Campaign Spending Commission

Campaign Spending Commission
Leiopapa A Kamehameha Building, Room 204
October 23, 2019
10:00 a.m.

Commissioners Present
Bryan Luke, Gregory Shoda, Stanley Lum, Russell Tsuji

Staff Present
Kristin Izumi-Nitao, Tony Baldomero, Gary Kam, Yayoi Tumamao, Ellisa Vendiola

Excused
Commissioner Maryellen Markley, Ph.D.
Deputy Attorney General Valri Kunimoto

Call to Order
Chair Luke called the meeting to order at 10 a.m.

Consideration and Approval of Minutes of Meeting on 9/18/19
Chair Luke asked for comments or changes to the minutes.  There were none.  Chair Luke called for a motion to approve the minutes.

Commissioner Tsuji moved to approve the minutes of the 9/18/19 meeting.  Motion seconded by Commissioner Lum.  Motion carried (4-0).

New Business
*Chair Luke asked if there was any objection to taking “Docket No. 20-09 – In Re the Matter of John Carroll, Alice Paet-Ah Sing, and Friends of John Carroll” out of order of business on the agenda.  There was none.

*Docket No. 20-09 – In Re the Matter of John Carroll, Alice Paet-Ah Sing, and Friends for John Carroll
Executive Director Izumi-Nitao reported that a complaint had been filed against Respondents John Carroll, Alice Paet-Ah Sing, and Friends for John Carroll for the failure to report contributions and expenditures as well as prohibited expenditures.

Respondent Carroll is the candidate and Respondent Paet-Ah Sing was the treasurer at the time of the alleged violation of the candidate committee called Friends for John Carroll.

Pursuant to HRS §§11-331 and 11-335, Respondents were required to file complete and accurate reports that disclose the committee’s contributions and expenditures for the reporting period and election period. On 10/1/19, Respondents amended and filed two (2) reports reporting 5 contributions totaling $535 which were not previously or timely reported.  On 10/1/19, Respondents amended and filed four (4) reports reporting 34 expenditures totaling $2,004.76 expenditures which were not previously or timely reported.

On 10/2/19, Commission staff sent Respondents a letter via first class mail informing them that a fine of $1,500 (i.e., $250 per schedule for unreported contributions and expenditures) would be imposed for the unreported contributions in the original filing of the 2^nd Preliminary Primary Report and Final Primary Report as well as the unreported expenditures in the original filing of the 1^st Preliminary Primary Report, 2^nd Preliminary Primary Report, Final Primary Report, and Preliminary General Report.  The deadline to pay the fine was 10/16/19.  Respondents did not pay the fine.

Pursuant to HRS §11-382(3), campaign funds shall not be used for personal expenses.  Under HAR §3-160-42(b)(6), “personal expenses” means expenses that would exist irrespective of a candidate’s campaign to seek the nomination or election to office or being elected to an office.  Respondents reported a monthly charge of $14.65 to Netflix on 6/19/18 (1^st Preliminary Primary Report), 7/17/18 (2^nd Preliminary Primary Report), and 8/17/18 (Preliminary General Report) for “online research” for a total expense of $43.95.

On 10/3/19, Commission staff sent Respondents a letter via first class mail informing them that a fine of $21.98 (i.e., 50% of the prohibited expense) and personal reimbursement of $43.95 to Respondent Friends for John Carroll would be assessed for the prohibited expenditures and that the deadline to pay the fine and personally reimburse the campaign was 10/17/19.

On 10/7/19, Respondent Carroll acknowledged notification of the campaign finance violations and informed Commission staff that he would like to challenge the violations.

On 10/8/19, Commission staff sent Respondents a copy of the complaint and informed them that the matter would be set on the 10/23/19 Commission Agenda.

Executive Director Izumi-Nitao recommended that the Commission make a preliminary determination, pursuant to HRS §11-405(a), that probable cause exists to believe that a violation of the campaign spending law has been committed, assess an administrative fine of $1,521.98, order that the fine be deposited into the general fund of the state pursuant to HRS §11-410(e), and order that Respondent Carroll personally reimburse $43.95 to the committee within 20 days of receipt of the Order.

Respondent John Carroll was present and stated that he accepts responsibility for what happened and asked for mercy.  He stated that Eric Ryan should pay the fines because the violations involved his actions.  He further commented that he did not want to go to the police to seek criminal charges because Eric Ryan has done good things for the committee in the past.

General Counsel Kam stated that Eric Ryan is not on the complaint because he is not on the Organizational Report of the candidate committee, and thus, not an officer of the candidate committee.  Also, Respondent Carroll expressed reluctance to pursue a criminal case against Ryan.

Vice Chair Shoda commented that he appreciated that Respondents corrected their reports and was saddened to have to assess a fine for correcting reports, but that it was important that when Respondents filed their reports, their report should have been true and accurate so the public had the correct information at that time.

