Campaign Spending Commission

Campaign Spending Commission
Zoom Video Conference
July 13, 2022
10:00 a.m.

Commissioners Present
Stanley Lum, Maryellen Markley, Ph.D., Bryan Luke, Neal Herbert, Vic Bonfiglio

Staff Present
Kristin Izumi-Nitao, Tony Baldomero, Gary Kam, Yayoi Tumamao, Janelle Tanna
Deputy Attorney General Candace Park

Guests
Jaerick Medeiros-Garcia, Malia Gusman, Dianne Hensley, Robert Armstrong, Nancy Cook Lauer (West Hawaii Today), Sandy Ma (Common Cause), Deputy Attorney General Dave Allin, Esq. (Civil Recoveries Division, Attorney General’s Office)

Call to Order
Chair Lum called the meeting to order at 10:05 a.m.

Chair Lum went over the procedures for this meeting via Zoom and introduced Commission staff and the Commissioners who were present.  He also asked the Commissioners if anyone else was with them.  All the Commissioners present stated that no one else was with them.

Consideration and Approval of Minutes of Meeting on 5/11/22
Chair Lum called for approval of the 5/11/22 meeting minutes.  He asked if there were any objections or reservations to approving the minutes.  There were none.

Commissioner Herbert moved to approve the minutes on 5/11/22.  Motion seconded by Commissioner Luke.  Motion carried (5-0).

Chair Lum asked for a motion to take “Consideration, Discussion, and Decision of a Settlement Offer in 1CSP-22-0000097 State of Hawaii, Campaign Spending Commission, by and through its Attorney General vs. Jaerick Medeiros-Garcia” out of order of business on the agenda.

Commissioner Luke moved to take “Consideration, Discussion, and Decision of a Settlement Offer in 1CSP-22-0000097 State of Hawaii, Campaign Spending Commission, by and through its Attorney General vs. Jaerick Medeiros-Garcia” out of order.  Motion seconded by Commissioner Herbert.  Motion carried (5-0).

Old Business
*Consideration, Discussion, and Decision of a Settlement Offer in 1CSP-22-0000097 State of Hawaii, Campaign Spending Commission, by and through its Attorney General vs. Jaerick Medeiros-Garcia – Executive Director Izumi-Nitao stated that Mr. Jaerick Medeiros-Garcia was a candidate in the 2020 election for Hawaii County Council.  This matter was before the Commission at the 10/14/20 meeting in Docket No. 21-18 for the late filing of the 2^nd Preliminary Primary Report in which the Commission originally granted a conciliation agreement for a reduced fine of $100 (in Conciliation Agreement No. 21-18 which was heard and granted at the 9/9/20 Commission meeting), but because he failed to comply with the terms of the conciliation agreement, a complaint was filed which reinstated the fine to its original amount of $300.  She stated that the other count in the aforementioned docket was the failure to file the Final Primary Report and a fine of $500 was ordered.  At the Commission meeting on 10/14/20, the Commission issued a preliminary determination of probable cause ordering that Mr. Medeiros-Garcia pay a $300 fine for the late filing of the 2^nd Preliminary Primary Report, pay a $500 fine for the failure to file the Final Primary Report, and ordered him to file the Final Primary Report.  She stated that Mr. Medeiros-Garcia failed to comply with the Commission’s order, and thus, a Deputy Attorney General from the Civil Recoveries Division filed the Petition for an Order Enforcing the Campaign Spending Commission’s Preliminary Determination of Probable Cause.

The petition was heard before Judge John Tonaki on 7/7/22 and the matter was continued to 9/8/22 to permit the parties to discuss resolving the matter.

Executive Director Izumi-Nitao presented the settlement offer as agreed upon between Associate Director Baldomero and Mr. Medeiros-Garcia:  (1) File all outstanding disclosure reports; (2) File an amended organizational report with a current address and residence phone number; (3) Agree to a reduced fine of $100 for the late filing of the 2^nd Preliminary Primary Report; (4) Pay the $500 fine for the failure to file the Final Primary Report; and (5) Permit a payment plan for him to pay the $600 aggregate fine.  He will also seek termination of his candidate committee but understands that this cannot happen until he pays his fines.  She added that Mr. Medeiros-Garcia has already filed all outstanding disclosure reports and filed an amended organizational report with a current address and residence phone number.

