1996 annual report - new jersey election law …1996 annual report i election law enforcement...

1996 Annual ReportThe N.J. Election LawEnforcementCommission

May, 1997

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TABLE OF CONTENTS

Page

The Commission ................................................................................................................... 1

Chair's Message .................................................................................................................... 4

Commission Staff ................................................................................................................. 6

Table of Organization ........................................................................................................... 7

Executive Director's Remarks .............................................................................................. 8

ELEC Overview ................................................................................................................... 10

Statutory History of ELEC ................................................................................................... 11

Legislative Review ............................................................................................................... 12

Legal Section ........................................................................................................................ 15

Compliance and Information Section ................................................................................... 21

Review and Investigation Section ........................................................................................ 25

Gubernatorial Public Financing Section............................................................................... 30

Computer Section ................................................................................................................. 36

Administration Section ......................................................................................................... 38

Budget Overview and Evaluation Data ................................................................................ 40

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28 West State Street13th FloorTrenton, New Jersey

New Jersey Election Law Enforcement CommissionCN-185Trenton, NJ 08625-0185

(609) 292-8700

http://www.state.nj.us/lps/elec/

HOW TO CONTACT ELEC

ELEC's Location

ELEC's Mailing Address

ELEC's Telephone

ELEC's Home Page

1996 Annual Report 1

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Ralph V. Martin, Chair

Ralph V. Martin, retired SuperiorCourt Judge serving Passaic County, and nowa practicing attorney in Wayne, New Jersey,was appointed to fill an unexpired term on theCommission in December, 1995, and wasappointed Chair in February, 1996, byGovernor Christine Todd Whitman.

While a Superior Court Judge, theChair was involved in all divisions of theCourt, with the bulk of his service occurringin the Civil Division.

A graduate of Rutgers University in1951 with a B.S. and M.S., Judge Martinearned his J.D. in 1958 from RutgersUniversity. He was subsequently admitted tothe New Jersey and U.S. District Court in1958 and to the U.S. Supreme Court in 1963.

The Chair is a member of the PassaicCounty and State of New Jersey Bar Associa-tions. He has a legal interest in complexlitigation and media delivery issues. JudgeMartin had chaired the Supreme Court MediaCommittee for an extensive period of time.

A veteran of the U.S. Army whereinhe served as a Nuclear Guided Missile Officerfrom 1951-1955 (14th Ordnance Battalion),the Chair is married to the former Ida K.Kuiphoff. The couple have four sons.

David Linett, Vice Chair

David Linett has completed two termson the Commission. An attorney, he iscurrently President of the Bridgewater lawfirm of Ginden and Linett, PC.

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Vice Chair Linett is a formerProsecutor of Somerset County and a formerTreasurer of the National District AttorneysAssociation. A past Chair of the SupremeCourt’s District XIII Ethics Committee, healso served as the Treasurer of the SupremeCourt’s Ethics Financial Committee. He is amember of the American, New Jersey State,and Somerset County Bar Associations.

Very active in charitable and volunteerendeavors, Vice Chair Linett was named“Citizen of the Year” in 1989 by the SomersetCounty Chamber of Commerce. Further, heserved three terms as Chair of the Board ofTrustees of Alternatives, Inc. (formerlyAAMH), and two terms as a Director of theSomerset County Chamber of Commerce.Vice Chair Linett was a District Governor ofRotary International in 1991-92 and a past-president of the Somerville Rotary Club. Hewas twice elected to the Democratic StateCommittee from Somerset County.

Vice Chair Linett is a graduate of YaleUniversity and Harvard Law School. Heresides in Summit with his wife, Penny. Theyhave five children and three grandchildren.

Paula A. Franzese, Commissioner

Paula A. Franzese is serving her firstterm on the Commission. Appointed in 1996by Governor Christine Todd Whitman,Commissioner Franzese is a Professor of Lawat the Seton Hall University School of Law.

Commissioner Franzese is the Founderand Director of the New Jersey MentorProgram, which pairs inner-city high schoolswith law firms, public sectors law offices, andSeton Hall Law School. Existing since 1987,

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Mentor provides inner-city youth with theopportunity to participate in the legal systemand with access to role models within theprofession.

A lecturer, as well as a commentatoron Caucus: New Jersey Court T.V.,Commissioner Franzese had served asPresident of the Justice Resource Center Boardof Directors in New York City.

A graduate of the Columbia UniversitySchool of Law, Commissioner Franzese is amember of the New Jersey and New York barsand is admitted to practice in the U.S. DistrictCourts for the Southern and Eastern Districtsof New York and the District of New Jersey.

A recipient of numerous awards andhonors, and the author of several publicationsand papers, she is married to Michael Roseloa.The couple has two children.

Frederick M. Herrmann, Ph.D.,Executive Director

Frederick M. Herrmann, Ph.D., hasbeen the executive director of the New JerseyElection Law Enforcement Commission forover a decade. He received an A.B. (1969)from the University of Pennsylvania and anM.A. (1970) and a Ph.D. (1976) from Rutgers,The State University of New Jersey. Dr.Herrmann is also an honor graduate of theUnited States Army Quartermaster School atFort Lee, Virginia.

The author of many publications abouthistory and government, he is a frequentspeaker at various forums inside and outsideof New Jersey. Currently, he is the bookreview editor of The Guardian, a member of

the Peer Review Board of the Ethics Sectionof Spectrum: The Journal of StateGovernment, and on the editorial board ofPublic Integrity Annual.

Once a teacher at Rutgers and KeanCollege as well as a staff member of the NewJersey Legislature, he has also served on theOrganizational Planning and CoordinatingCommittee of the Council of StateGovernments and has been the President ofthe Council on Governmental Ethics Lawsand the Chairperson of the NortheasternRegional Conference on Lobbying.

In 1993, he was the recipient of theAnnual Award of the Council on GovernmentalEthics Laws for his continued efforts topromote the highest level of ethical conductamong governmental officials and candidatesfor public office in the international arena.

James P. Wyse, Counsel

James P. Wyse was selected to be theCommission’s new Counsel in 1994 and beganserving in that capacity in January, 1995.

Mr. Wyse is a partner in theMorristown law firm of Schenck, Price, Smithand King, where he specializes in the areas ofcorporate and commercial law, real estate,environmental law, and estate planning.

Mr. Wyse, admitted to practice inNew Jersey and before the United States Courtof Appeals for the Third Circuit, has arguedcases in that Court and before the New JerseySupreme Court.

As Counsel for a number of national,State, and local land trust organizations, Mr.

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Wyse has developed special expertiseregarding conservation and agriculturaleasements and innovative land preservationtechniques.

Mr. Wyse received a B.A. degree fromBucknell University and J.D. degree withhonors from the Rutgers University School ofLaw.

Appointed General Counsel to the NewJersey Conservation Foundation, he alsoadvises the Junior League of Morristown, theMorris Shelter, Inc., and the Dierdre O’BrienChild Advocacy Center. Married to PamelaPaxton, he serves on the Board of Trustees ofthe Morris Parks and Land Conservancy.

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By Ralph V. Martin

As Chair of the New Jersey ElectionLaw Enforcement Commission, it is indeed apleasure to present this report to the membersof the Legislature.

The year 1996 was truly monumental.In fact, it should be remembered as a watershedyear in the Commission's efforts towardmaking significant improvements in itscomputer operations, thereby enhancinggreatly its mission of disclosure.

Without the benefit of an added ap-propriation earmarked for recomputerization,the Commission drew from its operating bud-get to begin the process of upgrading itscomputer operations.

In this vein, the Commission achieveda number of long-held goals in 1996. Itinitiated steps to enhance its existing softwareprogram for candidate reporting, a projectwhich is now in its final stages. It purchaseda new platform and it began the process ofconverting the existing software to a newlanguage. Moreover, using money out of theGubernatorial Public Financing Programadministration account appropriated forcomputerization purposes, the Commissiontook the first steps to provide electronicreporting for gubernatorial candidates in futuregubernatorial elections.

Specifically, the Prime 4150 Systemutilized by the Commission for more than adecade will be replaced by the client-servertechnology of the DEC Alpha Server 1000.The client server database management systemof Oracle will now be used and ELEC's PrimosSoftware is now being migrated to VisualBasic. Aided by $155,000 of a $630,000

MESSAGE FROM THE CHAIRMAN

appropriation for public financing, theCommission remains hopeful that it will beable to implement an electronic filing pilotprogram for the 1997 gubernatorial generalelection.

In addition to these majorrecomputerization undertakings, theCommission added other important computerenhancements. For example, it established ahome page, it is hooked up to the internet forthe purposes of research, and it purchasedbasic scanning equipment. It now also hasflash fax capabilities.

Along with other long-term plans forimproved technology, such as electronic filingfor legislative candidates and imageprocessing, these recent innovations willgreatly improve the Commission's ability tomake information available to the public in anefficient and effective manner.

During 1996, the Commissionaccomplished other important changes thatbenefit the public and the objectives ofdisclosure. First and foremost, it undertooka major move that not only optimizes itsavailable space but greatly expanded andimproved its public area. No longer will thepublic have to deal with cramped space forreviewing records, it now has three comfortableand convenient rooms for its use. This areahas been set for a computer hookup as well.

The Commission continued its effortsin the area of analysis in 1996. This past yearwitnessed the publication of its eleventh in aseries of white papers by Deputy DirectorJeffrey M. Brindle, State Parties andLegislative Leadership Committees: AnAnalysis 1994-1995. It also produced pressreleases, one of which analyzed the financial


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activity of lobbyists.

The Commission's ComplianceSection, as well as its enforcement staff,continued their strong efforts in 1996.

Not only did the Compliance Sectioncompletely overhaul its candidate andcontinuing political committee manuals, butit assisted the public with requests forinformation, processed 20,000 reports, andphotocopied over 180,000 pages of reports. Itproduced press releases and attained acompliance rate of over 90 percent.

In enforcement, the Legal Sectionwhile issuing Advisory Opinions and draftingregulatory proposals, issued 140 complaints.

The Review and Investigation Section,on the other hand, closed 45 investigations.

As usual, the Commission's veteranExecutive Director, Frederick M. Herrmann,continued to excel in his job. With a strongand unwavering belief in ELEC as aninstitution, the Executive Director continuedhis efforts toward fulfilling the Commission'smission of disclosure, most specifically in1996 by leading ELEC toward a brighttechnological future. Moreover, as a knownnational leader in the field, Executive DirectorHerrmann published an article in the 1997edition of Public Integrity Annual entitled"Bricks without Straw: The Plight ofGovernmental Ethics Agencies in the UnitedStates."

