Meeting was called to order by Chair Anderson.

Members present: Anderson, Fluegel, Pauly, Rodriguez, Slocum, Wilson.

Others present: Olson, Goldsmith, Swanson, Perreault, staff: Gretz, counsel.

MINUTES (April 24 and May 4, 1998)

Mr. Slocum's MOTION: To approve the April 24 and May 4, 1998, minutes as drafted.

Vote on MOTION: Unanimously passed by 4 members (Fluegel abstained, Wilson absent).

Chair Anderson welcomed Wil  Fluegel. The Governor appointed Mr. Fluegel to Ms. Wilson's former position on the Board effective June 16, 1998.

Next Board meeting will be Friday, July 24, 1998.

Chair Anderson made the following appoints to the nominating committee: Ms. Rodriguez, Mr. Slocum, and Chair Anderson. The committee will meet by conference call and report to the Board at the July Board meeting.

Vote on MOTION: Unanimously passed.

Board members reviewed a draft policy on security information regarding individuals required to file certain documents with the Board.

Ms. Rodriguez's MOTION: To approve the policy on security information as drafted.

The Board reviewed and made certain language changes to a draft Affirmative Action Plan for August 1, 1998, to July 31, 2000.

Ms. Rodriguez's MOTION: To approve the Affirmative Action Plan as amended in discussion.

Vote on MOTION: Unanimously passed by 5 members (Wilson absent).

Ms. Olson reported the following:

The Campaign Finance Management System software is available for client use in version one. Mr. Goldsmith continues to offer weekly software training to interested clients.

Mr. Goldsmith, Ms. Swanson, and Ms. Olson met with Mr. Fluegel to discuss Board activities and policies.

Mr. Goldsmith continues to meet with the Minnesota Historical Society's Electronic Records Advisory Task Force in an attempt to resolve issues about the definition and storage of electronic records.

Public Outreach:

The position description for the Assistant Executive Secretary, Mr. Goldsmith incumbent, has been rewritten to reflect the current responsibilities. The Department of Employee Relations is reviewing the position description to ensure compensation at an appropriate level.

A copy of a portion of the tobacco settlement dealing with lobbyist disclosure was provided to Board members. The additional disclosure information is filed with the Attorney General's office and Governor's office.

The annual COGEL conference will be in Seattle from September 13 - 16th. Registration and program information was provided to Board members. Board members may wish to discuss attendance at the conference. An early decision on who will attend may keep travel costs down.

Mr. Goldsmith will moderate a session at the conference intended to assist other jurisdictions in developing electronic disclosure systems. Ms. Olson will attend the COGEL steering committee meetings all day Sunday, September 13th and Wednesday afternoon and Thursday following the conference.

It was agreed by consensus that Mr. Slocum and Mr. Fluegel will attend the COGEL conference in Seattle. Ms. Wilson will serve as an alternate in case Mr. Slocum is unable to attend.

Ms. Perreault presented the following enforcement matters for Board action:

• Report of Receipts and Expenditures for Principal Campaign Committees

• Report of Receipts and Expenditures for Political Committees or Political Funds

Michael McCarthy, treasurer, Libertarian Party of Minnesota

Curtis De Young, treasurer, St. Croix Valley Central Labor Union

• Lobbyist Disbursement Report

Edwin Cain, Representing City of Marshall

• Supplementary Statement of Economic Interest

M. Judith Schmidt, Arts Board

David Doth, Human Services Department

M Elaine Prom, Teaching Board

Marilyn Vigil, Board of Social Work

Riddhi Jani, Office of the Attorney General

Scott Malm, Minnesota Technology Institute

Board Action: Authorization of a third letter, to be sent by certified mail, to compel the filing of an Original Statement of Economic Interest, due March 27, 1998, and subsequent legal action if the report is not filed. A reminder letter and two certified letters have been sent to the client.

Samlong Inthaly-Smith, Board of Social Work

Board Action: Authorization of a certified letter for the nonpayment of a late filing fee and subsequent legal enforcement action in the event the fee is not paid. Two notices have been previously sent to each client.

