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Wednesday, December 17, 2003

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Ladyslipper Conference Room

Ground Level, Centennial Office Building

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Meeting was called to order by Chair Miller.


Members present:  Ashmore, Fluegel, Kelley, Milbert, Miller, Pauly

Others present:  Olson, Sigurdson, Swanson, Drilias, staff; Huwe, counsel


MINUTES  (November 19, 2003)


Ms. Pauly's MOTION:                        To approve the November 19, 2003, minutes as drafted.


Vote on MOTION:       Unanimously passed.




·            Board Meeting Schedule


Next meeting will be held on January  28, 2004.


·            Nomination Subcommittee Report


Chair Miller reported that the Nomination Subcommittee recommends the following slate of officers for 2004:  Wil Fluegel, Chair and Teri Ashmore, Vice Chair.


Mr. Milbert's MOTION:            To approve the subcommittee's recommendation and elect Wil Fluegel as Chair and Teri Ashmore as Vice Chair for 2004.


Vote on MOTION:            Unanimously passed.




Mark Scipioni, Management Analysis Division, Department of Administration, presented the fee payment options selected by Board members at the November 19th meeting with modifications as directed.  Board members reviewed and selected one of the two Political Party Unit options presented. 


Mr. Fluegel's MOTION:            To adopt the political party unit option that requires  state committees and legislative caucuses to pay an annual fee based on the level of disbursements made by the party unit in a two-year period.


Vote on MOTION:            Unanimously passed.


Board members reviewed and made language changes to drafts of the legislative report, executive summary, and the transmittal letter to be signed by the Board Chair. 


Mr. Kelley's MOTION:            To approve the drafts of the legislative report,  executive summary, and the transmittal letter as amended in discussion.


Vote on MOTION:            Unanimously passed.


The report will be made available to interested parties before the January 15, 2004, deadline for delivery to the Legislature.  Board members thanked Mr. Scipioni for his assistance with this project.




Mr. Fluegel, subcommittee chair, presented a proposed list of legislative recommendations to the Board and discussed changes made to the list by the subcommittee. 


Mr. Fluegel's MOTION:            To approve the legislative recommendations for 2004 as amended by the subcommittee.


Vote on MOTION:            Unanimously passed (see copy of legislative recommendations for 2004 attached).




Ms. Olson submitted the following written report:






·            Staff Activities


On December 3rd Ms. Olson presented information about political committees and funds, lobbying, and the gift ban to a continuing legal education symposium for approximately 50 association managers.


On December 12th staff sent invoices to 1,233 registered lobbyists advising them of the lobbyist fee due January 15, 2004.  Lobbyists who terminate their registration prior to January 15th will not need to pay the fee.


Staff completed the work necessary to enable lobbyists to file their January 15, 2004, reports electronically.  Passwords have been assigned and information about electronic filing was sent to all reporting lobbyists.  The legislature directed the Board to have this option available for lobbyists by January 2005.


The Department of Administration informed staff that beginning July 1, 2004, the Board will be charged for our clients' use of our searchable website.  The costs are estimated to be between $250 and $3,000 each month.  We have purchased our own server and are working toward maintenance of our website internally to avoid the additional costs.


On January 21st Ms. Olson will present information about lobbying, campaign finance, and the gift ban at a Faegre and Benson continuing legal education seminar.


On January 23rd Ms. Olson will be on the faculty of a continuing legal education seminar – The Minnesota Legislative Process.  She will be discussing lobbying registration and reporting requirements of Chapter 10A.


On January 29th staff will present a training session for lobbyists in the State Office Building and provide them with information about 2003 law changes, the Board's report to the legislature about a proposed fee schedule, and electronic filing of Lobbyist Disbursement Reports.


·         Personnel


Ms. Olson introduced Belinda Stampley.  Ms. Stampley began work on December 8th as the Board's Program's Assistant. 


·         Miscellaneous


Ms. Pauly's and Mr. Kelley's terms of service on the Board expire in January 2004. 

Pursuant to Minn. Stat. § 15.0575, subd. 2, Board members may serve until their successors are appointed and qualify but in no case later than July 1 in a year in which a term expires unless reappointed. 


Enforcement Report


Discussion Items




·         Kristine Madson, Minnesota Housing Resources, Inc., regarding the complaint against the (Dave) Engstrom for Senate committee - At its meeting of Oct

·         ober 22nd the Board issued findings regarding a complaint filed by Ms. Madson against the (Dave) Engstrom for Senate committee.  The findings directed Mr. Engstrom to determine the fair market value of the committees use of Minnesota Housing Resources, Inc.'s (MHRI) fax, phone and email address, and to reimburse MHRI for the use of these resources.  On November 20th Mr. Engstrom's attorney provided the Board with a copy of a check from Mr. Engstrom to MHRI for $28.50.


