. The letter requested that the measure be amended to avoid jurisdictional overlap between the Inspector General and the Ethics Commission. Although the Rules Committee did not make the specific amendment requested in the letter, the measure was amended to remove “misconduct” from the Inspector General’s scope, which has now been limited to laws or policies involving “waste, fraud, or abuse.” This change is beneficial and will reduce the likelihood of Inspector General investigations negatively impacting Ethics investigations.
Engagement and Compliance Response Time Statistics
At the June meeting, Kyle Kennedy provided a programmatic update about the work of the Engagement and Compliance Division. As a follow-up to that presentation, the following statistics show the average times for Engagement and Compliance staff to resolve requests for advice and technical assistance. These statistics are based on advice requests handled through the Commission’s online support portals, which are used to intake, track, and respond to advice requests.
| Program Area | Average Time to Resolution |
|---|---|
| Statement of Economic Interests (Form 700) | 7.7 business days |
| Campaign Finance & Campaign Consultants | 4.6 business days |
| Lobbyists | 1.6 business days |
| Major Developers & Permit Consultants | 1.1 business days |
| All Programs (Average) | 3.7 business days |
On July 29th, Staff launched the fifth and final online advice portal, which will support advice questions pertaining to ethics and conflict-of-interest questions. Through the use of this portal, Staff will be able to generate definitive average response times for advice requests within that program area, which are not currently available.
The targets for responding to advice requests across all program areas are three business days to acknowledge receipt and ask follow-up questions, if necessary, and five business days from the time of the request to provide advice. Staff intend to respond to all advice requests within this timeframe and to achieve an average response time of 3.5 business days. We anticipate meeting these target response times across all program areas beginning in the current quarter.
Public Financing Program Update
The public financing program is experiencing significant activity ahead of the November election. The program provides public financing for qualifying candidates for Mayor or Supervisor. There will be six contests for Supervisor (Districts 1, 3, 5, 7, 9, and 11) and one contest for Mayor on the November ballot. Currently, nineteen candidates have qualified for the program: sixteen supervisorial candidates and three mayoral candidates. In total, these nineteen candidates have already been approved for $4.1 million in public funds. The following chart provides a breakdown of approved public funds by candidate and contest. These funds have either already been received by the candidates or are in the process of being distributed to the candidates. The Controller’s Office handles all distributions of public funds after the distributions are approved by the Commission following Staff’s review of candidate requests.
Candidates may continue to submit applications to qualify for public financing until August 27th. Once qualified, they may continue to submit further requests for additional funds until 30 days following the election.
Public Financing Audits
As reported previously, the Commission contracted with the external vendor Macias Gini & O’Connell LLP (MGO) to complete audits of fifteen candidate committees that were awarded public financing in the 2020 and 2022 elections. This contract was executed because the Commission’s Audits Division was not able to complete the audits, which are mandated by City law, and a backlog of audits existed that needed to be completed. The cost of the contract was $30,000 per audit, for a total of $450,000. This sum was paid out of the City’s Election Campaign Fund, which may be used to cover administrative expenses associated with the public financing program.
MGO began its work on the fifteen audits in February, completed its audit work in May, and provided draft audit reports to the Commission in May and June. Committees were then given the opportunity to respond to the draft audit reports. All fifteen audit reports have now been finalized and are posted to the audits section of the Commission’s website. At this time, all outstanding required audits of publicly financed candidate committees are completed, and there is no audit backlog.
As discussed above, there are already nineteen committees qualified for public financing in the November 2024 election. All nineteen committees must undergo audit pursuant to City law, and it is possible that additional committees will qualify for public financing and also require an audit. Candidates may continue to submit applications to qualify for public financing until August 27th. Planning is underway to complete all of the required audits of publicly financed candidate committees internally during calendar year 2025. This will avoid the need to pay for a contractor to perform the audits and will ensure more timely audits and resolution of any violations that are found. As discussed above in the section concerning the FY25 and FY26 budget, the reclassification of the four positions within the Audits Division to specialized auditor classifications will support this and other initiatives.
Performance Plan and Appraisal Report Process Completed
As discussed in the April report, the process to complete a Performance Plan and Appraisal Report (PPAR) for all staff members took place during Q4 of FY24. The PPAR is the City’s standard performance review process used across City departments. The PPAR includes a standard form through which managers set out the duties and responsibilities for a position and identify employee objectives for the coming fiscal year. Each employee meets with their manager halfway through the fiscal year to have a mid-period review and again at the end of the fiscal for a formal performance review.
The PPAR process is an important tool for providing useful feedback to staff members, planning and coordinating projects over the course of a fiscal year, and establishing milestones. Division managers began the process by establishing division goals for FY25. The division goals were aligned throughout the department to ensure consistency and collaboration. One of the major goals that is shared across all divisions is the creation of standardized operating protocols that govern all basic Commission functions. These protocols will help to clarify and standardize how the Commission’s work is performed, ensuring consistency, quality, and continuity.
At this time, all staff members but one have signed their PPAR for FY25. Mid-period reviews are planned for January.
Annual Report
Work is underway to prepare the Commission’s FY24 annual report. Division managers are working on pulling statistics and summarizing operations during the last fiscal year. The report will discuss the strategic initiatives and accomplishments that have been reported in previous staff reports, as well as additional fiscal year-end statistics. I welcome all ideas from commissioners about particular topics to highlight or helpful ways to present information. I plan to work with Chair Finlev on crafting the final product for publication at the end of Q1.