7-6361-16947-CV
STATE OF
OFFICE OF ADMINISTRATIVE HEARINGS
|
Marvin Koppen, Complainant, vs. Respondents. |
FINDINGS
OF FACT, CONCLUSIONS,
AND ORDER |
The above-entitled matter came on for an evidentiary hearing on January 27 and January 30, 2006, before a panel of three Administrative Law Judges: Richard C. Luis (Presiding Judge), Barbara L. Neilson, and Bruce H. Johnson. The hearing record closed on February 21, 2006, with the filing of the parties’ post-hearing briefs.
Jay
Benanav and Luke Kuhl, Attorneys at Law, Weinblatt and Gaylord, PLC,
Jill
Clark, Attorney at Law,
This is the final decision in this case, as provided in Minn. Stat. § 211B.36, subd. 5. A party aggrieved by this decision may seek judicial review as provided in Minn. Stat. §§ 14.63 to 14.69.
1. Did Respondent Hjelle and/or Respondent MFA violate Minn. Stat. § 211B.06, by preparing and disseminating campaign material with respect to the personal or political character or acts of a candidate that was false and that Respondent(s) knew was false or communicated to others with reckless disregard as to whether it was false?
The panel concludes that the Complainant failed to establish that Respondent Hjelle and/or Respondent MFA violated Minn. Stat. § 211B.06.
2. Did Respondent Hjelle and/or Respondent MFA violate Minn. Stat. § 211A.12 by accepting contributions in excess of $300?
The panel concludes that the Complainant established that Respondent Hjelle violated Minn. Stat. § 211A.12 by accepting contributions from MFA in excess of $300. The panel further concludes that the Complainant failed to establish that Respondent MFA violated Minn. Stat. § 211A.12.
3. Did Respondent MFA violate Minn. Stat. § 211B.15, subd. 2, by making prohibited corporate contributions?
Because MFA meets the exemption provided for in Minn. Stat. § 211B.15, subd. 15, the panel concludes that the Complainant failed to establish that Respondent MFA violated Minn. Stat. § 211B.15, subd. 2.
4. Did Respondent Hjelle violate Minn. Stat. § 211B.13 by accepting contributions from MFA that were prohibited by Minn. Stat. § 211B.15?
The panel concludes that the Complainant failed to establish that Respondent Hjelle violated Minn. Stat. § 211B.13 by accepting corporate contributions from MFA that were prohibited by Minn. Stat. § 211B.15.
Based upon the entire record, the panel makes the following:
1.
The City of
2.
Complainant and Respondent Erik Hjelle were both
candidates in the 2005 election for the Maplewood City Council. Complainant was an incumbent, having served
on the Maplewood City Council for 12
years. He was first elected to the City
Council in 1993 and was re-elected in 1997 and 2001. Respondent Hjelle was a first-time
candidate. He is also a
3.
There were five candidates for Maplewood City
Council in the September 13, 2005, primary election. Kathleen Juenemann received 1047 votes, the
Complainant received 972 votes,
4. Will Rossbach is currently a member of the Maplewood City Council. In the 2005 election he was a candidate for Mayor. His opponent was Diana Longrie.[3]
5.
On or about October 24, 2005, the Maplewood
Firefighters Association, Inc. (MFA) distributed a campaign flyer and cover
letter urging Maplewood residents to vote for Diana Longrie for Mayor, and
Rebecca Cave and Erik Hjelle for City Council.
The MFA is an organization made up of the approximately 80 paid-per-call
firefighters that work for the City of
6. On November 2, 2005, the Complainant filed a complaint with the Office of Administrative Hearings against the Respondents alleging that they had violated several provisions of Minnesota Statutes Chapters 211A and 211B.
7.
On November 3, 2005, Administrative Law Judge
8.
On November 6, 2005, the MFA endorsed Diana
Longrie for mayor, and Erik Hjelle and
9.
In the November 8, 2005, general election,
Respondent Hjelle and Kathleen Juenemann received the highest number of votes
and were elected to the City Council. Respondent
Hjelle received 2,772 votes, Kathleen Juenemann received 2,523 votes,
10.
On
November 10, 2005, Administrative Law Judge
11.
On
January 16, 2006, the Complainant filed a motion to amend his Complaint to add
an allegation that Respondent Hjelle violated Minn. Stat. § 211B.13 by
accepting corporate contributions from Respondent MFA that were prohibited by
Minn. Stat. § 211B.15. On January 23,
2006, the panel of Administrative Law Judges issued an Order granting
Complainant’s motion to amend the complaint.