Commissioner Tsuji moved to make a preliminary determination that probable cause exists that a violation had been committed and to accept the fine and terms stated in the complaint.  Motion seconded by Commissioner Lum.  Motion carried (4-0).

*Proposed Conciliation Agreement No. 20-10 – In Re the Matter of Josh Green for Hawaii
General Counsel Kam stated that the proposed conciliation agreement was a result of an investigation initiated by Commission staff pursuant to HRS §11-314(7) concerning excess contributions from nonresidents to a candidate committee in violation of HRS §11-362.  He reported that Respondent Green has been informed in letters from Commission staff about the investigation, has provided written responses to staff’s inquiries, has met with staff on several occasions, has received a copy of the proposed conciliation agreement, and has been notified of today’s meeting.

General Counsel Kam stated that under HRS §11-362, contributions to a candidate from persons, not including immediate family members, who are not residents of Hawaii at the time the contributions are made, shall not exceed 30% of the total contributions received by that candidate in the election period.  He stated that based upon a review of the filed reports for the 2018 election period, it appeared that Respondent’s aggregate nonresident contributions, based upon the reported out-of-state addresses, was very close to the 30% limit.  In addition, 8 contributors who each gave the $6,000 maximum amount to Respondent, also gave to another candidate committee.  However, Respondent reported that these 8 contributors had Hawaii addresses while the other candidate committee reported that these 8 contributors had out-of-state addresses.  Respondent informed staff that although the addresses printed on the checks of these 8 contributors were mainland addresses, these contributors provided Respondent with Hawaii addresses.  For these same 8 contributors, the other candidate committee reported the mainland addresses printed on the checks.  Subject to further investigation, Commission staff determined that $24,508.77 of Respondent Green’s nonresident contributions exceeded the 30% cap.

General Counsel Kam explained that the matter was brought before the Commission by way of a conciliation agreement because the Commission’s Schedule of Fines does not include a fine for excess nonresident contributions.

General Counsel Kam recommended that the Commission make a preliminary determination of probable cause that a violation had been committed, waive further proceedings, and approve the terms as stated in the proposed agreement which includes Respondent Green paying a $1,000 administrative fine to be deposited in the general fund of the State of Hawaii as well as Respondent Green returning a $6,000 contribution made by Clayton Webb on 4/16/19 and a $6,000 contribution made by William Webb on 5/9/18 no later than 11/6/19.

Commissioner Tsuji moved to approve the proposed conciliation agreement.  Motion seconded by Vice Chair Shoda.  Motion carried (4-0).

*Docket No. 20-05 – In Re the Matter of Shirlene DelaCruz Ostrov, Marilyn Moniz, Hawaii Republican Party, and Annie Chan
Executive Director Izumi-Nitao reported that a complaint had been filed against Respondents Shirlene DelaCruz Ostrov, Marilyn Moniz, Hawaii Republican Party, and Annie Chan for the failure to report contributions and expenditures as well as for an excess contribution.

Respondent Hawaii Republican Party is a registered noncandidate committee that is a political party that satisfies the requirements of HRS §11-61, and thus, is subject to an aggregate $25,000 contribution limit per person in any two-year election period under HRS §11-360(a).

In the last amended Organizational Report filed with the Commission, Respondent Ostrov is listed as the chairperson and Respondent Moniz is identified as the treasurer of Respondent noncandidate committee.

HRS §11-331(b) provides that every report required to be filed by a noncandidate committee shall be certified as complete and accurate by the chairperson and treasurer.  HRS §11-335 requires the authorized person in the case of a party to file reports that disclose all contributions received and expenditures made.

On 8/28/19, Respondents amended and filed four (4) reports reporting a total of twenty (20) contributions totaling $1,044.35 which were not previously or timely reported.  On this same date, Respondents amended and filed four (4) reports reporting a total of eleven (11) expenditures totaling $9,084.25 which were not previously or timely reported.

On 9/3/19, Commission staff sent Respondents a letter via first class mail informing them that a fine of $2,000 (i.e., $250 per schedule for unreported contributions and expenditures) would be imposed for the unreported contributions in the original filing of two (2) Supplemental Reports (1/1/17-6/30/17 and 7/1/17-12/31/17), Preliminary Primary Report (1/1/18-7/27/18), and 2nd Preliminary General Report (9/27/18-10/22/18) as well as the unreported expenditures in the original filing of two (2) Supplemental Reports (1/1/17-6/30/17 and 7/1/17-12/31/17), Preliminary Primary Report (1/1/18-7/27/18), and 2nd Preliminary General Report (9/27/18-10/22/18).  The letter informed Respondents that they could avoid the complaint process by waiving their rights to be heard at a HRS chapter 92 public meeting and a HRS chapter 91 contested case hearing, and voluntarily paying the $2,000 fine by 9/17/19.

