STATE OF MINNESOTA
ETHICAL PRACTICES BOARD

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Friday, August 23, 1996

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St. Croix Conference Room
Second Floor, Centennial Office Building

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MINUTES

Meeting was called to order by Chair Rodriguez.

Members present: Anderson, Owens Hayes, Pauly, Rodriguez, Slocum, Wilson.

Others present: Olson, Goldsmith, Swanson, Maloney, staff; Becicka, Gretz, counsel.

Ms. Olson introduced Susan Gretz, Assistant Attorney General, who will be the Board's legal counsel following the September Board meeting.

MINUTES (July 26, 1996)

Mr. Anderson's MOTION: To approve the draft of the July 26, 1996, minutes as amended in discussion.

Vote on MOTION: Unanimously passed.

CHAIR'S REPORT

Board Meeting Schedule - Next Board meeting: Friday, September 20, 1996.

Board Objectives - (see June 21st, and July 26th, minutes) Board members reviewed a draft copy of 1997 Board Objectives.

Ms. Wilson's MOTION: To lay over the 1997 Board Objectives to the September 20, 1996, Board meeting.

Ms. Wilson withdrew her MOTION.

Board members discussed certain language changes to the first objective.

Ms. Wilson's MOTION: To lay over the 1997 Board Objectives to the September 20, 1996, Board meeting.

Vote on MOTION: Unanimously passed.

Board Working Rules - (see July 26th minutes)

Mr. Anderson's MOTION: To approve the draft policy of the Board's Working Rules as amended in discussion.

Vote on MOTION: Unanimously passed. (See copy attached).

Board Member Reimbursement - (see June 21st minutes)

Ms. Owens Hayes' MOTION: To approve the draft policy for the reimbursement of Board members expenses as amended in discussion.

Vote on MOTION: Unanimously passed. (See copy attached).

Performance Review of Executive Director - Chair Rodriguez reported that she reviewed the performance of Ms. Olson and approved a 3% increase in salary as allowed under the Manager's Plan. The plan also provides that each fiscal year the Board may grant one Managerial Achievement Award to only one employee covered by the plan. Chair Rodriguez reported that the achievement award was offered to Ms Olson who chose to defer it to Gary Goldsmith, Assistant Director.

EXECUTIVE DIRECTOR'S REPORT

Council on Governmental Ethics Laws (COGEL) - The COGEL Conference will be held in Philadelphia, PA, December 8 - 11, 1996. Registration materials were available for Board review. Chair Rodriguez noted that she will be not be able to attend the conference and appointed Mr. Anderson and Ms. Pauly as Board representatives. Mr. Anderson will be the Board delegate. Staff members Olson and Goldsmith will also attend.

Campaign finance seminars - Ms. Olson reported that 230 people have been present for eleven campaign finance seminars and one presentation requested by a political party unit since August 5th. The last seminar will be held on Saturday, August 24th.

Rules Resolutions - Board members considered a proposed resolution relating to enforcement of the administrative rules that went into effect May 20, 1996, and are being amended in the current rulemaking process.

Ms. Pauly's MOTION: Be it resolved, "The Board will not take action: 1) when an act which must be accomplished "promptly" under a statute or rule is completed within 14 days of the event triggering the requirement; 2) when a contribution to a political committee or a political fund (including principal campaign committees and party units) made by a joint check is attributed to the persons who signed the check or to the joint account holders in cases where the committee receiving the contribution knows or ascertains that a joint account holder who did not sign the check intended to be included as a contributor; 3) when a facsimile transmission filing is not followed by receipt in the Board office of the original document, provided that the filer retains the original document with a notation of when it was transmitted and files it by mail or in person within 5 days if so requested by the Board; 4) when the 48 hour notice of large contributions before the primary and general elections is timely filed by facsimile transmission, in person, by certified mail, by telegram, or by mailgram."

Vote on MOTION: Unanimously passed.

Annual Report

Mr. Anderson's MOTION: To approve the staff draft of the Annual Report as amended in discussion.

Vote on MOTION: Unanimously passed.

Staff will issue the Annual Report as soon as the final budget figures for fiscal year 1996 are available from the Department of Finance.

Enforcement Report

Mr. Maloney presented the following enforcement matters for Board action:

. Consent Items:

Board Action: Authorization of third certified letter requiring filing of amendment and subsequent legal enforcement action in the event the amendment is not filed. Two notices have previously been sent to client.

Charles J. O'Connor, Self & Workers Compensation Lobby, Lobbyist Disbursement Reports due 1/15/91 through 4/15/96, late filing fee, $0.

Board Action: Authorization of third certified letter requiring signature on Lobbyist Disbursement Report. Two notices have previously been sent to client.

Bruce Leier, Minnesota Senior Federations, failure to sign Lobbyist Disbursement Report, late fee, $0.

Board Action: Authorization of third certified letter for nonfiling of Lobbyist Disbursement Report and subsequent legal enforcement in the event the report is not filed. Two notices have been previously sent to each client.