12.
In January of 2005, the City of
13.
Brad Scheib, vice president and principal
planner with Hoisington Koegler Group, Inc., was the Project Manager of the
14.
Janet Steiner McGovern was a member of the
Gladstone Task Force. She was also the
Chair of the Gladstone Neighborhood Coalition, a grass-roots group of
15. In August of 2005, Mr. Scheib presented the Task Force with three alternate development proposals for the Savanna area. One of the proposals involved allowing development on approximately 6 acres of the Savanna in exchange for 6 acres of other land that would remain open space. Such a land swap would permit development in the Savanna but would result in no net loss of open space. By the end of the meeting, however, it was clear to Mr. Scheib that development of the Savanna had become a polarizing issue and that the Task Force would not be able to reach a consensus on the issue.[10]
16.
On August 20, 2005, Council member Will Rossbach
distributed 700 campaign flyers to households within the
17. On his campaign website in August of 2005, Mr. Rossbach discussed the Gladstone redevelopment planning process and stated that it was too early “to take a final position” because the Task Force “was still involved in the master developer study process.” Mr. Rossbach pointed out that the current (August 2005) proposal was a land swap, which would not result in a loss of open space. However, he acknowledged that if the proposal was approved, it would substantially alter the area. Mr. Rossbach also stated that while “the current concepts for housing types seems fine,” he was “having trouble” with the concept of four and five-story buildings.[13]
18. Prior to the September 13, 2005, primary election, the Complainant distributed a campaign flyer that stated he would work hard to “enhance parks & open spaces.”[14] This flyer was nearly identical to the flyer he distributed during his 2001 campaign. In Complainant’s 2001 flyer, however, the Complainant stated that he would work hard to “preserve open spaces.”[15] The substitution of the word “enhance” for the word “preserve” was the only significant change made to the 2001 campaign flyer.[16]
19.
On September 29, 2005, the Task Force held a
public meeting regarding the planning process and proposed development of the
20. By October of 2005, the Task Force was considering whether to recommend no development on the Savanna, or whether to recommend varying degrees of development on the Savanna.[19] Of general concern to the Task Force was whether development of the open space would violate the public trust and, if development was allowed, what should be done with any potential revenue.[20]
21. At the October 13, 2005, Task Force meeting, Mr. Scheib asked each member of the Task Force to vote “yes,” “no,” or “punt” on the question of whether to develop the Savanna.[21] The “punt” option allowed members to qualify their position or to take a neutral position. Both the Complainant and Council member Rossbach “punted” on the issue of developing the Savanna. Complainant stated that he was opposed to selling a portion of the Savanna for development, but that if the City Council did approve this option, he would insist that the money received for the land be put toward open space and not toward anything else.[22] Council member Rossbach stated that he personally believed that the Savanna should not be developed but that he thought the master plan public process should run its course before any decision was made.[23] Although the precise question was not put to them, neither the Complainant nor Council member Rossbach stated how they would vote on a development proposal in December. Mr. Rossbach believed it would be inappropriate to say how he would vote before the planning process was completed.[24]
22.
By mid-October 2005, the Complainant was aware
that voters were very concerned about development and possible sale of open
spaces in
23.
In mid-October 2005, the Complainant distributed
another campaign flyer urging
24.
On or about October 24, 2005, MFA distributed a
campaign flyer and cover sheet urging
Under the heading “Other facts” was the following sentence: “Maplewood Police have not increased the number of patrol officers in 10 years.”[29]
25.
The League of Women Voters held a Candidates
Forum for the Maplewood City Council and Mayoral candidates on October 26, 2005
at the
26. The campaign flyer that MFA prepared and distributed in mid-October of 2005,[31] listed four budget-related items under the heading “Other Facts.” One of the items listed was the following: “Maplewood Police have not increased the number of patrol officers in 10 years.”
27. The term “patrol officers” is generally considered to refer to sworn police officers who perform patrol work on foot, horseback or in marked squad cars. Although police officers of higher rank, such as sergeants and lieutenants, may occasionally perform patrol duties, they are generally not considered to be “patrol officers.”[32]
28.
In 1995 the City of
29.