In a letter dated 9/17/19, Respondents asked the Commission to reconsider the proposed fine of $2,000 “in light of the efforts made by the [Hawaii Republican] Party to be in compliance, the mitigating factors surrounding the oversights, including the fact that the [Hawaii Republican] Party self-reported, and the hardship that would be suffered by the [Hawaii Republican] Party if it is required to pay the fines as currently assessed.”

HRS §11-364(a) provides that any noncandidate committee that is a political party that receives in the aggregate of more than $25,000 per person in a two-year election period “shall return any excess contribution to the contributor within thirty days of receipt of the excess contribution.  Any excess contribution not returned to the contributor shall escheat to the Hawaii election campaign fund.”  Subsection (b) further provides that a “noncandidate committee that complies with this section prior to the initiation of administrative action shall not be subject to any fine under section 11-410.”

HRS §11-361(a) provides that “[a]ll contributions and expenditures of a person whose contributions and expenditures are financed, maintained, or controlled by any corporation, labor organization, association, party, or any other person, including any parent, subsidiary, branch, division, department, or local unit of the corporation, labor organization, association, party, political committees established and maintained by a national political party, or by any group of those persons shall be considered to be made by a single person.”

Upon review of Respondents’ reports filed with the Commission, Commission staff found a $25,000 contribution on 8/30/17 and an $11,000 contribution on 9/25/18 from Respondent Annie Chan.  The $11,000 check was drawn upon the account of KC Realty, LLC.  Subsequent discussions with Respondents revealed that Respondent Chan finances, maintains, and controls KC Realty, LLC, and thus, under HRS §11-361(a), an aggregate contribution of $36,000 was made within the two-year election period to Respondent Hawaii Republican Party thereby exceeding their contribution limit of $25,000 by $11,000.  Respondent Hawaii Republican Party did not return the excess contribution to Respondent Chan within 30 days of receipt.

On 9/10/19, Commission staff sent Respondents a letter via first class mail informing them that Respondent Chan made an excess contribution to their committee.  The letter informed Respondents that they could avoid the complaint process by waiving their rights to be heard at a HRS chapter 92 public meeting and a HRS chapter 91 contested case hearing, and voluntarily escheating the $11,000 excess contribution by 9/24/19.  The letter also informed Respondents that a $1,000 administrative fine would be assessed against the excess contributor Respondent Chan.

On 9/10/19, Commission staff sent Respondent Annie Chan a letter via first class mail informing her of her excess contribution to Respondents.  The letter informed Respondent Chan that she could avoid the complaint process by waiving her rights to be heard at a HRS chapter 92 public meeting and a HRS chapter 91 contested case hearing, and voluntarily paying the $1,000 fine.  Respondent Chan was further informed that Respondent Hawaii Republican Party would be paying her fine which could be reduced through a Conciliation Agreement process if she so chose.

In a letter dated 9/24/19, Respondents asked the Commission to reconsider and rescind the excess contribution.  In the alternative, Respondents requested that they be able to return the excess contribution to Respondent Chan and reduce the excess contributor fine to $333.33 because the error was unintentional.

With respect to the excess contribution, Respondents and Respondent Chan were informed of the possibility of a Conciliation Agreement to reduce the fine from $1,000 to $333.33 which was ultimately rejected by Respondents to pursue the instant complaint.

On 10/16/19, Commission staff sent Respondents and Respondent Chan a copy of the Complaint and set the matter on the 10/23/19 Campaign Spending Commission Agenda.

Executive Director Izumi-Nitao recommended that the Commission make a preliminary determination, pursuant to HRS §11-405(a), that probable cause exists to believe that violations of the campaign spending law have been committed, assess an administrative fine of $2,000 against Respondents, assess an administrative fine of $1,000 against Respondent Chan, order that the fines be deposited into the general fund of the state pursuant to HRS §11-410(e), order Respondents to escheat $11,000 to the Hawaii Election Campaign Fund, and order that Respondent Hawaii Republican Party amend their report to reflect that KC Realty, LLC, made an $11,000 contribution to them on 9/25/18 rather than Respondent Chan within 2 weeks of receipt of the order.

Respondent Shirlene Ostrov and Respondent Marilyn Moniz were present at the Commission meeting.  Respondent Ostrov admitted to the violations but sought mitigation.  She stated that she is new to politics and that it has been a huge learning curve.  She stated that the party wants to comply and a large part of their budget is used for professional services to comply with the laws.  Respondent Ostrov commented that many of these violations occurred before her time as committee chair, that it took several months to identify the problems, and that they self-reported the errors.  With respect to Respondent Chan, she stated that Annie Chan is a generous donor and that the checks and balances in the electronic filing system did not capture the excess contribution.  Respondent Ostrov asked for mercy and reduction of the fines.

