1. Chairman Lemon called the meeting to order at approximately 9:35 a.m.
    
   
2. Approval of the August 7, 2001 minutes:

   Commissioner McKay moved to approve the August 7, 2001 minutes, seconded by Commissioner Detrick, the August 7, 2001 minutes were approved as presented. Motion carried.

3. Executive Director's Report:

   Announcements:

   Five Dollar Bill's debut is scheduled for Cottonwood, Arizona on October 6, 2001. The event will feature a parade and chili cook off. Citizens Clean Elections Commission name badges and t-shirts will be ordered for the Commissioners and staff who attend this event.

   Two new candidates have filed applications with the Secretary of State's office for the Governor's seat. They are Mike Newcomb and Alfredo Gutierrez.

   The campaign finance seminars will begin on August 22, 2001. Five different dates have been established for these seminars:

   August 22, 2001
   September 19, 2001
   October 10, 2001
   November 14, 2001
   December 19, 2001
   

   Those wanting to attend one of these seminars can R.S.V.P. to the Citizens Clean Elections Office by calling (602) 200-0013 or toll free: 1-877-631-8891. All classes begin at 3:00 p.m.

   The Governor's office will be sending out a press release in the next week to start recruiting applicants to fill the Commissioner position which will be vacated at the end of January 2002.

   The Auditor General's preliminary report is due the end of August. This report will be discussed at the September 11, 2001 Commission meeting.

   Fund projections will be discussed in the October 2, 2001 Commission meeting which will be held in Tucson, Arizona. A tentative Commission meeting schedule for 2002 will also be presented and discussed.

   Voter Education:

   The Debate Committee met on Thursday, August 16, 2001 to consider all applications submitted to sponsor the debates. These applications are still under consideration. The Commission will be notified in a future meeting as to the outcome of these meetings.

   Director Connor discussed the cost involved to produce and mail candidate statements to Arizona voters. Karen Osborne, Maricopa County Elections Director, will present an outline of the costs later in this meeting. Jessica Funkhouser, Secretary of State's Office, has drafted a proposed legislative change that would allow the Commission to do a single mailing rather than the four mailings that the statute envisions.

   Legal Matters:

   Todd Lang, Assistant Attorney General, is working on Sean Nottingham's request for an appeal to refund the $1,000 of qualifying contributions he submitted. He is also working on the Lavis v. Bayless case and preclearance submission to the Department of Justice regarding the rules.

4. Consideration of the Procedure for the Dissemination of Candidate Statements:

   Karen Osborne, Maricopa County Elections Director, presented to the Commission three separate working plans regarding the cost estimates to produce the Arizona Voter Information Guide. The cost estimates are based on current data with regards to voter registration, number of recognized parties, postage, paper cost, as well as projected quantities when applicable. She introduced Mr. Ray Valenzuela and recognized him as being instrumental in producing the three cost estimate scenarios.

   Commissioner Detrick moved for the Commission to move forward with plan #3, seconded by Commissioner Lopez. Motion carried

   Plan #3 is as follows:

   This plan provides for one statewide information pamphlet to be printed by the CCEC and mailed to households. Maricopa County will produce 700,000 early voter inserts, 8 ½ x 2 ¼ that only contains text that instructs voters on how and where to obtain an information pamphlet if one has not been received. The total cost to the County is $291,300. CCEC will implement a procedure for disseminating the statements according to this plan and it will be discussed at the next Commission meeting.

5. Consideration of Public Comments on Rules to Amend Article 1:

   Chairman Lemon reviewed each proposed rule with the Commissioners to amend Article 1.

   R2-20-104 (I) - Commissioner Jones moved to adopt this rule as presented, seconded by Commissioner McKay. Motion carried

   R2-20-104 (J) - Chairman Lemon expressed concern over the final clause in this rule. He felt it was too broad and without an adequate statutory base. He feels that it should specify a penalty of no more than $500.00. To proceed with rule R2-20-104 (J) it is important to have the record reflect the basis for what the Commission is doing. The Commission's power to certify, which is expressed in the act under general principles of statutory construction would include the ancillary power to decertify or suspend certification. Public Comments received suggested that the Commission does not have the authority to propose this issue in rule. The Commission did propose this change as a part of the legislative changes in SB 1382. SB 1382 failed. Although, Legislature did not pass SB 1382 it does not mean that the Commission should not exercise the authority the act gives them to make the improvements the Commission deems necessary. To make the overall act work with integrity, it is important that the Commission have the authority to suspend certification or delay the delivery of funds.

   Commissioner Jones moved to adopt R2-20-104 (J) with the modification of the last clause to insert the words " or specify a penalty of no more than $500," seconded by Commissioner Detrick. Motion carried.