In terms of its budget, theCommission's regular budget for operationswill remain steady at $1,417,000 in FY-1998.Though an increase in its budget wouldcertainly enable the Commission to intensify

MESSAGE FROM THE CHAIRMAN continued

its disclosure efforts even more, theCommission recognizes that government is ina period of budgetary restraint, and isappreciative to the Governor and Legislaturefor its support.

Thus, as I stated above, I am delighted,on behalf of the Commission, to present thisreport of progress to the Legislature

Cordially,

Ralph V. MartinChair


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Executive

Frederick M. Herrmann, Ph.D., Executive DirectorJeffrey M. Brindle, M.A., Deputy DirectorGregory E. Nagy, Esq., Legal DirectorElbia L. Zeppetelli, Administrative AssistantSteven Kimmelman, M.A., Research Assistant

Administration

Barbra A. Fasanella, DirectorDonna D. Margetts, M.A., Personnel Officer/Lobbying AuditorElaine J. Salit, Fiscal OfficerDebra A. Kostival, Head ReceptionistIrene Comiso, Senior Receptionist

Compliance and Information

Evelyn Ford, Esq., DirectorKimberly Key, Associate Compliance OfficerLinda White, Associate Compliance OfficerChristopher Guear, M.A., Assistant ComplianceOfficerAmy Davis, Assistant Compliance OfficerMonica Triplin-Nelson, ClerkElizabeth A. Michael, ClerkMaria Concepcion, ClerkErin Kasa, ClerkSamira Wood, Messenger

Computer

Carolyn Neiman, Systems AdministratorBrenda A. Brickhouse, Systems OperatorShirley R. Bryant, Senior ClerkNelly R. Rosario, Associate Data Entry OperatorBarbara Counts, Secretarial Associate

COMMISSION STAFF

Legal

Nedda Gold Massar, Esq., Deputy Legal DirectorIrene Szedlmayer, Esq., Assistant Legal DirectorGail Shanker, Esq., Legal AssistantRuth Ford, Legal Secretary

Review and Investigation

Carol Hoekje, Esq., DirectorShreve E. Marshall, Jr., Associate DirectorBrett Mead, Associate Report ExaminerIvy Bartuswicz, Clerk Typist

Gubernatorial Public Financing

Nedda Gold Massar, Esq., DirectorAndrew Mersel, AnalystPamela Hamilton, AnalystKimberly McCubbin, AnalystHarry Ravenel, AnalystLeila Sabitsana, Computer AssistantPamela Kinsey, ClerkDarlene Kozlowski, Clerk


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TABLE OF ORGANIZATION

COUNSEL

EXECUTIVE DIRECTOR

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DEPUTY DIRECTOR

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LEGAL DIRECTOR

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DIRECTOR OFADMINISTRATION

5

DIRECTOR OFCOMPLIANCE AND

INFORMATION 11

DIRECTOR OF PUBLICFINANCING

8

DIRECTOR OF REVIEW AND

INVESTIGATION 4

SYSTEMSADMINISTRATOR

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LEGAL

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Fiscal & management servicesBudgetPersonnelPurchasingPayrollReceptionLobbying Program

Program analysisRecords retentionMicrofilmPublic education

Technical assistanceReport analysisPublic disclosure reports

Report reviewDesk auditsField investigationsComplaint recommendations

Data entryStatistical reportsSystem operation &maintenance

LitigationFinal DecisionsEnforcementAdvisory OpinionsRegulations

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ADMINISTRATIVEASSISTANT

1


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MESSAGE FROM THE EXECUTIVE DIRECTOR

By Frederick M. Herrmann, Ph.D.

The New Jersey Election Law En-forcement Commission (ELEC) has been inexistence for over two decades. In that timeperiod, it has managed to establish a nationalreputation for excellence in administering andenforcing the State's campaign financing andlobbying laws. It is a record of which all thecommissioners, staff, and citizens of the statecan be proud.

In 1988, Professor Frank J. Souraf ofthe University of Minnesota cited ELEC in hiscomprehensive study, Money in AmericanElections, as one of only two ethics agenciesin the nation that provided campaign financedata "far above the average." Moreover, healso mentioned the Commission as one ofonly four governmental ethics agencies withstrong enforcement records. A year later,Professor A. T. Barbrook of the University ofKent at Canterbury (England) wrote in a letterto me that "ELEC is certainly a model in theUnited States for its production of campaignfinance literature." In an interview that sameyear published in Governing, John D. Feerick,the Chairman of the New York StateCommission on Government Integrity and theDean of the Fordham Law School, stated thatELEC is a "dynamic, independent enforcementboard."

During 1990, even more praise waslavished on the Commission from otherdistinguished sources. In its study ofcomputerized entree to state campaign financedata entitled The Paper Chase: A CommonCause/Ohio Study of Improving Access toCampaign Finance Data in the States, theBuckeye State's citizens' lobby concluded thatNew Jersey and two other states "lead thepack." Meanwhile, in another national study

called Campaign Disclosure Laws: AnAnalysis of Campaign Finance Disclosure inNorth Carolina and a Comparison of 50 StateCampaign Reporting Laws, the North CarolinaCenter for Public Policy Research reportedthat ELEC "does the best job of all the statesin making information available to the public."Professor Larry J. Sabato, a leading campaignfinancing scholar at the University of Virginiaand most recently author of Dirty Little Secrets:The Persistence of Corruption in AmericanPolitics, made an overall assessment of theCommission's performance before theRosenthal Commission created to reform thestate's ethics and campaign finance laws byremarking "I think it's the most effective stateethics agency in the country."

One of the top experts in the nation forthe study of political money is Dr. Herbert E.Alexander, Director of the Citizens' ResearchFoundation and Professor of Political Scienceat the University of Southern California. Inhis important study, Reform and Reality: TheFinancing of State and Local Campaigns, herefers to ELEC and only one other state agencyas "the best of the bunch" among electioncommissions in the United States for collectingcampaign finance information and enforcingelection laws. According to ProfessorAlexander, "New Jersey's ELEC, in detailedstudies of the state's gubernatorial elections,has examined not only where the money comesfrom but where it goes, with special emphasison media costs. Such studies are essential indetermining why campaign costs are rising somuch faster than inflation. ELEC has alsopublished a series of white papers including'Trends in Legislative Campaign Financing:1977-1987' and an analysis leading to anendorsement of 'Legislative PublicFinancing.'" The most recent study in thatseries written by Deputy Director Jeffrey M.


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Brindle is State Parties and LegislativeLeadership Committees: An Analysis 1994-1995.

Over the Summer of 1996,Contributions Watch, a non-profit group thatmonitors campaign finance issues, rankedELEC third nationally among state agenciesthat try to keep citizens informed aboutpolitical spending. A review of such factorsas copying fees, facilities, report availability,and computerization concluded moreover thatthe Commission was far ahead of other statesin its region. Joe Donohue of the Star-Ledger(Newark) wrote in a story about this surveyentitled "Election Law Watchdog Gets a Paton Head" that ELEC "has always been in thevanguard of state election enforcementagencies."

Perhaps, the most touching praise theCommission received in recent years was ina letter to Commissioner David Linett from aperson who had met with ELEC's staff. Hewrote, "When I visited the Commission'soffices on two occasions I was impressed bythe quick access to information that was madeavailable to me, the knowledgeable staff whoanswered my inquiries and helped meunderstand the intricate nature of the law andjust the general pleasant, warm and helpfulatmosphere that prevails . . . . [L]o and beholdhere is an agency that performs its work in anexemplary manner."

ELEC takes great pride in itsaccomplishments. To be called "far above theaverage," "a model," "dynamic," "pack leader,""most effective," "best of the bunch," and "inthe vanguard" by prominent sources and, atthe same time, to be respected by averagecitizens as "pleasant, warm and helpful" isheady praise to be sure. But, the Commission

will not be content to rest upon its laurels.ELEC plans to continue building upon itsoutstanding record and remain as New Jersey'spreeminent guardian over political andgovernmental ethics.

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ELEC OVERVIEW

COMMISSIONERS

1973Frank P. Reiche, ChairJudge Sidney Goldmann, Vice ChairJudge Bartholomew Sheehan, CommissionerFlorence P. Dwyer, Commissioner

1974-1979Frank P. Reiche, ChairJudge Sidney Goldmann, Vice ChairJosephine Margetts, CommissionerArchibald S. Alexander, Commissioner

1980-1981Judge Sidney Goldmann, ChairJosephine Margetts, Vice ChairAndrew C. Axtell, CommissionerM. Robert DeCotiis, Commissioner

1982-1983Andrew C. Axtell, ChairM. Robert DeCotiis, Vice ChairJustice Haydn Proctor, CommissionerAlexander P. Waugh, Jr., Commissioner

1984-1986Andrew C. Axtell, ChairAlexander P. Waugh, Jr., Vice ChairJustice Haydn Proctor, CommissionerOwen V. McNanny III, Commissioner

1987-1988Judge Stanley G. Bedford, ChairOwen V. McNanny, III, Vice ChairAndrew C. Axtell, CommissionerDavid Linett, Commissioner

1989-1990Judge Stanley G. Bedford, ChairOwen V. McNany, III, Vice ChairDavid Linett, CommissionerS. Elliott Mayo, Commissioner

1991-1992Owen V. McNany, III, ChairJudge Stanley G. Bedford, CommissionerDavid Linett, Commissioner

1993-1994Owen V. McNany, III, ChairWilliam H. Eldridge, Vice ChairDavid Linett, Commissioner

1994-1995William H. Eldridge, ChairOwen V. McNany, III, Vice ChairDavid Linett, CommissionerMichael Chertoff, Commissioner

1996Judge Ralph V. Martin, ChairDavid Linett, Vice ChairPaula A. Franzese, Commissioner

EXECUTIVE DIRECTORS

1973-1975 David F. Norcross1976-1981 Lewis Thurston, III1981-1984 Scott A. Weiner1984-present Frederick M. Herrmann

COUNSELS

1973-1994 Edward J. Farrell1994-present James P. Wyse


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STATUTORY HISTORY OF ELEC

Commission created by P.L. 1973, c.83(N.J.S.A. 19:44A-1 et seq.) -"The NewJersey Campaign Contributions andExpenditures Reporting Act" - effectivedate: April 24, 1973.

Gubernatorial Public FinancingProgram started by P.L. 1974, c.26(N.J.S.A. 19:44A-27 et seq.) - effectivedate: May 6, 1974.

Personal Financial DisclosureProgram started by P.L. 1981, c.129(N.J.S.A. 19:44B-1 et seq.) - effectivedate: May 1, 1981.

