Source: https://sfethics.org/ethics/2005/02/san-francisco-ethics-commission-audit-report-strunsky-for-supervisor-fppc-id-1246077.html
Timestamp: 2019-04-21 00:10:33+00:00

Document:
This Audit Report summarizes the results of the audit of the committee, Strunsky for Supervisor, Identification Number 1246077 (“the Committee”), for the period from January 1, 2002 through December 31, 2002. The audit was conducted to determine whether the Committee materially complied with the requirements of the Political Reform Act (“the Act”) (California Government Code Section 81000, et seq.) and San Francisco’s Campaign Finance Reform Ordinance (“CFRO”) and Electronic Filing Ordinance (S.F. Campaign and Governmental Conduct Code (“C&GC Code”) Sections 1.100, et seq., and 1.300, et seq., respectively).
(1) the Committee failed to file two Late Contribution Reports, in violation of S.F. C&GC Code section 1.106 and Government Code section 84203; (2) the Committee failed to disclose complete contributor information for 10 contributions, in violation of S.F. C&GC Code section 1.114(e); (3) the Committee failed to itemize 49 expenses of $100 or more totaling $55,429.05, in violation of S.F. C&GC Code section 1.106 and Government Code section 84211(k); (4) the Committee failed to timely file the paper and electronic semi-annual campaign statement for the period ending December 31, 2002, in violation of Government Code section 91013 and S.F. C&GC Code sections 1.106 and 1.300; (5) the candidate, who filed a statement accepting the applicable expenditure ceiling under former S.F. C&GC Code section 1.128, spent more than the ceiling before the ceiling was lifted.
The Committee was formed in August 2002 to support the election of Burke Strunsky to Member, Board of Supervisors, District 6, in the November 5, 2002 general election. The candidate did not participate in the limited public financing program that was available to candidates for the Board of Supervisors. Marsanne Weese was the Committee’s treasurer. The Committee filed a Statement of Organization on August 25, 2004 indicating that the Committee was terminated on 12/31/03.
A “late contribution” is any contribution, including a loan, which totals in the aggregate $1,000 or more that is made or received by a candidate, a controlled committee, or a committee formed or existing primarily to support or oppose a candidate or measure before the date of the election at which the candidate or measure is to be voted on but after the closing date of the last campaign statement required to be filed before the election. Gov’t Code §82036. The combined activities of affiliated entities are used to determine whether the $1,000 threshold is met or exceeded. Cal Code Regs. §18428.
Late contributions must be reported within 24 hours of receipt by facsimile transmission, telegram, guaranteed overnight mail through the United States Postal Service or personal delivery. C&GC Code §1.106, Gov’t Code §84203(b). A candidate or committee that receives a late contribution must include on the Late Contribution Report: 1) its full name and street address; 2) the date and amount of the late contribution; and 3) the contributor’s name, street address, occupation, and employer, or if self-employed, the name of the business. Late Contribution Reports must be filed with each office with which the candidate or committee is regularly required to file campaign statements. C&GC Code §1.106, Gov’t Code §84203(a).
S.F. C&GC Code section 1.106 and Government Code section 84211(k) state that for each person to whom an expenditure of $100 or more has been made during the period covered by the campaign statement, all of the following information must be obtained and reported on the campaign statement: (1) his or her full name; (2) his or her street address; (3) the amount of each expenditure; and (4) a brief description of the consideration for which each expenditure was made.
Government Code section 91013 imposes a fine of $10 per day for campaign statements received after the filing deadline. The liability for late filing of the paper statement is limited to the cumulative amount of contributions or expenditures for the period covered by the late statement or $100, whichever is greater. San Francisco ’s Electronic Filing Ordinance (S.F. C&GC Code section, 1.300 et seq.) imposes an additional fine of $25 per day for electronic filings received after the filing deadline. In addition, under S.F. C&GC Code section 1.170(c), any person who intentionally or negligently violates any of the provisions of the Campaign Finance Reform Ordinance is liable for an amount up to $5,000 for each violation, or three times the amount not reported.
In 2002, candidates running for the Board of Supervisors who did not participate in the public financing program were required to notify the Ethics Commission if they received contributions, made expenditures or had funds in their campaign trust account that exceeded 75 percent of the applicable expenditure ceiling, which was $75,000. In addition, candidates were also required to notify the Ethics Commission if they received contributions, made expenditures or had funds that equaled or exceeded 100 percent of the expenditure ceiling. These notices were required to be made within 24 hours of meeting the applicable thresholds. See former C&GC Code section 1.152(a)(3). The form that was used in 2002 to provide these notices to the Ethics Commission was called the Reporting Notice B.
Former sections 1.128 and 1.130 of the Campaign and Governmental Conduct Code required candidates, who filed a statement with the Department of Elections indicating that they agreed to abide by the applicable expenditure ceiling, to limit their qualified campaign expenditures to $75,000 in the general election.