In 2005, the City of
30. Since 1995, the number of FTE patrol officers in the Maplewood Police Department has increased by seven.[36]
31. As a member of the City Council since January 1, 1994, the Complainant voted several times to approve the police budget, which included the hiring of additional patrol officers.[37]
32.
There are approximately 80 paid-per-call
firefighters working for the City of
33.
On March 10, 2005, Respondent Hjelle and Ed
Dietz went to the Secretary of State’s Office and filed Articles of
Incorporation on behalf of MFA. Respondent Hjelle listed himself as the sole
incorporator of MFA and he listed his business address,
34. MFA is not organized as a business and does not operate as a business. It has no shareholders or other persons affiliated so as to have claim on its assets or earnings. In addition, MFA was not established by a business corporation or a labor union, and it has not accepted significant contributions from those entities.[40]
35.
In July of 2005, MFA ordered 250 lawn signs and
150 stands from E.W. Honsa Printing Company, Inc. (Honsa Printing). Bill Kordis, a
Erik
Hjelle
Change
& Common Sense
Endorsed by Maplewood Firefighters Association, Inc.
Paid for by Maplewood Firefighters Association, Inc.
The word “VOTE” was written at an angle in the upper left hand corner of the sign.[41]
36.
Respondent Hjelle picked up the signs with MFA’s
secretary,
37. Sometime prior to September 2, 2005, the Maplewood City Clerk called Respondent Hjelle and told him that he needed to have a disclaimer on his lawn signs.[44]
38. On or about September 2, 2005, Mr. Kordis ordered adhesive labels from Honsa Printing to apply to the lawn signs that contained the following disclaimer: “Prepared and paid for by the Maplewood Firefighters Association, Inc., 7200 Hudson Blvd. N., Suite 107, Oakdale, MN 55128, in support of Erik Hjelle.”[45]
39. The total cost of the labels was $89.13.[46] Respondent Hjelle paid for the labels with a check to Honsa Printing drawn on his business checking account, “Erik Hjelle & Associates, Inc.”[47]
40. On September 3, 2005, Respondent Hjelle signed a Campaign Financial Report on behalf of MFA listing MFA’s expenditures for the period August 15, 2005, through September 3, 2005, as $1,308.00 on “signs” for the Maplewood City Council race.[48]
41.
Sometime in October of 2005, MFA began using
Respondent Hjelle’s new business address,
42. On or about October 11, 2005, Respondent Hjelle wrote a check to Honsa Printing in the amount of $636.65 from his business checking account, “Erik Hjelle & Associates, Inc.” The check was payment for pamphlets Respondent Hjelle had ordered for his campaign.[50]
43.
In mid-October of 2005, MFA members drafted the
campaign flyer and cover sheet that endorsed Respondent Hjelle and two other
candidates discussed at Finding 24. MFA
members John Melander, Joseph Waters and Dale Solheid reviewed the campaign
flyer prior to its mailing.[51] None of them believed the material contained
anything false or objectionable. Mayoral
candidate Diana Longrie also reviewed the campaign flyer prior to its
distribution and did not believe there was anything false or objectionable in
the material. Ultimately, MFA paid for
the copying of the cover letter and flyer, and reimbursed Janet Steiner
McGovern $1711.32 and
44.
On or about October 20, 2005, Jon Melander and
Joseph Waters were named directors of MFA.
As directors, they schedule and run meetings, and answer questions from
the public or other members.[54] Dale Solheid was named Treasurer of MFA.[55]
45. On October 24, 2005, MFA members organized a football watching party at Fire Station 4. Several MFA members, and friends attending the gathering, assisted with organizing the mailing of the campaign material by stuffing envelopes with the MFA’s cover letter and campaign flyer. MFA members mailed the campaign material sometime shortly after October 24, 2005.[56]
46. On or about November 3, 2005, Respondent Hjelle contacted Kay Owens, one of the owners of Honsa Printing, and asked if she would be willing to refund to him the $1,423.91 he paid from his business account for the lawn signs in exchange for a check in the same amount from the MFA. Respondent Hjelle explained that he had just recently learned that he should not have paid for the signs from his business account. Ms. Owens agreed to refund Hjelle the $1,423.91 and accept a check in the same amount from the MFA.[57] On or about November 3, 2005, Dale Solheid wrote a check to Honsa Printing on MFA’s account. He left the amount and date blank and either Respondent Hjelle or someone at Honsa Printing later filled in the amount as $1,423.91.[58]
47.