Lobbying Program started by P.L.1981, c.150 (N.J.S.A. 52:13C-18 etseq.) - effective date: May 22, 1981.

Continuing Political Committee(PACs) Quarterly Reporting started byP.L. 1983, c.579 (amendment toN.J.S.A. 19:44A-1 et seq.) - effectivedate: January 17, 1984.

Lobbying Reform established by P.L.1991, c.243 (amendments to N.J.S.A.52:13C-18 et seq.) - effective date:January 1, 1992.

Campaign Finance Reform establishedby P.L. 1993, c.65 (amendments toN.J.S.A. 19:44A-1 et seq.) - effectivedate: April 7, 1993.

Street Money Reform Law establishedby P.L. 1993, c.370, (codified asN.J.S.A. 19:44A-11.7) - effective date:January 7, 1994.

Uniform Recall Election Lawestablished by P.L. 1995, c. 105,(codified as N.J.S.A. 19:27A-1 et seq.) -effective date: May 17, 1995.

Political Identification Law establishedby P.L. 1995, c. 391, (codified asN.J.S.A. 19:44A-22.2 and 22.3) -effective date: February 1, 1996.


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LEGISLATIVE REVIEW

An important task for Commissionstaff at the start of each legislative session isreview of the many bills introduced whicheither directly or indirectly impact on campaignfinancing or lobbying disclosure. These billsare closely monitored, and Commission staffis often called upon to provide technicalassistance during the legislative process. In1996, the first year of the 207th Session of theNew Jersey Legislature, a total of 78 billswere identified as having potential impactupon the areas of Commission jurisdiction.

Of those bills, 36 directly concernedthe Campaign Contributions and ExpendituresReporting Act (hereafter, the Reporting Act),including its gubernatorial public financingprovisions. Among those were bills that wouldreduce the contribution limits for non-gubernatorial candidates and committees,while others would abolish legislativeleadership committees or create a publicfinancing system for legislative candidates.Bills were also introduced to increase thenumber of debates in which publicly-financedgubernatorial candidates are required toparticipate and to reduce the public fundswhich may be given to qualified gubernatorialcandidates.

Eight bills concerned the LegislativeActivities Disclosure Act (hereafter, theLobbying Act). Among them was a billrequiring lobbyists and legislative agents toprovide written notice to Legislative andExecutive Branch members and staff ofreportable benefits given to them. Approvedby the Governor on December 20, 1996, asChapter 144 of the Laws of 1996, this bill isintended to promote more accurate disclosureon annual lobbying reports filed by lobbyistsand legislative agents of benefits actuallypassed to members and staff of the Legislative

and Executive Branches. The Commissionanticipates that regulations will be proposedduring 1997 to clarify the reportingrequirements and other issues raised by thisnew law.

One of the two bills introduced in1996 concerning the Gubernatorial andLegislative Candidate Personal DisclosureStatement Act (hereafter, the CandidateDisclosure Act) proposes to change the filingdeadline for the gubernatorial and legislativedisclosure statements of sources of incomeand other information and would givecandidates additional time to prepare and filethe reports.

The remaining 32 bills concernedgeneral election-related matters. For example,several of them would change the dates ofcertain elections or consolidate elections andtherefore could potentially affect Commissionoperations in a significant manner.

Legislative Recommendations

The recommendations for legislativechanges which follow are based onCommission review of the Reporting Act, theLobbying Act, and the Candidate DisclosureAct, or as a result of questions raised bymembers of the public and requests foradvisory opinions. These inquiries often pointout unclear areas of the law, or raise newquestions not addressed in existing statutes.Research conducted into campaign financingissues and results published in theCommission’s White Paper series highlightadditional areas of concern. Further, in thecourse of public hearings which are held duringthe regulation adoption process, theCommission becomes aware of areas of thelaw which require clarification.


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The Commission therefore recom-mends consideration of the followinglegislative changes:

• Reduce the contribution limit to the Stateparty committees from $25,000 ($30,000as adjusted for 1997) to $15,000 and reducethe contribution limit to legislativeleadership committees and county partycommittees from $25,000 ($30,000 asadjusted for 1997) to $10,000 as suggestedin the Commission’s July, 1996, WhitePaper, “State Parties and LegislativeLeadership Committees: An Analysis1994-1995.” This recom-mendation isbased upon detailed Commission analysisof actual contributions received by theState party committees and legislativeleadership committees over a period oftwo calendar years. The Commissiondetermined to undertake a white paperresearch project to examine the financialactivity of the county political partycommittees.

• Amend the definitions in the ReportingAct of “political committee” (PC) and“continuing political committee” (CPC)to require that each receive contributionsfrom a number of different contributorseach year and that each make a number ofcontributions to different candidatesduring the year. The current definitionsdo not specify that a PC or CPC shouldhave any required number of contributingpersons or entities or that any number ofcandidates be supported in a year. Thesechanges will prevent establishment of PCsor CPCs by one or two contributing entitiesfor the purpose of circumventing thecontribution limits in the Reporting Act.

• Establish limits for contributions to PCsand CPCs from individuals, corporations,unions, associations, and groups. Thesecontributions are currently unlimited, andthe Commission believes that reasonablelimits to PCs and CPCs from all types ofcontributors are appropriate.

• Amend N.J.S.A. 19:44A-16d to requirethat in order to be eligible to file a CertifiedStatement (Form A-1 or A-2), the totalamount of contributions raised in anelection by a candidate or candidates, aswell as the amount to be spent in theelection, must not exceed the Form A-1 orA-2 threshold. This change will enhancedisclosure by strictly limiting filing ofcertified statements to only thosecandidates who have raised and spentamounts below the certified statementthresholds.

• Amend the Reporting Act to define theterm “national committee of a politicalparty.” Among the contribution limitsestablished by the 1993 amendments tothe Reporting Act was the prohibition thatthe “national committee of a politicalparty” contribute no more than $50,000annually ($59,000 as adjusted for 1997) tothe State committee of a political party.In order to monitor effectively thatcontribution limit, it is necessary to knowprecisely which entities qualify under NewJersey law as the “national committee of apolitical party.”

• Lengthen the statutory response time for aCommission advisory opinion from 10days, as provided in N.J.S.A. 19:44A-6f,to 35 days to conform to the monthlymeeting schedule of the Commission.

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LEGISLATIVE REVIEW continued

• Ban contributions made directly fromcorporations and labor unions, and permitonly those contributions made throughtheir voluntary employee political actioncommittees.

• Permit the Commission to imposepenalties equal to the dollar amount ofinformation which is missing or late orequal to the current statutory maximums,whichever penalty amount is greater.

• Lengthen Commissioner terms from threeto five years; require that upon theexpiration of a Commissioner’s term, areplacement be nominated and confirmedwithin 90 days, or the Commissionerserving in holdover status shallautomatically retain the position foranother term; and permit the Governor toselect a chair and vice chair for a fixedterm. These changes are necessary becausethe complexity of the Reporting Act,Lobbying Act, Candidate Disclosure Act,and Commission regulations requiresexpertise that develops over a period ofyears and warrants longer terms. Further,with the current three-year Commissionerterms, the Commission might be composedduring a gubernatorial election year ofmembers with no prior experience inadministering the gubernatorial publicfinancing program.

• Create a program for partial publicfinancing of legislative elections. TheCommission’s experience since 1977 inpublicly-financed gubernatorial electionsprovides a sound basis for designing andimplementing such a program forlegislative races.

• Implement the recommendation contained

in the Commission’s “1997 Cost IndexReport” to modify the statutory roundingprocess mandated at N.J.S.A. 19:44A-7.1for quadrennial adjustment of the limitsand thresholds in the Reporting Act. Thisrecommendation is also discussed in theGubernatorial Public Financing Sectionof this Annual Report.

• Adequately fund the continued acquisitionof computer technology, the hiring ofsuch additional staff as may be necessaryto enable the Commission to provide thepublic with timely access to the campaignfinance reports it receives, and theCommission's enforcement respons-ibilities.

The Commission offers these suggestionsfor legislative change in its constant effort toenhance disclosure of information to the NewJersey public.


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LEGAL SECTION

The Legal Section is responsible for:

1. Developing regulations to assist ininterpreting the statutory requirements of theCampaign Contributions and ExpendituresReporting Act (hereafter, the Reporting Act)or the Lobbying Disclosure Act (hereafter,Lobbying Act);

2. Providing advisory opinions tofiling entities seeking specific legal guidanceunder those laws; and,

3. Prosecuting alleged violations ofthese laws by issuing civil complaints. Inaddition, of particular importance in 1996,were issues concerning the application ofcontribution limits in different fact settings.For the first time, contribution limit violationallegations were litigated under a statutepermitting candidates to seek pre-electionrelief in the State Courts against an opposingcandidate. Also in 1996, a new law wasenacted assigning to the Commissionresponsibility for administering fullidentification of candidates or committeescirculating campaign advertising.

Regulations

The Commission is very active inutilizing rulemaking as a means of providingguidance for reporting entities and the publicin: interpreting statutory requirements forreporting contributions, applying variouscontribution limits to different categories ofcontributors, properly identifying campaignmaterials, and understanding other regulatorymatters pertinent to financing elections.During 1996, rulemaking activity included:

Contributions by Partnerships: Latein 1995, the Commission proposed regulations

prohibiting contributions from partnershipentities from being accepted by candidates orcommittees. The Reporting Act does notspecifically address whether or notpartnerships may make contributions. After apublic hearing was conducted on January 2nd,the regulation was adopted in February.

Joint Candidates Committees: Rulesreflecting statutory amendments concerningparticipation in and full identification of jointcandidates committees and naming ofcampaign depositories were proposed in earlyApril, and became effective on June 3rd.

Campaign Advertising: Legislationrequiring candidates and committees toidentify themselves on all campaignadvertising (such as print and broadcast paidadvertising, billboards, literature, etc.) wasadopted into law in February. The Commissionproposed rules to implement these newrequirements on April 19, and after a publichearing in June, the rules became effective onAugust 19.

Advisory Opinion Procedures: In aneffort to facilitate requests for advisoryopinions, the Commission proposed rulesspecifying the information that must beprovided by requesting persons. After ahearing conducted in July at which no oneoffered any comments, the rules were adoptedon September 10. In conjunction with theserules, the Commission implemented a formfor making such requests.

Street Money Payments: On October21st, the Commission proposed amendedregulations to strengthen the reporting of streetmoney transactions. The term “street money”refers generally to payments made toindividuals for get-out-the-vote efforts, poll


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watching, and other activities intended to aidor promote a candidate, or the passage ordefeat of a public question. All such paymentsmust be made by check. The proposed ruleclarified that in the event that a candidateemploys a vendor or other entity on behalf ofthe campaign to make such payments, thatvendor or entity is also required to make thepayments by check, and the candidate retainsresponsibility for reporting the identity ofpersons receiving payments. After a publichearing was conducted on November 19, atwhich no testimony was offered, theamendments were adopted by the Commissionin December.