Mr. Medeiros-Garcia was present and addressed the Commission.  He said he has never attended a Commission meeting before today.  He explained that since 7/17/20, he has been dealing with family issues involving his in-law’s property where he used to reside.  This situation has led to him being denied access to his mail that was delivered to that address and as a result, he did not know about this matter until he was served at his current residence.  He added that the records show certified mail addressed to him being accepted at the old address, but it was not him that signed off on it and that it must have been the person who held his mail.  He further added that it is important that this matter get settled somehow.

Mr. Medeiros-Garcia stated that he agrees to paying the reduced assessment of $100 for the late filing of the 2^nd Preliminary Primary Report, but asked that the $500 fine assessment for failing to file the Final Primary Report be lowered.  He also stated that he will pay the fines with a payment plan.

Commissioner Luke stated that this matter was put on the agenda to approve a settlement agreement.  He explained that if Mr. Medeiros-Garcia is not in agreement with the settlement offer, there is no settlement agreement to vote on.  General Counsel Kam further explained that this case is currently with the circuit court which continued the matter for the parties to pursue a settlement agreement and if Mr. Medeiros-Garcia does not agree with what was discussed with Associate Director Baldomero then there is no settlement agreement, and the case will go back to the circuit court for a final decision.  Executive Director Izumi-Nitao added that once the case goes back to the circuit court, Mr. Medeiros-Garcia could present his argument and have the Judge make the decision on the outcome of the case.

Deputy Attorney General Dave Allin from the Civil Recoveries Division was present.  He was asked by the Commissioners to explain what could happen at the circuit court level.  Deputy Attorney General Allin explained that the Judge may recognize that there was notice to Mr. Medeiros-Garcia and decide that the Commission’s order is final and confirm the full $800 fine amount.  On the other hand, to the extent that the Judge is convinced that he did not get sufficient notice for due process or did not receive it such that the order is not final, then the Judge may remand the matter back to the Commission for an administrative hearing. Deputy Attorney General Allin added that as a disclaimer, he represents the State in this matter, and therefore cannot offer Mr. Medeiros-Garcia any legal advice.  This is just his observation of where this case can go.

Executive Director Izumi-Nitao pointed out that as a candidate, it is important to have proper contact information on the committee’s organizational report so that Mr. Medeiros-Garcia could have been notified on these matters.  The Commission was unaware of his circumstances because there were no changes to his organizational report.  As for the settlement agreement, she stated that it was placed on the agenda because Commission staff was under the impression that he was in agreement with the settlement offer.  However, if that is not the case, then it is up to Mr. Medeiros-Garcia where he wants to go with this.  She further stated that Mr. Medeiros-Garcia’s argument concerning notice for due process is a matter for the circuit court, and if believed and the matter is remanded back to the Commission which is the best case scenario for Mr. Medeiros-Garcia per Deputy Attorney General Allin, notice no longer becomes the issue and the Commission will be dealing with the late filing of the 2^nd Preliminary Primary Report and the unfiled Final Primary Report whereupon staff will recommend a $300 fine for the late filed 2^nd Preliminary Primary Report and a $500 fine for the unfiled Final Primary Report.

Mr. Medeiros-Garcia stated that he believes in due process and because he did not get his mail, he did not have the opportunity to respond to these matters in front of the Commission.  He reiterated his request to reduce the $500 fine and added that he would like to run for office again in the future.

Chair Lum stated that he understands life continues regardless of what goes on with these matters, and therefore, while he will not make the decision for him, he believes the best course of action for Mr. Medeiros-Garcia may be to go on the payment plan that was discussed between him and Associate Director Baldomero.

Mr. Medeiros-Garcia stated that he will take the offer if he is being forced to pay.  General Counsel Kam clarified that Mr. Medeiros-Garcia is not being forced to do anything.  He reiterated that if Mr. Medeiros-Garcia does not agree with the settlement offer, the matter will go back to the circuit court for due process in the judicial system.

Mr. Medeiros-Garcia said if that is his only option then he would like to move forward with the payment.

General Counsel Kam stated that the Commission has the final authority over any settlement for a Commission case.  If the Commissioners want to reduce the $500 fine amount, they could do so since they have the ultimate authority.  However, he cautioned that the $500 fine was assessed for a failure to file a report from the 2020 election and it was not filed until just recently.  There should be a more serious consequence for an unfiled report than a late report.

