ETHICAL PRACTICES BOARD

Complicated campaign finance laws create confusion

Complicated laws produce complicated questions.

And once again, the Legislature is contemplating changes in
campaign finance regulations, including further restricting
interest group political contributions and matching small
donations from within a candidate's district.

But those charged with enforcing campaign laws say they are
having a hard enough time just keeping up with existing law. 

Twenty years ago, when the state Legislature decided to try to
make money less influential and more accountable in state
politics, lawmakers realized the need for an enforcement
mechanism and an administrative organization to carry out the
aims of the law. They decided to vest all of those
responsibilities into a single quasi-judicial body.

Minnesota's Ethical Practices Board is charged with, among other
duties, enforcing the state's campaign and lobbyist disclosure
laws, processing and analyzing thousands of forms and requests
every year, administering the $1.7 million public financing
system for over 400 political campaigns, and keeping track of
"potential conflicts of interest."

It's not an easy job, especially with a staff of six, no
full-time investigators, and an expectation by the public that
the board can actually deal with "ethical" problems in
government.

"They're trying to help people do the right thing," said Deb
Nankivell, former head of Minnesota's Common Cause chapter and a
board observer, but "the law is terribly complicated."

Bill Heaney, a lobbyist and former chair of the board, agreed,
adding that Minnesota politics is a relatively clean sport.

"Some of the reporting could be simplified and still end up
disclosing the same amount of data," Heaney said. "I know of some
treasurers [who] are highly skilled financial people that have a
hell of a time with the reporting and they're busting their butt
to do the right thing in a timely fashion."

The grandiose title of the board itself has caused more than a
few furrowed brows. The board's staff gets calls on everything
from medical malpractice to questionable campaign brochures, over
which the board has no authority.

"Other than the name.  . . we do not have purview over ethics,"
explained Mary Ann McCoy, the board's executive director, during
a Jan. 25 House committee hearing.

The Ethical Practices Board was created in 1974, just as the
federal government was refining its own tool for campaign law
enforcement (the Federal Elections Commission) in the wake of
Watergate. The intent of Minnesota's effort was to provide a
politically balanced, independent board with the authority to
interpret the law, which could then investigate and punish
offenders.

In reality, board members and staff say, they are largely a
depository of information that the state requires to be
collected. Unless there is technical mistake on a submitted form
-- and it happens to be noticed by staff or brought to the
board's attention by a concerned party -- no action will be
taken.

Much to the chagrin of legislators who have been slapped with
fines for "inadvertent" infractions, this lack of proactive
effort hinders the board's ability to educate them and help them
"navigate a complex process."

Legislators like first-term Rep. Gary Worke (IR-Waseca) say they
feel buried under a pile of complex campaign regulations and
requirements that make it difficult for those who really want to
play by the rules to do so.

Worke was fined for failing to report within 48 hours a
contribution greater than $400 received between Sept. 2 and Sept.
15 of an election year, as required by law.

"If anybody had taken a look at the situation, it was obvious
that no one [in the campaign] was trying to circumvent the law,"
he said. Worke explained that there was no real investigation of
his case, nor provisions for board leniency. The board called his
infraction "inadvertent," but imposed a $250 penalty anyway.

Rep. Kris Hasskamp (DFL-Crosby) complained that "you almost have
to be a lawyer or a [certified public accountant]" to understand
the law and its filing requirements, and legislators "pray that
the [campaign's] treasurer gets it right." She expressed concern
that some people might even be frightened out of the political
process because of the law's complexity.

One telling measure of the confusion people have with disclosure
and finance laws is the increasing number of advisory opinions
issued by the board, which are written upon request to clarify or
interpret gray areas in the law. The board is currently producing
more opinions than at any time in the past decade.

But those who are affected by the law cannot even be certain that
asking the board for advice will produce a clear answer. In 1992,
for the first time in its history, the board deadlocked on an
advisory opinion. In fact, it failed to respond to two formal
requests for advice last year, both dealing with a lobbyist
disclosure provision in 1990 amendments to campaign laws.

The board was asked to decide whether municipalities were
required to file expenditure reports as "principal lobbyists" if
they hired people to influence legislation. Three members of the
board and the Senate sponsor of the bill said that the law meant
to include local government bodies under its adopted disclosure
rules. But the other three board members disagreed, creating the
deadlock.

Bruce Willis, a Minneapolis attorney and the current chair of the
board, said the board's inability to resolve the more
controversial ambiguities about state law hasn't kept them away
from tough questions, but it certainly doesn't do confused
citizens or lawmakers any good.

"I think it creates a situation where it's more difficult for the
people who are subject to the law to understand what's required
of them," said Willis.

To be sure, the board and its employees labor to make the law
"user friendly." This past year, members of the staff held a
"primer" for first-time candidates on election year red tape. The
board also issues informational packets and receipt books to make
mandated disclosure easier.

And few, if any, complaints are heard about the abilities of the
staff and board members to spell out legal deadlines and
requirements upon request, or to point out statutory ambiguity
where it may exist.

Nevertheless, judging by the comments of legislators and the
rising caseload of questions and requests the board must manage,
frustration with the system abounds.

All of this leads to questions about what the board can manage,
and what its proper role in regulating campaigns ought to be.

Willis explained that the board remains largely reactive in its
enforcement efforts. "We rely in large measure . . . on the
candidates to police one another." He added that "very often the
complaints we get are not the result of any independent
investigation that we've undertaken, but, rather, somebody else
is going through the opposition's reports with a fine-tooth
comb."

Heaney conceded that the board generally deals with campaigns
that want to abide by the law, but are imposing fines because of
statutory requirements even when the mistakes are relatively
trivial.

"It's just all inadvertent stuff that happens because of the
frantic pace of campaigns," Heaney said. "It's bread crumb city,
you know. If somebody's trying to circumvent the law and
illegally accept money, they're not going to leave a trail."

Although Nankivell criticized board members for not perceiving
their roles as "activist" in nature, and for periodically taking
"very strict interpretations of the law," she agreed with Willis'
sentiment: "They don't have the money to do the audits, to do the
investigations."

However, Nankivell also emphasized that the reporting
requirements that have so strained the board's resources (and so
frustrated politicians and lobbyists) are necessary if the state
wants to maintain its high standards of disclosure when it comes
to mixing money and politics. "There's really no other way to
analyze where the money is coming from," she said.

Part of the board's problem is that the Legislature has at times
increased its authority without increasing its resources, Willis
said. Most recently, the board was directed to register lobbyists
and their employers that concentrate their efforts on local units
of government. However, no additional staff was added in the 1990
legislation, making the task difficult to carry out.

Some legislators believe that the campaign disclosure and finance
laws may be too complicated to be adequately or fairly enforced.
"We have met the enemy and the enemy is us," Rep. Gil Gutknecht
(IR-Rochester) said during a Jan. 25 legislative hearing.

Referring to campaign finance regulations, Gutknecht said, "We
have created this monster. . . and now it may be time to take a
giant step backwards." Gutknecht suggested that the law ought to
be simplified by creating a single spending and contribution
limit.

Lawmakers appear poised to enact some form of campaign reform
measure this year. But it remains to be seen how it can be
effectively enforced without exacerbating the same frustrations
board members, staff, and legislators are feeling already.

-- Adam Samaha



Originally printed in 1993 in Session Weekly, a weekly
newsmagazine published by the Minnesota House Public Information
Office.

***Last Update 8/5/94 (jtt) Last Review 8/5/94 (jtt) ***