Campaign Spending Commission

Campaign Spending Commission Meeting
Zoom Video Conference
February 5, 2025
10:00 a.m.

Commissioners Present
David Chee, Neal Herbert, Danton Wong, Barbara Polk, Jon Itomura (arrived at 10:05 a.m.)

Staff Present
Kristin E. Izumi-Nitao, Tony Baldomero, Gary Kam, Terence Lau

Excused
Anthony Diep

Deputy Attorney General
Candace Park

Guest(s)
Chad Blair

Call to Order
Chair Chee called the meeting to order at 10:03 a.m.

Chair Chee went over the procedures for the remote meeting via Zoom and introduced the Commissioners, Commission staff, and the Deputy Attorney General who were present.  The Commissioners present stated that there was no one else with them.

Consideration and Approval of Minutes of Meeting on 1/8/25
Vice-Chair Herbert moved to approve the minutes of the meeting held on 1/8/25.  Motion seconded by Commissioner Wong.  Motion carried (4-0) (Commissioner Itomura arrived after the vote was taken).

New Business
Executive Director Izumi-Nitao stated that the following three Conciliation Agreements on the agenda was a result of an investigation initiated by her as the Executive Director pursuant to HRS §11-314(7) to determine whether there had been a violation of the Hawaii campaign spending laws.  She stated that Respondents have been informed in a letter from Commission staff of the violation and have been notified of today’s meeting as well as received a copy of the proposed conciliation agreement.  She recommended that the Commission make a preliminary determination of probable cause that a violation had been committed, waive further proceedings, and approve each of the proposed agreements.

*Proposed Conciliation Agreement No. 25-36 – In Re the Matter of Friends of Kelton Chang – Executive Director Izumi-Nitao explained that this proposed conciliation agreement concerns the late filing of the Final Election Period Report and requested that the Commission assess a reduced fine from $200 to $100 as it is Respondent’s second violation.  Chair Chee asked if there were any comments or questions.

Commissioner Wong moved to approve the proposed conciliation agreement.  Motion seconded by Commissioner Itomura. Motion carried (5-0).

*Proposed Conciliation Agreement No. 25-37 – In Re the Matter of Friends of Caryl Burns – Executive Director Izumi-Nitao explained that this proposed conciliation agreement concerns the late filing of the Final Election Period Report and requested that they assess a reduced fine from $200 to $66.67 as it is Respondent’s first violation.  Chair Chee asked if there were any comments or questions.

Commissioner Wong moved to approve the proposed conciliation agreement.  Motion seconded by Commissioner Itomura. Motion carried (5-0).

*Proposed Conciliation Agreement No. 25-38 – In Re the Matter of Friends of Jeremiah Savage – Executive Director Izumi-Nitao explained that this proposed conciliation agreement concerns the late filing of the Final Election Period Report and requested that they assess a reduced fine from $200 to $66.67 as it is Respondent’s first violation.  Chair Chee asked if there were any comments or questions.

Commissioner Wong moved to approve the proposed conciliation agreement.  Motion seconded by Commissioner Itomura. Motion carried (5-0).

*Docket No. 25-24 – In Re the Matter of Reginald Garcia, Lehua Garcia, and Friends of Reginald Garcia – Executive Director Izumi-Nitao stated that this is a complaint by the Executive Director against Reginald Garcia, Lehua Garcia, and Friends of Reginald Garcia for the failure to file the Final Election Period Report in violation of HRS §11-334 and §11-410.

She reported that in the Organizational Report filed with the Commission, Respondent Reginald Garcia is the candidate and Respondent Lehua Garcia is the treasurer of the candidate committee called Friends of Reginald Garcia.

Pursuant to HRS §11-334(a), Respondents were required to file the Final Election Period Report for the period covering 8/11/24 through 11/5/24 by 11:59 p.m. Hawaii standard time on 12/5/24.  Respondents did not file the report by the deadline.

On 12/6/24, Commission staff notified Respondents via first class mail of their failure to file the report and that their failure to file this report would result in the Commission filing a complaint and assessing a fine.  The letter was addressed to Respondents at the addresses listed on their Organizational Report.

Respondents did not file the Final Election Period Report.

On 1/6/25, Commission staff sent Respondents a copy of the complaint and set the matter on the 2/5/25 Commission agenda.

Respondents have not responded to the complaint within 30 days from the mailing of the complaint, and therefore, pursuant to HRS §11-403(c), the Commission may treat the failure to explain or respond as a rebuttable presumption that a violation has occurred.

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 $500 for failing to file the Final Election Period Report, order that Respondents file the report within 2 weeks of receipt of this order, and order that any and all administrative penalties be deposited into the general fund pursuant to HRS §11-410.

Commissioner Polk 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 Wong.  Motion carried (5-0).

*Presentation, Discussion, and Approval of Standard Fine Guidelines – Executive Director Izumi-Nitao stated that per Hawaii Administrative Rules (“HAR”) §3-160-73(a), the Commission may adopt a schedule of fines for campaign finance violations in guidelines approved by the Commission at an HRS chapter 92 Sunshine meeting.  Per HAR §3-160-73(b), these guidelines may be amended from time to time by the Commission in accordance with subsection (a) and must be posted on the Commission’s website.  Per HAR §3-160-73(c), the executive director may assess fines for violations in accordance with these guidelines, and per HAR §3-160-73(d), the executive director must report to the Commission the amount of fines paid by persons in the annual report.  She further stated that this Schedule of Fines which is posted on the Commission’s website is referred to in all fine letters to the committees.

Vice-Chair Herbert moved to go into executive session 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 concerning the Schedule of Fines.  Motion seconded by Commissioner Wong.  Motion carried (5-0).

*Commission went into Executive Session at 10:19 a.m.

