Campaign Spending Commission

Campaign Spending Commission
Leiopapa A Kamehameha Building, Room 204
July 22, 2015
10:00 a.m.

Commissioners Present
Eldon Ching, Gregory Shoda, Adrienne Yoshihara, Bryan Luke

Staff Present
Kristin Izumi-Nitao, Tony Baldomero, Gary Kam, Ellen Kojima

Call to Order
Executive Director Izumi-Nitao called the meeting to order at 10:03 a.m.

Old Business
Continued Discussion on Succession Planning of Commissioners
Executive Director Izumi-Nitao opened the matter for discussion.

Commissioner Shoda stated that he would be willing to serve as chair until the new Commissioners are able to attend, participate in the meetings, and obtain a better feel of the conduct of the meetings.  Then, Commissioners would feel comfortable nominating the chair and vice chair.

Commissioner Ching moved to nominate Commissioner Shoda as Chair and Commissioner Yoshihara as Vice Chair until the end of 2015.  Motion seconded by Commissioner Luke.  Motion carried (4-0).

With the selection of a new chair, Chair Shoda presided over the meeting.

Consideration and Approval of Minutes of June 17, 2015 Meeting
Vice Chair Yoshihara moved to approve the minutes of June 17, 2015. Motion seconded by Commissioner Ching.  Motion carried with Commissioner Luke abstaining because he had not yet been appointed to serve on the Commission.

New Business
Docket No. 15-89 – In Re the Matter of Forward Progress and John White
Vice Chair Yoshihara recused herself because her firm, Chun Kerr LLP, represents Pacific Resource Partnership (“PRP”).

General Counsel Kam reported that an amended complaint was filed alleging two counts of coordinated activity for ads paid for by Respondent Forward Progress on behalf of candidates in the 2014 Hawaii County Council election.  He noted that in their joint response, Respondents asked for a continuance of the matter or a dismissal of the complaint.  He stated that the evidence of coordination is provided in email conversations between a representative of PRP and the candidates, and that the email conversations concern the content of the ads and what the Respondents wanted posted on the candidates’ websites or social media accounts for Respondents to use in their ads.

Respondent John White is the Executive Director of PRP and the Chair and Treasurer of Respondent Forward Progress.

General Counsel Kam stated that the purpose of the email conversations was to coordinate future ads to be paid by Respondent Forward Progress.  The candidates also confirmed that the images used in the mailers paid for by Respondent Forward Progress were images that they posted to their social media site or website at the request of the PRP representative.

Staff 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 and assess a fine of a $1,000 for each count.

In response to Commissioner Ching’s procedural question regarding the original and amended complaints, General Counsel Kam responded that the original complaint that alleged republication of a candidate’s campaign material was replaced with the amended complaint that alleges actual coordination of expenditures.  After the original complaint was filed, staff received information and evidence of actual coordination and decided to pursue the coordination violation.

General Counsel Kam further stated that Respondents’ response to the amended complaint cited a case that involved a political party and a congressional candidate who was a member of that party.  The Federal Election Commission assumed that there was coordination given the relationship.  But the Supreme Court has ruled that coordination cannot be assumed by the government, that there needs to be actual evidence of coordination.  Staff believes that evidence has been provided to show actual coordination in this case.

Commissioner Ching moved to make a preliminary determination that probable cause exists that a violation has been committed and assess a total fine of $2,000.  Motion seconded by Commissioner Luke.  Motion carried (3-0).

Old Business
Consideration and Discussion of Commission Legislation and/or Other Campaign Finance Related Bills/Resolutions for the 2015 Legislative Session
General Counsel Kam reported that since the last meeting, Governor Ige signed HB 1491 into law as Act 209.  This law will require additional reporting by Super PACs receiving contributions of more than $10,000.  The Super PAC must disclose the internet address where a contributing entity’s disclosure report can be publicly accessed; the name, address, occupation, and employer of each funding source of $100 or more to the contributing entity; or an acknowledgment that the contributing entity is not subject to any state or federal reporting requirements regarding the source of the contributing entity’s funds.

Executive Director Izumi-Nitao also reported that Associate Director Baldomero is working with ICSD to modify the Noncandidate Committee Filing System to include the new requirements which go into effect on 1/1/16.  The manuals and guidebooks will also be updated.

Report from Executive Director
Welcome and Introduction of New Commissioners
Executive Director Izumi-Nitao introduced and welcomed new Commissioner Bryan Luke who was appointed by Governor Ige to serve a four-year term beginning 7/1/15.  Commissioner Luke is the President and Chief Operating Officer at Hawaii National Bank.  A graduate of Punahou School, he received his BA from Amherst College and MBA from Harvard University.  He has also served on a number of community boards including the The Rehabilitation Hospital of the Pacific, Pacific and Asian Affairs Council, and Teach for America-Hawaii.

On 7/21/15, Commissioner Luke took his oath of office and attended a new Commissioner orientation.

She further reported that Governor Ige appointed another member to the Commission but, because of issues that have come up, he may not be able to serve.  If he is unable to serve, Governor Ige will appoint another person from the list.  She will keep the Commissioners informed on the status of their fifth member.

Report on Compliance of Filing Timely Disclosure Reports
Executive Director Izumi-Nitao reported that she and General Counsel Kam met with the Attorney General’s Office on 7/13/15 and have worked out a course of action that involves developing and coordinating procedures with them.

In response to Commissioner Luke’s question of when the matter would be resolved, General Counsel Kam responded that it has been decided to pursue this as a collection matter in District Court, and that once the District Court forms have been created and the procedures are set in place, the process should go quickly.  Staff’s main concern was how an order to file a report would be enforced as a collection matter.  The Attorney General’s Office assured staff that it could be worked into the collection process.

Report on July CSC Newsletter
Executive Director Izumi-Nitao reported that the Commission’s newsletter is scheduled to be released on 7/22/15.  Headlines for the newsletter will include:

-Reminder to file the Supplemental Report due on 7/31/15;
-Update on the Yamada Case;
-New Laws Going into Effect;
-Committees Who Have Violated the Campaign Finance Laws;
-Status of the Hawaii Election Campaign Fund;
-Running in the 2016 Election;
-New Reporting Schedules;
-Reminder Regarding Reproduction of Campaign Material;
-Welcome New Commissioner;
-Thank You to Outgoing Commissioners;
-Upcoming Events

Commissioner Luke moved to convene Executive Session to consult with attorney pursuant to HRS §92-5(a)(4).  Motion seconded by Commissioner Ching.  Motion carried unanimously (4-0).

Public session reconvened – 10:45 a.m.

Next Meeting:
Scheduled for Wednesday, September 9, 2015 at 10:00 a.m.

Vice Chair Yoshihara moved to adjourn meeting.  Motion seconded by Commissioner Ching. Motion carried (4-0).  Meeting adjourned at 10:45 a.m.