Campaign Spending Commission

Campaign Spending Commission
Leiopapa A Kamehameha Building, Room 204
In-Person Meeting & Zoom Video Conference
July 15, 2020
10:00 a.m.

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

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

Guests
Sandy Ma (Common Cause) via Zoom

Call to Order
Chair Luke called the meeting to order at 10:02 a.m.

Chair Luke went over the rules for this in-person and video conference meeting.

Consideration and Approval of Minutes of Meeting on 6/10/20
Chair Luke asked for comments or changes to the minutes.  There were none.  Chair Luke called for a motion to approve the minutes.

Commissioner Markley moved to approve the minutes of the 6/10/20 meeting.  Motion seconded by Commissioner Herbert.  Motion carried (4-0).

New Business
*Docket No. 20-11 – In Re the Matter of Richard E. Wilson, James J. Wade, John F. Perkin, Sandra P. Haskell, and Thurston H.B. Wong
General Counsel Kam stated that the attorneys for four of the five Respondents have recently asked that this matter be continued until the August meeting.  Their email requests have been provided to the Commissioners.  Three of the attorneys were apparently retained or made appearances within the past week.  He stated that staff did not object to Respondents’ request for a continuance to the August meeting.

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

Commissioner Herbert moved to continue the matter to the next Commission meeting.  Motion seconded by Vice Chair Lum.  Motion carried (4-0).

Old Business
*Draft Advisory Opinion No. 20-01 – Covington and Burling, LLP
General Counsel Kam stated that in summary, Hawaii’s ban on political contributions from government contractors under HRS section 11-355 do not apply to the pharmaceutical discount agreements set forth in this request for an Advisory Opinion.

General Counsel Kam stated that Commission staff recommends approval and adoption of draft Advisory Opinion No. 20-01.

Commissioner Herbert asked if the requestor wanted to make campaign donations.  General Counsel Kam responded that it was unknown.

Vice Chair Lum moved to approve and adopt draft Advisory Opinion No. 20-01.  Motion seconded by Commissioner Markley.  Motion carried (4-0).

*Consideration, Discussion, and/or Update of Commission Legislation and Other Campaign Finance Related Bills/Resolutions for the 2020 Legislative Session
General Counsel Kam reported the following:

• HB 1706, HD1, SD1 – This is a Commission bill that originally proposed amending HRS section 11-364 to provide for the escheat of excess nonresident contributions to the Hawaii Election Campaign Fund (“HECF”) if not returned to contributor within 30 days. On 6/23/20, Senate JDC amended the bill to require the Commission to notify candidate committees of excess nonresident contributions after the filing of Final Election Period Report.  Candidate committees would have 30 days after receipt of notice to return contributions.  If not returned, then the excess would escheat to the HECF. On 7/6/20, the House disagreed with SD1.  Thus, the bill is dead as the legislature adjourned on 7/10/20.
• HB 2738, HD1, SD2 – This bill prohibits foreign nationals and foreign corporations from making independent expenditures and requires a statement of certification from corporations that makes contributions or expenditures and Super PACs regarding foreign influence or receipt of foreign funds. On 7/8/20, the House disagreed with SD2.  Thus, the bill is dead as the legislature adjourned on 7/10/20.
• SB 840/SB 2794, SD1, HD1 – This bill allows the Commission to refer a complaint to the attorney general or county prosecutor in addition to any administrative determination and without the requirement that the Commission believes the respondent has recklessly, knowingly, or intentionally committed a violation. Further, it disqualifies a person convicted of violating campaign finance laws from holding elective public office for 10 years, rather than 4 years. Lastly, it repeals language stipulating that elections criminal prosecution law does not apply to any person who has paid or agreed to pay fines related to report filing violations and advertisement violations prior to the commencement of the proceedings.  At the time the legislature recessed on 3/16/20, the House JUD had not decided on the bill.

On 6/25/20, in Stand. Com. Rep. No. 1222-20, after a hearing, the House JUD inserted the contents of SB 840 into SB 2794, a comprehensive measure amending various sections of the Elections Law in response to statewide voting by mail beginning with the 2020 primary election.  On 7/6/20, SB 2794 was recommitted to House FIN.  Thus, the bill is dead as the legislature  adjourned on 7/10/20.

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

Report from the Executive Director
*Report on Compliance of Filing Timely Disclosure Reports
Executive Director Izumi-Nitao reported that the deadline for candidate committees to declare their $1,000 or less status was on 6/30/20 and that 33 candidate committees declared this status.

She also stated that the 1B Preliminary Primary Report was due on 7/9/20 and reported the following:

• 267 candidate committees were expected to file
• 243 (91%) filed on time
• 23 (9%) failed to file on time
• 1 filed late
• As of today, 11 candidate committees still have not filed
• 33 ($1,000 or less candidate committees) and 8 (candidate committees who will only appear on the general election ballot) were not required to file this report.

