Minutes for April 10, 2019 Meeting

Posted in Minutes

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

Commissioners Present
Bryan Luke, Kenneth Goodenow, Gregory Shoda, Stanley Lum, Maryellen Markley, Ph.D.

Staff Present
Kristin Izumi-Nitao, Tony Baldomero, Gary Kam, Yayoi Tumamao
Deputy Attorney General Valri Kunimoto

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

Consideration and Approval of Minutes of Meeting on 3/13/19
Chair Luke asked for comments or changes to the minutes.  There were none.  Chair Luke called for a motion to approve the minutes.

Vice Chair Goodenow stated that on page 3, under “Proposed Conciliation Agreement No. 19-154 – In Re the Matter of Friends of Joy San Buenaventura,” he disclosed that he was Representative San Buenaventura’s treasurer prior to the violations.

Vice Chair Goodenow moved to approve the amended minutes of the 3/13/19 meeting.  Motion seconded by Commissioner Markley.  Motion carried (5-0).

New Business
Executive Director Izumi-Nitao stated that the two (2) Conciliation Agreements on the agenda were a result of investigations initiated by Commission staff 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 the settlement amounts stated in each of the proposed agreements.

*Proposed Conciliation Agreement No. 19-165 – In Re the Matter of Good Guys for Tanabe
Executive Director Izumi-Nitao explained that this proposed conciliation agreement concerns the late filing of the Supplemental Report and requests that they assess a reduced fine from $200 to $100.  Chair Luke asked if there were any comments or questions.

Hearing none, Vice Chair Goodenow moved to approve the proposed conciliation agreement.  Motion seconded by Commissioner Shoda.  Motion carried (5-0).

*Proposed Conciliation Agreement No. 19-166 – In Re the Matter of Rick Nava, Friends of Rick Nava
Executive Director Izumi-Nitao explained that this proposed conciliation agreement concerns the late filing of the Supplemental Report and requests that they assess a reduced fine from $200 to $66.67.  Chair Luke asked if there were any comments or questions.  There were none.  Chair Luke called for a vote.

Vice Chair Goodenow moved to approve the proposed conciliation agreement.  Motion seconded by Commissioner Lum.  Motion carried (5-0).

*Docket No. 19-35 – In Re the Matter of John White and Friends of John White
Executive Director Izumi-Nitao reported that a complaint by the Executive Director had been filed against John White and Friends of John White for the late filing of the Supplemental Report.

Respondent White did not run in the 2018 election. In the Organizational Report filed with the Commission, Respondent White is listed as the candidate and treasurer of the candidate committee called Friends of John White.

Pursuant to HRS §11-334(b), Respondents were required to file the Supplemental Report for the period covering 7/1/18 through 12/31/18 by 11:59 p.m. Hawaii standard time on 1/31/19.  Respondents did not file this report by the deadline.

On 2/1/19, Commission staff notified Respondents via first class mail of their failure to file this report and that a fine would be imposed.

On 2/5/19, Respondents filed the Supplemental Report.

On 2/8/19, Commission staff notified Respondents via first class mail that a fine of $200 was assessed for the late filing of the report.  Respondents did not pay the fine.

On 2/27/19 and 3/18/19, Commission staff left messages with Respondent White that a complaint would be filed if the fine was not paid.  Commission staff also sent Respondent White an email on 3/5/19 concerning the fine payment.

On 4/1/19, Commission staff sent Respondents a copy of the complaint and set the matter on the 4/10/19 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, order that the fine be paid from the candidate’s personal funds if the committee funds are insufficient or if the Commission so orders, and order that any and all administrative penalties be deposited into the general fund pursuant to HRS §11-340(g) within two (2) weeks of receipt of this order.

Vice Chair Goodenow 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 Markley.

Chair Luke commented that Respondents are habitually late in filing their reports.  Executive Director Izumi-Nitao stated that this was the 13th time that Respondents have filed a late report since running in the 2010 election and that this was the 5th complaint filed.  She commented that typically Respondents pay the late report fine.  Chair Luke asked whether there were other remedies.  Executive Director Izumi-Nitao reported that the fine amount is set by statute, but that they could order that Respondents pay the fine with the candidate’s personal funds.

Motion carried (5-0).

*Discussion and Approval to Repeal Commission Advisory Opinion No. 01-09
General Counsel Kam discussed Commission Advisory Opinion No. 01-09 issued on 1/15/02 regarding use of campaign funds to attend banquets, golf tournaments, and testimonials.  He recommended that the advisory opinion be rescinded because a blanket prohibition of the use of campaign funds to attend these three types of activities was unwarranted.

General Counsel Kam explained that under HRS §11-381(a)(1)(A), campaign funds may be used for any purpose directly related to a candidate’s campaign.  Thus, if a candidate is able to show that attendance at a banquet, golf tournament, or testimonial is directly related to the candidate’s campaign, then pursuant to the statute, that candidate is allowed to use campaign funds to attend the event.  Also, he stated that with some conditions, HRS §11-381(a)(3) permits candidates to use campaign funds to make charitable donations; therefore, a candidate’s use of campaign funds to attend a banquet or a golf tournament could very well be a charitable donation.  In such a case, a blanket prohibition on the use of campaign funds that is otherwise authorized by statute would not be appropriate.