Commissioner Herbert commented that it is unfortunate that Mr. Medeiros-Garcia was not aware of these matters, but it was his responsibility to follow the law as the Commission has said to others in the same circumstances.

Commissioner Luke stated that in consideration of the case potentially coming back to the Commission after it gets sent back to circuit court, he asked if he could make a motion to reduce the $500 fine to $200.  Discussion ensued.  Vice Chair Markley agreed with Commissioner Luke and stated that this is an unusual situation, and they should put it behind them and move on.  General Counsel Kam stressed that the Commission has treated not filing a report as a serious violation, and therefore, the standard fine assessment for this violation is $500.  However, if the Commissioners are amenable to reducing the fine, that is completely within their authority to come up with an amount that all parties can agree to.  Commissioner Herbert cautioned that while he is not in disagreement with Commissioner Luke, the Commission should be careful not to set a precedent.  He explained that Mr. Medeiros-Garcia agreed to pay the fine before Commissioner Luke made the offer.

Mr. Medeiros-Garcia said he did not negotiate the $500 fine with Associate Director Baldomero.  Chair Lum asked if he discussed a payment plan to pay the $600 aggregate fine.  Mr. Medeiros-Garcia answered that they talked about the payment plan, but he thought they were just talking about the $300 fine.

Associate Director Baldomero stated that he made it very clear to Mr. Medeiros-Garcia that there are two fines on the table: 1) $300 fine down to $100 for the late filing of the 2^nd Preliminary Primary Report; and 2) $500 fine for the unfiled Final Primary Report.  The Final Primary Report was due on 8/28/20 and Mr. Medeiros-Garcia did not file this report until 7/7/22.  Associate Director Baldomero remarked that during the 2020 primary election, none of Mr. Medeiros-Garcia’s opponents and the public knew how much activity he had in the fifteen-day period prior to the Final Primary Report because he only recently filed that report.  Associate Director Baldomero further stated that they discussed a payment schedule and talked about Mr. Medeiros-Garcia being able to afford $25 to $50 a month.  Commissioner Herbert asked if they discussed reducing the $500 fine.  Associate Director Baldomero responded that they did not because the $500 fine was assessed for an unfiled report.

Chair Lum asked for a motion to accept the terms of the agreement between Associate Director Baldomero and Mr. Medeiros-Garcia.

Commissioner Bonfiglio moved to accept the terms of the settlement offer in 1CSP-22-0000097 State of Hawaii, Campaign Spending Commission, by and through its Attorney General vs. Jaerick Medeiros-Garcia.  Motion seconded by Commissioner Herbert.  Motion carried (5-0).

Chair Lum asked for a motion to take “Docket No. 23-02 – In Re the Matter of Dianne Hensley and Friends of Republican” out of order of business on the agenda.

Commissioner Bonfiglio moved to take Docket No. 23-02 out of order.  Motion seconded by Commissioner Luke.  Motion carried (5-0).

New Business
*Docket No. 23-02 – In Re the Matter of Dianne Hensley and Friends of Republican – Executive Director Izumi-Nitao reported that a complaint by the Executive Director had been filed against candidate and treasurer Dianne Hensley and her candidate committee called Friends of Republican for the failure to timely register with the Commission by filing an electronic filing form and the organizational report.

HRS §11-321(a) provides that candidate committees shall register with the Commission by filing an organizational report.  Respondents were required to file their organizational report with the Commission by 6/12/22 which is 10 days from the date the candidate filed nomination papers for office on 6/2/22.

HRS §11-321(b) and (c) provides that before filing the organizational report, candidate committees shall mail or deliver an electronic filing form to the Commission which shall include a written acceptance of appointment by the chairperson and treasurer, and a certification by the candidate and the treasurer of each filed report.  Respondents failed to complete and submit the electronic filing form.

On 6/8/22, Commission staff helped Respondent Hensley locate the electronic filing form on the Commission’s website and informed Respondent Hensley that she may electronically file the electronic filing form via eSign.  On 6/9/22, Respondent Hensley electronically filed the candidate electronic filing form via eSign to sign as the candidate and listed Michael Robert Hensley as the chairperson and Patricia Hensley as the treasurer.  Because the electronic filing form requires multiple signatures in order for it to be complete, when the form is submitted via eSign, it must be eSigned separately by each person that is required to sign the form.  Since Michael Robert Hensley and Patricia Hensley did not submit their electronic fling forms to sign and accept the appointment as Respondent Hensley’s chairperson and treasurer, Respondent Hensley’s electronic filing form was incomplete and could not be processed.

