September 1999 Meeting Minutes

Indiana Election Commission

MINUTES

SEPTEMBER 30, 1999

MEMBERS PRESENT: Dudley Cruea, Chairman of the Indiana Election Commission [IEC]; S. Anthony Long, Butch Morgan; Joseph M. Perkins, Jr.

MEMBERS ABSENT: None

STAFF ATTENDING: Candy Marendt, Co-Director, Election Division, Office of the Indiana Secretary of State ("Election Division"); Spencer Valentine, Co-Director, Election Division; J. Bradley King, Co-General Counsel, IEC and Election Division; Kristi Robertson, Co-General Counsel, IEC and Election Division; Michelle Thompson, Co-Director, Campaign Finance, Election Division; Bruce Northern, NVRA and Precincts Coordinator.

ALSO ATTENDING: Mr. Steve Corey of Governmental Business Systems (GBS); Ms. Wendy Davis, Marion County Election Board; Mr. Tom Wyman, of The Indianapolis Star.

1. CALL TO ORDER:

The chair called the September 30, 1999 meeting of the Indiana Election Commission to order at 1:35 p.m. in State House Room 156-A, Indiana State Capitol Building, 200 West Washington Street, Indianapolis, Indiana. He noted that proper notice of the meeting had been given, as required by state law, and that all Commission members were present.

Copies of the meeting notice, agenda, and executive summary are incorporated by reference in these minutes. [Copies of all documents incorporated by reference are available for public inspection and copying at the Election Division office.]

The chair noted that each Commission member had previously received a draft of the proposed Commission minutes for the August 3, 1999 regular meeting. He added that a draft of the September 30, 1999 executive session minutes and certification had also been distributed to Commission members. There being no corrections, Mr. Long moved that the August 3, 1999 regular session minutes and the September 30, 1999 executive session minutes be approved as submitted, and that Commission members execute the required certification concerning the executive session. Mr. Morgan seconded the motion. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted.

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3. REPORT BY CO-DIRECTORS:

The chair welcomed Ms. Marendt to her first Commission meeting as a Co-Director. Ms. Marendt thanked the Commission members for their welcome and said that she looked forward to working with them. Mr. Valentine said that he also welcomed Ms. Marendt as a Co-Director, and that he was pleased to be working with her. Mr. Valentine added that the weeks before a municipal election were an especially challenging time for the office, and that Ms. Marendt's experience had eased the difficulties that can result in the transition to a new Co-Director.

4. CAMPAIGN FINANCE ENFORCEMENT:

The chair recognized Ms. Thompson, who reported that the campaign finance staff had contacted the Division's vendor for this project (Quest Information Systems, Inc.), and were pleased to report that Quest had made several improvements to the data base audit functions to make these functions perform more efficiently. She stated that Quest had modified the website to make the functions more user friendly and had improved the system's software. She noted that the campaign finance staff would be conducting audits in the near future, and would be examining the audit reports to determine whether potential enforcement actions should be brought to the Commission.

The chair recognized Ms. Thompson, who reported that the campaign finance staff had provided Commission members with a four page list of committees referred to the Attorney General to collect unpaid civil penalties for campaign finance violations resulting from delinquent pre-election 1998 and 1999 annual reports. A copy of this list is incorporated by reference in these minutes.

The chair recognized Ms. Thompson, who reported that after the January 2000 annual reports have been filed, the campaign finance staff would determine which committees have not engaged in campaign finance activity during the preceding three years and are subject to administrative dissolution under the recent amendments to Indiana Code 3-9-1-12. She noted that the staff would then submit proposed orders dissolving these committees to the Commission for its consideration.

Indiana Election Commission Minutes

September 30, 1999

The chair recognized Mr. King, who stated that Commission members had received a copy of proposed Final Orders 1999-79 through 1999-83, which reflected the enforcement actions taken by the Commission at its August 3, 1999 meeting. Copies of these orders are incorporated by reference in these minutes.

After reviewing the proposed Final Orders, Mr. Long moved, seconded by Mr. Perkins, that Orders 1999-79 through 1999-83 be adopted as presented. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted.

The chair recognized Mr. King, who noted that Commission members had previously received a draft of the following documents: (1) "Draft #2; Advisory Opinion 1999-01"; (2) a 28 page extract from a Federal Election Commission publication entitled Campaign Finance Law 98; and (3) a fair copy of Advisory Opinion 1999-01 incorporating the revisions highlighted in Draft #2 of this document. A copy of each document is incorporated by reference in these minutes.