Richard D. Aspenwall, self, Lobbyist Disbursement Report due 7/15/96, late filing fee, $20 and accruing

John E. Diehl, Joint Commission on Accreditation of Healthcare, Lobbyist Disbursement Report due 7/15/96, late filing fee $30 and accruing.

John E. Diehl, Minnesota Society for Respiratory Care, Lobbyist Disbursement Report due 7/15/96, late filing fee $30 and accruing

Lance Ness, Fish and Wildlife Legislative Alliance, Lobbyist Disbursement Report due 7/15/96, late filing fee, $0.

Mark Nygaard, R-Kids (Remember Kids in Divorce Settlements), Lobbyist Disbursement Report due 7/15/96, late filing fee, $30 and accruing.

Charles J. O'Connor, self, Lobbyist Disbursement Report due 7/15/96, late filing fee, $0.

Charles J. O'Connor, Workers Compensation Lobby, Lobbyist Disbursement Report due 7/15/96, late filing fee, $0.

Mark J. Oyaas, Corporation for Supportive Housing, Lobbyist Disbursement Report due 7/15/96, late filing fee: $30 and accruing.

Mark J. Oyaas, Greater Minneapolis Convention and Visitors Association , Lobbyist Disbursement Report due 7/15/96, late filing fee, $30 and accruing.

Mark J. Oyaas, Piper Jaffray Companies Incorporated, Lobbyist Disbursement Report due 7/15/96, late filing fee, $30 and accruing.

Donald R. Sweitzer, : G-Tech Corporation, Lobbyist Disbursement Report due 7/15/96, late filing fee, $0.

Francis X. Viggiano, Minnesota State University Student Association, Lobbyist Disbursement Report due 7/15/96, late filing fee, $30 and accruing.

Board Action: Authorization of third certified letter for nonfiling of Candidate's Statement of Economic Interest and subsequent legal enforcement in the event the statement is not filed. Two notices have been previously sent to each client.

Sharon Anderson, No Registered Committee, Statement of Economic Interest due 7/17/96, late filing fee, $0.

John M. Hollander, No Registered Committee, Statement of Economic Interest due 7/30/96, late filing fee, $0.

Mr. Anderson's MOTION: To authorize the actions specified in the consent matters.

Vote on MOTION: Unanimously passed by five members. (Owens Hayes absent).

. Discussion Items

Waiver Requests

Lobbyist Program - Lobbyist Disbursement Report due 4/15/96

Ken Smith, (Fathers Who Care), $100, second waiver request, first waiver request of $10 was denied on June 24, 1994, for the late filing of the Lobbyist Disbursement Report due January 18, 1994.

Mr. Slocum's MOTION: To approve Mr. Smith's request to waive the $100 late filing fee.

Vote on MOTION: Yes - Slocum

No - Anderson, Pauly, Rodriguez, Wilson.

Absent - Owens Hayes.

Motion failed: 4 to 1.

Board Recommendation on Case at Attorney General's Office

Information about the following individuals, currently at the Attorney General's Office, is included for the Board to review and to make recommendations for further action:

Phil Ratte, (Phil) Ratte for State Representative Committee, 1-3328 52A - Two judgments have been obtained for late filing fees and nonfiling of the Special Election Cycle Report of Receipts and Expenditures due September 19, 1995. The monetary portions of the judgments have been referred to the Minnesota Collection Enterprise (MCE) and revenue recapture for enforcement. The last report filed for this committee shows an ending cash balance of $1,200. The candidate did not receive public subsidy in the special election.

Mr. Anderson's MOTION: To pursue the judgment compelling the filing of the delinquent Report of Receipts and Expenditures against Mr. Ratte.

Vote on MOTION: Unanimously passed by five members. (Owens Hayes absent).

Clark Schmidtke, Friends for (Clark) Schmidtke, 1-3178 22B - This matter is before the Board for consideration of options for further enforcement. A judgment has been obtained for late filing fees and the non-filing of the annual report of receipts and expenditures due January 31, 1995. Clark Schmidtke has since moved to Arizona. The Board may wish to refer the matter to MCE and Revenue Recapture for the monetary portion of the judgment, however, the Attorney General's office does not recommend pursuing the non-monetary portion because it would not be cost effective.

Another matter involving Clark Schmidtke is currently at the Attorney General's office. Findings for the collection of a $200 civil fine were turned over to the Attorney General's office in September, 1995. Until recently, this matter apparently was misplaced. Follow up work on this matter is currently proceeding.

Mr. Anderson's MOTION: To: 1) accept the recommendation of the Attorney General's office and refer the collection of the monetary portion of the judgment to Minnesota Collection Enterprise; and 2) defer from pursuing the judgment on the non-filing of the Report of Receipts and Expenditures against Mr. Schmidtke unless Mr. Schmidtke moves back to Minnesota.

Vote on MOTION: Unanimously passed by five members. (Owens Hayes absent).

Request to Terminate Registration With Cash Balance in Excess of $100

Robert M. Weiss, treasurer, Minnesota Bankers Political Action Committee, 4-0011 - The group that supports this committee has established a separate committee for Minnesota activities. The terminating committee is a federal political action committee and will remain active as such. The terminating committee's most recent contribution to a committee covered by 10A was in calendar year 1994. The committee reported a cash balance of $1,705.46 on its report which will be due September 3, 1996.