Vice Chair Goodenow moved to rescind Advisory Opinion No. 01-09.  Motion seconded by Commissioner Markley.  Motion carried (3-2) (Commissioners Shoda and Lum oppose).

Commissioner Lum stated that he preferred the bright-line test over the need to determine the purpose of the spending of campaign funds for these events on a case-by-case basis.  Vice Chair Goodenow commented that they should have some degree of flexibility in the use of campaign funds when they are invited as candidates.  Discussion ensued about the pressures of appearing at such events when candidates are invited and for the Commission to treat these incidents on a case-by-case basis.

*Selection of Campaign Spending Commission Leadership
Chair Luke asked for a motion to go into Executive Session pursuant to HRS §92-5(a)(4) to consult with the Commission’s attorney on questions and issues pertaining to the Commission’s powers, duties, privileges, immunities, and liabilities concerning Commission leadership.

Commissioner Markley moved to go into Executive Session for the aforementioned reason.  Motion seconded by Vice Chair Goodenow.  Motion carried (5-0).

*There were no members of the public present who were excused.

*Public Session reconvened at 10:37 a.m.

Vice Chair Goodenow moved to have Chair Luke continue as chair and Commissioner Shoda as Vice Chair, but if in the event Chair Luke is not reappointed for another 4-year term by the Governor, Commissioner Shoda to become chair.  Motion seconded by Commissioner Lum.  Motion carried (5-0).

Old Business
*Consideration, Discussion, and/or Update of Commission Legislation and Other Campaign Finance Related Bills/Resolutions for the 2019 Legislative Session
General Counsel Kam and Executive Director Izumi-Nitao informed the Commission of the status of the Commission’s bills, other campaign finance related bills, and budget bills for the 2019 legislative session.

Report from the Executive Director
Report on Compliance of Filing Timely Disclosure Reports
Executive Director Izumi-Nitao reported the following:

  • Preliminary Special Report (reporting period 1/1/19 to 3/29/19) due on 4/3/19
    • Candidate Committees
      • 2 expected to file
      • 2 filed on time (100%)
    • Noncandidate Committees
      • 245 registered committees
      • 218 expected to file (27 declared $1,000 or less)
      • 167 filed on time (77%)
      • 2 filed late (1%)
      • 49 did not file (22%) → now, 12 (6%) + total of 52 NCCs checked $1K or less box on OR

The next report due will be the Late Contributions/Expenditures Report (reporting period 3/30/19 to 4/9/19) due 4/10/19 for applicable committees.  Also, the Final Election Period Report (reporting period 3/30/19 to 4/13/19 or 1/1/19 to 4/13/19 if $1,000 or less) due on 5/13/19 for the unsuccessful candidate in the 2019 Special Election for Honolulu City Council, District 4 (Trevor Ozawa or Tommy Waters) and all noncandidate committees.  The successful candidate in the 2019 Special Election will be required to file the Final Election Period Report 3 days prior to being sworn-in to office.

As for prior reports:

  • Supplemental Report → 6 candidate committees have not filed (5 have Attorney General referrals) & 5 noncandidate committees have not filed (4 have Attorney General referrals)
  • Final Election Period Report → 1 candidate committee has not filed (referred to the Attorney General’s Office) & 5 noncandidate committees have not filed (4 have Attorney General referrals)
  • 2nd Preliminary General Report → 5 noncandidate committees have not filed (4 have Attorney General referrals)
  • 1st Preliminary General Report → 4 noncandidate committees have not filed (4 have Attorney General referrals)
  • Final Primary Report → 4 noncandidate committees have not filed (4 have Attorney General referrals)
  • Supplemental Report → 3 candidate committees have not filed (3 have Attorney General referrals)
  • Preliminary Primary Report → 4 noncandidate committees have not filed (4 have Attorney General referrals)

With respect to compliance on prior matters before the Commission, General Counsel Kam reported the following:

  • Kaniela Ing – Respondent has been making fine payments and amended reports are pending review
  • Trinette Furtado – Commission staff is trying to clarify the issues with Respondents in preparation for the contested case hearing

Update on the Elections Assistant Position
Executive Director Izumi-Nitao reported that Ellisa Vendiola was hired and that her start date will be 5/1/19.

EXECUTIVE SESSION
Chair Luke asked for a motion to convene in Executive Session to: (1) Consider and approve Executive Session minutes from the Commission meeting on 3/13/19; and (2) Review and consider Commission staff performance and compensation pursuant to HRS §92-5(a)(2).

Vice Chair Goodenow moved to convene in Executive Session for the aforementioned reason(s).  Motion seconded by Commissioner Lum.  Motion carried (5-0).

*Public Session reconvened at 11:40 a.m.

Vice Chair Goodenow moved to adjourn the meeting.  Motion seconded by Commissioner Markley.  Motion carried (5-0).

Meeting adjourned at 11:41 a.m.

Next Meeting:
Scheduled for Wednesday, May 15, 2019 at 10 a.m.