On
November 9, 2005, Dale Solheid submitted to the Maplewood City Clerk, Karen
Guilfoile, amended Campaign Financial Reports on behalf of MFA. One report listed MFA expenditures for the
period September 14, 2005 through October 29, 2005, as $2,414.77 for five
“mailings” that occurred between October 14 and October 27, 2005. Another report listed MFA expenditures for
the period October 30, 2005, through November 3, 2005, as $1,423.91 for
“printing.” In the cover letter attached
to the amended campaign financial reports, Mr. Solheid stated that MFA’s prior
report dated September 3, 2005, and signed by Hjelle, incorrectly listed $1,308
as the cost for printing the signs. Mr.
Solheid explained that the $1,308 figure was the quote MFA received from Honsa
Printing on August 15, 2005, but that the actual final cost was $1,423.91.[59]
48.
On
November 15, 2005, Mr. Solheid submitted to the City Clerk four Campaign
Financial Reports on behalf of MFA. The
first report, dated September 3, 2005, listed no contributions received and no
expenditures. The second report for the
period September 4, 2005, through October 29, 2005, listed $3,700 in
contributions received and $2,414.77 in total expenditures for five mailings
that occurred in October of 2005. The
third report for the period October 30, 2005, through November 15, 2005, listed
$500 in contributions and $346.48 in total expenditures for two mailings and
one printing. The fourth report for the
period October 30, 2005, through November 3, 2005, listed no contributions and
$1,423.91 in expenditures for printing.
All of these reports were signed by Dale Solheid and Mr. Solheid listed
MFA’s address as:
49.
On or
about November 17, 2005, Respondent Hjelle again contacted Ms. Owens at Honsa
Printing and asked if she would refund a check in the amount of $636.65 that he
wrote to Honsa Printing on his business checking account on or about October
11, 2005,[61]
in exchange for a check in the same amount from his personal checking
account. Ms. Owens agreed to do so, and
wrote a check out to Respondent Hjelle in the amount of $636.65.[62] Respondent Hjelle wrote a check from his
personal checking account to Honsa Printing in the amount of $636.65. The check was deposited on or about November
18, 2005. However, the check was dated
September 14, 2005.[63]
50.
On January 16, 2006, MFA filed a change of
address with the Secretary of State listing
Based upon the foregoing Findings of Fact, the panel makes the following:
1. Minn. Stat. § 211B.35 authorizes the panel of Administrative Law Judges to consider this matter.
2. The burden of proving the allegations in the complaint is on the Complainant. The standard of proof of a violation of Minn. Stat. § 211B.06, relating to false campaign material, is clear and convincing evidence. The standard of proof as to all other violations is preponderance of the evidence.[65]
3. Minn. Stat. § 211B.01, subd. 2, defines “campaign material” to mean “any literature, publication, or material that is disseminated for the purpose of influencing voting at a primary or other election.” The campaign flyer (Ex. 39) that was prepared and distributed by the Maplewood Firefighters Association is campaign material within the meaning of that statute.
4. Minn. Stat. § 211B.06, subd. 1, provides, in part:
“A person is guilty of a gross misdemeanor who intentionally participates in the preparation [or] dissemination … of … campaign material with respect to the personal or political character or acts of a candidate … that is designed or tends to elect, injure, promote, or defeat a candidate for nomination or election to a public office …, that is false, and that the person knows is false or communicates to others with reckless disregard of whether it is false.”
5.
The Complainant has failed to show shown by
clear and convincing evidence that the Respondents violated Minn. Stat. §
211B.06, subd. 1, with regard to the statements at issue in the campaign flyer
(Ex. 39) concerning the candidates’ positions on open space development and the
number of
6.
7. Minn. Stat. § 211B.15, subd. 15, provides an exemption to the corporate contribution prohibition for a nonprofit corporation that:
(1) is not organized or operating for the principal purpose of conducting a business;
(2) has no shareholders or other persons affiliated so as to have a claim on its assets or earnings; and
(3) was not established by a business corporation or a labor union and has a policy not to accept significant contributions from those entities.
8. MFA is not organized or operated for the principal purpose of conducting a business. It has no shareholders or other persons affiliated so as to have a claim on its assets or earnings. In addition, MFA was not established by a business corporation or a labor union and it has not accepted significant contributions from those entities.[67]
9. MFA is a nonprofit corporation that meets the exemption provided in Minn. Stat. § 211B.15, subd. 15. Therefore, the Complainant has failed to establish that MFA violated Minn. Stat. § 211B.15 by contributing money or a thing of monetary value (lawn signs) to Respondent Hjelle.
