June 2013 Agenda

    NOTICE AND AGENDA

    Commission Meeting

     

    Board of Supervisors Chambers

    70 West Hedding Street

    San Jose, CA 95110


    Thursday, June 20, 2013

    10:00 A.M.

    View Agenda as PDF

    Under Government Code section 11123(a), all meetings of a state body are open and public, and all persons are permitted to attend any meeting of a state body, except as otherwise provided in that article. The section further states that the portion of the teleconferenced meeting that is required to be open to the public must be audible to the public at the location specified in the notice of the meeting. The Commission may take action on any item listed on this agenda.

    This meeting of the Commission will include teleconference participation by Commissioners Eskovitz and Wasserman. The teleconference locations, in addition to the address above are:

    101 West Broadway, 10th Floor, San Diego, CA 92101

    1230 Crenshaw Blvd, Suite 103, Torrance, CA 90501

    Welcome

    Ann M. Ravel, FPPC Chair

    1. Public Comment

    This portion of the meeting is reserved for comment on items not on the agenda. Under the Bagley-Keene Act, the Commission cannot act on items raised during public comment, but may respond briefly to statements made or questions posed; request clarification; or refer the item to staff.

    Comment Letter - Common Cause (item 19)

    Comment Letter - League of California Cities City Attorneys FPPC Committee (item 20)

    Comment Letter - (item 23)

    2. Approval of May 2013 Commission Meeting Minutes

    3-18 Enforcement - Consent Calendar

    Money Laundering

    3. In the Matter of Daniel Chun, FPPC No. 13/325. Staff: Senior Commission Counsel Bridgette Castillo, Senior Commission Counsel Dave Bainbridge, and Supervising Special Investigator Sandra Buckner. In 2008, Respondent, Daniel Chun, caused $4,000 in political contributions to be made on behalf of Hai Fu “Joey” Lo to two candidates for mayor of the City of Fremont without disclosing that he was acting as an intermediary for Mr. Lo in violation of Government Code Section 84302 (4counts). Total Proposed Penalty: $18,000.

    Chun - Stip

    4. In the Matter of Hai Fu “Joey” Lo, FPPC No. 11/460. Staff: Senior Commission Counsel Bridgette Castillo, Senior Commission Counsel Dave Bainbridge, and Supervising Special Investigator Sandra Buckner. In 2008, Respondent, Hai Fu “Joey” Lo, provided $4,000 to Daniel Chun that Mr. Chun used to make eight political contributions to two candidates for mayor of the City of Fremont on Respondent’s behalf without disclosing that Respondent was the source of the contributions in violation of Government Code Section 84301 (4 counts). Total Proposed Penalty: $18,000.

    Lo - Stip

    Conflict of Interest

    5. In the Matter of Joni Gray, FPPC No. 12/286. Staff: Commission Counsel Milad Dalju and Special Investigator Annaraine Diaz. On April 1, 2008, Respondent, Joni Gray, in her capacity as a member of the Santa Barbara County Board of Supervisors, made a governmental decision in which she knew, or had reason to know, she had a financial interest, by voting to authorize the Chair of the Santa Barbara County Board of Supervisors to execute a forgivable loan in the amount of $50,000 to the Lompoc Housing and Community Development Corporation, in violation of Government Code Section 87100 (1 count). Total Proposed Penalty: $3,000.

    Gray- Stip

    Independent Expenditure Committee Coordination

    6. In the Matter of Aide Castro, Matthew Lemcke, and Friends to Elect Aide Castro, FPPC No. 11/253. Staff: Commission Counsel Galena West and Program Specialist Grant Beauchamp. Respondent, Aide Castro (“Respondent Castro”), was a replacement candidate in the September 2007 Lynwood City Council election. Respondent, Friends to Elect Aide Castro (“Respondent Committee”), was her candidate controlled recipient committee, and Respondent, Matthew Lemcke (“Respondent Lemcke”), was the Treasurer at all times relevant. Voters Against Corruption (“VAC”) was a recipient committee formed to support both the recall of the incumbent Lynwood City Council members and the replacement candidates in there call election, including Respondent Castro. Respondent Lemcke was also Treasurer for this committee. Respondent Committee’s campaign consultant, Mr. Chris Robles, and his company, The Pericles Group, were also hired to be VAC’s campaign consultants. Through this interaction between the two committees by agents of Respondent Committee, VAC became a controlled committee of Respondent Castro and, as such, all contributions and expenditures were required to go through Respondent Committee. Respondents failed to disclose information regarding a $3,000 contribution received and over $10,000 in expenditures made of $100 or more on a semi-annual Form 460 Campaign Statement for the reporting period ending December 31, 2007, in violation of Government Code Section 84211, subdivisions (a),(b), (f), and (k), (1 count). Total Proposed Penalty: $3,500.

