Notes of the Feb. 23, 2017 CCEC Meeting
1. Present: All five of the Commissions were present along Tom Collins, the Executive Director and other staff. I introduced myself to the new Commissioner, Mary Chan, who used to work for the SOS’s office when it was under Ken Bennett and she said she remembers fondly working with LWV folks in a very cooperative manner. She was the Elections Director and is an attorney.
2. Executive Director’s Report: Tom Collins. Highlights:
a. Gina Roberts, the Voter Education Manager, will be working with Inspire AZ (a group that educates high school students on leadership and citizenship, with which LWVMP has worked).
b. Workshops will soon be started and guides prepared for 2017 participating candidates as they can start collecting $5 on August 1, 2017.
c. All but one enforcement action from 2016 has been closed; and the 2014 enforcement action against the Legacy Foundation is still in process.
d. Staff have been in discussions with the SOS’s office which has requested $300,000 to help create a more modern report filing system, they they say will also then cover all local governments, and that will cost about $700,000 total. This led into a rather long explanation about the history of Interagency Service Agreements (ISAs) between the CCEC and the SOS for data systems and questions about this proposed ISA. Commissioner Chan said she remembered such a system being built for a web based system in 2013 and wanted to know what happened to that one and why more money was needed now. Collins said that the SOS deleted some CCEC reports from the existing system, which resulted in CCEC having to create its own reporting forms etc. and which is still being resolved with them. Also there was a system that CCEC helped pay for in 2006 which is now outdated; however, the 2013 one has never been fully completed. Further he said that under Governor Brewer, CCEC was ‘at the table’ in the design of such a system and CCEC reports were in it. Various Commissioners asked questions: if some reports are statutorily required, how could the SOS delete them? what control will CCEC have it if provides these funds? Will CCEC really use almost half the system and if not, why pay almost half the costs? what will be the ROI for CCEC? And ‘this sounds more like a ‘supplemental’ appropriation for the SOS’s office.’ Collins said in this situation, the ISA is really more like a purchase order with CCEC being the ‘customer’ and as such it has the right and duty to make sure it gets what it pays for. Collins said that the SOS’s office has an IT staff of 15 and now says it plans to bring in a new person to develop this system. However, he said that before any CCEC funds are spent, he will contract with an IT specialist to assess what the ‘new system’ might provide to CCEC and how much it is worth.
3. Governor’s Regulatory Review Council Issues. For those who have been receiving and reading my prior reports, I’m sure you are aware of the on going battle between the GRRC and the CCEC, in that the CCEC says it is not subject to the GRRC but out of courtesy provides it with 5 year reports, which in the past (2000, 2005, 2010) have always been discussed with GRRC staff and accepted. And then came 2015; and since then the GRRC has refused to accept the report, without providing reasons, identified issues but then refused to accept the revisions etc. etc. etc. Thus, two GRRC Commissioners came to this meeting to try to resolve the impasse, along with their legal counsel: John Sundt and Christopher Ames, and Chris Kleminia. Another LONG discussion followed with various Commissioners asking Sundt questions (Ames did not speak at all and Kleminia only spoke very very briefly). At the end, I think the two parties agreed to disagree, i.e., CCEC says is it not subject to GRRC and is protected by any future laws requiring such by the Voter Projection Act, and GRRC says they are but for now, litigation will only take place if some other party sues. (I can answer more questions if anyone cares but...)