Discussion ensued on whether Respondents obtained campaign finance training which they said they did.  Chair Luke commented that he appreciated Respondents willingness to come forward, self-report their errors, and stay in compliance.  Respondent Ostrov stated that it is the party’s position that candidates must obtain campaign finance training if they want the party’s endorsement.

Vice Chair Shoda asked about the checks and balances of the electronic filing system.  Associate Director Baldomero said that Respondents entered a different address for Respondent Chan (i.e., one in Hawaii and one in California) which is why the system did not capture the excess contribution.  Executive Director Izumi-Nitao pointed out that the one from California from Annie Chan was actually from KC Realty, LLC which should have been the appropriate contributor entry in the first place.  Discussion ensued on whether the excess $11,000 contribution could be returned to Respondent Chan to which Commission staff commented that it was beyond the 30 days permitted by statute.

Respondent Moniz commented that she is thankful that the party has cleaned up its records and appreciated Commission staff’s assistance.

Commissioner Tsuji stated that he would like to reduce the fine for failure to report contributions and expenditures from $2,000 to $1,000.  Discussion ensued about reducing the fine.  Vice Chair Shoda commented that he liked the idea of reducing the fine in consideration of the Respondents’ commitment to making it mandatory for candidates to attend campaign finance training if they want the party’s endorsement.  Chair Luke agreed.

Commissioner Tsuji moved to make a preliminary determination that probable cause exists that a violation had been committed and to accept the fine and terms stated in the complaint with the exception of reducing the fine to $1,000 for failure to report contributions and expenditures.  Motion seconded by Commissioner Lum.  Motion carried (4-0).

*Docket No. 20-06 – In Re the Matter of Healani Land Company LLC and Stacy Philippou
Chair Luke recused himself because he knows Respondent Philippou.

Executive Director Izumi-Nitao reported that a complaint had been filed against Respondents Healani Land Company LLC and Stacy Philippou for the late filing of the Supplemental Report.

Respondent is a noncandidate committee that is registered with the Commission and Respondent Philippou is the chairperson and treasurer.  Pursuant to HRS §11-336, Respondents were required to file the Supplemental Report for the period covering 4/14/19 through 6/30/19 no later than 11:59 p.m. Hawaii standard time on 7/31/19.  Respondents filed this report on 8/20/19 thereby incurring a $200 fine which was paid on 10/22/19.  Due to compliance, Executive Director Izumi-Nitao asked to withdraw the complaint.

Commissioner Lum moved to approve the withdrawal of the complaint.  Motion seconded by Commissioner Tsuji.  Motion carried (3-0) (Chair Luke recused).

*Docket No. 20-07 – In Re the Matter of Eric Link and Link El Ohana
Executive Director Izumi-Nitao reported that a complaint had been filed against Respondents Eric Link and Link El Ohana for the late filing of the Supplemental Report.

Respondent Link is the candidate and treasurer of the candidate committee called Link El Ohana.  Pursuant to HRS §11-334, Respondents were required to file the Supplemental Report for the period covering 1/1/19 through 6/30/19 no later than 11:59 p.m. Hawaii standard time on 7/31/19.  Respondents did not file this report by the deadline.

On 8/1/19, Commission staff sent Respondents a letter via first class mail informing them that the Supplemental Report had not been filed and that a fine would be imposed.  On 8/30/19, Respondents filed the Supplemental Report.

On 9/4/19, Commission staff sent Respondents a letter via first class mail informing them that a fine of $200 would be assessed for the late filing of the report and that the deadline to pay the fine was 9/18/19.  Respondents did not pay the fine.

On 9/25/19, Commission staff contacted Respondent Link regarding the status of the fine payment and left a message that a complaint may ensue if the Commission did not receive the fine payment.  Respondents have not responded nor paid the fine.

On 10/3/19, Commission staff sent Respondents a copy of the complaint and informed them that the matter would be set on the 10/23/19 Commission Agenda.

Executive Director Izumi-Nitao recommended that the Commission make a preliminary determination, pursuant to HRS §11-405(a), that probable cause exists to believe that a violation of the campaign spending law has been committed, assess an administrative fine of $200, and order that the fine be deposited into the general fund of the state pursuant to HRS §11-340(g).

Vice Chair Shoda moved to make a preliminary determination that probable cause exists that a violation had been committed and to accept the fine and terms stated in the complaint.  Motion seconded by Commissioner Lum.  Motion carried (4-0).

*Docket No. 20-08 – In Re the Matter of Gene Leslie, Anne Johnson, and Friends of Bucky Leslie
Executive Director Izumi-Nitao reported that a complaint had been filed against Respondents Gene Leslie, Anne Johnson, and Friends of Bucky Leslie for the late filing of the Supplemental Report.