Mr. King noted that the proposed Advisory Opinion concerns whether a committee may use contributions made to a candidate's committee for the reimbursement of a candidate's lost wages or the payment of a salary to a candidate or a member of the candidate's household under Indiana Code 3-9-3-4. He stated that Draft #2 contained revisions requested by the Commission during its initial consideration of this Advisory Opinion at its August 3, 1999 meeting. Mr. King noted that the revisions redlined in this draft were: (1) several additions of the word "written" inserted before "agreement"; (2) an entirely new SECTION 5, which states that no reimbursement to a candidate may exceed the actual wages or salaries that the candidate would have earned in the candidate's regular employment; (3) an entirely new SECTION 6, which states that a candidate's committee may not pay a salary or reimbursement in an amount that exceeds the amount specified under the written agreement unless the candidate's committee first files an amendment to the agreement permitting the additional payment; and (4) the expiration of the Advisory Opinion on December 31, 2000, so that this Opinion would remain in effect during the entirety of the 2000 election year if the General Assembly did not address this matter through legislation. Mr. King stated that, except for these revisions, the draft of the Advisory Opinion was identical to the draft the Commission reviewed at its August 3 meeting.

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September 30, 1999

In response to a question from Mr. Morgan, Mr. King stated that the Commission could assess a civil penalty of not more than one thousand dollars ($1,000) against a candidate's committee which paid a salary or reimbursement to a candidate in a manner that the Commission determined was a violation of Indiana Code 3-9-3-4.

Mr. Long requested that the Election Division staff prepare a revision of the statement of organization form filed by candidate's committees (Form CFA-1) to permit a committee to indicate whether the committee had agreed to pay a salary or reimbursement to a candidate.

After Commission members reviewed the proposed Advisory Opinion, Mr. Long moved, seconded by Mr. Cruea, that Advisory Opinion 1999-01 be approved and issued by the Commission as presented. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted.

Mr. Long requested that copies of the Advisory Opinion be furnished to the chairs of the House and Senate Elections Committees for their consideration. Mr. King noted that SECTION 9 of the Advisory Opinion also required the Election Division to promptly forward a copy of the Advisory Opinion to each county election board and to the state chairs of the Democratic, Libertarian, and Republican parties.

The chair recognized Mr. Valentine, who noted that Commission members had previously received a copy of the following documents: (1) a three page memorandum dated September 27, 1999 from himself and Ms. Marendt titled "Recommendations for Expenditure Coding"; (2) a five page copy of the July 22, 1999 Legislative Council minutes; (3) a two page document titled "Indiana Campaign Finance Expenditure Codes", which was presented to the Council at the July 22, 1999 meeting; (4) a one page letter dated August 27, 1999, from Ms. Doris E. Munning, Washington County Circuit Court Clerk, to the Co-Directors, concerning the proposed expenditure codes; (5) a three page letter dated September 3, 1999, from Sherry Conway, M.B.A., of the Vanderburgh County Democratic Party, concerning the proposed expenditure codes; and (6) a three page letter dated September 2, 1999, from Mr. David F. Rees, Attorney at Law, to Ms. Wendy Davis, Marion County Election Administrator, concerning the proposed expenditure codes. A copy of each document is incorporated by reference in these minutes.

Mr. Valentine stated that at the Commission's direction at its August 3, 1999 meeting, the Election Division staff had sent information concerning the proposed campaign finance expenditure codes to each county election board and to the state political parties, and had received

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the responses referenced above. Mr. Valentine remarked that based on these comments and further examination of the issue by staff, the Co-Directors were recommending the adoption of four expenditure codes by the Commission: "C", which would refer to contributions to other campaign committees; "F", which would refer to fundraising expenditures made by the committee; "A", which would refer to advertising expenditures; and "O", which would refer to basic operating expenditures made by the committee. He noted that the Division anticipated that all committees (not merely candidate committees) would be required to include these expenditure codes on future campaign finance reports, beginning with the 2000 pre-primary report. Commission members further examined the proposed expenditure codes and recommendation by the Co-Directors.

In response to a question from Mr. Long concerning the implementation of these expenditure codes, Ms. Robertson noted that Commission members had received a draft of Advisory Opinion 1999-02, which would indicate that the expenditure codes would not be required on the 1999 annual report, which must be filed by all committees no later than noon, January 19, 2000, but would be implemented for most committees with the 2000 pre-primary report filed in April 2000. She indicated that committees may have been making expenditures throughout 1999, but have not assigned codes to each expenditure since the coding system had not yet been finalized by the Commission. She remarked that requiring committees to assign expenditure codes to expenditures made months ago could result in confusion and unintended errors. Ms. Robertson added that the Commission had previously adopted an Advisory Opinion to resolve questions arising from campaign finance legislative changes made during 1997 that became effective during the middle of a campaign finance reporting period. She noted that draft legislation to implement this Advisory Opinion had already been presented during this interim to the Census Data Advisory Committee.