10. Minn. Stat. § 211B.13, subd. 2, provides as follows:
A person may not knowingly solicit, receive, or accept any money, property, or other thing of monetary value, or a promise or pledge of these that is a disbursement prohibited by this section or section 211B.15.
11. Because MFA’s contributions to Respondent Hjelle were not prohibited under Minn. Stat. § 211B.15, the Complainant has failed to establish that Respondent Hjelle violated Minn. Stat. § 211B.13, subd. 2, by accepting money or things of monetary value from MFA.
12. Minn. Stat. § 211A.12 provides in relevant part as follows:
A candidate or a candidate’s committee may not accept aggregate contributions made or delivered by an individual or committee in excess of $300 in an election year for the office sought and $100 in other years; …
13. Minn. Stat. § 211A.12 applies to candidates or candidates’ committees. Respondent MFA was not a candidate or candidate’s committee in the 2005 election. The Complainant has failed to establish that MFA violated Minn. Stat. § 211A.12.
14.
15.
16. The Maplewood Firefighters Association, Inc. is a “committee” within the meaning of Minnesota Statutes Chapter 211A. It is a corporation or association that acted to influence the election of candidates for Maplewood City Council.
17.
The Complainant has established by a
preponderance of the evidence that Respondent Hjelle violated Minn. Stat. §
211A.12 by accepting contributions in excess of $300 from a committee in an
election year. The Complainant has
established that Respondent Hjelle accepted contributions from MFA in excess of
$2,228.84.[68]
Based upon the record herein, and for the reasons stated in the following Memorandum, the panel makes the following:
IT IS ORDERED: That Respondent Hjelle pay a civil penalty of $400.00 by March 31, 2006, for violating Minn. Stat. § 211A.12.[69] In all other respects, the Complaint against Respondent Hjelle and Respondent MFA is DISMISSED.
Dated: March 1, 2006
|
/s/ Richard C. Luis |
|
RICHARD C. LUIS |
|
Presiding Administrative Law Judge |
|
/s/ Barbara L. Neilson |
|
BARBARA L. NEILSON |
|
Administrative Law Judge |
|
/s/ Bruce H. Johnson |
|
BRUCE H. JOHNSON |
|
Administrative Law Judge |
False Campaign Material
Minn. Stat. § 211B.06 prohibits the preparation or dissemination of false campaign material that refers to the personal or political character or acts of a candidate. In order to be found to have violated this section, a person must intentionally participate in the preparation or dissemination of false campaign material that the person knows is false or communicates with reckless disregard as to whether it is false. The Complainant alleges that two statements in the campaign flyer prepared and/or disseminated by the Respondents are false and that Respondents either knew the statements were false or communicated them with reckless disregard as to whether they were false.
In Kennedy v. Voss,[70] the Minnesota Supreme Court observed that the statute is “directed against the evil of making false statements of fact and not against criticism of a candidate or unfavorable deductions derived from the candidate’s conduct.”[71] Even inferences that are “extreme and illogical” do not come within the purview of the statute so long as they are based on fact.[72] The Court explained that the public is protected from such extreme inferences by the candidate’s ability to rebut remarks during the campaign process.[73] When distinguishing between fact and opinion, a challenged statement’s specificity and verifiability, as well as its literary and public context, are factors to be considered.[74] The statement that must be proved false is not necessarily the literal phrase published but rather what a reasonable reader would have understood the author to have said; expressions of opinion, rhetoric, and figurative language are generally protected speech if, in context, the reader would understand the statement is not a representation of fact.[75]
The
panel concludes that the first statement at issue in the flyer, “No current
council person will affirmatively state where they stand or how they will vote
when this plan comes before them this December,” is not a false statement of
fact. This statement was published in
mid-October 2005. At that point, both
the Complainant and Council member Rossbach gave qualified answers or “punted”
when asked at the October 13, 2005 Task Force meeting whether they would
support development of the Gladstone open space. In addition, neither stated how they intended
to vote on the redevelopment plan in December.
