Campaign Spending Commission

Campaign Spending Commission Meeting
Leiopapa A Kamehameha Building, Room 204
October 13, 2010
10:00 a.m. 

Commissioners Present:
Chair Paul Kuramoto, Vice-Chair Steven Olbrich, Gino Gabrio
Michael Weaver – Excused Late (arrive 10:15 a.m.)
Dean Robb – Excused

Staff Present:
Barbara Wong, Tony Baldomero, Grant Tanimoto, Ellen Kojima
Deputy Attorney General Robyn Chun

Call to Order:
Meeting convened at 10:05 a.m. with Chair Kuramoto presiding.

Consideration of Minutes:
Commissioner Gabrio moved to approve the minutes of the September 14, 2010 meeting.  Motion seconded by Vice-Chair Olbrich.  Motion carried unanimously.

New Business:
Appointment of New Executive Director
Chair Kuramoto announced that after the application, review and interview process,  Deputy Attorney General Kristin Izumi-Nitao is recommended to take the place of current Executive Director Barbara Wong who is retiring at the end of October.

Commissioner Gabrio moved to appoint Kristin Izumi-Nitao as the new Executive Director effective November 4, 2010.  Motion seconded by Vice-Chair Olbrich.  Motion carried unanimously.

In the interim, Associate Director Tony Baldomero will be the Acting Executive Director.

Proposed Conciliation Agreement 10-13  In Re the Matter of Kai Nishiki
Proposed Conciliation Agreement is offered to settle a self-reported excess non-resident contribution, in violation of Hawaii Revised Statutes (“HRS”) section 11-204.5.  Executive Director Wong recommends the Commission make a preliminary determination that probable cause exists that Respondent Nishiki committed a violation.

Commissioner Gabrio moved to find that probable cause exists that Respondent committed a violation and that the calculation for the excess non-resident contribution be re-checked.  Motion seconded by Vice-Chair Olbrich.  Motion carried unanimously.

Chair Kuramoto asked that the motion be modified to ask that the excess non-resident contribution calculation be rechecked.

Respondent Nishiki waives findings of fact and conclusions of law and requests a contested case hearing and waives a contested case hearing.  Respondent agrees to a fine of $375.  Executive Director Wong recommends acceptance of proposed Conciliation Agreement 10-13 with an assessed fine of $375 and with the escheat amount to be re-checked.

Vice-Chair Olbrich moved to accept proposed Conciliation Agreement 10-13.  Motion seconded by Commissioner Gabrio.  Motion carried unanimously.

* Discussion deferred on Proposed Conciliation Agreement 10-14 until Commissioner Weaver arrives.

Proposed Conciliation Agreement 10-15  In Re the Matter of Linda Lingle Campaign Committee
Proposed conciliation agreement is offered to settle an excess contribution to the Friends of Duke Aiona candidate committee, in violation of HRS, sections 11-204(a) and 11-204(f).  The excess contribution has been escheated to the Hawaii Election Campaign Fund.  Executive Director Wong recommends the Commission make a preliminary determination that probable cause exist that Respondent Linda Lingle Campaign Committee committed a violation.

Commissioner Gabrio moved to make a preliminary determination that probable cause of a violation exists.  Motion seconded by Vice-Chair Olbrich.  Motion carried unanimously.

Commissioner Weaver arrived at 10:15 a.m.  Chair Kuramoto informed him of the current item on the agenda.

Respondent waives findings of fact and conclusions of law and requests a contested case hearing and waives a contested case hearing.  Respondent agrees to a fine of $1,500.  Executive Director Wong recommends acceptance of proposed Conciliation Agreement 10-15 with an assessed fine of $1,500.

Commissioner Gabrio moved to accept proposed Conciliation Agreement 10-15.  Motion seconded by Vice-Chair Olbrich.  Motion carried unanimously.

Proposed Conciliation Agreement 10-14  In Re the Matter of First Hawaiian Bank
Commissioner Gabrio recused himself as he and his firm provide legal services for First Hawaiian Bank.

Proposed conciliation agreement is offered regarding a self-reported excess contribution to a noncandidate committee, Citizens for Responsive Government, in violation of HRS, section 11-204(b).  Executive Director Wong recommends the Commission make a preliminary determination that probable cause of a violation exists.

Vice-Chair Olbrich moved to make a preliminary determination that probable cause of  a violation exists.  Motion seconded by Commissioner Weaver.  Motion carried unanimously.

Respondent waives findings of fact and conclusions of law and requests a contested case hearing and waives a contested case hearing.  Respondent agrees to a $260 fine.  Executive Director Wong recommends acceptance of proposed Conciliation Agreement 10-14 with an assessed fine of $260.  The excess contribution will escheat to the Hawaii Election Campaign Fund.  Commissioner Weaver moved to accept proposed Conciliation Agreement 10-14.  Motion seconded by Vice-Chair Olbrich.  Motion carried unanimously with the recusal of Commissioner Gabrio.

Proposed Conciliation Agreement 10-16  In Re the Matter of Tercia Ku, Tercia Ku Campaign Committee
Vice-Chair Olbrich recused himself due to a previous business arrangement with Respondent.