4. Proposed New Rules Relating to Campaign Consultants to Include Political Parties. Again, for those who read my prior reports, you are aware that there was a complaint filed toward the end of last year regarding expenditures by Clean candidates to political parties (at this point, only the Democratic Party) for the purchase of ‘services,’ which resulted in audits for such candidates and which led Representative Leach to file a bill to repeal Clean Elections, because he said he saw it as a way to ‘funnel money’ to a political party. During the hearing of that bill (HCR2004), at which Leach openly said that was why he had filed the bill, Collins said that the Commission was aware of the concern and was in the process of drafting proposed rules to address this issue. So, such rules will now be put out for public comment. There will be two sets of proposed rules, i.e., for expenditures to parties and for expenditures to consultants. For the former, three options will be proposed: 1) such will be banned; 2) such will be limited to voter information (voter rolls) and public events or 3) other services would be allowed but with much more documentation and with advance payments only for specific services (e.g., the party will knock on X # of doors) vs. as a retainer. For consultants, the proposed rules will also require more documentation along with a list of other candidates for whom they are working to ensure that there is no coordination or to help determine how shared expenditures are apportioned. A Commissioner asked if these rules might discourage candidates from running Clean. Collins said that he has discussed these proposed rules to some extent with some candidates and some consultants but of course the public comment period will provide an opportunity for people to address this concern.
5. Legislative Agenda. Collins said that SB1158 is going to the House; it will exclude the surcharge set aside to fund the CCEC for penalties etc. from being reduced by a judge, though other fees will be more easily subject to reduction to enable more prior offenders to regain their full rights to include voting rights. He also said he is working with various legislators on a HB2304 that includes language re how information is sent to voters (by email, which means to each person vs. to each household with a registered voter, which is how the CCEC now mails the Candidate brochures). He said there is also some language about the CCEC and SOS ‘cooperating’ on voter education, which he is concerned might allow the SOS’s office to veto voter education efforts by the CCEC.
6. 2016 Annual Commission Report. This was reviewed and has excellent information to include plans for 2017, e.g., a data driven roundtable on voter education to include decisions makers, local governments etc.
7. Public Comment. Everyone looked at me?? so I got up and gave a few quick comments about LWVAZ and our history with CCEC, said I was so impressed with what the CCEC has done that I hoped we could get copies of the Annual Report for the upcoming LWVAZ Convention and that I hoped LWVAZ would be included in the roundtable (and I was assured both would be done as long as I let them know about how many copies LWVAZ will need); and then I said I was very glad to have been able to testify against HCR2004 on behalf of LWVAZ to repeal the Clean Elections Act. (At the moment the bill is dead).
_As part of the Executive Director’s Report, information was distributed and discussed about Voter Education efforts by staff, among which was prominently listed the Voters’ Rights Summit. There was also a list of outstanding enforcement actions relating to the 2016 election cycle, all of which have been or are in the process of being resolved; and THREE from the 2014 election cycle. The first one relates to Tom Horne; the second the Legacy Foundation Action Fund (LFAF) which was just filed in the Supreme Court; and the third is the Veterans for a Strong America (VSA). The AG has not been able to resolve this one either and is actually working with the CCEC on this. VSA’s primary attorney is about to become the White House Counsel, which will make it even more difficult to resolve the issue.
3. New Chair: Potential Implications for LWVAZ. The CCEC elected Steve Titla as the new Chair. The term of the current Chair, Melvin Laird, a Republican from Maricopa County, is about to end, with the January 2017 meeting likely to be his last. NOTE: At present the CCEC is all male with one non Caucasian member. The next appointment will be made by the highest ranking Democrat, i.e., Senator Katie Hobbs, and must be a Republican who cannot live in Pima County (based on the statute). I’ve approached the LWVMP Board to help identify a female Repubican as it seems that LWV would be an appropriate background for the next Commissioner. So far no one has submitted names. My problem is that I bascially don’t know how almost any LWVMP or LWVNWMC members are registered.
4. CCEC Schedule January-June 2017. The CCEC adopted its meeting schedule thru June of 2017 with dates being: 1/19, 2/23, 3/23, 4/20, /18 and 6/22.