And statements made by the Complainant and Mr. Rossbach in prior
campaign material about open space development could reasonably be interpreted
as vague or equivocal. For example, the
Complainant stated in campaign literature he distributed prior to the September
2005 primary that he would work hard to “enhance” parks and open space. The word “enhance” does not make clear
Complainant’s position on whether to sell or develop open space. And Mr. Rossbach stated on his website in
August 2005 that it was too soon to take a final position on any proposed
Like Kennedy v. Voss,[78] the statement in MFA’s flyer that no council member will take a stand on the sale or development of open space is an opinion or inference based on fact and does not come within the purview of the statute. The statement simply reflects MFA’s opinion that as of mid-October 2005, current council members, including the Complainant and Rossbach, would not say definitively whether they supported or opposed selling and/or developing public open space. The panel concludes that Complainant has failed to show by clear and convincing evidence that Respondents violated Minn. Stat. § 211B.06 with respect to the “open space” statement.
As for the second statement in the flyer, that the Maplewood Police have not increased the number of patrol officers in 10 years, the panel concludes that while this statement is false it is not campaign material “with respect to the personal or political character of acts” of the Complainant and therefore does not amount to a violation under Minn. Stat. § 211B.06. Instead, it is a statement that criticizes a decision of the Maplewood Police Department or the City Council as a whole. Complainant has failed to establish by clear and convincing evidence that this statement relates to his personal or political acts or character. In addition, Complainant has not shown that Respondents knew the statement was false or communicated the statement with reckless disregard as to whether it was false. The Respondents testified that by comparing Police Department rosters from 1995 through 2005 and discounting officers that were on leave or other assignments, and based on their familiarity and interactions with patrol officers, they concluded the number of patrol officers in the Maplewood Police Department had stayed the same over the past 10 years. Although the Respondents’ analysis was anecdotal and flawed and their conclusion incorrect, Complainant did not establish by clear and convincing evidence that Respondents knew their statement was false or communicated it with reckless disregard as to its falsity. In order to establish reckless disregard, there must be sufficient evidence that Respondents entertained serious doubts as to the truth of a statement, but published the statement anyway.[79] The Complainant did not show this. For all of these reasons, the Complainant has failed to establish a violation Minn. Stat. § 211B.06 with respect to the patrol officer statement.
MFA Contributions
(1) is not organized or operating for the principal purpose of conducting a business;
(2) has no shareholders or other persons affiliated so as to have a claim on its assets or earnings; and
(3) was not established by a business corporation or a labor union and has a policy not to accept significant contributions from those entities.[80]
The Complainant argues that MFA does not fall within the nonprofit corporation exemption because MFA was organized and operates for the purpose of conducting a business. According to the Complainant, the MFA carries out activities that can be considered “conducting business,” such as sponsoring benefits for fellow firefighters, endorsing candidates, and purchasing lawn signs. The Complainant also contends that MFA is essentially a labor union because it is an association of firefighters organized for the purpose of improving their working conditions and securing better pay and benefits. Moreover, the Complainant maintains that the MFA does not have any policy against accepting corporate contributions and that it did in fact accept at least $1,423.91 in contributions from Erik Hjelle & Associates, Inc. for the campaign lawn signs. According to the Complainant, the fact that MFA later reimbursed Hjelle & Associates, Inc. for the cost of the signs does not change the fact that MFA initially accepted a corporate contribution.
After reviewing the record and the submissions of the parties, the panel concludes that MFA does fall within the nonprofit corporation exemption to the corporate contribution prohibition provided by Minn. Stat. § 211B.15, subd. 15. With respect to the first exemption criteria, the panel finds that MFA’s co-sponsorship of a charitable benefit, endorsement of candidates, and purchasing of campaign material is not sufficient business activity to conclude that MFA is organized or operating for the principal purpose of conducting a business. And, contrary to the Complainant’s argument, the Minnesota Supreme Court’s decision in LaBelle v. Hennepin County Bar Association, et al.,[81] does not persuade the panel to hold otherwise. In that case, the Minnesota Supreme Court considered the applicability of the Corrupt Practices Act[82] and its prohibition against corporate contributions to non-profit corporations. The Court concluded that a bar association, although organized as a social and charitable nonprofit corporation, was not exempt from the Corrupt Practices Act because it was “doing business” when it conducted a plebescite to determine its members’ opinions of judicial candidates. In so holding, the Court rejected the bar association’s contention that the Act applied only to corporations organized for pecuniary profit doing business in the state.[83] Unlike LaBelle, this case is not about whether non-profit corporations are governed by the provisions of Fair Campaign Practices Act. Section 211B.15, subd. 1, defines “corporation” to include non-profit corporations that carry out activities in the state. Rather, the issue before the panel in this matter is whether MFA meets the express exemption to the corporate contribution prohibition allowed for non-profit corporations under subdivision 15. The panel concludes that MFA meets the first statutory criteria because, based on the evidence presented, it is not organized or operating for the principal purpose of conducting a business.