Respondent Leslie is the candidate and Respondent Johnson is the treasurer of the candidate committee called Friends of Bucky Leslie.  Pursuant to HRS §11-334, Respondents were required to file the Supplemental Report for the period covering 1/1/19 through 6/30/19 no later than 11:59 p.m. Hawaii standard time on 7/31/19.  Respondents did not file this report by the deadline.

On 8/1/19, Commission staff sent Respondents a letter via first class mail informing them that the Supplemental Report had not been filed and that a fine would be imposed.  On 8/8/19, Respondents filed the Supplemental Report.

On 8/8/19, Commission staff sent Respondents a letter via first class mail informing them that a fine of $200 would be assessed for the late filing of the report and that the deadline to pay the fine was 8/22/19.  Respondents did not pay the fine.

On 8/27/19 and 9/4/19, Commission staff contacted Respondent Leslie regarding the status of the fine payment.  Respondent Leslie returned Commission staff’s call and agreed to a payment plan of $25 per month starting on 10/31/19.

On 9/5/19, Commission staff informed Respondent Leslie that under the payment plan, his committee would remain registered and would be required to file reports.  Respondent Leslie responded that he would be sending a check for the entire fine payment.

On 9/10/19 and 9/26/19, Commission staff called Respondent Leslie regarding the status of the fine payment.  Respondent Leslie said that he would pay the entire fine amount online.  Per his instructions, Commission staff emailed him a link to the Commission’s PayPal website link to pay the fine.

On 9/24/19, Commission staff called Respondent Leslie regarding the status of the fine payment.  Respondent Leslie said that he would check his email and pay the fine by the following day.

On 10/1/19, Commission staff called Respondent Leslie and was informed that his accountant was supposed to mail out a check and that he would follow up.

On 10/4/19, Commission staff called Respondent Leslie and left a message that his fine payment had not been received and that a complaint would ensue.

On 10/10/19, Commission staff sent Respondents a copy of the complaint and informed them that the matter would be set on the 10/23/19 Commission Agenda.

Executive Director Izumi-Nitao recommended that the Commission make a preliminary determination, pursuant to HRS §11-405(a), that probable cause exists to believe that a violation of the campaign spending law has been committed, assess an administrative fine of $200, and order that the fine be deposited into the general fund of the state pursuant to HRS §11-340(g).

Vice Chair Shoda moved to make a preliminary determination that probable cause exists that a violation had been committed and to accept the fine and terms stated in the complaint.  Motion seconded by Commissioner Lum.  Motion carried (4-0).

*Docket No. 20-10 – In Re the Matter of Selina Blackwell, Jason Wilson, and Selina T. Blackwell
Executive Director Izumi-Nitao reported that a complaint had been filed against Respondents Selina Blackwell, Jason Wilson, and Selina T. Blackwell for the late filing of the Supplemental Report.

Respondent Blackwell is the candidate and Respondent Wilson is the treasurer of the candidate committee called Selina T. Blackwell.  Pursuant to HRS §11-334, Respondents were required to file the Supplemental Report for the period covering 1/1/19 through 6/30/19 no later than 11:59 p.m. Hawaii standard time on 7/31/19.  Respondents did not file this report by the deadline.

On 8/1/19, Commission staff sent Respondents a letter via first class mail informing them that the Supplemental Report had not been filed and that a fine would be imposed.  On 8/19/19, Respondent Blackwell informed Commission staff that she thought the committee’s registration was terminated.  Commission staff explained that the committee had not been terminated and informed her that a fine may be assessed for the unfiled Supplemental Report.  Respondent Blackwell requested a conciliation agreement for any fine associated with the late filing of the Supplemental Report.

On 8/23/19, Respondents filed the Supplemental Report.

On 8/26/19, Commission staff sent Respondents a letter via first class mail informing them that a fine of $200 would be assessed for the late filing of the report and that the deadline to pay the fine was 9/6/19.

On 8/26/19, Commission staff prepared and mailed via first class mail Proposed Conciliation Agreement No. 20-07 to Respondents and informed them that the matter would be heard at the 9/18/19 Commission meeting.  At this meeting, the Commission approved Proposed Conciliation Agreement No. 20-07 which reduced the fine assessment from $200 to $100.  Respondents were given until 10/2/19 to sign the agreement and pay the reduced fine.

Notably, the agreement provides that if the assessment is not paid by the deadline, the Commission will consider Respondents to be in breach of the agreement and will then assess Respondent the original amount of the fine.

Despite Commission staff phone calls and discussions with Respondent Blackwell, Respondents did not pay the $100 fine nor sign the agreement, and thus, failed to comply with the terms of Conciliation Agreement No. 20-07.

On 10/14/19, Commission staff sent Respondents a copy of the complaint and informed them that the matter would be set on the 10/23/19 Commission Agenda.