Limited Liability Entities: In responseto questions made during its hearing on itsregulations prohibiting contributions bypartnerships (see above), the Commissionproposed on August 19, to prohibit alsocontributions from limited liability companiesand limited liability partnerships. A hearingon the proposal was conducted on November19, and the proposal was adopted by theCommission on January 17, 1997.

Contributions by Affiliated Entities:On December 2d, the Commission proposed arule preventing affiliated corporations,associations, or labor organizations from eachmaking contributions that, when aggregatedtogether, exceed applicable contribution limits.Therefore, if such entities are affiliated underthe standards contained in the rule, theycollectively may contribute only an amountthat does not exceed what a single entity cangive. After a public hearing was conducted onDecember 17, the Commission adopted therule on January 17, 1997.

Contributions by Minors: At itsmeeting of December 17th, the Commission

authorized proposal of rules prohibiting minorsfrom making contributions unless the minor is14 years of age or older, the contribution ismade from funds comprised of the minor’searned income, and affidavits are submittedfrom the minor and the minor’s guardians thatthe decision to contribute was solely that ofthe minor. A public hearing on the proposalwas held on February 18, 1997.

Advisory Opinions

Issues concerning the permissible usesof candidate funds and application ofcontribution limits dominated questionspresented to the Commission in requests foradvisory opinions. Any candidate, committee,or person subject to recordkeeping, reporting,or other requirements of the Reporting Act orLobbying Act may seek guidance from theCommission upon submitting a written requestfor the Commission’s opinion on a specificquestion of law. In order to facilitate suchrequests, the Commission this year establisheda form for these requests, which form isavailable on request. Advisory opinions issuedin 1996 addressed the following topics:

Use of candidate funds for futureelections: The Commission was asked whetheror not a candidate who raised funds in anelection candidacy for one office, in this caseState Assembly, could use the remainingunspent balance from that candidacy for afuture candidacy for another office (i.e., StateSenate). In Advisory Opinion No. 04-1996,the Commission observed that nothing in the1993 amendments to the Reporting Actappeared intended to change the policypermitting a candidate to transfer unspentfunds from a prior candidacy to a futurecandidacy, and that this policy extended bothto a future candidacy for the same office, or a

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different office. However, the Commissionconcluded that in order to insure thatcontribution limits were not violated in anysingle election, contributions received afterthe date of the termination of the 20-daypostelection report for the prior election andnot used to meet net outstanding obligationsfrom that prior election, must be considered ascontributions to the new candidacy.

Use of candidate funds for legal feesand constituent communications: Late in1995, the Commission was asked whether ornot an officeholder could use candidate fundsto pay legal fees arising out of theofficeholder’s defense for alleged ethicsviolations. The Commission held that thestatute regulating permissible uses of candidatefunds permitted “ordinary and necessary”officeholding expenses, and that anofficeholder subject to the rules of theLegislature is answerable before the JointLegislative Committee on Ethical Standards.Therefore, legal fees for representation beforethat body acting in its official capacity were apermissible use; Advisory Opinion No. 13-1995 (issued January 4, 1996). Also, theCommission held that candidate committeefunds could be used to pay part of the costs ofproducing and distributing the annual reportof a governing body to its constituents, butthat any text that might be construed aselection-related could give rise to politicalcommunication reporting and contributionlimits for the candidate; Advisory OpinionNo. 06-1996.

Joint federal and State fundraising:A State political party committee asked theCommission to prescribe procedures forhandling contributions received by check theproceeds of which are ultimately allocated bythe State Committee between its federal and

State election accounts. The Commissionestablished several restrictions, including arequirement that the State Committee providenotice to contributors of the formula thatwould be used by the State Committee tomake the allocation. Also, the State Committeemust receive acknowledgment from thecontributor that the contributor was awarethat such an allocation would be made;Advisory Opinion No. 01-1996.

Non-election related activity: InAdvisory Opinion No. 3-1996. theCommission ruled that a group of personswho solicited funds to purchase a personal giftfor an officeholder (i.e., a birthday present)would not acquire reporting responsibilitiesunder election-related finance disclosure law.However, the Commission noted that underother ethics statutes not within its jurisdiction,the officeholder would be required to reportthe identities of persons providing personalgifts having a value of more than $400.

Charitable contributions: TheCommission was asked whether or not it waspermissible for a candidate to make a charitablecontribution by using campaign funds topurchase a raffle ticket sold by a charity. Theticket ultimately proved to be the winningone. The Commission held that as long as thecandidate disclaims any rights to the winnings,the purchase of a raffle ticket from a bona fidecharity is permitted; Advisory Opinion No.08-1996.

Lobbying activities: The Commissionwas asked whether or not an organizationestablished by elected legislators would besubject to lobbying reporting and otherrequirements if it solicited funds and hiredstaff to make lobbying communications toother legislators. The Commission concluded



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that the fact that the organization wasestablished by legislators did not remove itfrom the Lobbying Act’s requirements. Whilethe acts of a State officer in carrying out theofficer’s duties are exempted from lobbyingreporting, the Commission ruled thatundertaking the solicitation and spending offunds to lobby other legislators was not withinthe scope of the exemption; Advisory OpinionNo. 02-1996. The Commission declined toissue an opinion to a person who contendedthat lobbying of regulatory officials occurringin the context of a public hearing or otheropportunities to be heard under theAdministrative Procedures Act were exemptfrom lobbying disclosure requirements.Because of the absence of any statement ofwhat lobbying activity was actuallycontemplated by this person, and what interestthat person had in that contemplated activity,the Commission lacked adequate facts to issuea ruling; Advisory Opinion Request No. 05-1996.

Prohibited corporate contributions:Election law prohibits certain corporate entitiesfrom making political contributions. However,since that law is not part of the Reporting Act,the Commission does not have legaljurisdiction to administer the prohibition, orissue legal opinions interpreting it. Instead,the Commission refers inquiries concerningthe statutory prohibition to the AttorneyGeneral, who may issue opinions for theguidance of such corporations. Accordingly,the Commission referred such a request to theAttorney General from a group of insurancecompanies and officers who wished to form acommittee for the purpose of makingcontributions; Advisory Opinion Request No.O7-1996.

Cost index and gubernatorial publicfinancing: The extensive rulemaking thatoccurred on these subjects is discussed in theGubernatorial Public Financing section of thisAnnual Report.

Civil Complaints

Both the Reporting Act and theLobbying Act authorize the Commission tobring civil complaints seeking monetarypenalties against persons who may haveviolated the requirements of those laws. Suchenforcement proceedings are used as a meansof compliance with reporting requirements,such as in the case of non-filers who filereports in response to complaint proceedings.Any person charged by the Commission mayrequest a full hearing before an AdministrativeLaw Judge, but in the great majority of casessuch hearings are voluntarily waived.

In 1996, the Commission issued 140complaints for alleged violations; 109concerning violations of the Reporting Actand the remaining 31 concerning the LobbyingAct.

While most respondents waive formalhearing proceedings, a person named as aRespondent in a Commission complaint hasthe right to a full, evidentiary hearing beforean Administrative Law Judge, who is anindependent hearing officer of the Office ofAdministrative Law (OAL) in the Departmentof State. There were a total of 23 hearingrequests pending during the year, 14 of thesewere closed prior to conducting the hearingand nine remain pending at the OAL.Interestingly, despite the number of hearingrequests, it proved unnecessary for the OALto conduct any hearing in Commission casesbecause respondents chose to settle during



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prehearing conferences or immediately priorto the hearing date. Settlements are oftenachieved after discovery is completed, andrespondents accept the proposed penalties inthe complaint. As a general rule, proposedpenalties are not negotiated, and are onlyreduced in cases where a respondent makes arequired filing or otherwise brings a filedreport into compliance.

The great majority of complaints weregenerated by an examination of Commissionrecords, comparing lists of candidates withfilings received from those candidates. Incases where records indicated no reports werefiled, complaints were initiated. However, 12of the complaints were the result ofinvestigations conducted by the Review andInvestigation Section. In these cases, theprosecuting attorney and the investigator worktogether in drafting the specific allegations ofthe complaint, and in prosecuting the hearing,if one is requested.

After a complaint has either been heardbefore the OAL, or a hearing has been waived,the Commission reviews the record and entersa Final Decision in the case. If the allegedviolations have been proved to theCommission’s satisfaction, the Commissionmay impose a monetary penalty of up to$3,000 per violation, or higher penalties incases of intentional violations of contributionlimits. During 1996, the Commission receivedpayments totalling $32,877 for such penalties.

Among the complaints undertaken thisyear for the first time, the Commissionprosecuted a violation of the contributionlimits established by the 1993 amendments tothe Reporting Act. The case involved acandidate-controlled Continuing PoliticalCommittee (CPC) which had dissolved by

contributing the balance of its funds to a localmunicipal political party committee. Sincethis balance amounted to slightly more than$100,000, this violation was a substantial oneof the $5,000 limit for a CPC contributing toa municipal committee. In this case, since thefunds were returned and ultimately disbursedproperly, the Commission concluded that theevidence did not support a finding that theexcessive contribution was made willfullyand intentionally, and therefore imposed apenalty for a non-willful violation on the CPCand its treasurer.

Also a first in 1996, was the bringingof 31 complaints against legislative agentswho were charged with filing late or not filingquarterly lobbying activity reports. Previouslobbying enforcement activity had been forlate or non-filing of annual reports, whichconvey most financial information. However,the Commission undertook this year toprosecute also quarterly report violationsbecause of the importance of timelyinformation concerning legislative agentlobbying activities, including identificationof clientele, areas of legislation and regulationlobbied, and specific bills.

In other significant litigation, theCommission brought a complaint against acounty political party committee which hadengaged in joint fundraising with a U.S. Senatecandidate. The county committee filed, as aresult of the complaint, reports identifyingbank accounts in which jointly raised fundshad been deposited, and information regardingexpenditures for “street money” in the election.In another case, still pending, the Commissionhas alleged that a committee affiliated with alabor union and two of its officers acted as aContinuing Political Committee by makingcontributions to candidates going back to 1991,



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but has failed to file any reports.

All complaints and final decisionsissued by the Commission are made availablefor public inspection at the Commissionoffices.