Aric Nissen, candidate, Aric Nissen for State Representative: $100

Marilyn Vigil, Board of Social Work: $20

Joseph Quinn, treasurer, Minneapolis Fire Department Pensioners' PCF: $55

Board Action: Authorization of a third letter, to be sent by certified mail, to compel the filing of the Lobbyist Disbursement Report, due April 15, 1998, and subsequent legal action if the report is not filed. A reminder letter and two certified letters have been sent to each client.

Fred Myers, Representing National Rifle Association Institute for Legislative Action

Forest Wilkinson, Representing Forest Wilkinson

Ann M DeGroot, Representing Gay and Lesbian Community Action Council

C. Scott Cooper, Representing Gay and Lesbian Community Action Council

Michael Burns, Representing Hennepin County Board of Commissioners

Board Action: Authorization of a third letter, to be sent by certified mail, to compel the filing of a required amendment to the committee's Registration and Statement of Organization and to authorize subsequent legal enforcement action if the amendment is not filed. An amendment letter and one subsequent notice have previously been sent to each client.

Richard Peterson, treasurer, Jackson County DFL

Brian Bergson, candidate, Volunteers to Elect Brian Bergson

Board Action: Authorization of a letter, to be sent by the Attorney General's Office to compel the filing of the Annual Report of Lobbyist Principal, due March 16, 1998, and subsequent legal action if the report is not filed. Two letters have been sent to each client.

Ms. Rodriguez's MOTION: To authorize the actions specified in the consent matters.

Vote on MOTION: Unanimously passed 5 members (Wilson absent).

The following committees have been identified as inactive. Staff notified the treasurer of each committee of the need to terminate the committee's registration with the Board. Staff requests authorization of a certified letter to compel the termination and subsequent action, as directed by the Board, if the termination is not filed. Two notices have been previously sent to each client.

• Randy Kamrath, candidate, (Randy) Kamrath Volunteer Committee, ending cash balance of $166.71, outstanding loans receivable of $184.16 from individuals, unpaid bills of $541.10 to individuals.

• Michael Carlson, treasurer, Volunteers to Elect John Hall Committee, ending cash balance of $430

• Thomas Meyer, candidate, East Side Neighbors for Tom Meyer, ending cash balance of $0, outstanding loans to the candidate of $3,479.18, unpaid bills of $3,206.36 to vendors

Mr. Fluegel's MOTION: To authorize: 1) a certified letter to compel termination; and 2) subsequent notification to the Attorney General's office of the committees that fail to terminate.

Vote on MOTION: Unanimously passed 5 members (Wilson absent).

• Patrick Harris, candidate, Harris for House Committee - $100, for the late filing of the Report of Receipts and Expenditures for calendar year 1997, due February 2, 1998. Report was received in the Board office on May 6, 1998. No motion was made.
• Marvin Scroggins, treasurer, Larry McKenzie Campaign Committee - $100 for the late filing of the Report of Receipts and Expenditures for calendar year 1997, due February 2, 1998. Report was received in the Board office on May 4, 1998

Ms. Rodriguez's MOTION: To approve Mr. Scroggin's request to waive the $100 late filing fee request due to extenuating circumstances.

Vote on MOTION: Unanimously passed by 5 members (Wilson absent).

• Nancy Anderson, treasurer, Volunteers for Brian Bergson - $100 for the late filing of the Report of Receipts and Expenditures for calendar year 1997, due February 2, 1998. Report has not been received in the Board office to date. Ms. Anderson has resigned as treasurer of the Volunteers to Elect Brian Bergson.

Vote on MOTION: Unanimously passed by 5 members (Wilson absent).

• William Schottler, William Schottler Volunteer Committee - $100 for the late filing the Report of Receipts and Expenditures due February 2, 1998.

Mr. Slocum's MOTION: To: 1) approve the request to waive the $100 late filing fee due to extenuating circumstance; and 2) direct staff to administratively terminate the William Schottler Volunteer Committee.

Vote on MOTION: Unanimously passed by 5 members (Wilson absent).