The record also established that the MFA does not have shareholders or other persons affiliated so as to have a claim on its assets, and therefore it meets the second statutory criteria of the nonprofit exemption. In addition, with respect to the third criteria, the panel rejects the Complainant’s claim that MFA is essentially a labor union and is therefore not entitled to the exemption. MFA’s purpose in promoting the work of the paid-per-call firefighters and its efforts to discuss wage and benefit issues with Maplewood City Manager Richard Fursman did not render it a labor union. Although the City allowed MFA to participate in a “labor-management committee,” MFA was not the paid-per-call firefighters’ exclusive representative for collective bargaining purposes and did not engage in collective bargaining on behalf of the paid per call firefighters. In fact, as an association of on-call employees not regularly scheduled to work 14 hours or more per week, MFA was informed it was prohibited from negotiating pay or benefits under the Public Employee Labor Relations Act.[84] Finally, the panel concludes that the fact that Respondent Hjelle initially paid for the lawn signs with a check written from his business checking account is not enough to conclude that MFA has a policy of accepting significant contributions from corporations or labor unions. Respondent Hjelle wrote the check to Honsa Printing for $1,423.91 from his business checking account on or about August 3, 2005. On or about November 3, 2005, Honsa Printing reimbursed Hjelle this amount in exchange for a check from MFA. At most, this transaction amounted to a 90 day loan of $1,423.91 to MFA from Hjelle & Associates, Inc. The panel concludes that the value of the 90 day loan and the $89.13 payment by Hjelle & Associates, Inc. for the labels does not establish that MFA accepted significant corporate contributions.
Because
the panel concludes that MFA meets the nonprofit corporation exemption to the
prohibition against corporate contributions, Complainant has failed to show
that MFA violated Minn. Stat. § 211B.15 by contributing in excess of $2,228.84
in lawn signs and printing and mailing campaign material on behalf of Respondent
Hjelle. Likewise, Complainant has failed
to show that Respondent Hjelle violated Minn. Stat. § 211B.13, subd. 2, by accepting
or receiving from MFA corporate contributions prohibited by section 211B.15.[85] These allegations are dismissed.
The panel, however, does find that MFA’s contribution to Respondent Hjelle of $1,423.91 in lawn signs and approximately $804.93 in mailing costs violated the $300 contribution limit set forth at Minn. Stat. § 211A.12. Although MFA is exempted from the corporate contribution prohibition of Minn. Stat. § 211B.15, it is still subject to the contribution limitations of Minn. Stat. § 211A.12. Pursuant to this statute, a candidate may not accept aggregate contributions from a “committee” in excess of $300 in an election year. MFA, as a corporation or association acting to influence the election of a candidate, meets the definition of a “committee” under Chapter 211A.[86] MFA endorsed candidates, purchased lawn signs, and paid for the printing and mailing of campaign literature that urged voters to vote for Respondent Hjelle and others. By doing so, it acted to influence the election of a candidate. In addition, “contribution” is defined to mean anything of monetary value. Based on the evidence presented, the Complainant has established that Respondent Hjelle violated the contributions limits set forth at Minn. Stat. § 211A.12 by accepting contributions from MFA in an amount in excess of $300.
Having
found that Respondent Hjelle violated Minn. Stat. § 211A.12, by accepting at
least $2,228.84 in contributions from the MFA, the Panel may make one of
several dispositions.[87] The panel may issue a reprimand, may impose a
civil penalty of up to $5,000, and may refer the complaint to the appropriate
county attorney for criminal prosecution. In this case, the panel has decided to impose
a civil penalty of $400. The panel concludes that Respondent Hjelle’s
violation of the contribution limits was negligent and had minimal impact on
R.C.L., B.L.N., B.H.J.
[1] Testimony of Rossbach and Longrie.
[2] Testimony of Koppen and Hjelle.
[3] Testimony of Rossbach.
[4] Ex. 39.
[5] Testimony of Cave; Ex. 52.
[6] Testimony of Koppen; Ex. 99.