Executive Director Izumi-Nitao recommended that the Commission make a preliminary determination, pursuant to HRS §11-405(a), that probable cause exists to believe that a violation of the campaign spending law has been committed, assess an administrative fine of $200, and order that the fine be deposited into the general fund of the state pursuant to HRS §11-340(g).

Vice Chair Shoda moved to make a preliminary determination that probable cause exists that a violation had been committed and to accept the fine and terms stated in the complaint.  Motion seconded by Commissioner Tsuji.  Motion carried (4-0).

*Consideration, Discussion, Approval, and Update of Commission Legislation for the 2020 Legislative Session
General Counsel Kam reported the following 7 bills have been drafted for the Commission’s consideration for the 2020 Legislative Session:

• CSC-01 (20), RELATING TO ELECTIONEERING COMMUNICATIONS.

This measure was introduced last session (H.B. 164/S.B. 139) but did not pass.  This measure amends HRS §11-341 by changing “disclosure date” to when the electioneering communication is publicly distributed rather than when the contract for the electioneering communication is executed.  Also, the measure re-tolls the $2,000 expenditure aggregate amount before the filing of additional statements of information are required and includes advertisements sent by mail at any rate in the definition of electioneering communication by deleting “bulk rate.”  Lastly, the measure deletes “communications that constitute expenditures by the expending organization” from the exceptions to the definition of “electioneering communications” to make it clear that candidate and noncandidate committees are required to file statements of information.

• CSC-02 (20), RELATING TO VIOLATIONS OF CAMPAIGN FINANCE LAW.

This measure was introduced last session (H.B. 162/S.B. 137) but did not pass.  This measure amends HRS §11-410 by raising the amount of fine that can be assessed against a Super PAC (that has received or spent more than $10,000 in an election period) from $1,000 to $5,000 and to permit the fine to be up to three times the amount of the unlawful contribution or expenditure.  Also, allows the Commission to order that the payment of the fine assessed against a noncandidate committee, or any portion, be paid from the personal funds of an officer of the noncandidate committee.

• CSC-03 (20), RELATING TO CAMPAIGN CONTRIBUTIONS.

This measure was introduced last session (S.B. 643) but did not pass.  This measure amends HRS §11-364 by requiring nonresident contributions exceeding 30% of the total contributions received by a candidate committee for each election period to escheat to the Hawaii election campaign fund if not returned to the contributor within thirty days.

• CSC-04 (20), RELATING TO CAMPAIGN FINANCE REPORTS.

This measure amends HRS §11-340(c) to make clear that the increased fine (not to exceed $300 per day) for the late-filing of preliminary reports only applies to the reports due ten days before a primary, general, or special election.  This measure is necessary due to the additional preliminary reports mandated by the Legislature last session.

• CSC-05 (20), RELATING TO ORDERS OF THE CAMPAIGN SPENDING COMMISSION.

This measure amends HRS §11-410 by (1) amending subsection (b) to provide that a person waives the right to a contested case hearing if the person fails to request a contested case hearing within twenty days of receipt of the Commission’s preliminary determination, and (2) amending subsection (d) to provide that a final order of the Commission may be filed in the First Circuit Court for confirmation as a civil judgment, enforceable and collectible as any other judgment issued in the circuit courts.  These amendments were suggested by the deputies in the Civil Recoveries Division of the Department of the Attorney General who are helping the Commission by enforcing its orders in the First Circuit Court.

• CSC-06 (20), RELATING TO REPORTS OF CANDIDATE COMMITTEES.

This measure amends HRS §11-333(b) by amending paragraph (3) by adding “committee reimbursements to the candidate or other individuals” to the list of expenditures that need to be itemized.  As currently written, only candidate reimbursements need to be itemized.  In many instances, individuals other than the candidate are being reimbursed for campaign costs advanced by those individuals.  Those reimbursements to other individuals should also be itemized.

• CSC-07 (20), RELATING TO CONTRIBUTION LIMITS FOR NONCANDIDATE COMMITTEES.

This measure amends HRS §11-358 to provide that the $1,000 per election contribution limit for noncandidate committees does not apply to noncandidate committees making only independent expenditures.  This codifies the permanent injunction entered against the state by the U.S. District Chief Judge J. Michael Seabright.  See Yamada v. Kuramoto, 744 F.Supp.2d 1075, 1078 (D. Haw. 2010), affirmed, A-1 A-Lectrician v. Snipes, 786 F.3d 1182 (9^th Cir. 2015), cert. den., Yamada v. Shoda, 577 U.S. 4 (2015).

Chair Luke asked if there were any comments or questions.  There were none.

Vice Chair Shoda moved to approve the proposed legislation for the 2020 Legislative Session.   Motion seconded by Commissioner Tsuji.  Motion carried (4-0).

Chair Luke commented that the Commission should review its standard fine guidelines.  Executive Director Izumi-Nitao reported that Commission staff regularly considers whether the fine guidelines are appropriately deterring violations and would inform them if they were not. 