• Joseph Quinn, treasurer, Minneapolis Fire Pensioners PAC - $55 for the late filing of the Report of Receipts and Expenditures for calendar year 1997, due February 2, 1998. Report was received on April 13, 1998. No motion was made.

As a result of review of the Reports of Receipts and Expenditures for calendar year 1997, staff sent letters informing committees of the requirement to have complete date, address, and employment/occupation disclosure for all individuals which give an aggregate of over $100. All committees have provided complete date and address information. There are currently eight committees which have missing employment information. Staff requests Board direction on further enforcement procedure.

Vote on MOTION: Unanimously passed.

• June Holmes, treasurer, National Association of Independent Insurers

Staff review of the National Association of Independent Insurers Report of Receipts and Expenditures found contributions from unregistered associations. During phone calls with staff, it was explained that these are contributions from other federal PACs. By letter, dated May 21, 1998, June Holmes states that the contributions, while not solicited, are an important source of revenue for the committee and it is not realistic for the committee to refund them. Therefore, the committee requests that their registration be withdrawn immediately and that no further enforcement action be taken. The committee registered in 1996, and made contributions, to the Minnesota House and Senate Republican Caucuses.

Ms. Rodriguez's MOTION: To approve the request to withdraw the registration of the National Association of Independent Insurers committee and to take no further enforcement action against the committee.

Vote on MOTION: Unanimously passed.

• John C. Briggs, treasurer, HyVee Inc., Employees Political Action Committee

On May 26, 1998, staff received a letter from John C. Briggs the treasurer of the HyVee Inc., Employees Political Committee requesting that the committee's registration be withdrawn. The committee registered on April 16, 1998, and gave one contribution to a candidate which was returned.

Ms. Rodriguez's MOTION: To approve the request to withdraw the registration of the HyVee Inc., Employees Political Action Committee.

Vote on MOTION: Unanimously passed.

• William Forsberg, treasurer, Committee to Retain the Appeals Court Judges

On June 3, 1998, staff notified the Committee to Retain the Appeals Court Judges that it was considered an inactive committee and that it must file a termination report with the Board within 60 days. On June 12, 1998, Mr. Forsberg sent a letter requesting that the committee be allowed to remain active. The letter states that although no funds have been expended the committee has been active. During the 1996 elections, none of the appeals court judges were challenged. According to the letter, the very nature of the committee is that it is an ongoing committee that becomes active during election years.

Mr. Anderson recused himself from discussion on this matter. Vice Chair Rodriguez presided.

Ms. Pauly's MOTION: To approve the request of the Committee to Retain the Appeals Court Judges to remain active.

Vote on MOTION: Unanimously passed by 5 members.

• Thomas Tauscheck, treasurer, Minnesota Podiatry PAC

On June 3, 1998, staff notified the Minnesota Podiatry PAC that it was considered an inactive committee and that it must file a termination report with the Board within 60 days. On June 22, 1998, Mr. Tauscheck sent a letter requesting that the committee be allowed to remain active. Mr. Tauscheck states that the committee will be participating in the 1998 election year.

Ms. Pauly's MOTION: To approve the request of the Minnesota Podiatry PAC to remain active.

Vote on MOTION: Unanimously passed.

• Kay Fecke, treasurer, Burnsville Education Association

On June 3, 1998, staff notified the Burnsville Education Association Committee that it was considered an inactive committee and that it must file a termination report with the Board within 60 days. On June 24, 1998, Ms. Fecke sent a letter requesting that the committee be allowed to remain active. Ms. Fecke states that the committee will be making expenditures during the upcoming 1998 election year.

Ms. Rodriguez's MOTION: To approve the request of the Burnsville Education Association Committee to remain active.

Vote on MOTION: Unanimously passed.

The Board directed staff to place on the consent agenda first time requests from inactive committees requesting to remain active.

• Tim Knoedler, candidate, Knoedler for Minnesota Senate Committee

The Board imposed a late filing fee of $100 for the late filing of the Pre-Primary Report of Receipts and Expenditures due on September 6, 1996. At its meeting of June 27, 1997, the Board directed staff to dismiss the court proceedings against Mr. Knoedler and proceed with the Revenue Recapture and Minnesota Collections Enterprise programs. The Board directed staff to review the matter in one year. The filing fee was not recovered through the collection programs. Board members agreed by consensus that no further legal action would be taken. The Board directed staff to continue attempts to secure the $100 late filing fee through Revenue Recapture and Minnesota Collections Enterprise programs.