The Legal Section staff was expandedlate in 1996 with the addition of a legalassistant. As a result, the Legal Section wasable to establish a campaign finance case lawlibrary containing precedents from both federaland out-of-State courts. As the regulation ofcampaign finance has become more complexand has extended to the other States, it hasbecome increasingly important to establishthis research tool. In addition, the legalassistant has provided assistance in theprosecution of more involved cases, and in thedrafting, production and recordkeeping ofcomplaints and final decisions.



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COMPLIANCE AND INFORMATION SECTION

The calendar year 1996 was a busyyear for the Compliance and InformationSection. The enormous task of phasing in thecampaign financial disclosure reforms enactedin 1993 continued throughout the year as newregulations were promulgated. The“Compliance Manual for CampaignReporting” was updated and expanded toreflect the reforms. The recall law, along withthe political identification statement law, werealso phased in, requiring new forms andmaterials. In addition, the Compliance andInformation Section began to focus onexamining the ways in which its policies andprocedures could be streamlined and improvedby using new technology.

The Compliance and InformationSection did an outstanding job of re-workingits operations both inwardly and outwardly.

Compliance

In 1996, as in 1994, neither house ofthe Legislature was slated for election, norwere there any gubernatorial races. Despitethis fact, there were still approximately 20,000reports filed with the Commission during1996. While the number of reports is about thesame as that filed in 1994, it appears thatcandidates and committees filing detailedreports are spending more money.Accordingly, while the number of candidatesand committees does not appear to be risingdramatically, the amount of money spent bythese committees is increasing.

During 1996, 5,272 candidates andcommittees participated in the elections(school board, municipal, runoff, primary,and general). In prior years, the Commissionrequired that the county clerks place candidatenames onto Commission documents. Since it

was apparent that many clerks’ offices werecomputerizing their candidate lists, theCompliance and Information Sectionauthorized the clerks to transmit candidatenames using the clerks’ own computerizedformats. Further, the Section accepted thecandidate names via facsimile. This initiativesaved time and effort on the part of the 21county clerks and enabled the Section toreceive the names more quickly. As a result,the 1996 candidates and committees receivedtheir filing materials much earlier.

The Compliance and InformationSection re-examined in 1996 many of itsinternal procedures. One such procedure isthe process of “coding” reports. Every reportfiled with the Commission is assigned a code.The code is necessary for the purpose ofidentification and for use by the data entrystaff. A code consists of numerals whichreflect the office sought, county and municipallocation, political party, and a sequencenumber. Since the Commission’s creation in1973, this code was manually created andplaced on a report. During the fall elections,a pilot program was implemented to determineif computerized labels could be substitutedfor the manual operation. The program was ahuge success and has become a permanentprocedure for the Section. The “labeling” hasdecreased human error, saved time, and willallow the disclosure timeframe to be greatlyimproved.

To assist candidates and treasurerswith their compliance with the campaign laws,the staff of the Compliance and InformationSection conducted four seminars: threeseminars were held in Trenton and one seminarwas held in Bergen County. Seminars heightencompliance with the law and help buildrelationships with the candidates and treasurers


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who file reports with the Commission. Theseminars were well attended and continue tobe a favored event as a compliance tool.

For those candidates and treasurerswho were unable to attend the seminars, theCompliance and Information Section hadvideotapes available to borrow, or for viewingat the Commission’s offices in Trenton. Thisservice is available in recognition that manycampaign officials are unable to attendseminars, but would be able to view a seminartape at home.

By far one of the most notableaccomplishments of 1996 concerned therevision of the major source of informationnecessary for candidate compliance: “TheCompliance Manual for Campaign Reporting.”This Manual was totally revised to capture thenumerous changes to the regulations as aresult of the sweeping campaign reformsenacted in 1993 and to provide materials forthose involved with a recall election. TheManual was created with desk-top publishing,and contains a much more comprehensivediscussion of the complex campaign financialdisclosure laws. Much of 1996 was spentcreating the new Manual, which was publishedand available in January of 1997.

The Compliance and InformationSection continued to provide support andassistance to candidates and committeesthrough its informational mailings andnonfiler/delinquent notices. Prior to eachelection, every candidate running for officereceived a Manual with forms and reportingdates. Within 3 days of the filing date, nonfileror delinquent notices were sent to candidateswho failed to file reports. Treasurers of PACsreceived filing materials and reporting datesone month prior to each of the quarterly

reporting dates, and a delinquent notice ifreports were not filed. By providinginformational mailings prior to the filing datesand nonfiler/delinquent notices promptly afterthe filing date, the Section was able to maintainits high rate of compliance throughout 1996.By election day, 95 percent of the generalelection candidates had filed reports with theCommission.

Disclosure by lobbyist organizationsand legislative agents remained an area ofhigh interest during 1996. As with thecandidates and PACs, the Compliance andInformation Section provided informationalmailings to registered agents, along withdelinquent notices. At each quarterly filing,approximately 88 percent of the registeredagents filed their quarterly report of legislativeactivities on time. At the filing date of theannual reports of financial activity, 89 percentof legislative agent filed reports; that numberrose to 99 percent within one month of thefiling date. Furthermore, the Section continuedto administratively terminate any agents whofailed to remit the required registration fee,thus keeping the active agent list current. Theadministrative termination program is anexcellent compliance tool to insure that agentsproperly register and maintain a bona fideagent status.

The Compliance and InformationSection continued to produce its quarterlyreport of lobbying activity, published shortlyafter each calendar quarter. This com-prehensive report summarizes all activity, byquarter, of all legislative agents registered inNew Jersey. The report also contains a listingof whether or not a particular legislative agentfiled a quarterly report. Copies of the quarterlyreports filed are also compiled and publishedwith the report. This publication is both an

COMPLIANCE AND INFORMATION SECTION continued


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excellent compliance tool and a popular anduseful resource for the press and public.

As a result of the passage of a politicalidentification statement law in 1996 (alsocalled the “disclaimer” or “labeling” law),entities making expenditures for politicaladvertising and filing with the Commissionare required to place an identification statementon the communication. The Compliance andInformation Section notified those affectedby the new law of its requirements and assistedthose posing questions concerning the law’sapplication.

Overall , the Compliance andInformation Section was very successful inpromoting compliance with the campaign,PAC and lobbying disclosure laws, therebyproviding the citizens of New Jersey with anabundance of information with which to beinformed voters.

Information

One of the highest priorities of theCompliance and Information Section is thefunction of providing disclosure to the citizensof New Jersey. The Compliance and Infor-mation Section is very proud of itsaccomplishments in this area.

During 1996, a study was done by anational watchdog agency called“Contributions Watch.” This group examinedthe practices and procedures in each of the 50states concerning public disclosure. TheCommission was ranked third highest inexcellence among the 50 states, a rankingwhich reflects the continuous striving toprovide a high level of service to the people ofNew Jersey.

Each year more and more NewJerseyans become involved with the politicalprocess. Accordingly, the Compliance andInformation Section is always poised and readyto experiment with new initiatives toaccommodate as many interested persons aspossible. One such initiative was the expansionof the “public records” area. Over the historyof the Commission, the public area wasconfined to one room, with limited workspaceand seating. Due to the lack of space, therewas no photocopying machine available forpublic use, and the reports placed in the publicarea were on display on a temporary basis.Each election cycle, reports were removedfrom the public area to make space for the nextelection cycle reports. During 1996, theCommission was able to obtain additionalspace for the public area expansion. Thepublic area now has three times the physicalspace it once had, with plans to open a fourthroom during the next year. A largephotocopying machine has been installed forexclusive use by the public. Filing cabinetsline the walls and house reports which can beaccessed much like that of a library. Referencematerials can now be shelved and provide acomprehensive source of current informationconcerning the campaign and lobbying laws.The press and public can visit the public areaand review the reports and materials withoutstaff intervention, thereby enhancingconfidentiality and convenience.

Since the public records area is alsothe “filing headquarters” for candidates,treasurers, and legislative agents required tofile reports with the Commission, space in thenewly expanded public area was devoted totheir needs. Forms, manuals, advisoryopinions, and regulations are available to assistthose who file with the Commission. Also, asecured receptacle was installed to streamline



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the filing procedures on filing deadlines. Afiler is never required to wait in line to file areport; the report need only be deposited in thesecured receptacle located in the public recordsarea.

To further improve the disclosurefunction of the Commission, staff of theCompliance and Information Section travelledto the Federal Election Commission (FEC) inWashington, D.C. to observe and learn ofpractices and procedures which could benefitthe public in New Jersey. Since the FECshares a similar mission with New Jersey’sElection Law Enforcement Commission, it isquite economical to benefit from the FEC’sdisclosure experience. The staff of the FECwas able to provide invaluable adviceconcerning various technologies and vendors.

Since more and more members of thepublic have access to a facsimile machine, theuse of “flash fax” technology is imperative.This technology enables a person to obtain,through their facsimile machine, copies ofsuch items as forms, regulations, advisoryopinions, press releases, and other importantnotices, by calling into a facsimile directory.This service will be available 24 hours a day.Much of the ground work was done on thisproject during 1996 to have it in place for the1997 elections.

The Compliance and InformationSection published numerous press releases in1996 announcing upcoming Commissionmeetings, new laws, filing and disclosuredates for the elections, and analytical releases.The Commission meeting releases provide anopen invitation to the press and public toattend the open public meetings and to becomeinvolved with the work of the Commission.The analytical releases done in the lobbying


area during 1996 remained to be ofextraordinarily high interest and resulted inwidespread coverage by the media.

Conclusion

The Compliance and Information Section isvery proud of its compliance and disclosurerecord during 1996. By improving compliancewith the law by those who are required to filewith the Commission, and by enhancingdisclosure with the use of new technology, anexpanded physical space, and streamlinedprocedures, the citizens of New Jersey canbecome the most informed electorate ever.


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REVIEW AND INVESTIGATION SECTION

Investigations

This year again proved to be a busyone for the Review and Investigation staff.The Commission received 107 requests toundertake new investigations (a figure that isconsistent with the 110 requests received in1995), and the Commission determined toopen 51 investigations as a result. Ten ofthese requests were referrals from other Stateor local agencies. In addition, the Commissiondetermined to open another 19 investigationsas a result of internal review. The Sectionstaff closed a total of 45 investigations, and atthe close of 1996 a total of 35 investigationsremained open.

Of the 45 completed investigations,17 resulted in the Commission approvingissuance of formal complaint proceedings.The Commission is authorized to filecomplaints in cases where it believes violationsof campaign or lobbying laws may haveoccurred, and civil penalties may be imposedafter respondents have had an opportunity fora hearing in an Administrative Law Court.