Mr. Slocum's' MOTION: To allow the Minnesota Bankers Political Action Committee to terminate it's registration with the Board with a cash balance greater than $100.

Vote on MOTION: Unanimously passed by five members. (Owens Hayes absent).

. Informational Items

Payment of civil penalty

Volunteers for (Bob) Anderson, #1-0653 10A - The Board investigated in executive session, on May 31, 1996, the committee's acceptance of contributions during 1995, which exceeded the applicable contribution limit. On August 12, 1996, the Volunteers for (Bob) Anderson paid a civil fine of $72, two times the excess amount. Representative Anderson entered into a conciliation agreement with the Board to remedy the matter that was signed by the Board Chair on July 26, 1996.

(Arne) Carlson/(Joanne) Benson Volunteer Committee, #1-2300 Gov - The Board reviewed, in regular session on July 26, 1996, its decision of May 31, 1996, regarding the committee's acceptance of four contributions from registered lobbyists during the regular session of the legislature during 1995. Under protest, the committee paid a civil fine of $2,000 on July 3, 1996. The Board voted to return to the committee $750 of the $2,000 paid for the civil fine imposed. The amended findings were signed by the Board Chair on August 2, 1996.

House Republican Campaign Committee, #2-0010 - The Board investigated in executive session, on June 21, 1996, the committee's acceptance of two contributions from registered principal campaign committees and one contribution from a registered lobbyist during the regular session of the legislature during 1995. On July 30, 1996, the House Republican Campaign Committee paid a civil fine of $1,500.

All payments of civil fines have been deposited in the general fund of the state under Minn. Stat. §10A.28.

Payment of late filing fees

George Gregorich, treasurer, (George) Gregorich Campaign Fund, #1-3213 7A, $49.25 - This is a late filing fee for the late filing of the Pre-Primary Election Report of Receipts and Expenditures due 9-6-94. $25 monthly installment payments began October 1, 1995, subsequent payments due the 1st of each month, until the $250 late filing fee is paid. The $49.25 payment represents the $24.25 payment due June 1, 1996, and the $25 payment due July 1, 1996. All late fees assessed have been satisfied.

All payments have been deposited in the general fund of the state under Minn. Stat. §10A.34.

Financial Report and Agency Deposits - No report.

ADVISORY OPINION REQUESTS

Requests for the following advisory opinions are nonpublic data.

Advisory Opinion #243 - Candidate without public subsidy agreement exceeding campaign spending limit (see July 26th minutes)

A copy of the final approved Advisory Opinion #243 was available for Board review.

SUMMARY: ADVISORY OPINION #243 as signed by Chair Carolyn Rodriguez, August 23, 1996: A candidate may sign a public subsidy agreement even if the limits it imposes were exceeded in a previous year.

Advisory Opinion #244 - Commercial use of Ethical Practices Board Data

The Board reviewed a draft response to an advisory opinion request from the representative of an organization who asks the Board if use on a commercial internet site of data obtained from reports and statements filed with the Board is a prohibited commercial use under Minn. Stat. § 10A.02, subd. 8(e).

Mr. Anderson' MOTION: To: 1) lay over discussion of Advisory Opinion #244 to the September 20, 1996, Board meeting; and 2) request Board counsel to research the issue.

Vote on MOTION: Unanimously passed.

Advisory Opinion #245 - Gift of plaque to official

The Board reviewed a draft response to an advisory opinion request from a lobbyist representing a lobbyist principal who asks if the award of a plaque worth $150 to $200 to a legislator based on individual services in the field of fire service is permitted as an exception to the general gift prohibition established in Minn. Stat. § 10A.071.

Mr. Anderson's MOTION: To approve Advisory Opinion #245 as drafted.

Vote on MOTION: Unanimously passed.

SUMMARY: ADVISORY OPINION #245 as signed by Chair Carolyn Rodriguez, August 23, 1996: A plaque awarded by a lobbyist principal to a legislator based on individual services in the field of fire service falls within an exception to the general prohibition of gifts by lobbyist principals to officials.

LEGAL COUNSEL'S REPORT

Board members reviewed memos from Counsel Eller and Joan Wood outlining the status of cases which have been turned over to the Attorney General's office. (See memos attached).

LEGISLATIVE RECOMMENDATIONS AND RULES SUBCOMMITTEE REPORT

Subcommittee chair Owens Hayes reported that the Legislative Recommendations and Rules Subcommittee met and heard comments on the proposed rules from Robert Hentges, lobbyist. Subcommittee chair Owens Hayes has scheduled a subcommittee meeting on September 12, 1996, at 8:30 a.m. . Staff will prepare revisions to the draft rules based on the public comments. The subcommittee shall review the draft at its September 12th meeting and will present a final draft to the full Board at the September 20th meeting.

ADJOURNMENT

Meeting adjourned.

Respectfully submitted,

Nancy Wilson, Secretary

(Minutes by staff)

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