William Anderson, Friends of Rob Hafiz: $75

Paul Peterson, (Steven) Boynton for Senate: $10

Gavin Wilkinson, Klaphake Volunteer Committee: $15

• Lobbyist Disbursement Report due January 15, 1998

Teri Halpin, Representing Minneapolis Municipal Retirement Association: $85

• Original Statement of Economic Interest due March 17, 1998

Ellen Palmer, The Board of Lola & Rudy Perpich Minn Center for Arts Education: $10

• Connie Heisenfelt, candidate, Connie Heisenfelt for House - During election year 1996, the Connie Heisenfelt for House Committee accepted aggregate contributions from a political party totaling $5,360. The total amount of these contributions exceeded the applicable limit by $360. The Board issued Findings Concerning Probable Cause on July 8, 1997, and imposed a civil fine of $360 for aggregate contributions in excess of the applicable limit. On May 1, 1998, the Committee paid an installment of $175 toward the civil fine. The remaining balance of the civil fine plus the $80 service of process fee was paid on May 15,1998, to conclude the matter.

• Ansgar Rothstein, treasurer, Committee to Re-elect Doug Stang - During calendar year 1997, the Committee to Re-elect Doug Stang accepted a $150 contribution, which facially exceeded the applicable non-election year limit by $50. The committee also accepted contributions which together totaled $105, exceeding the applicable $100 limit by $5. Doug Stang entered into a conciliation agreement on May 5, 1998, to remedy the matter. On May 4, 1998, the committee paid a civil fine of $105, two times the amount by which the facially- excessive contribution exceeded the limit, and one times the amount by which the cumulatively excessive contributions exceeded the applicable contribution limit.

• Bonnie Jennings, treasurer, Loren Jennings for State Representative - During calendar year 1997, the Jennings for State Representative committee accepted a $200 contribution which exceeded the applicable non-election year contribution limit by $100. Loren Jennings entered into a conciliation agreement on May 5, 1998, to remedy the matter. On May 4, 1998, the Jennings for State Representative committee paid a civil fine of $200, two times the amount by which the contribution exceeded the applicable contribution limit.

• Judi Ray, treasurer, (Ted) Mondale for Governor - During the 1997 regular legislative session, the Mondale for Governor committee accepted a contribution from a lobbyist registered with the Board. On April 31, 1998, the Board issued Findings Concerning Probable Cause and imposed a civil fine of $500, for acceptance of a contribution during the legislative session. On May 5, 1998, the Mondale for Governor paid a civil fine of $500, to conclude the matter.

• Deborah Olson, treasurer, (Hubert) Humphrey for Governor Committee - During calendar year 1997, the Humphrey for Governor Committee accepted total contributions from one source of $600, exceeding the applicable $500 non-election year contribution limit by $100. Hubert H Humphrey III, entered into a conciliation agreement on April 20, 1998, to remedy the matter. On May 7, 1998, the Humphrey for Governor Committee paid a civil fine of $100, one times the amount by which the contribution exceeded the applicable contribution limit.

• Antoinette Harms, treasurer, ( Michael) Freeman for Governor - During regular 1997 regular legislative session, the Freeman for Governor committee accepted three contributions from lobbyists registered with the Board. On March 27, 1998, the Board issued Findings Concerning Probable Cause and imposed a civil fine totaling $900, for acceptance of contributions during the legislative Session. On April 28, 1998, the Freeman for Governor committee paid a civil fine of $900, to conclude the matter.

• Steve Sviggum, chair, House Republican Campaign Committee - During the 1997 regular legislative session, the House Republican Campaign Committee solicited contributions from lobbyists when it mailed fundraising invitations to a list of people. On April 24, 1998, the Board issued Findings Concerning Probable Cause and imposed a civil fine of $500 for soliciting contributions from registered lobbyists during the legislative session. On May 18, 1998, the House Republican Campaign Committee paid a civil fine of $500 to conclude the matter.