In addition to receiving requests forinvestigations from outside sources, theCommission also determines to initiateinvestigations as a result of its own review. In1996, the Commission authorized the Reviewand Investigation Section to undertake a projectto review the quarterly reports filed by thecounty political party committees. That projectis still ongoing and involves review of suchreporting obligations as the requirement toreport all depository accounts, to disclosecomplete contributor information, and to file48-hour notices for contributions receivedand expenditures made in the period betweenthe date of the last quarterly report and anelection occurring before the due date of the

next quarterly report.

Investigations during 1996 involvedtwo new and very different areas ofexamination - the contribution limits imposedby the 1993 Amendments and the politicalidentification requirements which werebrought under the Commission’s jurisdictionby legislation effective February 1, 1996.Each area has involved new challenges for thestaff and will probably continue to do so. Ininvestigations involving violations of thecontribution limits, a critical issue has becometo examine not only whether the contributionlimit was violated, but also whether or not itwas done wilfully and intentionally, therebyrequiring a showing of specific intent.Therefore, establishing and proving intent ina contribution limit case has presented anadditional challenge.

During 1996, a new law was enactedplacing responsibility with the Commissionfor enforcement of correct politicalidentification on political advertisements.Under this law, candidates and committeesfinancing political advertisements or othersimilar campaign materials must identifythemselves on the advertisements. This lawhas already generated three investigationsarising out of the 1996 primary election, andin those cases the Commission issued lettersof correction rather than undertaking complaintaction because of the relative newness of thelegislation, and the lack of familiarity withthe requirements. The name and address ofthe candidate or other committee must appearon the literature, not the name of the treasureras in the prior, now superceded law, whichwas under the jurisdiction of the countyprosecutors’ offices. An increasing numberof requests for investigation now includeallegations of incorrect and/or missing political


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identification. These allegations have involveda number of local elective offices and oftenrequire on-site inspection of signs and othercampaign material around the state, aninvestigative function which differs from theaccounting function involved in auditing booksand records for reporting of campaigncontributions and expenditures. Despite thisincreased demand for investigative resources,the Section has received no additionalpersonnel and remains staffed with twoinvestigators.

Investigations continued to involvesuch other issues as: failure to reportcontributions and expenditures, including “in-kind”(that is, other than cash) contributions;failure to identify contributions in excess of$200.00 and/or to report occupation andemployer information for those contributions;failure to report outstanding obligations;failure to report required detailed informationfor “street money” expenditures; exceedingthe affidavit report form expenditure thresholdof $2,000 in an election; failure to establishand/or report a depository account; filingobligations of entities allegedly engaged inelection advocacy; the requirement to dissolveall candidate-controlled political committeesand continuing political committees; and thealleged “personal use” of campaign funds.

In 1996, the Section completed itsfirst investigation with a recommendation forprosecution concerning the contribution limitsimposed by the 1993 Amendments. Thisinvestigation involved a candidate-controlledcontinuing political committee, which wasrequired to wind up and dissolve by April 8,1994. The full balance of some $100,000 wastransferred to a municipal political partycommittee. While this transfer effectivelysatisfied the requirements of Section 9h(1),

the amount of the transfer exceeded the limitof $5,000 on a contribution from a continuingpolitical committee to a municipal politicalparty committee. The Commission approvedthe issuance of a Complaint against thecontinuing political committee and itsorganizational treasurer for making acontribution in the amount of $101,752.37, anamount in excess of the $5,000.00 statutorycontribution limit.

Another investigation involved acommittee of a labor union, which allegedlywas making contributions to and on behalf ofcandidates for elective office, and thereforehad incurred an obligation to file quarterlyreports with the Commission as a continuingpolitical committee. Review of expendituresby this entity disclosed that it exceeded the$2,500.00 expenditure threshold for filing asa continuing political committee in calendaryears 1991-1994, and therefore incurred afiling obligation with the Commission as acontinuing political committee. Theinvestigation showed that over the relevanttime period, more than $50,000 was expendedin election-related activity. Staffrecommended the issuance of an eighteen-count complaint against the continuingpolitical committee and its treasurers for failingto file quarterly reports for calendar years1991 through 1995, and for failing to file adesignation of campaign treasurer anddepository (Form D-3).

In one investigation involving a po-litical committee raising and expending fundsto support candidacies of two candidates forTownship Committee in the 1994 generalelection, staff recommended a three-countcomplaint against the political committee andits campaign treasurer, including one countfor failure to file 48-hour notices relevant to

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the receipt of five “in-kind” contributions,totaling $5,302.99, each in excess of $500 inthe aggregate, which were received betweenthe thirteenth day prior to the election and thedate of the election.

In another investigation in which theCommission approved issuing a complaintagainst a continuing political committee forlate filing of quarterly report information, theCommission also approved issuance of a letterof correction to two officeholders listed as“honorary co-chairmen” of the continuingpolitical committee on fundraising material,to advise the officeholders that Section 9h(1)prohibits each from participating directly orindirectly in the management of the continuingpolitical committee, and that when a candidatelends his or her name as “honorary chair” or“co-chair,” an implication arises that there issome degree of participation by the candidatebecause the candidate otherwise would notlend his/her name to be used for purposes withwhich he/she does not agree.

Requests for Investigation

Any person may request that theCommission undertake an investigation bysubmitting a written statement setting forth anallegation that constitutes a potential violationof the Campaign Reporting Act. It is alwayshelpful when the complainant forwards asmuch specific evidence as possible to supportthe allegations. The staff reviews every requestfor investigation, determining whether or notit presents an allegation that falls within theCommission’s jurisdiction. Staff assesseswhether or not the allegation can be resolvedby a relatively minor reporting adjustment, orby clarification of the applicable reportingrequirements with the complainant. In someinstances, the request involves allegations that

are not yet “ripe” for review because theyconcern future elections and/or reportingperiods that have not been concluded. Allremaining requests for investigation arepresented to the Commission for itsconsideration. In 1997, the Review andInvestigation Section anticipates completinga form for use in requesting an investigation.

Subpoenas

The Review and Investigation Sectionissued 15 subpoenas in calendar year 1996 innine investigations. Eight subpoenas wereissued to respondent reporting entities and/ortreasurers for records, and seven subpoenaswere issued to financial institutions for records.

Additional Complaint Recommendations

The Review and Investigation Sectionis also responsible for generating complaintrecommendations for those candidates or filingentities that did not file campaign, quarterly,or personal financial disclosure reports withthe Commission. In order for the Commissionto identify these entities, staff must undertakea review of its files of campaign reports, andcompare those files against the computer-generated checklist which identifies thoseentities that have not filed with theCommission as of a specific date. Thecomplaint recommendation process isconducted with painstaking thoroughness sothat complaints are recommended only in caseswhere both the report files and the checklistagree that no report was filed. In addition,staff also reviews the annual and quarterlyreports of lobbyists and legislative agents forcompliance with the provisions of theLegislative Activities Disclosure Act. In 1996,the Review and Investigation staff preparedand forwarded complaint recommendations



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that resulted in the issuance by the LegalSection of 36 complaints for non-filers in the1995 general election, five complaints fornon-filers in the 1996 municipal election, 56complaints for non-filers in the 1996 primaryelection, 15 complaints for non-filers of 1995second quarter lobbyist reports, and 16complaints for late filers of 1995 second quarterlobbyist reports.

Administrative Hearing Support

The Review and Investigation Sectionalso assists in the preparation of cases forhearings before the Office of AdministrativeLaw. The investigators prepare a chronologyof the filing events that constitute the allegedviolation and work with the prosecutingattorney to identify within the Commission’sfiles the documents and prepare the testimonynecessary to present the Commission’s case atthe hearing. In 1996, the Associate Directorprepared testimony for one hearing. Theinvestigators also completed resident addresschecks for the Legal Section to determine thecurrent and correct address for a respondentwhenever a county sheriff advises ELEC thatpersonal service could not be accomplished atthe address provided in election records.

Fine Collection

The Review and Investigation Sectionis also responsible for maintaining a finecollection program in cases where penaltiesremain unpaid after issuance of FinalDecisions. During 1996, staff issued 27 finecollection letters. Staff efforts resulted in thecollection of $3,367 in unpaid fines in 1996.

Other Activities

The Review and Investigation staff

provided technical assistance and input to theCompliance and Information Section into thedrafting and issuance of a new compliancemanual and updated forms for candidates andcandidate committees. This input wasimportant because it was based upon theinvestigators’ experience with reporting errorsand accounting problems and was intended toassist in making the new manual and forms asuser-friendly as possible, particularly in viewof the complex requirements inherent in anysystem of contribution limits. The Sectionstaff also provided supplemental assistance tothe Compliance and Information Section withtelephone coverage and in-office contacts asnecessary during various intervals during theyear in responding to inquiries by candidates,treasurers, or other persons seekinginformation on reporting and filingrequirements.

Staff members also provided inputinto the drafting of Commission regulationsand assistance to the Legal Director in thepreparation of advisory opinions, includingbackground information on the filing status ofrequesting entities, and suggested appropriatetechnical solutions for reporting questions.The staff also provided report review assistanceon the contributor coding project for the 1995general election.

Associate Director Shreve Marshallserved as liaison to investigative counterpartsin other state, local, and federal agencies ingiving assistance in a number of investigativeinquiries. He also conducted report reviewtraining for new staff members. Bothinvestigators attended training courses inanalysis sponsored by the State CriminalJustice Academy and training courses in theEXCEL software program. As a result,investigative reports began to incorporate new



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charts and other applications of this enhancedtraining. All of the investigative staff hasworked to become as proficient as possible inthe use of the personal computer.

Staffing

The Review and Investigation Sectionwas staffed by two investigators, one secretary/clerk and the Director, during 1996. In Julythe Section completed its move from thethirteenth floor to the twelfth floor. As theyear ended, the Section anticipated convertingto a new computer system designed to enablethe more efficient preparation and completionof investigative reports. The Commissionlooks forward in the coming year to respondingto the challenge of meeting the growingdemands placed upon its investigativeresources by the accounting complexityinvolved in investigating all the various perelection and annual contribution limits, by therelatively new duty imposed by the 1993Amendments to examine whether or notspecific uses of campaign funds arepermissible, and by administering theprovisions of the new political identificationlaw.



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GUBERNATORIAL PUBLIC FINANCING SECTION

Preparations for the 1997gubernatorial public financing program werebegun by the Commission immediately uponconclusion of the 1993 gubernatorial elections.Administrative and regulatory matters whichwere the subject of litigation in 1993 werereviewed, and staff began preparing datapertinent to the statutory mandate to adjust byDecember, 1996, the limits and thresholdsapplicable to the gubernatorial public financingprogram. As a result of the 1993 amendmentsto the Campaign Contributions andExpenditures Reporting Act (hereafter, theAct), staff was under the additional mandateto adjust, for the first time, the variousthresholds and limits applicable to non-gubernatorial candidates and committees.