    Castro - Stip

    Campaign Reporting

    7. In the Matter of Fountain Valley Kids 2012, Yes on Measure N, and Paul Rincon, FPPC No. 12/885. Staff: Commission Counsel Zachary Norton and Political Reform Consultant Teri Rindahl. Respondent, Fountain Valley Kids 2012, Yes on Measure N, was a primarily formed ballot measure committee that supported the passage of Measure N, a Fountain Valley School District bond measure on the ballot in the November 6, 2012 election. Respondent, Paul Rincon, was the Treasurer for the committee at all times relevant. Respondents failed to timely file a first pre-election Form 460 Campaign Statement covering the period January 1, 2012, through September 30, 2012, due October 5, 2012, (1 count) and a second pre-election Form 460 Campaign Statement covering the period October 1, 2012, through October 20, 2012, due October 25, 2012, (1 count) in violation of Government Code Sections 84200.5, subdivision (b), and 84200.7. Total Proposed Penalty: $5,000.

    Fountain Valley Kids - Stip

    8. In the Matter of Anna Caballero, Anna Caballero for Senate 2010 committee, and James R. Santos, FPPC No. 11/275. Staff: Senior Commission Counsel Galena West and Program Specialist Luz Bonetti. Respondent, Anna Caballero, was an unsuccessful candidate for California State Senate in the November 2, 2010 Statewide General Election. Respondent, Anna Caballero for Senate 2010, was her candidate controlledrecipient committee. Respondent, James R. Santos, served as the committee Treasurer. In this matter, Respondents failed to timely report subvendor information for payments totaling approximately $825,335, on Form 460 Campaign Statements filed for the reporting periods ending September 30, 2010, and October 16,2010, in violation of Government Code Sections 84211, subdivision (k), and 84303 (1 count). Total Proposed Penalty: $1,000.

    Caballero - Stip

    9. In the Matter of Alberto O. Torrico, Alberto Torrico for Attorney General 2010committee, and James R. Santos, FPPC No. 11/944. Staff: Senior Commission Counsel Galena West and Program Specialist Luz Bonetti. Respondent, Alberto O.Torrico, was an unsuccessful candidate for Attorney General in the June 8, 2010 Statewide Primary Election. Respondent, Alberto Torrico for Attorney General 2010, was his candidate-controlled recipient committee. Respondent, James R. Santos, served as the committee Treasurer. In this matter, Respondents failed to timely report subvendor information for payments totaling approximately $465,531, on Form 460 Campaign Statements filed for the reporting periods ending March 17, 2010, May 22,2010, and June 30, 2010, in violation of Government Code Sections 84211, subdivision (k), and 84303 (1 count). Total Proposed Penalty: $1,000.

    Torrico - Stip

    10. In the Matter of Mike Stevens, Committee to Re-Elect Councilman Mike Stevens 2013, and Mike Stevens, Treasurer, FPPC No. 13/240. Staff: Political Reform Consultant Adrianne Korchmaros. Respondents, Mike Stevens, Committee to Re-Elect Councilman Mike Stevens 2013, and Mike Stevens as Treasurer, failed to timely file the second pre-election Form 460 Campaign Statement covering the period February 17, 2013, through March 16, 2013, due March 21, 2012, with the City of Inglewood in violation of Government Code Section 84200.5. (1 count). Total Proposed Penalty: $200.

    Stevens - Stip

    11. In the Matter of Laura Santos, FPPC No. 12/738. Staff: Legal Analyst Tracey Frazier and Law Clerk Michael Hamilton. Respondent, Laura Santos, a governing Board Member for Bassett Unified School District, failed to timely file a Form 470 Short Form Campaign Statement covering the 2012 calendar year, due July 31, 2012, in violation of Government Code Section 84200 (1 count). Total Proposed Penalty: $200.