Mr. Long requested that the Co-Directors prepare responses thanking the three individuals who had submitted suggestions concerning the proposed expenditure coding system. Mr. Valentine agreed to do so.

In response to a question from Mr. Long, Ms. Robertson indicated that the staff would prepare revisions to the CFA-4 campaign finance reporting form to include the proposed expenditure codes, and that this form revision would then be presented to the Commission for approval.

Mr. Long commented that some legislators had expressed concerns regarding the imposition of civil penalties by the Commission for reports that did not contain the proper expenditure codes. He indicated that he would be inclined to not assess penalties during the first year that campaign finance reports were required to include expenditure codes so that committees and the campaign finance staff could better assess the areas in which enforcement actions by the Commission were needed. In response to a question from Mr. Long, Mr. King indicated that the concern expressed by legislators concerning the assessment of civil penalties had been addressed clarifying that the

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Commission can only impose a penalty for a defective report if a committee is first notified of the defect and then fails to correct the defect within five days after receipt of the notice.

There being no further discussion, Mr. Morgan moved, seconded by Mr. Long, that proposed expenditure code recommendations presented by the Co-Directors be approved as presented. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted.

Commission members reviewed the draft of proposed Advisory Opinion 1999-02, which had been discussed earlier in the context of the recommendation concerning expenditure codes. A copy of this document is incorporated by reference in these minutes.

There being no further discussion, Mr. Long moved, seconded by Mr. Morgan, that Advisory Opinion 1999-02 be approved and issued by the Commission as presented. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted.

6. VOTER REGISTRATION:

The chair recognized Mr. Northern, who stated that he had not had an opportunity since the last Commission to collect information from the "Disabled Students Voter Registration Services Survey" authorized by the Commission. He indicated that he would be moving forward with this project and would have a further report at the next Commission meeting.

The chair recognized Mr. King, who stated that Commission members had previously received a copy of proposed Order 1999-78, which approved revised absentee ballot forms, and Order 1999-84, which approved revised candidate and Election Commission forms. He noted that a letter dated August 6, 1999 to the Commission from Ms. Sally LaSota, Director of the Lake County Board of Elections and Registration, had also been provided to Commission members. A copy of each document is incorporated by reference in these minutes.

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September 30, 1999

Mr. King noted that the absentee ballot application forms had been revised to include the date of birth of the applicant in response to the request set forth in Ms. LaSota's letter. He noted that several other counties had previously telephoned to request this change. Mr. King reported that the Commission had the authority under state law to revise the application forms to include this change.

Mr. King noted that the ABS-3 form is a write-in absentee ballot that will be sent to military and overseas voters outside of the United States during June 2000, and that the ballot form had been modified to include the offices and questions to be placed on the ballot next year. He indicated that several absentee and candidate forms had been revised to reflect the current name of the Lake County Board of Elections and Registration, and its Director. He remarked that the ABS-6, ABS-7, and ABS-8 absentee ballot envelopes had previously been distributed to county election boards to permit the printing of these revised envelopes for the November 1999 municipal election in conformity with state law.

Mr. King also indicated that Commission members had received a copy of a letter dated September 14, 1999 from Ms. Wendy Davis of the Marion County Election Board requesting that the Commission approve the use of a variation of the ABS-6 and ABS-7 envelopes in Marion County only. A copy of this letter is incorporated by reference. In response to a question from Mr. Long, Mr. King noted that this authorization for use in Marion County was included in SECTION 9 of Order 1999-78. The chair recognized Ms. Davis, who thanked the Commission for its consideration of this request.

With regard to Order 1999-84, Mr. King said that although the petition forms for presidential primary candidates and major party primary candidates for governor and the United States Senate had been revised to reflect the new name of the Lake County Board of Elections and Registration, this Order specified that the most recent former version of these forms (CAN-4 and CAN-8) could continue to be used for petitioning for placement on the 2000 primary election ballot. He noted that several candidates had previously requested these forms from the Election Division and were currently undertaking petition drives.

Mr. King noted that Order 1999-84 also included a revised form for county election boards to certify to the Election Division that a pre-test and public test of ballot card and optical scan ballot card automatic tabulating equipment had been conducted before election day in accordance with 1999 revisions to the testing statutes.