Executive Director Izumi-Nitao stated that the Commission may potentially see conciliation agreements and/or complaints with respect to these committees that failed to file or filed late at the next Commission meeting scheduled for 8/12/20.  Chair Luke shared his concerns about not addressing these potential conciliation agreements and complaints before the primary election.  Associate Director Baldomero stated that the Commission may want to consider moving the meeting date up a week prior to address the reports and other issues before the primary election.  However, more discussions may be necessary to ensure that staff is prepared to do so.  Executive Director Izumi-Nitao agreed but stated that it is difficult to predict the level of compliance at this time.  She added that we must permit parties notice if a complaint is being heard and will also need to consider compliance with the Sunshine law which requires the agenda to be filed 6 days before the meeting date.  She further added that it is one thing to get matters on the agenda, but another if it ends up having to continue because the parties are not ready due to such short notice.  Therefore, she suggested to keep the 8/12/20 date for now, and staff will keep in touch with the Commissioners about moving the meeting date should business start to rise.

*Update on the 2020 Election
Associate Director Baldomero reported the following:

• 308 candidates are running (300 candidates will be on the primary ballot and 8 candidates will move directly to the general ballot)
• 128 elective seats
• 103 seats up for election
• 19 seats unopposed
• 22 open seats
• 10 incumbents who are term-limited
• 5 incumbents seeking a different office
• 7 incumbents decided not to run
• 152 candidates filed the Affidavit to Voluntarily Agree with the Expenditure Limit
• 29 candidates filed the Statement of Intent to Seek Public Funds
• 2 public fund applications have been approved so far totaling $21,355
• 3 public fund applications are pending approval for $10,975.80

(After this second batch is processed, the public funding disbursements will total $32,330.80 for the 2020 election compared to $60,976.37 in the 2018 primary election)

• 97 fundraisers have been held so far in 2020
• 250 registered noncandidate committees (20 Super PACs)
• 226 Statements of Information for Electioneering Communications have been filed
• 6 noncandidate committees have been filing Statements of Information for Electioneering Communications

Ms. Sandy Ma of Common Cause asked if there is a report on how many candidates have used public funding for the primary election.  Associate Director Baldomero responded that such information is posted on the Commission’s website.

*Update on the Status of the Appointment of a New Commissioner
Executive Director Izumi-Nitao reported that former Vice Chair Gregory Shoda’s term ended on 6/30/20.  She has been in communication with Boards & Commissions and have been informed that they are still working on his replacement.  Once the new commissioner is appointed, he/she will be given an orientation.  Chair Luke shared his concerns about commissioners not being appointed on a timely basis and inquired if it would be effective to submit a letter.  Executive Director Izumi-Nitao responded that she has been in touch with Sharon Ibarra, who is in charge of Boards & Commissions and informed her that she had been asked to provide updates at the monthly Commission meetings and underscored the importance of having a full Commission because it is an election year.  The last she heard from Ms. Ibarra was that they are working on it.  Executive Director Izumi-Nitao asked to let her know if the Commission would like further efforts should be sought.

*Update on Commission Operations
Executive Director Izumi-Nitao reported that staff renegotiated the FY2021 contract with Socrata and obligated some remaining funds from FY2020 for this contract because FY2021 budget will be very conservative and will be restricted quarterly.  With this renegotiated contract with Socrata, the public and the committees will continue to have access to the candidate and noncandidate committee dashboards and datasets.  She also reported that staff went into a MOA with Department of Health to use their secured Zoom government license to allow Commission meetings via Zoom.  Some remaining FY2020 funds were obligated to pay for the Zoom license.

With regard to the Commission office, the office remains physically closed unless someone has an appointment or calls and asks to receive assistance at the office.  Staff members have been going into the office 1-3 times a week and teleworking.  The Commission office has signage, acrylic sneeze guards, masks, disposable wipes, and hand sanitizers.  The Commission’s website has been updated with new features including a link for first time candidates, FAQs, and a payment link.  Since the in-person trainings for neighbor islands had to be cancelled, staff is working on posting updated training videos on the Commission’s website.

Vice Chair Lum commended Commission staff for their work.  With respect to the data garnered by the media, he asked if they use the data in the dashboard or call for the information.  Executive Director Izumi-Nitao responded that the media is aware of the datasets but may call Associate Director Baldomero to verify their research before they publish.

*Report on the July CSC Newsletter
Executive Director Izumi-Nitao reported that the July CSC Newsletter was published on 7/6/20 and was sent to 1,072 emails—502 candidate committees, 245 noncandidate committees ,and 325 members of the public.  She went over the contents of the newsletter.

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 6/10/20; (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; and (3) 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 Docket No. 20-12 – In Re the Matter of Eric Ryan v. John Carroll for Governor.

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

Chair Luke explained how the Executive Session will occur.

10:57 a.m. Recess

Public Session reconvened at 11:38 a.m.

*Pursuant to Hawaii Revised Statutes section 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 regarding Docket No. 20-12 – In re the Matter of Eric Ryan v. John Carroll for Governor
Chair Luke stated that Deputy Attorney General Park recommended to vote on the matter in public session and asked for a motion.

Vice Chair Lum moved to waive the attorney-client privilege and allow staff to communicate with the attorney general’s office as necessary.  Motion seconded by Commissioner Markley.  Motion carried (4-0).

Commissioner Markley moved to adjourn the meeting.  Motion seconded by Commissioner Herbert.  Motion carried (4-0).  Meeting adjourned at 11:40 a.m.

Next Meeting:
Scheduled for Wednesday, August 12, 2020, at 10 a.m.