On 6/13/22, Commission staff sent Respondents a letter via first class mail informing them that their organizational report was due on 6/12/22, that their failure to register by filing an organizational report violates campaign finance laws, and of the imposition of an administrative fine if it was not filed.

On 6/16/22, Respondent Hensley called Commission staff and mentioned that she was going to the mainland for a funeral.  Respondent Hensley asked if Commission staff could reach out to Michael Robert Hensley to help complete their registration.  Commission staff told Respondent Hensley to have Michael Robert Hensley call the Commission for assistance to which Respondent Hensley agreed to do.  Michael Robert Hensley did not call the Commission’s office.

On 6/22/22, Commission staff sent Respondents a letter via first class mail notifying them that a fine of $150 would be assessed against them for their failure to timely file the electronic fling form and the organizational report.  The letter informed them that they could avoid the complaint process for their failure to timely file the electronic filing form and the organizational report by waiving their rights to written notice and an opportunity to be heard at a HRS chapter 92 public meeting and a HRS chapter 91 contested case hearing by voluntarily paying the fine amount, submitting their electronic filing form, and filing their organizational report by 7/6/22.

On 6/30/22, Respondent Hensley called the Commission staff for assistance and was given instructions over the phone.  On 7/1/22, Commission staff emailed Respondent Hensley detailed instructions on how to submit the electronic filing forms, organizational report, and mentioned the $150 fine payment.

On 7/1/22, Respondent Hensley submitted the electronic filing form via eSign to electronically sign as the candidate, chairperson, and treasurer, and filed the organizational report.

On 7/5/22, Respondent Hensley called and informed the Commission staff that she will fight the $150 fine.  Commission staff explained to Respondent Hensley that a complaint would be filed to be heard at the 7/13/22 Commission meeting.

On 7/7/22, Commission staff sent Respondents a copy of the complaint and set the matter on the 7/13/22 Commission agenda.

On 7/11/22 at 4:37 p.m., Respondent Hensley sent an email regarding this matter.  Pursuant to H.B. 2026, H.D. 2, S.D. 1 which was recently signed into law by Governor Ige as Act 264, this response was not submitted within 48 hours before the meeting time, and thus, did not make the board packet which had been distributed to the Commissioners and made available for public inspection.  As such, Commission staff consulted with the Office of Information Practices and was informed that staff could only produce this response to the Commissioners at the commencement of today’s meeting.

Executive Director Izumi-Nitao commented that for future consideration, if Respondents or interested parties submit documents or written testimony for the Commissioners to consider on matters noticed on the agenda which did not make the board packet, they may want to consider placing them at the end of the meeting and after a recess to permit them time to review their submissions.

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 $50 for failing to timely file the electronic filing form and $100 for failing to timely file the organizational report, and order that any and all administrative penalties be deposited into the general fund pursuant to HRS §11-410(e) within two (2) weeks of receipt of the order.

Respondent Hensley was present and asked if the Commissioners read her email and viewed the video attachment.  Chair Lum responded that he read her email but had not viewed the video.  He asked Respondent Hensley to explain what the video was about.  She explained that the video was about how psychiatric drugs are harmful to children and that this is the reason why she feels compelled to run for office.  Chair Lum thanked Respondent Hensley for sharing what the video was about but informed her that it does not have anything to do with the case.  Respondent Hensley agreed.

With regards to not filing the electronic filing form and the organizational report, Respondent Hensley stated that she had trouble electronically signing the form because she did not have experience with it.  She also had to fly out to the mainland due to her mother’s sudden passing and as a result, she was away for 10 days.  She further stated that she had listed her ex-husband and daughter’s names on her initial electronic filing form, but she did not have their permission to do so.  She did this because she assumed they would step up.  Respondent Hensley stated that she is doing everything on her own and said it is appalling that a novice such as herself is being fined.

Chair Lum recognized Respondent Hensley’s circumstances and about her mother’s passing.  He also recognized that she does not seem to disagree with the violations.  He stated that there is a higher expectation for political leaders to follow the law and that is the same expectation that applies to Respondent Hensley as a candidate.