There being no further discussion, Mr. Long moved, seconded by Mr. Perkins, that Order 1999-78 and Order 1999-84 be approved and issued by the Commission as presented. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted.

Indiana Election Commission Minutes

September 30, 1999

8. VOTING SYSTEMS:

The chair recognized Mr. Valentine, who noted that Commission members had received a copy of a sixteen page memorandum from the Co-Directors dated September 27, 1999, and titled "Voting Systems Supplemental Certification Process." A copy of this document is incorporated by reference in these minutes.

Mr. Valentine stated that the Election Division staff had provided copies of the proposed certification document to each vendor with an application for voting system certification pending before the Commission. He noted that the addendum to the certification included the text of the applicable statutes setting forth the "Indiana standards" applicable to voting systems, specifically the higher level programming language, Year 2000 compliance, and physical durability requirements. He indicated that each of these standards will probably be incorporated in the revised Federal Election Commission guidelines for voting system certification, or will be fully implemented by vendors in all of their voting systems before the new guidelines are issued. He remarked that the demands of the market place currently require all vendors to use at least C++ programming language, and that all voting systems must attain Year 2000 compliance during the next year to be able to function.

Mr. Valentine noted that although a voting system certification granted by the Commission is for a five year period under state law, the Commission also is authorized by statute to revoke a voting system certification if the certification was given as a result of inaccurate information supplied by a vendor.

Mr. Long stated that he was generally uncomfortable with the proposed certification process since it permitted a vendor to state that the vendor complied with the applicable statutory standards, while the Election Division did not possess adequate budget and staff resources to determine independently if the vendor's statements were accurate. He indicated that Warrick County officials had been required to spend a significant amount of money to resolve a problem that resulted from property reassessment software certified by the State Board of Tax Commissioners, and that he did not wish to place any other county in this position due to the failure or malfunction of a state certified voting system. He indicated that despite his concerns, he was willing to support this recommendation if this was the desire of the Co-Directors.

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Ms. Marendt said that she would regularly contact the National Association of State Election Directors to keep informed concerning any problems that those states had experienced with voting systems applying for certification in Indiana. She added that it was important to expedite the voting system certification process to avoid a bureaucratic quagmire, and to permit vendors to offer county election officials as many voting system options as possible for use in Indiana.

Mr. Valentine said that Florida was a jurisdiction noted for requiring strict certification procedures, and that a voting system certified in that state would have already undergone extensive testing to determine compliance with Federal Election Commission standards. The chair suggested that the Co-Directors follow up with states which conduct primaries between February and April 2000 to become aware of any problems experienced in those elections with systems certified in Indiana.

Mr. Long stated that the legislature should revisit the voting system certification process to determine whether the Election Division should perform its responsibilities regarding voting system certification by either contracting for voting system testing by individuals with the appropriate expertise, or by hiring staff with this expertise. Mr. Valentine stated that the long-term solution to this problem during the next four to five years may be the promulgation of the revised Federal Election Commission voting system guidelines that could supersede the Indiana standards. In response to a question from the chair, Mr. King indicated that the Federal Election Commission had reported that the revised guidelines would not be finalized before 2001.

There being no further discussion, Mr. Long moved, seconded by Mr. Perkins, that the proposed voting systems supplemental certification process be approved as presented. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted.

The chair recognized Mr. King, who noted that Mr. Steve Corey of GBS was present to address the Commission concerning this voting system.

The chair recognized Mr. Corey, who provided Commission members with a twenty-six page document titled "Supplemental System Requirements; State of Indiana." A copy of this document is incorporated by reference in these minutes.

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Mr. Corey noted that this voting system had been assigned a National Association of State Election Directors (NASED) number, has been certified in ten states, and is currently in use in eight states. He remarked that GBS would be happy to supply Commission members with any additional information concerning this system. Mr. Corey noted that the application for certification of this system had been pending before the Commission since June 1998, and that GBS had supplied the technical documentation concerning the voting system to the Election Division at that time. He indicated that GBS would be happy to provide any additional information that the Division needed for the certification process to be completed.

Mr. Corey added that he was not particularly concerned regarding the year 2000 compliance issue with regard to voting systems since voting systems are not date and time oriented. He indicated that most newer voting systems have an internal clock which would have no difficulty in recognizing the year 2000. He added that the test of the voting system conducted by Wyle Laboratories is very demanding and extensive, and that he felt confident that this voting system would pass any tests conducted by Indiana. The chair thanked Mr. Corey for his presentation.