*Commission returned into public session at 10:37 a.m.

Executive Director Izumi-Nitao presented staff recommendations on amendments to the Commission’s Standard Fine Guidelines which was last amended and approved by the Commissioners at the Commission’s HRS chapter 92 Sunshine meeting on 11/8/23.  Based on the violations incurred in the last fiscal year which were discussed and are documented in the Commission’s Annual Report, she was not recommending further enhancements to the current violations, but had the following considerations.  She further stated that, if approved, the fine guidelines will be posted on the Commission’s website.

Discussion ensued on Commission staff’s recommendations.

With respect to filing substantially defective or deficient reports, Executive Director Izumi-Nitao reported that Commissioners have not defined what constitutes “substantially defective or deficient,” but she agreed with Chair Chee that this category has been subsumed by more specific violations as set forth in the schedule of fines.

With respect to false reports, discussion ensued on whether to strike it from the schedule because the violations contained in the schedule are for administrative purposes for staff to issue fine letters rather than for violations that are the result of an investigation involving a formal review, for instance, of a committee’s subpoenaed bank records, that may result in a complaint from General Counsel Kam.  Vice-Chair Herbert did not see the harm in posting these penalties for purposes of transparency and consistency.  Staff commented that striking it from the schedule did not mean that it was being eliminated as a violation.

With respect to cash contributions exceeding $100, Executive Director Izumi-Nitao reported that the Commission has a bill moving through the legislature to escheat excess cash contributions that are not returned to the contributor (i.e., H.B. 369 and S.B. 255).

With respect to unauthorized collection of contributions or unauthorized expense of campaign funds, Executive Director Izumi-Nitao stated that this is a new category that she recommends codifying as a result of prior matters.  She recommended a tiered application of $100 for the first time a violation has occurred, $500 for the second time, and $750 for the third time applying HRS §11-410 catch-all.  This fine was most recently applied in Docket No. 25-19 – In Re the Matter of Sheila Medeiros, Brandee Medeiros, and Friends of Sheila Medeiros heard at the Commission’s meeting on January 8, 2025 and previously applied in Docket No. 19-04 – In Re the Matter of Friends of Alika Atay, et al.

With respect to Conciliation Agreements, Executive Director Izumi-Nitao proposed the following amendments:  Application to only enumerated violations (i.e., late reports, advertisement disclaimers, electioneering communications, excess non-resident contributions, and excess contributions) and a reset if a committee terminates its registration with the Commission.  Commissioner Polk disagreed with the reset and expressed concern about candidates/elected officials not knowing the laws that they pass.  Vice-Chair Herbert agreed with Commissioner Polk and further commented that conciliation agreements only apply to first time candidates.  Discussion ensued on the five enumerated violations which Executive Director Izumi-Nitao stated that they represent high volume violations that require an efficient resolution process and have been historically applied.  Chair Chee asked that staff send the Commissioners the link to the Commission’s annual reports for them to review the violations that have occurred in prior fiscal years.

Vice-Chair Herbert inquired as to Part III. Criminal Activity on the schedule to which Executive Director Izumi-Nitao stated that it was included as a result of the prior consideration of the schedule since new criminal statutes were promulgated and Commissioners wanted to know how it would be applied to campaign finance violations.  She commented that perhaps it would be better to delete this section since it involves criminal prosecution for which the Commission has no authority.

Chair Chee stated that he would like to continue this discussion to the Commission’s next meeting on March 12, 2025 since the schedule of fines is essential to Commission business.

*Recess from 11:40-11:45 a.m.  Chair Chee asked Vice-Chair Herbert to take over since he had to leave at 12 p.m.  Vice-Chair Herbert presided.

Old Business
*Consideration, Discussion, Approval, and/or Update of Commission Legislation and Other Related Bills/Resolutions for the 2025 Legislative Session – General Counsel Kam reported on the status of the Commission’s bills and other related bills.  In the House, there are 20 campaign finance related bills, and in the Senate, there are 17 campaign finance related bills.  Bills will be tracked and status updates will be provided at subsequent Commission meetings.

Report from Executive Director
*Report on Compliance of Filing Timely Disclosure Reports – Executive Director Izumi-Nitao reported that the Supplemental Report was due on 1/31/25 for 710 committees registered with the Commission, but have different reporting periods depending on whether they ran in the 2024 election.  She reported the following:

• 228 candidates ran in the 2024 election with a reporting period of 11/6/24 to 12/31/24 for candidates
  • 197 filed on time (86%)
  • 22 failed to file
  • 9 filed late
  • As of today, 4 have yet to file
• 228 candidate committees who did not run in the 2024 election with a reporting period of 7/1/24 to 12/31/24
  • 157 filed on time (69%)
  • 59 failed to file
  • 12 filed late
  • As of today, 9 have yet to file
• 254 noncandidate committees with the reporting period of 11/6/24 to 12/31/24
  • 244 filed on time (96%)
  • 9 failed to file
  • 1 filed late
  • As of today, 1 has yet to file

She had no further updates for prior disclosure reports.

Executive Session
*Consideration and Approval of Executive Session Minutes of Meeting on 1/8/25 – Vice-Chair Herbert asked if there were no corrections or amendments to the proposed executive session minutes on 1/8/25, he would ask for a motion in open session.

Commissioner Polk moved to approve the executive session minutes on 1/8/25. Motion seconded by Commissioner Wong. Motion carried (4-0) (Chair Chee excused).

Next Meeting:
Scheduled for Wednesday, March 12, 2025.

Commissioner Wong moved to adjourn the meeting.  Motion seconded by Commissioner Itomura.  Motion carried (4-0) (Chair Chee excused).

Meeting Adjourned at 12:25 p.m.