    Santos - Stip

    12. In the Matter of San Fernando Valley Republican Club, FPPC No. 12/652. Staff: Legal Analyst Tracey Frazier and Law Clerk Michael Hamilton. Respondent, San Fernando Valley Republican Club, failed to file a semi-annual Form 460 Campaign Statement covering the period January 1, 2012, through June 30, 2012, due July 31, 2012, in violation of Government Code Section 84200 (1 count). Total Proposed Penalty: $200.

    San Fernando Valley Republican Club - Stip

    13. In the Matter of Friends to Elect Gerri Guzman, FPPC No. 12/742. Staff: Legal Analyst Tracey Frazier. Respondents, Friends to Elect Gerri Guzman, Geraldine Guzman, an incumbent Montebello Unified School District Governing Board Member, and Charlotte Truillo, the committee’s Treasurer, failed to timely file a Form 460 Recipient Committee Campaign Statement covering the period January 1, 2012, through June 30, 2012, due July 31, 2012, in violation of Government Code Section 84200 (1 count). Total Proposed Penalty: $200.

    Guzman - Stip

    14. In the Matter of Trina Williams, FPPC No. 12/736. Staff: Legal Analyst Tracey Frazier and Law Clerk Michael Hamilton. Respondent, Trina Williams, Board Member for the Inglewood Unified School District, failed to file a semi-annual Form 470 Campaign Statement covering the 2012 calendar year, due July 31, 2012, in violation of Government Code Section 84200 (1 count). Total Proposed Penalty: $200.

    Williams - Stip

    Major Donor Reporting

    15. In the Matter of Andrew Peceimer, FPPC No. 12/868. Staff: Senior CommissionCounsel Dave Bainbridge and Special Investigator Ann Flaherty. Respondent, Andrew Peceimer, failed to timely file Form 461 Major Donor Committee Campaign Statements for three reporting periods in violation of Government Code Section 84200 (3 counts). Total Proposed Penalty: $1,200.

    Peceimer - Stip

    Statement of Economic Interest – Non-Reporting

    16. In the Matter of Raymond J. Nutting, FPPC No. 13/290. Staff: Political Reform Consultant Adrianne Korchmaros. Respondent, Raymond J. Nutting, as a Supervisor for the County of El Dorado, failed to timely disclose his economic interests in grant moneys totaling $22,423 received through the California Forest Improvement Program Form from Cal FIRE and Sierra Coordinated Resources Management Council as well as both an income and investment interest in Nutting Ranch on his 2009 Annual Statement of Economic Interests covering the period January 1, 2009, through December 31, 2009, due April 1, 2010, in violation of Government Code Sections 87206 and 87207 (2 counts). Total Proposed Penalty: $400.

    Nutting - Stip

    17. In the Matter of Gregory J. Gruzdowich, FPPC No. 13/230. Staff: Political Reform Consultant Adrianne Korchmaros. Respondent, Gregory J. Gruzdowich, as an elected Member of the Board of Directors for the San Diego County Santa Fe Irrigation District, a position classified in Government Code Section 87200 as that of a “public investment manager,” failed to timely disclose his economic interests in investments in several stocks on the Candidate Statement of Economic Interests he filed for his successful election in violation of Government Code Section 87201 (1 count). Total Proposed Penalty: $200.

    Gruzdowich - Stip

    18. In the Matter of Thomas Hudson, FPPC No. 10/741. Staff: Senior Commission Counsel Neal Bucknell, Special Investigator Beatrice Moore, and Law Clerk Emma Olson. Respondent, Thomas Hudson, is a Tax Counsel III (Specialist) for the California State Board of Equalization (“BOE”). In this matter, Respondent failed to timely disclose a business interest (which was required to be disclosed by the BOE Conflict of Interest Code) on his 2010 Annual Statement of Economic Interests in violation of Government Code Section 87300 (1 count). Total Proposed Penalty: $200.