The chair recognized Mr. King, who stated that Commission members had received a one page letter dated August 31, 1999 to former Co-Director Laurie Christie from Mr. Paul T. Van Camp, National Sales Manager, Fidlar & Chambers, concerning the proposed supplemental voting system certification requirements. A copy of this letter is incorporated by reference in these minutes. Commission members reviewed the letter, and thanked Mr. Van Camp for his comments. Mr. King reported that there were no further developments to report regarding the application for certification of this voting system.

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Mr. King reported that there were no further developments to report regarding the application for certification of these voting systems and that vendors were awaiting the Commission's decision regarding the "Voting Systems Supplemental Certification Process" approved earlier at this meeting.

Ms. Robertson noted that Commission members had received a four page document in this matter dated September 17, 1999 issued by the U.S. Seventh Circuit Court of Appeals. A copy of this document is incorporated by reference in these minutes. Ms. Robertson stated that this case involved a challenge to the constitutionality of Indiana's legislation defining a "political action committee." She noted that the Indiana Supreme Court had previously determined that the definition of "political action committee" under Indiana Code 3-5-2-37 only includes groups which engage in "express advocacy" and that the Seventh Circuit Court had affirmed this ruling. Ms. Robertson said that as a result of this ruling, the PAC definition had been held constitutional and that barring any petition for certiorari being granted by the United States Supreme Court, this case would be dropped from the Commission's agenda.

Ms. Robertson remarked that this case involved a challenge to Indiana's campaign finance disclaimer statute. She stated that she had no additional information to report at this time concerning this case. She added that motions for summary judgment were filed earlier this summer, but that the federal district court has not yet ruled on those motions.

Ms. Robertson indicated that this case was a petition for review of the Commission's actions imposing civil penalties against three candidates for failing to timely file campaign finance reports. She noted that this case had just been filed, and that staff would have further information regarding this matter at later Commission meetings.

Ms. Robertson remarked that this case was brought by a petitioner seeking ballot access in all fifty states, and challenging state ballot access statutory requirements. She stated that a motion to dismiss was pending, but that she had no additional information to report at this time concerning this case. The chair thanked Ms. Robertson for her report.

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The chair noted that Commission members had received a copy of Order 1999-86, which would provide for a regularly scheduled Commission meeting date during the year 2000. A copy of this order is incorporated by reference in these minutes.

The chair noted that the Commission generally meets immediately before the December election administrators conference to approve the final set of form revisions to be distributed at that time. Ms. Robertson remarked that the Commission could expect to see campaign enforcement actions at its next meeting resulting from delinquent 1999 pre-election filings, and that the campaign finance staff would be grateful if Commission could hear those actions before the filing deadline for the 1999 annual report occurred in January 2000.

After further discussion, Commission members requested that the Co-Directors schedule the next Commission meeting for November 9 or November 10, 1999 and to notify Commission members concerning the date, time, and location for that meeting. The chair asked all Commission members to bring their calendars to the next meeting so that regular Commission meeting dates could be set for 2000, and to consider adoption of Order 1999-86 at that time. Commission members concurred with this suggestion. Ms. Robertson added that having regularly scheduled Commission dates greatly assists the campaign finance staff in preparing for the public hearings on these causes.

The chair recognized Ms. Robertson, who reported that Marion County had decided not to conduct the central count of absentee ballots at the November 1999 municipal election. She noted that as a result, the Commission's certification of the voting system used in the Marion County May 1999 primary before the November 1999 election would not be an issue.

The chair recognized Mr. Long, who requested that the Election Division staff arrange an opportunity for Commission members to meet with key legislators serving on the House and Senate Elections Committees to discuss whether the Commission could be granted further legislative discretion in the imposition of campaign finance enforcement civil penalties. The Co-Directors agreed to do so.

The chair recognized Mr. Morgan, who stated that he appreciated the attendance of Ms. Christie, Mr. Valentine, and Ms. Robertson at the recent Association of Indiana Counties conference in South Bend. He remarked that the conference participants had found their presentation very valuable.

Indiana Election Commission Minutes

September 30, 1999

The chair asked if there was further business to come before the Commission. There being no response, Mr. Morgan moved, seconded by Mr. Long, that the Commission do now adjourn. There being no further discussion, the chair called the question, and declared that with four members voting "aye" (Mr. Cruea, Mr. Long, Mr. Morgan, and Mr. Perkins), and no member voting "nay", the motion was adopted. The Commission then adjourned at 2:50 p.m.

Respectfully submitted,

________________________ ________________________

Candy Marendt, Spencer Valentine,

Co-Director Co-Director

APPROVED,

________________________

Dudley R. Cruea, Chair