• Vernon Wetterach, treasurer, Karen Clark Election Committee - During calendar year 1997, the Karen Clark Election Committee accepted aggregated contributions from special sources, which exceeded the applicable limit by $278. Karen Clark entered into a conciliation agreement on May 9, 1998, to remedy the matter. On May 7, 1998, the Karen Clark Election Committee paid a civil fine of $278, one times the amount by which the contributions exceeded the applicable limit.

• Michael Paymar, candidate, (Michael) Paymar Volunteer Committee - During calendar year 1997, the Paymar Volunteer Committee accepted two facially excessive contributions. The contributions exceeded by $50 and $100 respectively, the applicable non-election year limit. Michael Paymar entered into a conciliation agreement on May 9, 1998, to remedy the matter. On May 6, 1998, the Paymar Volunteer Committee paid a civil fine of $300, two times the amount by which the two contributions exceeded the applicable limit.

• Linda Jacobson, treasurer, Ted Winter Volunteer Committee - During calendar year 1997, the Ted Winter Volunteer Committee accepted a facially excessive contribution of $200, which exceeded by $100 the applicable non-election year limit. Ted Winter entered into a conciliation agreement on May 9, 1998, to remedy the matter. On June 1, 1998, the Winter Volunteer Committee paid a civil fine of $300, three times the amount by which the contribution exceeded the applicable limit.

• David Anderson, treasurer, (Roy) Terwilliger for Governor - During calendar year 1997, the Terwilliger for Governor Committee accepted $700 aggregated contributions from an individual, which exceeded by $250 the applicable non-election year limit. Roy Terwilliger entered into a conciliation agreement on May 31, 1998, to remedy the matter. On May 18, 1998, the Terwilliger for Governor Committee paid a civil fine of $250, one times the amount by which the contributions exceeded the applicable limit.

• Virginia Sande, treasurer, Friends of Chaudhary - During calendar year 1997, the Friends of Chaudhary accepted a facially excessive contribution of $400, which exceeded by $300 the applicable non-election year limit. The Friends of Chaudhary also accepted $1,050 in contributions from special sources. The total amount of these contributions exceeded by $138 the applicable limit on aggregate contributions from special sources. Satveer Chaudhary entered into a conciliation agreement on May 7, 1998, to remedy the matter. On June 15, 1998, the Friends of Chaudhary paid a civil fine of $600, two times the amount by which the facially-excessive contribution exceeded the applicable limit.

• James Bernstein, treasurer, Metropolitan Good Government Coalition - $271 paid through re-capture program for the late filing of the Pre-Primary Report of Receipts and Expenditures, due September 3, 1996; $209 late fee remaining.

• Amy desParois, treasurer, People for (Amy) desParois - $130 paid through Minnesota Collection Enterprise; $100 late filing fee for the Year-End Report of Receipts and Expenditures, due January 31, 1997, $30 Service of Process fee.

• George Bateman, treasurer, (George) Bateman for Representative - $263.70 partial payment through Chapter 13 bankruptcy. Final payment for return of public subsidy for 1990.

• John Dorn, treasurer, John Dorn Campaign Committee: $25

All payments of late filing fees and civil fines have been deposited in the general fund of the state pursuant to statute.

Board members reviewed a draft spending plan for fiscal year 1999.

Ms. Pauly's MOTION: To approve the spending plan for fiscal year 1999 as drafted.

Vote on MOTION: Unanimously passed.

The Board reviewed and discussed a draft response to an advisory opinion request by Robert Maline, Treasurer, Jesse Ventura for Governor Volunteer Committee, who asks: 1) if the manufacture and sale of fundraising merchandise using the services of a "pick and pack" distributor, which ordinarily makes these services available to the public, results in a contribution to the Committee from the manufacturer/distributor or in the bundling of contributions; and 2) if the consignment of manufactured items to retail businesses and the subsequent sale by the business results in a contribution to the Committee from the retail business or in the bundling of contributions.