During the late reporting period for the November 5, 2002 election, the Committee received two contributions totaling $40,000 from the candidate, thus triggering the obligation to file two Form 497 Late Contribution Reports (LCR), which the Committee failed to file. Please refer to Attachment 1 for a list of the two late contributions. After the auditor brought the non-filing to its attention during the audit, the Committee then filed the Late Contribution Reports on August 18, 2004, 659 days late for the LCR due 10/29/02 and 656 days late for the LCR due 11/1/02. The Committee is subject to a late filing fine of $13,150 ($10 x 659 days + $10 x 656 days) in addition to other penalties.
A review of the Committee’s campaign statements indicated that the Committee itemized 123 contributions. Of the 123 itemized contribution entries, contributor information was not fully or properly disclosed for 10 contributions. The missing information related to contributors’ street addresses and occupation and employer information.
As explained above, under S.F. C&GCC sections 1.114(e) and 1.114(f), contributions that are deposited without the required contributor information must be forfeited to the City, in addition to any other penalties. The amount that is subject to forfeiture is the amount that exceeds the first $99.99 of a contributor’s contribution; i.e., on a $100 contribution that lacks the required contributor information, the amount subject to forfeiture is one cent. The Committee is required to forfeit $1,700.10 in contributions, in addition to any other penalties.
The campaign statement covering 10/20-11/4/02 provided only a lump sum amount of $48,000 in total expenses. No detailed itemization of the expenses was listed on the campaign statement. The review of the Committee’s records indicated that 49 expenditures of $100 or more totaling $55,429.05 were incurred during this reporting period. The Committee was required to provide an itemized listing of these expenses on its campaign statement and failed to do so in violation of Section 84211(k) and C&GCC §1.106.
The post election campaign statement covering October 20, 2002 through December 31, 2002 was required to be filed by January 31, 2003. The Committee filed two separate campaign statements for the filing period: a campaign statement covering 10/20-11/4/02 was filed on November 5, 2002; and a campaign statement covering 11/5-12/31/02 was filed by paper on August 25, 2004 and by electronic file on November 6, 2003.
The Committee is subject to fines of $9,620 ($3,900 + $5,720) for these late filings, in addition to any other penalties.
On August 9, 2002, the candidate filed the Voluntary Expenditure Ceiling Statement with the Department of Elections stating that he agreed to adopt the voluntary expenditure ceiling. On October 28, 2002 he notified the Ethics Commission that he had received contributions, made expenditures or had funds in his campaign trust account that exceeded 100 percent of the expenditure ceiling. As a result the Ethics Commission lifted the expenditure ceiling in district 6 on October 29, 2002.
A review of the Committee’s records showed that as of October 25, at a time when the ceiling had not yet been lifted, the Committee had incurred expenses exceeding $75,000. In addition, the candidate should have notified the Ethics Commission two days earlier on October 26, 2002 instead of on October 28, 2002, when he notified the Commission that his contributions exceeded 100 percent of the expenditure limit. Finally, the candidate did not provide notice to the Ethics Commission when his contributions or expenditures exceeded 75 percent of the expenditure ceiling in violation of former C&GCC section 1.152.
The Committee was provided with an opportunity to review and comment on this audit report. The Committee stated that it filed Late Contribution Reports and amended the campaign statements that were not adequately filed when it was notified of the filing requirements by the Ethics Commission during the audit. The Committee also stated that it properly filed Reporting Notice B on October 26, 2004 to indicate that the Committee had received contributions or made expenditures in excess of the expenditure ceiling of $75,000.
Through the examination of the Committee’s records and campaign disclosure statements, the Auditor found that (1) the Committee failed to file two Late Contribution Reports, in violation of S.F. C&GC Code section 1.106 and Government Code section 84203; (2) the Committee failed to disclose complete contributor information for 10 contributions, in violation of S.F. C&GC Code section 1.114(e); (3) the Committee failed to itemize 49 expenses of $100 or more totaling $55,429.05, in violation of S.F. C&GC Code section 1.106 and Government Code section 84211(k); (4) the Committee failed to timely file the paper and electronic semi-annual campaign statement for the period ending December 31, 2002, in violation of Government Code section 91013 and S.F. C&GC Code sections 1.106 and 1.300; (5) the candidate, who filed a statement accepting the applicable expenditure ceiling under former S.F. C&GC Code section 1.128, spent more than the ceiling before the ceiling was lifted.
 Prior to August 25, 2003, the fine for late electronic filings was $10/per day.
 The spending limit increased to $83,000 as of January 2003.
 Former Section 1.128 provided: “All candidates for City elective office who adopt campaign expenditure ceilings as defined below must file a statement with the Department of Elections indicating acceptance of the expenditure ceiling. Said statement shall be filed no later than the deadline for filing nomination papers with the Department of Elections, and once filed may no be withdrawn. This statement is a public document.” As of July 2003, all candidates for City elective office must file a statement with the Ethics Commission indicating whether they accept or decline to accept the applicable expenditure ceiling. (S.F. C&GC §1.128, app. 6/27/2003 ).
 Effective August 25, 2003, the fine for late electronic reports is $25 per day.
 The requirements of former section 1.152(a)(3) were superseded; such reporting requirements are now set forth in section 1.134(b).

References: §82036
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 §84203
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