   Commissioner Detrick requested that Chairman Lemon's words regarding the rules be reflected in the minutes.

   R2-20-105 (C) -Commissioner Lopez moved to adopt as presented, seconded by Commissioner McKay. Motion carried.

   R2-20-105 (F) - Commissioner Jones moved to adopt as presented, seconded by Commission McKay. Motion carried

   R2-20-109 (C) - Commissioner Lopez moved to adopt as presented, seconded by Commissioner McKay. Motion carried.

   R2-20-109 (D) - Commissioner Jones moved to adopt the proposed rule which conforms to the opinion on the 9^th Circuit Court, seconded by Commissioner Lopez. Motion carried.

   R2-20-111 (H) - Commissioner McKay moved to adopt as presented, seconded by Commissioner Lopez. Motion carried.

   R2-20-112 - Commissioner Jones moved to adopt the rule in the form presented in the August 21, 2001 Commission meeting, seconded by Commissioner Lopez. Motion carried.

   These rules will be sent to the Department of Justice to become final.

6. Consideration of Electronic Funds Transfer and Discussion of Expenditures or Contributions Reported Immediately before an Election.

   Deputy Director Matt Shaffer explained the process used by the state to request a state warrant for participating candidate funds. Deputy Director Shaffer then discussed the results of the Office's experience with EFT. The process to setup EFT can take up to 45 days. Deputy Director Shaffer suggested that a follow-up discussion be put on the agenda for the next Commission meeting to suggest actions the Commission can take regarding the transfer of candidate funds. One possible action is to have the Commission adopt a policy that candidates cannot request electronic funds transfer after a certain date. A survey of candidates performed at the end of the 2000 election cycle indicated that 60% of the candidates would like funds to be transferred electronically.

   Commissioner Jones commented that if 60% of the candidates requested electronic transfer of funds it should not take 45 days to process these funds. Other states are doing these transfer of funds very successfully.

   Executive Director Connor also expressed some concern over the timelines and procedures of the process.

7. Approval of 4-year Revenue Projections and Scenarios for Fund Projections for 2002 Elections.

   Chairman Lemon requested a motion to reject the worst case scenario. Further discussion regarding the other scenarios will be discussed in the October 2, 2001 Commission meeting planned to take place in Tucson, Arizona. He also requested that a move be made to approve the revenue assumptions.

   Commissioner Lopez moved to reject the worst case scenario, seconded by Commissioner McKay. Motion carried.

   Commissioner Jones moved to approve the revenue assumptions, seconded by Commissioner Lopez. Motion carried.

8. Discussion of Amendments to Commission's Substantive Policy Statements.

   A draft of the Substantive Policies will be presented at the next Commission meeting for adoption. Included in this draft will be the following topics:

   1. electronic signatures
   2. credit card contributions
   3. independent expenditures

9. Legal Report (Oral Report from Assistant Attorney General Todd Lang).

   The Lavis v. Bayless lawsuit has moved to summary judgment. A motion has been filed. The next reply is due August 27, 2001. The final document will be filed on September 7, 2001.

   Todd Lang is working with the State Department of Justice on pre-clearance to Article 1.

   Sean Nottingham has filed a complaint with the State ombudsman.

10. Public Comment:

    Sharlene Bozack, Clean Elections Institute

    Shar stated that the Clean Elections Institute is in full support of Maricopa County Elections plan #3 regarding candidate statements. The Clean Elections Institute expressed they will work with the Secretary of State's Office and the Commission to change this at the Legislature. Shar is also glad the Commission has dropped the worst case scenario regarding the candidate funding projections. Dropping it will show a more positive approach and she thanks the Commission for doing so.

    Marge Mead, Clean Elections Institute

    Marge Mead noticed a discrepancy between the rules and substantive policy document regarding the solictor's address. She felt both documents should read the same and wanted to point this out to the Commission.

11. The next meeting is Tuesday September 11,2001, at 9:30 a.m., Citizens Clean Elections Commission, 4001 N. 3rd Street, Suite 200, Phoenix, Arizona 85012
     
    
12. To be placed on the next agenda:
    • Legislative Change Proposal
    • Consideration of Substantive Policy Statements Draft
    • Consideration of the Auditor General's Preliminary Report
    • Consideration of Strategic Planning Document
    • Consideration of the process for mailing Candidate Statements

    Commissioner McKay moved that the Commission meeting be adjourned, seconded by Commissioner Detrick. Motion carried.

13. Adjournment

Dated this 21^st day of August, 2001

Citizens Clean Elections Commission