Commissioner Herbert asked if conciliation agreement is possible for the fines.  Associate Director Baldomero responded that they are not eligible for the conciliation agreement process.  General Counsel Kam added that the fine guidelines would have to be amended to allow conciliation agreements for these fines.

Respondent Hensley stated that she was grateful to have the opportunity to share her insight and views.  She also stated that she will pay the fine.

Commissioner Bonfiglio 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 Luke.  Motion carried (5-0).

*Back to the order of 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 have been violations of the Hawaii campaign spending laws.  She stated that the 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 agreements.  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 amount stated in each of the proposed agreements.

*Proposed Conciliation Agreement No. 22-20 – In Re the Matter of Voting for Maurice – Executive Director Izumi-Nitao explained that this proposed conciliation agreement concerns the late filing of the 1A Preliminary Primary Report and requested that they assess a reduced fine from $50 to $16.67 as it is Respondent’s first violation. Chair Lum asked if there were any comments or questions.

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

*Proposed Conciliation Agreement No. 22-21 – In Re the Matter of Friends of Clyde McClain Lewman aka Mac Lewman – Executive Director Izumi-Nitao explained that this proposed conciliation agreement concerns the late filing of the 1A Preliminary Primary Report and requests that they assess a reduced fine from $100 to $33.33 as it is Respondent’s first violation. Chair Lum asked if there were any comments or questions.

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

*Docket No. 23-01 – In Re the Matter of Henry Cho III – Executive Director Izumi-Nitao reported that a complaint by the Executive Director had been filed against candidate Henry Cho III for the failure to register with the Commission by filing an electronic filing form and the organizational report.

HRS §11-321(a) provides that candidate committees shall register with the Commission by filing an organizational report.  Respondent Cho was required to file the organizational report with the Commission by 6/13/22 which is 10 days from the date he filed nomination papers for office on 6/3/22.

HRS §11-321(b) and (c) provides that before filing the organizational report, candidate committees shall mail or deliver an electronic filing form to the Commission which shall include a written acceptance of appointment by the chairperson and treasurer, and a certification by the candidate and the treasurer of each filed report.  Respondent Cho failed to complete and submit the electronic filing form.

On 6/8/22, Commission staff left a voicemail for Respondent Cho to register with the Commission.

On 6/13/22, Commission staff sent Respondent Cho a letter via first class mail informing them that his Organizational Report was due on 6/13/22, that his failure to register by filing an organizational report violates campaign finance laws, and of the imposition of an administrative fine.

On 6/15/22, which was already past the deadline to file the organizational report, Respondent Cho attempted to electronically file the candidate electronic filing form via eSign to sign as the candidate and listed himself as chairperson and treasurer.  Because the electronic filing form requires multiple signatures in order for it to be complete, when the form is submitted via eSign, it must be eSigned separately by each person that is required to sign the form.  Respondent Cho’s electronic filing form was therefore incomplete and could not be processed so Commission staff sent Respondent Cho an email with the link to the “One Person (Candidate, Chairperson, Treasurer) Electronic Filing Form” which would have allowed him to effectively sign as candidate, chairperson, and treasurer.

On 6/22/22, Commission staff sent Respondent Cho a letter via first class mail notifying him that a fine of $150 would be assessed against him for his failure to file the electronic filing form and the organizational report.  The letter informed Respondent Cho that he could avoid the complaint process for his failure to file the electronic filing form and the organizational report by waiving his rights to written notice and an opportunity to be heard at a HRS chapter 92 public meeting and a HRS chapter 91 contested case hearing, and voluntarily paying the fine amount, submitting his electronic filing form, and filing his organizational report by 7/6/22.

Respondent Cho did not file his electronic filing form and organizational report or pay his fine.

On 7/1/22, Commission staff phoned Respondent Cho and left a voicemail informing him that if he did not file the electronic filing form and organizational report as well as pay his fine by 7/6/22, a complaint would be filed.

On 7/7/22, Commission staff sent Respondent Cho a copy of the Complaint and set the matter on the 7/13/22 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 a violation of the campaign spending law has been committed, assess an administrative fine of $50 for failing to file the electronic filing form and $100 for failing to file the organizational report, order that any and all administrative penalties be deposited into the general fund pursuant to HRS §11-410(e) within two (2) weeks of receipt of the order, and order that Respondent Cho file all reports within two (2) weeks of receipt of the order.