      On December 4th Ms. Madson submitted a letter and supporting documents to Board staff stating that Mr. Engstrom sent 2,389 e-mails from his MHRI e-mail account regarding his campaign.  Ms. Madson requested the Board to instruct Mr. Engstrom to review his files and “fairly and accurately reimburse MHRI for the use of its resources." 


 Board members directed staff to draft a letter to Ms. Madson stating the Board declines to take further action in connection with the complaint, given the nature of the activity and the difficulty inherent in determining the economic value, if any, of the e-mails sent.


·         Former Representative Betty Folliard regarding the Volunteers for Betty Folliard committee - On May 3, 2003, former Representative Betty Folliard entered into a conciliation agreement with the Board agreeing to return to contributors an amount sufficient to bring the committee into compliance with Minn. Stat. §10A.27, sub 11, and paid a civil fine of $338, two times the amount the special source aggregate contributions exceeded the limit.


      In response to a routine reconciliation memo sent by Board staff in October, 2003, Representative Folliard responded saying that her committee incorrectly reported a transaction with Clean Water Action as an in-kind contribution.  The committee contracted with and paid Clean Water Action for the services.


      Representative Folliard amended the Report of Receipts and Expenditures to disclose the transaction with Clean Water Action as a campaign expenditure not an in-kind contribution and is requesting that the conciliation agreement be rescinded and that the civil fine of $338 be returned to the committee.


Ms. Ashmore's MOTION:            To approve Representative Folliard's request and rescind the conciliation agreement and direct staff to return the $338 civil fine to the Volunteers for Betty Folliard committee.


Vote on MOTION:            Unanimously passed.


Informational Items


Payment of late fees


·         Report of Receipts and Expenditures due October 28, 2002


LaVerne Turner, (LaVerne) Turner for Senate:  $30 (Balance, $240)


·         Report of Receipts and Expenditures due January 31, 2003


      Larry McKenzie, Larry McKenzie Committee:  $100 (Revenue Recapture)


Service of Process Fees  


Bridget Cronin:  $40

Larry McKenzie:  $38 (Revenue Recapture)


Payment of Civil Fines


·         Lynne Osterman, Lynne Osterman Campaign Committee - In calendar year 2002, the Lynne Osterman Campaign Committee accepted aggregate contributions in excess of the applicable election year contribution limit from political party units and terminating principal campaign committees.  The total amount of these contributions exceeded by $400 the aggregate contribution limit.  Representative Osterman entered into a conciliation agreement on November 17, 2003, which required her to return an amount sufficient to bring her committee into compliance, and pay a civil fine of $800, two times the amount by which the contributions exceeded the limit.


·         Melissa Hortman, Melissa Hortman Campaign Committee - In calendar year 2002, the Melissa Hortman Campaign Committee accepted contributions from the candidate, Melissa Hortman, in excess of the applicable election year contribution limit from candidates.  The total amount of these contributions exceeded by $460.91 the applicable contribution limit.  Melissa Hortman entered into a conciliation agreement on November 11, 2003, which required her to return $460.91 to the candidate and pay a civil fine of $460.91, one times the amount by which the contributions exceeded the limit.


Financial statement and agency deposits - Mr. Sigurdson submitted a report covering July 1 through November 2003.


Suggested Policy for Assessing Civil Penalties for Late Filing Fees (see November 19th minutes)


Board members reviewed a draft proposal for assessing the $1,000 civil fine.  The draft proposes weekly increments to the maximum of $1,000, rather than imposing the full civil fine as a beginning point and also considers the number of times the committee, association, or individual has filed required documents or paid fees late and escalates the rate at which the civil fine is assessed for repeat offenders.  Board members approved the policy as drafted.




Counsel Huwe presented the legal counsel report outlining the status of cases that have been turned over to the Attorney General's office (see copy of memo attached). 


Counsel Huwe reported that the Court of Appeals affirmed the decision of the trial court in all respects, including the award of attorney's fees, in the matter of the Campaign Finance and Public Disclosure Board vs. Minnesota DFL State Central Committee.  Board members agreed that there should be no further appeal and directed staff to pay the attorney's fees.




Meeting adjourned.


Respectfully submitted,




Jeanne Olson

Executive Director