The following four goals weretherefore established for public financing andmet in 1996:

• Calculate and implement the gubernatorialand non-gubernatorial cost indices andpropose and adopt regulations toimplement the cost index changes;

• Conduct a comprehensive review of thegubernatorial public financing primary andgeneral election regulations;

• Take steps to implement the “electronicdisk filing” project for the 1997gubernatorial general election; and,

• Hire and train analyst and data entry stafffor the 1997 public financing program andconduct information sessions forprospective candidates and interestedindividuals.

Campaign Cost Index Calculation andImplementation

Calculation of the New JerseyCampaign Cost Index (CCI) and promulgationof regulations implementing the cost indexchanges were the major focus of publicfinancing efforts during 1996. TheCommission has since 1989 been statutorilymandated to “establish an index reflecting thechanges occurring in the general level of pricesof particular goods and services . . . directlyaffecting the overall costs of electioncampaigning in this State,” and to use thatindex on a quadrennial basis to adjust thevarious limits and thresholds applicable topublicly-financed gubernatorial campaigns(N.J.S.A. 19:44A-7.1). This task becameeven more complex because the 1993amendments to the Campaign Act requiredthat the same index be applied also to thelimits and thresholds applicable to all non-gubernatorial candidates and committeesregulated by the Campaign Act (N.J.S.A.19:44A-7.2).

Using methodology described by theCommission in its June, 1988 “GubernatorialCost Analysis Report,” and applied for the1993 gubernatorial campaigns, staff calculatedthe 1997 CCI and determined that campaigncosts increased 16.12 percent since 1993. Thisresulted in the need to adjust for the secondtime the seven limits and thresholds in thepublic financing provisions of the Act, andadjustment for the first time of the 11 limitsand disclosure thresholds applicable to non-gubernatorial candidates and committees.Further, the various limits for contributions tonon-gubernatorial candidates and committeesalso required change. The cost index multiplierwas applied to each limit or threshold and thestatutorily-required rounding formula was


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GUBERNATORIAL PUBLIC FINANCING SECTION continued

used. The cost adjustment process nextrequired identification and amendment ofalmost 60 sections of Commission regulationscontaining the changed gubernatorial and non-gubernatorial limits and thresholds. This wasaccomplished as part of extensive amendmentsproposed in the October 7, 1996 New JerseyRegister.

As part of the proposed CCIadjustments, a public hearing was conductedon October 22, 1996, and five personspresented oral and written testimony. Thecommenters were generally opposed to thecontribution limit increases mandated by thelaw. The cost index process, the publiccomments received, and the Commissionresponses to the comments were discussed inthe “1997 Cost Index Report,” which waspublished in December, 1996, and providedto the Legislature by the mid-Decemberstatutory deadline.

The Commission concluded that thecost index adjustments must be implemented,even though there were objections to theincreased contribution limits, because thequadrennial process is statutorily mandated.However, as a result of the public commentsreceived, the Commission made the followingrecommendations in the “1997 Cost IndexReport”:

1. Any changes to the CCI process for the2001 elections should be implemented bythe end of 1999 to provide adequate timefor evaluation and public response. TheLegislature may wish to determine whetheror not a different CCI calculation, lessreliant on media costs, is more appropriatefor application to non-gubernatorialcandidates and committees.

2. The statutory rounding process for thecost index adjustments, required byN.J.S.A.19:44A-7.1, as applied to thelimits and thresholds in the Campaign Actof $1,000 or less should be modified torequire adjustment only where theincrement exceeds $50. Review by theLegislature of the effect of the statutoryrounding process as applied to all thelimits and thresholds may be warranted.

3. As described in the Commission’s July,1996 White Paper, “State Parties andLegislative Leadership Committees: AnAnalysis 1994-1995,” the Legislatureshould consider reducing the maximumcontribution permitted to the legislativeleadership committees from $25,000($30,000 as adjusted) to $10,000 to beadjusted by the CCI in the future, andshould also consider adjustment of thelimit to the State party committees from$25,000 ($30,000 as adjusted) to $15,000.

4. All the contribution limits should bereviewed by the Legislature prior to the1999 elections to determine whether ornot the present limits could be reducedwithout harming the balance betweenprotecting the government from thepotential for corruption and maintainingFirst Amendment rights of free speech.

The regulations containing the CCIadjustments for 1997 gubernatorial electionsbecame effective on December 16, 1996, whilethe adjustments relevant to non-gubernatorialcandidates and committees became effectiveon January 1, 1997.


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Review of Gubernatorial Regulations

Based upon the experience of theCommission staff in administering the publicfinancing program, litigation which occurredduring the 1993 gubernatorial election cycle,advisory opinions issued by the Commissioninvolving public financing issues, and changesto the Campaign Act, staff undertook anexamination of the gubernatorial primary andgeneral election regulations. Extensiveamendments to the primary electionregulations were proposed on May 20th andsimilar changes to the general electionregulations were proposed on October 7th.Public hearings on the amendments wereconducted on June 11th and October 22nd,respectively. Highlights of the changes follow.

Litigation conducted during the 1993general election concerned the expenditure ofgeneral election funds by a publicly-financedgubernatorial campaign before the primaryelection. Expenditures for the general electionare prohibited until the day after the primaryelection. The Administrative Law Judgehearing the case suggested that futureCommission regulations specifically addressthis issue. The Commission therefore proposedand adopted amendments which permit asuccessful gubernatorial primary electioncandidate to make payments from primaryelection funds in certain strictly limitedcircumstances which may later be reimbursedafter the date of the primary election usinggeneral election funds. For example, if asuccessful gubernatorial primary electioncandidate has paid rent for campaignheadquarters for the month of June, a portionof that rent may become attributable to generalelection activities and may therefore beproperly reimbursed to the primary electionaccount using general election funds.

Regulations were adopted requiringthat, as a condition for receipt of primary andgeneral election public matching funds, acontribution from an individual must disclosethe individual’s occupation and employer.The requirement to report occupation andemployer information for individualcontributors was among the 1993 amendmentsto the Act. A similar amendment toCommission regulations was not adopted in1993 because the gubernatorial campaignsstated that more time was needed to adjust tothe new requirement. The Commissionbelieved that by 1997 campaigns andcontributors had had sufficient experience withthe requirement to make reporting ofoccupation and employer information aprerequisite for all contributions submittedfor match with public funds.

Independent expenditures were thesubject of several requests for advisoryopinions during the 1993 gubernatorialelection cycle. The Commission determinedthat a State political party committee couldmake independent expenditures in the primaryelection if the expenditures were made withoutthe consent of, consultation with, orcoordination with the gubernatorial candidate.The primary election regulations wereamended to incorporate this result. However,because of different statutory provisions andpublic policy objectives, the general electionregulations were amended explicitly to prohibitindependent expenditures by political partycommittees for their gubernatorial candidates.The Commission found that, by virtue of itsrole promoting candidates in a general election,a State political party committee cannot bedeemed independent of its gubernatorialcandidate and cannot make independentexpenditures for a gubernatorial candidate ina general election.


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In prior gubernatorial elections,campaigns had requested regulatory guidancefrom the Commission in determining whetheror not two or more contributing corporationswere affiliated for purposes of applying asingle gubernatorial contribution limit. TheCommission therefore proposed and adopteda regulatory test based on corporate ownershipand control to assess corporate affiliation.

Gubernatorial candidates receivingpublic matching funds are required toparticipate in two televised debates, and theCommission is responsible for selectingsponsors for these debates. The Commissionamended its rules for organizations applyingto sponsor the mandated primary and generalelection debates to require more specificinformation concerning an applicant’s plansfor media coverage of the debates to insurethat the entire New Jersey voting public beprovided with the greatest opportunity to viewthe televised debates. The regulations werealso amended to require that sponsorapplicants describe sources of funds beingused to pay for costs associated with thedebates so that the Commission can avoidselection of a sponsor with a possibleappearance of a conflict.

The Commission had found in a 1994advisory opinion that there is no public policyobjective served by limiting a loan from aState political party committee to the InauguralCommittee of a Governor-elect to the $500Inaugural event contribution limit. The ruleswere therefore amended to clarify that anInaugural Committee may accept a loan fromthe State political party committee in excessof the $500 inaugural event contribution limit.An amendment was also adopted to requirethat, after its initial 45-day report of

contributions and expenditures, a gubernatorialinaugural event committee file reports onquarterly intervals rather than 60-day intervals.The regulatory change in reporting cycleparallels reporting dates established in the1993 amendments to the Act.

Public Information

New Jersey’s gubernatorial publicfinancing program has earned a nationalreputation since it first provided matchingfunds to candidates in the 1977 generalelection. Inquiries about the program aretherefore frequently received from states andother groups studying public financingsystems. During 1996, more than 70 requestswere completed for copies of documents,including over 12,000 pages of information,and staff responded to more than 200 telephoneinquiries. Gubernatorial informationmaintained by the Commission thereforecontinues to be of great interest even in non-election years.

Electronic Filing Initiative

During 1996, the Commissionrequested and received a special appropriationin its public financing administrative budgetto design and implement an “electronic” filingpilot project for the 1997 gubernatorial generalelection. This project will permit gubernatorialcampaigns to submit detailed contributorinformation, required as a part of thegubernatorial public matching fund applicationprocess, on a single computer disk rather thanin voluminous paper reports. When completed,the disk filing pilot project will permit fasterprocessing of candidates’ applications forpublic matching funds and eliminateduplicative data entry tasks.



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To implement this initiative, in 1996staff applied for and received approval towork with a vendor to convert its existinggubernatorial computer software to a newformat which will support the disk filingproject. Once the software conversion iscomplete, the Commission will work in early1997 with the Office of Telecommunicationand Information Services (OTIS) in theDepartment of the Treasury to designadditional software necessary for agubernatorial campaign to collect requiredcontributor information on a diskette whichwill then be “filed” in place of a paper report.The data on diskette will then be up-loadedfrom the diskette into the Commission’sgubernatorial computer database. It is hopedthat at least a portion of 1997 gubernatorialgeneral election public matching fundsubmission data will be filed using this newtechnology.

Staffing and Planning

The most important component of thepublic financing program is the temporarystaff hired to review and process candidateapplications for matching funds and to respondto the high volume of inquiries for information.Four public financing analysts were hired inlate 1996 and received intensive training inCommission regulations and computerprocedures. Data entry staff and a computerassistant began in January, 1997.

