Oakland’s Public Ethics Commission has laid out in stark terms how Mayor Sheng Thao’s proposed 2023-2025 budget will affect its operations.
During a meeting Wednesday night, commission staff said the budget would remove funding for the Democracy Dollars program, which aims to level the city’s political campaign finance landscape by giving voters—including low-income residents—money vouchers to support candidates.
With only a modest budget increase, the commission also won’t be able to hire additional staff for its overburdened enforcement program, which investigates and prosecutes campaign finance violations and other breaches of ethical rules by city staff and officials. Due to a prolonged staffing shortage, the enforcement chief said he must put half the city’s existing ethics cases on hold indefinitely.
No department was unaffected by Thao’s budget, which resolves a historic $360 million deficit caused by big drop offs in various tax revenues. Many leaders and residents are concerned about how cuts to police and fire will affect public safety. But as commission chair Ryan Micik lamented Wednesday night after hearing from the enforcement chief, the city’s financial situation also undermines Oakland’s ability to run a fair and ethical government.
“I hope that this serves as something of a wakeup call to the folks who control the purse strings,” Micik said.
The commission, which was founded in 1997, is charged with overseeing the administration and enforcement of Oakland’s campaign finance, lobbying, transparency programs, and government ethics laws.
Democracy Dollars delayed?
The commissioners’ priority Wednesday was to figure out whether it’s still possible to proceed with the Democracy Dollars program. Under Thao’s budget plan, the program’s funding—the roughly $4 million that would be distributed to voters as vouchers—would be postponed to the 2026 election. Acting executive director Suzanne Doran said Thao’s proposal is “devastating,” but noted that the commission could potentially proceed with a scaled-down version of the pilot in 2024.
“The benefits would be we’re going to have a rehearsal at a much smaller scale, with lower stakes, so we don’t go into a mayoral election in 2026 with everything untested and under-resourced,” said Doran.
The commissioners supported this idea, in part because Measure W, which instituted Democracy Dollars, also repealed the city’s Limited Public Financing Act. This law, in effect since 1999, provided some public funds to candidates running for City Council while helping level the playing field by imposing a spending cap on candidates who accept money under the program. Democracy Dollars was supposed to replace this program. If Thao’s budget is approved as is, Oakland would essentially have no public financing for campaigns in 2024.
Commissioner Francis Upton IV asked if the Limited Public Financing Act could be temporarily reinstated. A representative from the city attorney’s office said yes, but doing so would take months, time the commission doesn’t have. The City Council must approve the 2023-2025 budget by June 30.
The commission must present its plan for what to do about the Democracy Dollars program to the City Council and see if its members are willing to include it in the final budget. Doran warned that the commission could be asked to further shrink its already reduced proposal. She also said the commission needs cooperation and assistance from the city administrator’s office, which just this week received a new leader, Jestin Johnson.
Micik floated the idea of sending a resolution to the City Council asking for sufficient funds to run a pilot in 2024. Commissioner Arvon Perteet rejected this idea out of concern that its vagueness could lead to a situation where the commission is forced to do a pilot in just one council district.
“I’m not willing to sign onto something that says one district,” Perteet said. “To arbitrarily choose one district over another is problematic for me.”
Commissioner Alea Gage acknowledged that Thao has to make cuts in her budget. But Gage said the Democracy Dollars program lines up with Thao’s stated budget priorities, which include centering equity and pursuing innovative strategies.
“These cuts are not necessarily perfectly aligned with what they hoped to achieve in this budget,” Gage said.
Several public speakers urged the commission to push for a pilot program in 2024. Gail Wallace, representing the League of Women Voters Oakland and a coalition of organizations that advocated for Democracy Dollars, said they’ve spoken with Council President Nikki Fortunato Bas about implementing a version of the program.
“There’s a certain loss in not pursuing the pilot program here, because we have momentum,” Wallace said, adding that Seattle, which has a Democracy Dollars program, initially started with a partial rollout.
The commissioners agreed to have staff request funding from City Council to pursue a limited pilot program targeting the council districts in 2024, and ask for sufficient funds to conduct a full rollout in 2026.
“Not good news”: Enforcement chief sounds alarm, says he can’t keep up with caseload
In a startling public admission, the commission’s ethics enforcement chief, Simon Russell, said he’s putting half the PEC’s cases on hold indefinitely. Russell’s office is responsible for investigating violations of government ethics and campaign finance laws.
Russell said his office has 70 pending cases but only one investigator to manage them—himself.
“This is clearly not good news and not a decision I take lightly,” Russell said. “It’s also not something, frankly, I like talking about in public, because I don’t want to give a perverse incentive to people to delay or hinder our cases in any way.”
Russell said greater public awareness about the commission’s enforcement powers in recent years has led to a significant uptick in new cases, increasing the office’s workload. He hopes to hire a second investigator for a budgeted position that’s been vacant since last fall. But Russell said he would need four investigators to tackle the current workload without putting cases on hold. To underscore the severity of the staffing situation, Russell noted in his report that San Francisco’s ethics commission has eight investigators and a caseload of 56.
Speaking bluntly, Russell said he wants the public to understand that complaints filed with his office may not have a timeline for being resolved. He added that the office will continue to pursue high-profile cases that involve elected officials and large sums of money.
“I’m really not happy it’s come to this point,” Russell said. “(But) I have to be realistic about what we can do at this point.”
The PEC’s investigative problems come at a time when it’s handling several high-profile cases. In 2021, the commission issued a historic fine of $309,600 against a former city building inspector who was accused of taking bribes from property owners in exchange for approving permits and inspections. The year prior, the commission and the city attorney accused the owners of California Waste Solutions, Oakland’s curbside recycling provider, of funneling money through straw donors to several councilmembers’ campaign committees. These donors allegedly agreed to be reimbursed for paying thousands of dollars to help councilmembers running for election, or in one case, also help a councilmember pay for legal defense against a separate ethics investigation. That case is ongoing.
More recently, the commission fined Councilmember Rebecca Kaplan $19,000 for allegedly failing to disclose her ownership of a condominium near a waterfront park that she and the rest of council voted to expand with city funds. The commission claimed Kaplan left the condo off her annual financial disclosure for seven years. Kaplan characterized the omission and her participation in the vote as thoughtless errors. Another ongoing case involves allegations by a former staffer in Sheng Thao’s council office who has accused Thao of making city staff work on her mayoral campaign.
Commissioners expressed sympathy for Russell but indicated that no help is coming with the current budget crisis.
“Is there anything in the way of technology that can be done to facilitate your job?” Upton asked. He wondered whether ChatGPT and other AI products could assist in combing through thousands of pages of documents. Commissioner Vincent Steele suggested interns may be another cost-effective resource.
Russell said it would be helpful if the commission could continue to publicize the dire situation in his office so residents and elected officials are aware.
“Every day, practically, I have to talk to people who are frustrated with how long cases are taking,” Russell said. “And I want to say, no one is more frustrated than me with how long they’re taking.”
In recent years the ethics commission has busted city officials for corruption, political money laundering, and transparency failures.