Vice Chair Markley 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 Luke.  Motion carried (5-0).

Old Business
*Consideration, Discussion, and/or Update of Commission Legislation and Other Campaign Finance Related Bills/Resolutions for the 2022 Legislative Session – General Counsel Kam provided an update of the status of the Commission’s 5 bills as well as discussed other campaign finance bills introduced this session.  Two (2) of the Commission’s bills were passed:  Act 3 (H.B. 1427, HD 1) and Act 171 (S.B. 2043, HD 1).  Three (3) other campaign finance related bills not sponsored by the Commission were also signed:  Act 181 (S.B. 665, SD 1, HD 2, CD 1), Act 169 (H.B. 2416, HD 2, SD 1, CD 1), and Act 283 (S.B. 555, SD 1, HD 1).  The other three (3) Commission bills that did not pass this session were:  S.B. 2044 & H.B. 1423, S.B. 2041 & H.B. 1426, and S.B. 2042 & H.B. 1425.  Notably, the contents of S.B. 2042 and H.B. 1425 concerning electioneering communications were folded into H.B. 2416 which was signed into law as Act 169.

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

She noted that there are a number of reports due before the Commission’s next meeting in August.  They included:

• 1B Preliminary Primary Report for the reporting period of 1/1/22 (or 4/26/22 for candidates that filed 1A Preliminary Primary Report) to 6/30/22 is due on 7/14/22.
  • 316 out of 368 candidate committees are expected to file this report.
  • 13 candidates who will only appear on the General Election ballot are not required to file this report.
  • 39 candidate committees are $1,000 or less for this election and therefore, is not required to file this report.
• Deadline for noncandidate committees to declare their $1,000 or less status is on 7/29/22.
• Supplemental Report for the reporting period of 1/1/22 to 6/30/22 is due on 8/1/22.
  • 210 candidates not running in the 2022 election are expected to file this report.
• 2^nd Preliminary Primary Report for the reporting period of 7/1/22 to 7/29/22 is due on 8/3/22.
  • 316 candidate committees are expected file this report.
• Preliminary Primary Report for the reporting period of 2/27/22 to 7/29/22 is due 8/3/22.
  • All noncandidate committees are required to file this report.

With regard to prior reports, Executive Director Izumi-Nitao reported that the number of committees that have not filed their reports remains the same.  She added that Commission staff continue to work with AG-CRD to obtain full compliance.

*Report on Commission to Improve Standards of Conduct (CISC) – Executive Director Izumi-Nitao reported that the CISC meeting on Campaign Finance Reform was held on 6/29/22.  She went over the proposed bills that were presented at the CISC meeting:

1. Increase partial public funding to adjust for cost-of-living.
2. Limit cash contributions to $100.
3. Prohibit use of campaign funds to purchase 2 tickets to another candidate’s fundraiser.
4. Expand government contractor ban to include the owners/officers of the government contractors and to help abate bundling issues.
5. Prohibit contributions by Chapter 42 legislative and county council Grants in Aid recipients as they are not part of the government contractor ban.

Vice Chair Markley shared her concerns about adding additional challenges for nonprofits applying for grants.  She explained that vast majority of these aid recipients provide services to Hawaii’s citizens in need and they are very careful about conflicts of interest.  Executive Director Izumi-Nitao clarified that the proposal is to prohibit recipients of these aids from making contributions during the election period in which the grants are being received, similar to the government contractor ban analysis.

Commissioner Luke expressed his concerns about people resigning from nonprofits because they want to contribute to candidates.  General Counsel Kam stated that it would not be right if recipients are making contributions on the premise that doing so would mean that their nonprofit would be awarded grants.

Mr. Robert Armstrong commented that there could be a chilling effect on this proposal.  He said some of the greatest leaders come from nonprofits and if they see that they cannot solicit contributions from their board as a future candidate, that may have negative impact on those who may want to run for office.  He urged the Commission to address this proposal carefully.

Ms. Sandy Ma of Common Cause shared that she received concerns from the public, not about the grant process, but regarding those who sit on boards giving endorsements to candidates in position of authority to give grants.  She explained that they may feel that they cannot endorse other candidates who are running for the same position because they need these grants for their nonprofits.  She said this is the chilling effect for those new candidates entering into the political arena.