5. CCEC Budget, Expenditure Cap, Revenue Projects and Excess Monies. The CCEC reviewed and adopted its 2017 Budget, Expenditure Cap, Revenue Projections and Use of Excess Monies. During the discussion the following issues arose:
* The primary sources of funds for the CCEC come from Clean Election Candidates $5 contributions during election years, fines paid by entities that violate CCEC rules AND a statutory 10% surcharge on civil penalties and criminal fines. Up until October 2011, CCEC revenues included photo radar surcharges and until Dec. 2013 tax checks off and tax credits. However, the Legislature terminated these. Thus the CCEC is highly dependent upon surcharges/penalties. It is therefore finding itself in conflict with a new AZ Supreme Court “Fairness and Justice Project’ that is attempting to reduce these burdens, which of course weigh most heavily on those with limited incomes (and can keep some from being able to have their voting rights restored). However, this recommendations of this Project, which may appear as legislation in 2017, could also severely impact on the ability of the CCEC to operate, although the CCEC’s share of the surcharges/penalties is a relatively minor portion of all such.
NOTE: This may raise some real conflicts for those who support Clean Elections and also do not want to see poor defendants burdened with high fees and penalties.
* As a result of the termination of tax checkoffs and tax credits, CCEC revenue has decreased from $19 million to $7 million a year.
* In some past years, the CCEChas returned money to the General Fund, because of the caps on expenditures.
* In terms of public education, a detailed plan will be provided at the January 2017 meeting; further only paid media is capped. Costs associated with CCEC staff and education, e.g., a roundtable for recorders is not capped.
* It was also stated that County Recorders are concerned that the Secretary of State’s office (SOS) will shift the cost of the new campaign finance reporting system to the counties; and so far the SOS’s office has refused to accept CCEC funding to help establish the new system.
* As a result of SB 1516, the SOS’s office is expanding that system, and even cities and counties will have to pay to use it if they don’t have their own systems.
* The total budget for 2017 is estimated to be about $4.8 million (whereas the cap is over $20 million).
* The CCEC approved the caps, budget and the staff recommendation that excess funds NOT be returned to the general fund.
6. The CCEC and the Governor’s Regulatory Review Council (GRRC) 5 Year Report. This issue has been going on for a very l-o-n-g time with prior versions of the CCEC’s report returned as not satisfactory without any or very few explanations. Mr. Collins recommended that the CCEC submit a slightly revised report (trying to address the few actually stated concerns of the GRRC) along with a copy of the statement on this issue on the website.
7. Discussion and Possible Action on Rule Amendment Proposals. All but one amendment recommended by staff were adopted with between no and minimal discussion and reflected either clarifications, renumbering due to new laws or minor concessions to the requirements of new laws (e.g., SB 1516, HB2296/97), with a Preamble (that I can send to anyone interested) that in essence is a almost a ‘disclaimer,’ i.e., “...The Commission does not, by adopting these rules, waive any legal objection to the enactment of laws that violate the Voter Protection Act.....and questions of equal protection .... The Commission retains its full authority to enforce Article 2 of Chapter 6 of Title 16...”
NOTE: The comment on the proposed rule changes submitted by Shirley pretty much said the same thing!! However, the Commissioners had a long discussion on and voted 3 to 2 NOT to adopt staff recommended revisions to one section (109-B-4) that would have, for consistency with SB1516, end reporting in AZ for corporations, with just their IRS approval being sufficient. Sam Psross, AzAN spoke on this issue; and I considered doing so but when the Commissioners themselves raised the issue and voted NOT to accept any changes, I felt there was no need for LWVAZ to make a public statement.
8. Public Comment. I thanked the Commissioners for allowing staff to provide so much assistance to LWVAZ in the planning for the Voters’ Rights Summit and for their actual participation in it; and then personally invited each Commissioner to attend, handing them a flyer. Staff then announced that any Commissioner who wants to attend will have their registration paid for them by the CCEC funds.
1. If there is anyone else who ‘should’ be this report, please forward it and let me know so I can add them next time. I think it’s more important for folks to have a chance to read this, even if they chose not to, then to be left off.
2. In case some of you are not familiar with this, the CCEC’s mission statement is: “To improve the integrity of AZ State Government, diminish the influence of special interest money and promote freedom of speech under the US and AZ constitutions.” Neat!!
3. The numbers below do not correspond to the agenda, which is available on the website, because this report does not cover some items such as accepting minutes of prior meetings etc.
Submitted by Rivko Knox