Proposed conciliation agreement is offered regarding the late filing of 8 disclosure reports in violation of HRS, sections 11-212, 11-213, 11-213.5 and section 11-S, Act 211, SLH 2010.  Respondent acknowledges that the reports were not timely filed.  Executive Director Wong recommends the Commission make a preliminary determination that probable cause of violations exists.

Commissioner Gabrio moved to make a preliminary determination that probable cause of the violations exist.  Motion seconded by Commissioner Weaver.  Motion carried unanimously.

Respondent waives findings of fact and conclusions of law and requests a contested case hearing and waives a contested case hearing. Respondent agrees to a $600 fine.  Executive Director Wong recommends acceptance of the agreement with an assessed fine of $600.  Executive Director Wong also noted that 7 of 8 reports reported no contributions received and no expenditures made and only a loan from Ku to her committee was carried over.

Commissioner Gabrio moved to accept proposed Conciliation Agreement 10-16.  Motion seconded by Commissioner Weaver.

Respondent Tercia Ku thanked the staff for their time and patience with trying to get this matter resolved.

Discussion on whether the fine is daily and if there is a cap.  Executive Director Wong explained that with the previous law there was no cap, but the law was changed to allow for a cap on the amount owed.   Chair Kuramoto noted that if the minimum is $200, then the fine for 7 late reports should be $1,400.  A motion was made to accept the conciliation agreement and the motion failed.  (Vote taken – aye: Gabrio, Weaver / no: Kuramoto).

Respondent Ku remarked that she understood that the conciliation agreement has not been accepted and asked what could be done to get the matter resolved today.  If the understanding is that she should pay the full outstanding fine, then that is a concern because it is not a manageable amount for her.

Chair Kuramoto stated that the Commission should hold to whatever the amount is owed, whether the amount is paid or not is another question.  Commissioner Gabrio noted that the Commission has accepted other conciliation agreements with negotiated fines.

Chair Kuramoto asked to reconsider the previous motion and Commission Gabrio moved to accept proposed Conciliation Agreement 10-16 with assessed fine of $600.  Motion seconded by Commissioner Weaver.  Motion carried unanimously with the recusal of Commissioner Olbrich.

Docket No 10-05  Cory Chun v. Leatrice Grantham
Mr. Cory Chun, a 2010 House of Representative candidate, filed a complaint alleging that candidate Leatrice Grantham violated Act 211, section 11-FF, regarding anonymous contributions.

Ms. Grantham had 2 events, selling chocolates for $10 and a $25 per person event and the proceeds were entered as two aggregate amounts instead of individually.  The Commission advises candidates to enter every contribution so the system can aggregate contributions, but the law requires a record of the name and address for contributors more than $25.  Executive Director Wong recommends that the complaint be dismissed for insufficient evidence.

Vice-Chair Olbrich moved to dismiss the complaint.  Motion seconded by Commissioner Weaver.  Motion carried unanimously.

Draft Advisory Opinion 10-03  Ticket Price Range for Events/Fundraisers/No Tickets
Draft advisory opinion is in response to a candidate who asked whether it was permissible to use campaign funds to purchase a ticket for another candidate’s fundraiser when there is no specific ticket price, but a range for “price or suggested contribution per person.”  The opinion replies in the affirmative.

Also, whether campaign funds may be used if there are no tickets provided and only a contribution is solicited at the door.  The opinion replies in the negative.

Executive Director Wong recommends that the draft Advisory Opinion 10-03 be approved.

Commissioner Gabrio recommended removal of paragraph 2 on page 2 as not relevant.  Commissioner Weaver moved to approve the draft with the deletion of paragraph 2 on page 2.  Motion seconded by Vice-Chair Olbrich.  Motion carried unanimously.

Yamada et al. v. Kuramoto et al. Civil No. CV10-00497, U.S. District Court for the District of Hawaii
Charleen Aina, Deputy Attorney General present for discussion.  She and Deputy Attorney General Robyn Chun briefed Commissioners on the background and current status of the complaint.

Legislation
Grant Tanimoto, General Counsel, reviewed 3 draft bills that address the following issues:

-Technical corrections – Act 211;
– Requiring new candidates to file supplemental reports;
– Extension of reporting deadline if filing system is down;
– Clarify fines for notices and other forms;
– Add definition of address;
– Amending reporting schedule to accommodate new primary election date for 2012; and
– Prohibiting the use of campaign funds raised for one campaign to be used for another campaign.

Commissioner Gabrio moved to convene executive session to consult with attorney on Yamada et al v. Kuramoto et al. Motion seconded by Commissioner Weaver.  Motion carried unanimously.

Executive session convened at 11:15 a.m.

Public session reconvened at 12:05 p.m.

Next Meeting:
Scheduled for Wednesday, November 10, 2010 at 10:00 a.m.

Commissioner Gabrio asked that it reflect in the minutes of the meeting that the Commissioners unanimously appreciated Barbara Wong’s service.

Chair Kuramoto asked for a motion to adjourn meeting.  Commissioner Weaver moved to adjourn meeting.  Motion seconded by Commissioner Gabrio.  Motion carried unanimously.

Meeting adjourned at 12:08 p.m.