6. Expand Act 283/SB 555 fundraiser ban to no acceptance or solicitation of campaign contributions during legislative session.
7. Require committees to file the fundraiser notice regardless of the amount so the ticket price does not have to be more than $25.
8. Affirmatively treating a committee’s refusal to cooperate with the Campaign Spending Commission as a presumption of the existence of a violation.
9. Listing on the Campaign Spending Commission website of all committees who fail to register by filing an Organizational Report.
10. Consideration of any criminal fraud statutes to prevent or deter public corruption and support any penal code amendments so that committees are victims for purposes of theft or fraud statutes.
11. Support bills that did not pass last session:

o    SB 2044/HB 1423 – increases Super PAC fines from $1,000 to $5,000 or up to 3 times the amount of the unlawful contributions or expenditures and permits the Campaign Spending Commission to order the officers to personally pay the administrative fines.

o    SB 2041/HB 1426 – allows the Campaign Spending Commission to have an order confirmed as a civil judgment, enforceable and collectible as any other judgment in circuit court.

Ms. Ma asked if there was any consideration to reducing the contribution limits for candidates.  Executive Director Izumi-Nitao responded that in her experience, she has not seen a nexus between contribution limits and corruption which is the underlying purpose of these proposals.  General Counsel Kam cautioned that there must be evidence that lowering contribution limits would prevent corruption or appearance of corruption.  He cited to the situation in Alaska where the courts struck down their lowered limits and as a result, that state currently does not have any contribution limits.  Ms. Ma stated that she brought this up because she has been seeing reports about candidates taking bribes in the form of contributions.

Executive Director Izumi-Nitao shared the dates and the subject matter of the upcoming CISC meetings.

*Report on 2022 Election Training – Executive Director Izumi-Nitao reported on the candidate and noncandidate committee trainings:

• Candidate committee training in Hilo (In-person) was on 5/17/22 – 4 people attended.
• Candidate committee training in Kauai (In-person) was on 5/20/22 – Cancelled due to insufficient number of registrants.
• Candidate committee training in Maui (In-person) was on 5/27/22 – 5 people attended.
• Oahu training was on 6/1/22 –
  • Candidate committee training: 8 people attended in-person and 26 people attended via Zoom.
  • Noncandidate committee training: 1 person attended in-person and 36 people attended via Zoom.

Executive Director Izumi-Nitao went over the training evaluations.  She also shared that professional continuing education credits were issued to 3 certified public accountants.

Ms. Ma offered to share the Commission’s training announcement through Common Cause’s social media account in the future so they can urge candidates to attend the trainings.

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

*Update on the 2022 Election – Associate Director Baldomero reported that the Primary Election will be on 8/13/22 and the General Election will be on 11/8/22.  Primary Election ballots will be mailed starting on 7/21/22.

Associate Director Baldomero further reported that there are currently 368 candidates running for 115 seats up for election out of 128 elective seats in the State of Hawaii and its four counties.  He also stated that 11 candidates are unopposed this year and 28 seats are open meaning that there is no incumbent running in that race due to term limits, the incumbent seeking different office, the incumbent deciding not to seek reelection, or because of reapportionment.  He also stated that there are 6 qualified political parties this year.

As for public funding related filings, 172 candidates filed the Affidavit to voluntarily agree with the expenditure limit set for their office and 27 candidates filed the Statement of Intent to seek partial public funding.  So far, one candidate has received a total of $1,500 in partial public funding (Robert Armstrong).

As for fundraisers by candidates, 183 fundraisers have been held in the first half of 2022 outpacing the 84 fundraisers held during the same time in 2020 at the beginning of the pandemic.

With regards to noncandidate committees, there are 269 registered noncandidate committees of which 23 are Super PACs and there are no ballot issue committees.

*Report on 2022 CSC July Newsletter – Executive Director Izumi-Nitao reported that the newsletter was distributed via eBlast to 1,239 emails on 7/1/22 in consideration of the reporting deadline for 1B Preliminary Primary Report.  She went over the topics in the newsletter.

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

Chair Lum asked for a motion to adjourn this meeting.  Commissioner Herbert moved to adjourn.  Motion seconded by Commissioner Luke.  Motion carried (5-0).  Meeting adjourned at 12:25 p.m.

Next Meeting:
Scheduled for Wednesday, August 10, 2022, at 10 a.m.