Old Business
*Report on 2019 Annual Online Survey
Associate Director Baldomero reported on the results of the Commission’s 2019 Annual Online Survey results.  He stated that the purpose of the survey is to help evaluate the effectiveness of Commission operations and communications for fiscal year 2019 (i.e., July 1, 2018 through June 30, 2019) as well as provide the Commission with any feedback in areas that we administer and regulate for improvement in fiscal year 2020 and beyond.  He made the following remarks:

• This was the 8th year of the survey.
• The survey was launched on 9/18/19 via the CSC website, Eblast, Facebook & Twitter, and closed on 10/16/19.
• Total outreach via Eblast was 901 made up of 359 candidate committees, 241 noncandidate committees and 301 public subscribers. CSC’s Facebook and Twitter pages are in the public domain but at the time of the survey launch there were 243 Facebook and 709 Twitter followers. There were also 1,059 visitors to the CSC website during the time the survey was open.
• The survey ran for a total of 29 days which is tied with 2013 for the lowest number of days that we ran the survey and below the 8-year average of 38 days.
• There were 129 total responses which ranks at #3 for the 8 years that the Commission has been conducting the survey (136 responses were received in 2018 with the highest number of responses occurring in 2016 with 140). 106 or 82% of responders completed the survey to the end.
• 7 minutes and 34 seconds was the typical time spent completing the survey with the CSC estimating it was going to take 5-10 minutes.
• Reminders were sent via Eblast, Facebook, & Twitter on 9/18/19, 9/25/19, 10/3/19, and 10/9/19. The CSC website post remained on the website for the entire 29-day duration of the survey
• Survey comprised of 6 sections and 37 survey questions (26 multiple choice, 4 multiple choice/open-ended, 7 open-ended).

Associate Director Baldomero went through each of the 6 sections of the survey:

1 – Background Information Highlights (6 Questions/129 Responses)

• Responders were mostly treasurers or deputy treasurers (50) and candidates (25) from candidate committees (66) and noncandidate committees (38) that reside on the islands of Oahu (93), Maui (12) and Hawaii (11). There was also a good response from members of the public with 20 responders. The responders have a wide-range of experience that was evenly spread out among the 5 ranges with most falling in the 1-3 years of experience range (28) then the 10-20 years of experience range (25), but overall this was a balanced group that represented different areas of experience.
• 101 or 78% filed CSC reports electronically, 81 or 63% have been involved in campaign activities, and 64 or 50% made a contribution or loan to a candidate committee so this was an engaged group.
• 98 or 76% responded that this was their first time taking the survey with 29 or 23% responding that they took the survey between 2-4 times so it seems that this is a group that will offer us a fresh look at what we do.

2 – Communication/Access Highlights (4 Questions/127 Responses)

• 101 or 80% of responders in this category responded that the CSC website was the #1 source for obtaining information closely followed by phone calls or drop-in visits to the Commission’s office (100 or 79%) then Guidebooks and Manuals (74 or 58%), and Eblasts (70 or 55%).
• Social media engagement has picked up very slightly but is still lacking with only 26 or 20% following us on Facebook and/or Twitter. Despite that, 97 or 76% were email subscribers who received Eblasts (i.e., so most of the responders came from Eblast outreach and the CSC website versus Facebook and Twitter posts).

3 – Education/Training Highlights (11 Questions/118 Responses)

• 39 or 33% of responders in this category attended the candidate committee class and 20 or 17% attended the noncandidate committee class with 33 or 28% never attending any classes so perhaps this was not a favorable method or classes were not at a convenient time/location.
• 35 or 30% viewed the candidate committee cyber learning videos and 16 or 14% viewed the noncandidate committee cyber learning videos with 37 or 31% never viewing any videos. Slightly more responders attended classes than viewed the cyber learning videos but there was still a high number of responders that did not do either or felt that the two questions were not applicable to them.
• For those who attended training, most of them said that it had been more than 3 years since their last class (24 or 20%) or they attended training in the last 1-3 years (20 or 17%).
• 61 or 52% have viewed the Candidate Committee Guidebook, 50 or 42% viewed the Treasurer’s Guidebook, and 49 or 42% viewed the Candidate Filing System Manual.
• Electronically filing disclosure reports (78 or 66%) followed by viewing candidate committee disclosure reports (73 or 62%), electronically filing forms (60 or 51%) and viewing reporting schedules (55 or 47%) drove people to the CSC website. This has been consistent for every survey we have published. Overall, it seems that responders are really looking for information to help them comply.
• Of the 68 or 58% who said that they use the searchable database, 64 said it was a helpful tool that was mainly used to search contributor names and how much money they gave to candidates (60 or 88%) and how candidates spent their campaign funds (47 or 69%).
• The candidate and noncandidate committee data visualization apps were not as popular as the searchable database with 39 or 33% who said they had used it.
• Overall the responders were satisfied with what they see on the Commission’s website (110 or 93%)

4 – Compliance/Enforcement Highlights (4 Questions/118 Responses)

• 64 or 54% of responders in this category said they file their disclosure reports on time with 32 or 27% saying they have not with 30 saying they only filed late 1-2 times.
• 51 or 43% never entered into a Conciliation Agreement with the Commission but 37 or 31% have entered into a Conciliation Agreement with the Commission with this being the highest ever compared to prior surveys.
• 88 or 75% have never had a complaint filed against them with 5 or 4% saying they had a complaint brought before the Commission against them.