Chair Anderson welcomed Robert Maline, Treasurer, and Doug Friedline, Campaign Manager, for the Jesse Ventura for Governor Committee ("Committee"). Mr. Maline explained and answered questions from the Board about the procedure the committee planned to use in placing shirts for sale in public stores. Mr. Friedline asked the Board if the shirts should have a tag on them telling buyers that the purchase of a shirt is a campaign contribution to the Committee. Mr. Goldsmith noted that chapter 10A does not require that type of notification. Counsel Gretz cautioned that contributors giving donations in addition to the purchase of a shirt may reach limits that require other disclosure and that contributors should be made aware that the purchase of a shirt is considered a contribution.

The Board discussed the concept of retail sales of merchandise as a fundraising mechanism. The Board concluded that such sales would not result in contributions from the retailer or in bundling of contributions if the agreement between the committee and the retailer was an arms-length transaction based on fair market value consideration.

Vote on MOTION: Unanimously passed.

The Board reviewed a draft response to an advisory opinion request by the treasurer of a candidate's principal campaign committee who asks if the costs of publishing the candidate's message described in the facts may properly be reported as 25% campaign expenditures and 75% as noncampaign disbursements.

Vote on MOTION: Unanimously passed.

Summary: Advisory Opinion #294 signed by Chair Barry Anderson, June 26, 1998: Publication of a candidate's message at Christmas time is not a constituent service. Use of principal campaign committee funds for the publication must be reported as campaign expenditures.

Board members reviewed a letter from legal counsel of an Indian tribe that wishes to participate in the Minnesota political process who asks the Board to reconsider the conclusions rendered in Advisory Opinion #290.

Chair Anderson welcomed Robert Hentges, Kurt Bluedog, and Greg Paulson, counsel to the tribe who spoke concerning the issues.

Board chair welcomed Tony Trimble, counsel, Republican Party of Minnesota, who spoke concerning the reconsideration of the Advisory Opinion on a broader range of issues.

Vote on MOTION: Unanimously passed

The Board discussed whether it was necessary to reach a conclusion concerning the legal status of an Indian Tribe in order to provide the guidance the Tribe needs concerning disclosure.

Board members reviewed a letter from Tony Trimble, counsel, Republican Party of Minnesota, requesting reconsideration of the conclusions rendered in the original findings in this matter. No motion was made.

Mr. Hentges requested an additional 30 days to comply with the order based on the complaint of the Republican Party of Minnesota so the Tribe can confer with other tribes who have matters pending before the Board.

Vote on MOTION: Unanimously passed.

Board members reviewed a memo from Counsel Gretz outlining the status of cases which have been turned over to the Attorney General's office (see copy of memo attached).

Commercial Use of Board Data (see January 23rd, March 27th, and April 24th minutes)

• John Lever, treasurer, Committee to Elect Jeff Aakhus - $50 for the late filing of the Report of Receipts and Expenditures for calendar year 1997, due on February 2, 1998. Mr. Lever informed Counsel Gretz that he was no longer the treasurer for the committee to Elect Jeff Aakhus.

• Edward Cain, lobbyist, Braham Area Community Development -$100 for the late filing of the Lobbyist Disbursement Report for the period July 1 through December 31,1997, due January 15, 1998. Mr. Cain states that a copy of report was in his file dated February 3, 1998, which is before the accrual of any penalty. He assumed the report was sent to Board office. No motion was made.

The Board issued findings concerning probable cause in the matter of an investigation regarding a letter mailed to the membership of the Minneapolis Municipal Retirement Association which included a statement supporting a particular candidate running for state auditor in the 1994 election year and did not include a statement of independent expenditure. The Board ordered that the findings and the record of the investigation be made a part of the public records of the Board (see copy of findings attached).

Meeting adjourned.

Respectfully submitted,

 Sidney Pauly, Secretary

(Minutes by staff)

 attachments (3)

State of Minnesota

Campaign Finance & Public Disclosure Board

First Floor South, Centennial Building . 658 Cedar Street . St. Paul, MN 55155-1603

"Security information means government data, the disclosure of which would be likely to substantially jeopardize the security of . . . individuals . . . against . . . trespass or physical injury." Minn. Stat. § 13.37, subd. 1(a).