    Hudson - Stip

    19-22 General Items

    19. Discussion of Draft Regulation 18421.5: Staff: General Counsel Zackery P.Morazzini and Senior Commission Counsel Heather M. Rowan. Staff is seeking Commission and public input on a new regulation that would create a more specific and easily identifiable report of when a committee pays a person or group to create online content on behalf of the committee. Staff anticipates asking the Commission to adopt the regulation, with any revisions, at the August 2013 meeting.

    Regulation 18421.5 Memo

    18421.5 Paid Online Communications

    20. Discussion of Issues Relating to Material Financial Effect on Real Property: Staff: General Counsel Zackery P. Morazzini and Senior Commission Counsel William J. Lenkeit. Staff will discuss the history of Commission regulations that have tried to identify “what is the material financial effect of a governmental decision on a real property financial interest?” The discussion will include examples of actual factual situations that staff has been presented with in advice letters over the years in the hope that an informed discussion will lead to the development of regulations that provide guidelines that are better suited to real world application.

    Conflicts Real Property Materiality Memo

    Staff Memo 10.27.1978

    Staff Memo 04.20.1979

    Staff Memo 05.24.1979

    Staff Memo 07.14.1988

    Proposed Reg - 18702.3 - 05.27. 1988

    Adopted Reg - Statement of Reason - 18702.3 - 10.14.1988

    Staff Memo - 01.24.2000

    Appraiser Advice Letter Summaries

    Real Property Presentation 

    21. Adoption of Amendment to Regulation 18531. Staff: Lynda Cassady, Division Chief, Technical Assistance. Staff proposes to amend Regulation 18531 to update the positions and disclosure categories in the FPPC's conflict of interest code.

    Regulation 18351 Memo

    Proposed FPPC Code Amendment 2013

    Initial Statement of Reasons 5.16.2013

    22. Approval of FPPC Form 806 Agency Report of Public Official Appointments: Staff: Lynda Cassady, Division Chief, Technical Assistance. In 2012 the Commission amended regulation 18705.5 which creates a limited exception to allow public officials to vote on their appointment to a committee or position in the agency which the official serves, if the appointment will result in additional income of $250 or more in a 12-month period. The regulation requires the agency to identify the appointments on a form prepared by the Commission. The Form 806 has been revised to address therecent amendment.

    Form 806 Memo

    Form 806 FAQs

    Form 806 Instructions

    23. Executive Staff Reports

    Executive Director/Administrative Division Report. Staff: Interim ExecutiveDirector, Tina Bass

    Jun 2013 ED/Admin Report 

     

    Legislative Report. Staff: Legislative Coordinator, Sukhi Brar

    Jun 2013 Legislative Report

     

    Litigation Report. Staff: General Counsel, Zackery P. Morazzini

    Jun 2013 Litigation Report

     

    Legal Division Report. Staff: General Counsel, Zackery P. Morazzini

    Jun 2013 Legal Division Report

     

    Enforcement Division Report. Staff: Chief of Enforcement, Gary Winuk

    Jun 2013 Enforcement Division Report

     

    Technical Assistance Division Report. Staff: Chief of TAD, Lynda Cassady

    Jun 2013 TAD Report

    Additional Information

    Meeting Information: The agenda and related documents are posted on the FPPC website at www.fppc.ca.gov. Materials submitted by the public regarding each agenda item will be made available at the meeting and on the website. For more information about the meeting, contact the Commission Assistant, 428 J Street, Suite 620, Sacramento, CA, 95814, Tel. (916) 322-5745.

    Written comments on agenda items should be submitted to the Commission no later than 12:00 p.m. the day before the meeting in order to afford the Commissioners adequate time to fully consider the comments. The fax number for comment letters is (916) 322-6440.

    Listen by Phone or Online: Members of the public may listen to the meeting by phone by calling (888) 751-0624; access code 723284; or watch the meeting or watch the live meeting via YouTube.

    Accessibility: The meeting location is accessible to the disabled. Persons who, due to a disability, need assistance in order to participate in this meeting should, prior to the meeting, contact the Commission Assistant at (916) 322-5745 (voice), (916) 322-6440 (fax). TTY/TDD and Speech-to-Speech users may dial 7-1-1 for the California Relay Service to submit comments on an agenda item or to request special accommodations for persons with disabilities. Please allow a reasonable period of time between the request and the meeting date.