5 – Public Funding Highlights (6 Questions/110 Responses)

• Only a small number of responders in this category (8 or 7%) have qualified for and received public funding versus 57 or 52% who have not. Of the 8 receiving public funds, 2 or 11% received the maximum amount.
• 70 or 64% supported public funding versus 40 or 37% who did not.

6 – Other Highlights (6 Questions/106 Responses)

• 70 or 64% of responders in this category said they would support a general fund appropriation to see public funding continue versus 40 or 36% who said they would not.
• 51 or 48% have been checking off the $3 tax check-off versus 55 or 52% who did not. 91 or 86% knew that the $3 check-off did not affect their tax liability or decrease their refund versus 15 or 14% who did not. It seems that the responders are aware that checking off the box does not affect their tax liability or decrease their refund but they are still not checking the box.
• 68 or 64% responded that Super PACs were a concern versus 38 or 36% who said they were not a concern.

Associate Director Baldomero asked if there were any questions.  Vice Chair Shoda asked if the responders were identified.  Associate Director Baldomero responded that they were all anonymous.  Vice Chair Shoda suggested adding a new question to next year’s survey to ask responders if they wish to be contacted about their experiences to which Commission staff agreed.

Executive Director Izumi-Nitao stated that the survey results will be posted on the Commission’s website.

Report from the Executive Director
Report on Compliance of Filing Timely Disclosure Reports
Executive Director Izumi-Nitao reported that with respect to the last report that was due (i.e., Supplemental Report), there are 6 candidate committees (3 of whom have been previously referred to the Attorney General – Civil Recoveries Division (“AG-CRD”)) and 5 noncandidate committees (all of whom have been previously referred to AG-CRD) who have not filed.

With respect to prior reports, there are 1 to 3 candidate committees and 5 noncandidate committees that have not filed their reports.  All have been referred to AG-CRD.

With respect to an update on the status of the cases referred to AG-CRD:   (1) Junior Mataafa – working with Associate Director Baldomero; (2) Alika Atay – court order to comply with the Commission’s order; (3) Debra Kekaualua – pending; (4) Thomas Belekanich – pending; and (5) Michael Juarez – pending.

With respect to an update on the compliance of prior matters:  (1) Kaniela Ing – fine payments are current and Commission staff is reviewing his amended reports and new filings; and (2) Trinette Furtado – pending HRS chapter 91 contested case proceeding which has been set for January 15-16, 2020.

Report on Developments Concerning the Commission’s Electronic Filing Systems
Associate Director Baldomero reported that ETS’ conversion of the Commission’s candidate filing system from CodeCharge to ScriptCase and incorporating enhancements to the system appears to be on track.  He also reported that the Commission contracted with Socrata to build the noncandidate committee dashboard which should be ready for the 2020 election.  The noncandidate committee dashboard will be modeled after the candidate committee dashboard launched in September 2018. 

Update Regarding Campaign Spending Commissioners
Executive Director Izumi-Nitao reported that she was informed that Commissioner Russell Tsuji will be resigning from the Commission effective 10/24/19.

She stated that Governor Ige will be appointing another Commissioner to complete Commissioner Tsuji’s remaining term which expires on 6/30/23.  She will keep the Commissioners informed. 

EXECUTIVE SESSION
Chair Luke asked for a motion to convene Executive Session to: (1) Consider and approve Executive Session minutes from the Commission meeting on 9/18/19; and (2) Pursuant to HRS §92-5(a)(4), to consult with the Commission’s attorneys on questions and issues pertaining to the Commission’s powers, duties, privileges, immunities, and liabilities regarding McGee v. Campaign Spending Commission and Friends of Calvin Say.

Vice Chair Shoda moved to convene in Executive Session for the aforementioned reason(s).  Motion seconded by Commissioner Lum.  Motion carried (4-0).

Public Session reconvened at 1 p.m.

Vice Chair Shoda moved to adjourn the meeting.  Motion seconded by Commissioner Tsuji.  Motion carried (4-0).  Meeting adjourned at 1 p.m.

Next Meeting:
Scheduled for Wednesday, December 4, 2019, at 10 a.m.