Security information regarding individuals is classified as private data by the Minnesota Government Data Practices Act (Minn. Stat. Chapter 13).

An individual may request that public information about the individual filed with the Campaign Finance and Public Disclosure Board be considered security information and re-classified as private data. When such a request includes information which supports a belief that public data about the individual in Board files may substantially jeopardize the security of the individual against trespass or physical injury, the Executive Director shall temporarily classify that data as private and remove it from the Board's public files.

The matter shall be brought to the Board in executive session at its next regularly scheduled meeting. The Board will determine whether all or a portion of the filed data is security information. Any portion of the filed data which is security information shall be permanently edited from the copy of the filing kept in the Board's public records. The original filing shall be retained in Board records and classified as private data. Both the request and the Board's action shall be classified as security information and shall be private data under the Data Practices Act.

I. MAJOR CASES/MAJOR ISSUES:

1. St. Paul Legal Ledger v. State, Campaign Finance Board: We are working on the summary judgment motion, likely to be heard in September.

II. ENFORCEMENT MATTERS.

1. Cain, Edwin, Lobbyist, Braham Area Community Development. We have an enforcement action pending against this lobbyist for failure to file his disbursement report. Cain has produced a copy of a report dated February 3, 1998, which is before the accrual of any penalty. He states, "While a copy of the report was in my file, I can only assume that a copy was mailed to the Ethics Board." He asks that the $100 penalty be forgiven.

For other enforcement matters referred to the Attorney General's Office, see attached chart.

AG:46075 v1

AG:45951 v1

 STATE OF MINNESOTA

 Procedural Background

On March 16, 1998, Donald Moe (the "Complainant") filed a complaint with the Campaign Finance and Public Disclosure Board (the "Board") alleging that the Political Committee of the Minneapolis Municipal Retirement Association (the "Respondent") violated certain provisions of Minnesota Statutes, Chapter 10A during the 1994 election year.

The Complainant alleges that the Respondent mailed 30,000 letters on October 24, 1994, attempting to influence the outcome of the 1994 election for state auditor. The Complainant questions if the letter constitutes an independent expenditure and, if it does, whether or not Minn. Stat. §10A.17, was violated by not including a statement that the letter was an independent expenditure. The Complainant further alleges that the Respondent violated Minn. Stat. §10A.20, subd. 3(g), by failing to disclose the expenses associated with this letter on its 1994 year end Report of Receipts and Expenditures.

The evidence submitted in support of the complaint consists of a copy of the October 24, 1994, letter to members of the Minneapolis Municipal Retirement Association.

By letter dated April 13, 1998, Dan Cherryhomes, treasurer for the Respondent, states that in 1994 the organization mailed an internal communication to its membership, which at that time consisted of a little over 5,000 members. He also states that the organization was not aware that internal communications with its members were required to be disclosed under Minn. Stat. Chapter 10A. Mr. Cherryhomes states that the cost of mailing the letter was $1,498.

Mr. Cherryhomes spoke with Board staff regarding whether the communication met the definition of an independent expenditure. As a result of this conversation, Mr. Cherryhomes provided an Affidavit of Independent Expenditures, attesting that the October 24, 1994, letter was an independent expenditure and not made with the authorization, or expressed or implied consent of, or in cooperation or concert with, or at the request or suggestion of any candidate, or any candidate's principal campaign committee or agent.

On May 1, 1998, the Respondent amended the 1994 year end Report of Receipts and Expenditures to disclose the cost of the October 24, 1994, letter and to show the cost as an independent expenditure supporting a particular candidate.

The matter was considered by the Board in executive session on March 27, 1998. The Board further considered the matter in executive sessions on April 24, and May 22, 1998. Neither of the parties presented testimony. The matter was considered based on the compliant, Board records, and the Respondent's reply and amended Report of Receipts and Expenditures for the 1994 election year.

Copies of this document shall be provided to the complainant and the respondent.

 G. Barry Anderson, Chair

Campaign Finance and Public Disclosure Board