Each contribution submitted for matchand the supporting documentation providedby a campaign are reviewed by the publicfinancing analysts for conformity withstatutory and regulatory criteria. Contributionswhich are missing any required informationare temporarily rejected for match until thenecessary information is provided. Each

contribution is coded and keyed into theCommission computer database and givenfinal review for compliance with thegubernatorial contribution limit. As a resultof this process, computerized contributor listsfor publicly-financed gubernatorial candidatesare made available to the public in a preelectionsetting. To accomplish these tasks, publicfinancing staff must therefore be trained incomplex statutory and regulatory materialsand database operations in a very short periodof time.

The public financing manual forcandidates, the internal staff proceduresmanual, and forms were critically reviewedand updated during 1996 to reflect changes inthe law and regulations. Computer operationswere fully tested and documented.

A list of persons who indicated interestin the gubernatorial election was compiled bystaff and included those who contacted theCommission as well as individuals identifiedin newspaper articles and elsewhere asprospective gubernatorial candidates. Thislist was used to invite members of the publicto two information sessions conducted by thepublic financing staff in December, 1996.Public financing regulations, materials, andforms were provided to approximately 40attendees at the two sessions, and publicmatching fund procedures were discussed indetail. These information sessions assistprospective candidates and treasurers tobecome familiar with the strict statutory andregulatory limits and requirements forpublicly-financed gubernatorial candidates.



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The 1997 Public Financing Program Begins

The first date for receipt of agubernatorial primary election matching fundsubmission is January 6, 1997, and allCommission forms and preparations for thatdate are complete. Regulatory review, withsignificant public input, the CCI process, andstaffing and training were concluded. TheCommission is proud that all of these stepswere accomplished on time and withoutinterruption to other essential Commissionservices. The Gubernatorial Public FinancingSection looks forward to serving the publicand the gubernatorial campaigns in1997.



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COMPUTER SECTION

There are two basic areas whichcomprise the Computer Section. They are theComputer/Systems Operation and the DataEntry Staff. In 1996, the data entry staffincreased by one and the computer/systemsoperation acquired a DEC Alpha Server 1000,38 new personal computers, and three newprinters. Moreover, Computer/SystemsOperations rewired all the Commission'soffices to accommodate the new equipment.Both of these areas are basic to managing theCommission’s data efficiently and effectively.

Systems Operations

The systems operations area isresponsible for running and maintaining thePRIME Information 4150 Operating Systemas well as overseeing the upgrading, softwaredevelopment, and enhancements to the system.Systems operations also oversees theinstallation and use of personal computersutilized by staff. Systems operations is nowresponsible for the newly acquired AlphaSystem and LAN (local area network), and forstaff training relative to utilizing this sytem.

In 1996, the system operations areacontinued to phase in the last of the softwarechanges to accommodate the 1993amendments to the Campaign Reporting Act,which is used on the current PRIME system.

Additionally, 1996 marked thebeginning of a new stage in the life of theSystems Operations area. With direction fromthe Office of Telecommunications andInformation Systems (OTIS), the Commissionpurchased new computer hardware, had itsoffices rewired for a LAN, and contractedwith an outside vendor to rewrite itscustomized, software programs for ORACLEto be used in windows on the Personal

Computers (PCs). The Commission alsocontracted with OTIS to write a publicfinancing software program for electronicfiling. The Commission hopes to have a pilotprogram for electronic filing in place for the1997 gubernatorial general election. Thesechanges began during the second half of theyear and will gradually be phased in duringthe next year. The ultimate goal is to beindependent of the PRIME Information Systemand to run all programs in a client/serverwindows environment.

The Systems Operation area was veryinstrumental in putting out a compendium ofcampaign financing and lobbying statistics.This report was recently expanded to includethe State and county political party committeestatistics for the last ten years. The areaproduces various statistical reports oncampaign finance, continuing politicalcommittees, and annual lobbyists andlegislative agent filings.

The Systems Operations area alsoprovides technical support for the agency byhandling any PC problems, arranging trainingclasses as needed, providing initial PC trainingand making determinations for its end userson software packages. It provides the publicwith timely statistical data in various outputformats and is very basic to managing theCommission’s statistical information oncandidates and committees efficiently andeffectively.

Data Entry

During 1996, the data staff entered thenames and addresses of candidates running inthe May municipal, June runoff, June primary,November general, school board, firecommissioner, and special elections. The


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names and addresses are entered and verifiedfor accuracy as quickly as possible in order togenerate mailing labels for the ComplianceSection. The Compliance Section then sendsnotice to candidates of their filing obligation.

The data staff keyed the summaryfinancial information of receipts andexpenditures for candidates running in countyand local elections. The staff also keyed thefinancial summary information on State,county, and local political party committees,political committees as well as special interestPAC’s.

Staff also keyed the annual lobbyistfinancial information as well as the activitydata for the lobbyist quarterly reporting system.Various statistical reports were made availablefrom the information filed by the lobbyistsand legislative agent annual reports. Thesereports reflect salaries, benefit passing, andboards or commissions that legislative agentsserve on, and other forms of receipts andexpenditures.

A major accomplishment in 1996 bystaff was the keying of all contributorinformation from the 1995 legislative generalelection. This effort was the first time that theemployer information from individualcontributors was keyed into the system forlegislative candidates. In order to moreefficiently and quickly enter this contributorinformation, a secretarial staff member wasreassigned to the data entry staff. This actionbrought the data staff to four operators.

In addition to the achievements notedabove, the data entry staff was alsoinstrumental in retrieving information fromthe Commission's computer system and thenconverting it into a more usable fashion.

Requests for computer generated statisticalinformation were completed by the data entrystaff as well. By making better use of theCommission's PC’s, staff was able to retrievestatistical and contributor informational fromthe main computer system and copy it to disk.This information now becomes much moreuser friendly and can be read in a spread sheetfile. This development has made it mucheasier for the public to use this information ontheir individual PC’s.

In 1996, data staff also assisted othersections by providing receptionist coverage,helping with large mailing projects,photocopying on request, and assisting on anas needed basis whenever possible.

COMPUTER SECTION continued


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ADMINISTRATION SECTION

Other Activities

The Commission accomplishedseveral goals throughout 1996. First, theimplementation of the Commission'srecomputerization effort began. The client-server technology of the DEC AlphaServer1000 was purchased to eliminate the use of thePRIME 4150 System the Commission has hadfor over ten years. ORACLE will be used asthe client server database management system.In addition, ELEC's software which is nowwritten in PRIMOS, is being migrated toVisual Basic a language which is widely usedand easily changeable when new legislationdictates. This migration is expected to becompleted by the end of FY-1997.

The Commission has alsoaccomplished its goal of moving staff in orderto optimize its available space. TheCompliance and Information section hasmoved to the 13th floor and the Review andInvestigation Section and Legal Section staffhave moved to the 12th floor. This change hasallowed for three additional rooms to beutilized for public area space. Now, ELEC'spublic area consists of four rooms, onecontaining a small photocopier to be used,free-of-charge, by the public, for 50 pages orless. This "convenience" copier has helpedthe public and press greatly in securing limitedamounts of information quickly and easily.Also, the increase in space has allowed forreports to be placed in these rooms for quickerretrieval by the public and press. In addition,an area has been set up for use of ELEC'sFederal Election Commission (FEC) computerhook-up, which enables the public to accessreports filed by federal candidates andcommittees.

During 1996, the AdministrationSection effectively met the ever-increasingfiscal and personnel demands of theCommission. An essential part of the agency,Administration provides all managementservices for the Commission.

Since ELEC is "in but not of" the Departmentof Law and Public Safety, the Department hasno administrative responsibility or controlover the Commission.

Managing the Budget

In FY-1997 (July 1, 1996), ELECreceived an annual appropriation of$1,417,000, which represents a continuationbudget from FY-1996. The Commission alsoreceived a separate appropriation of $630,000for the administration of the GubernatorialPublic Financing Program.

As part of the $630,000 appropriationfor Public Financing, $155,000 has beenobligated for the implementation of anelectronic filing program to be used by thegubernatorial candidates in the general election(FY-1998). This election was chosen as thepilot project due to the limited amount ofcandidates participating. These funds will beused to pay for the necessary hardware andsoftware design needed to allow candidates tofile by diskette. The Commission is using theservices of an outside vendor as well as theOffice of Telecommunications andInformation Systems (OTIS) to accomplishthe design of the program. In the future, anelectronic filing program for legislativecandidates is planned, contingent on fundsavailability.


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ADMINISTRATION SECTION continued

In addition, the Commission has alsopurchased an instant fax system which willallow for commonly asked forms and generalinformation to be faxed "on demand" to anyfax machine. This system is similar to the oneused by the Division of Taxation in theDepartment of the Treasury for tax forms andgeneral information. The Commission hopesto have it operational by Spring 1997. Thistechnology too will enhance the public's abilityto obtain information from the Commission.

Looking Forward

The Commission hopes to be able toprovide limited access to its database from itspublic room as early as the next fiscal year.The need for easy access to public documentsis increasing day by day. ELEC is also linkedto the Internet. Moreover, the Commissionnow has a "home page." Future technologiesshould make it possible for candidate filingsto be made available via the Internet.

The next phase of the Commission'sre-automation plan consists of making furtherenhancements to its software and obtainingscanning and imaging technology which willnot only save on space requirements but alsoincrease the speed in which candidate reportscan be made available to the public. Inaddition, a legislative electronic filing programis also envisioned for the future.


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BUDGET OVERVIEW AND EVALUATION DATA

In FY-1998, the Commission anticipates an appropriation of $1,422,000 based on the Governor’s BudgetRecommendation.

Comparison of Fiscal Years 1996 and 1997 Appropriations

FY-1996 FY-1997Appropriations Appropriations

Personnel $1,212,000 $1,212,000Printing & Supplies 44,000 44,000Travel 1,000 1,000Telephone 25,000 25,000Postage 26,000 26,000Data Processing 39,000 39,000Professional Services 40,000 40,000Other Services 8,000 8,000OTIS 5,000 5,000Maintenance/Equipment 2,000 2,000Furniture/Equipment 0 0Commissioner Per Diem $15,000 $15,000Total Operational $1,417,000 $1,417,000Public Financing Administration 0 $ 630,000Gubernatorial Public Financing 0 $5,700,000

1996 Evaluation Data

Disclosure Reports (Total) 19,568Campaign & Quarterly 16,202Lobbyist 3,364Personal Finance 2

Photocopies 182,273Investigations 45Civil Prosecutions 140Public Assistance Requests 10,243Fine Collection $32,877Lobbying Annual Fees $173,875

ADMINISTRATION SECTION continued

1996 annual report - new jersey election law …1996 annual report i election law enforcement...

Documents