[7] Testimony of Scheib and Koppen; Exs. 13, 14, 56 and 76.
[8] Testimony of Scheib; Ex. 72.
[9] Testimony of Steiner McGovern.
[10] Testmony of Scheib; Ex. 56.
[11] Testimony of Rossbach.
[12] Ex. 55.
[13] Ex. 56.
[14] Ex. 74.
[15] Exs. 73 and 74 (emphasis added).
[16] Testimony of Koppen and Longrie.
[17] Testimony of Koppen.
[18] Testimony of Rossbach.
[19] Testimony of Scheib.
[20] Testimony of Scheib.
[21] Testimony of Scheib.
[22] Testimony of Scheib, Koppen.
[23] Testimony of Rossbach.
[24] Testimony of Koppen and Rossbach.
[25] Testimony of Koppen and Rossbach.
[26] Ex. 74.
[27] Ex. 76 (emphasis in original).
[28] Ex. 39 (emphasis in the original).
[29] Ex. 39.
[30] Ex. 88.
[31] Ex. 39. See Finding 24.
[32] Testimony of Faust and Thomalla.
[33] Testimony of Faust and Thomalla; Exs. 57, 89.
[34] Testimony of Faust and Thomalla; Exs. 66, 89.
[35] Testimony of Thomalla.
[36] Testimony of Faust and Thomalla; Exs. 57-66.
[37] Testimony of Koppen.
[38] Testimony of Cave, Hjelle; Exs. 18-20.
[39] Testimony of Hjelle; Exs. 48-51.
[40] Testimony of Waters and Solheid; Ex. 30.
[41] Testimony of Owens; Ex. 38.
[42] Ex. 90
[43] Testimony of Owens and Hjelle; Ex. 80.
[44] Testimony of Hjelle.
[45] Testimony of Owens and Hjelle; Ex. 37.
[46] Ex. 91.
[47] Testimony of Owens and Hjelle; Ex. 81.
[48] Ex. 40.
[49] Exs. 29 and 47.
[50] Testimony of Hjelle; Ex. 82.
[51] Testimony of Melander and Waters.
[52] Testimony of Solheid; Ex. 42; MFA’s written closing argument at 1.
[53] See Finding 42.
[54] Testimony of Melander and Waters.
[55] Testimony of Melander, Waters and Solheid. Ex. 31 indicates that Melander, Waters and Solheid were nominated and elected at MFA’s November 6, 2005, meeting.
[56] Testimony of Melander.
[57] Testimony of Owens; Ex. 84A.
[58] Testimony of Solheid; Ex. 83.
[59] Testimony of Solheid; Ex. 42.
[60] Ex. 43.
[61] Testimony of Hjelle; Ex. 82. See, Finding 42.
[62] Testimony of Owens; Exs. 86-A, 87.
[63] Ex. 87.
[64] Testimony of Hjelle; Ex. 103.
[65] Minn. Stat. § 211B.32, subd. 4.
[66] Minn. Stat. § 211B.15, subd. 1.
[67] Testimony of Waters and Solheid; Ex. 30.
[68] This figure represents $1,423.91 for the lawn signs (Ex. 38) and $804.93 for one-third of the cost of mailing the October campaign flyer that endorsed Hjelle and two other candidates (Ex. 39).
[69]
The check should be made payable to: “Treasurer, State of
[70]
304 N.W.2d 299 (
[71]
304 N.W.2d 299 (
[72] 304 N.W.2d at 300.
[73]
[74] Diesen v. Hessburg, 455 N.W.2d 446, 451
(
[75]
Jadwin v. Minneapolis Star and Tribune,
390 N.W.2d 437, 441 (Minn. App. 1986), citing
Old Dominion Branch No. 496, National
Assoc. of Letter Carriers v. Austin, 418 U.S. 264, 284-86 (1974); Greenbelt Coop. Publishing Assoc. v. Bresler,
398 U.S. 6, 13-14 (1970). See also Milkovich v. Lorain Journal Co.,
497
[76] Ex. 56.
[77] Ex. 76.
[78]
304 N.W.2d 299 (
[79] St. Amant v. Thompson, 390
[80]
[81] 288 N.W. 788 (1939).
[82] The Corrupt Practices Act is the predecessor to the Fair Campaign Practices Act.
[83] 288 N.W. at 790.
[84] Ex. 20.
[85] The panel notes that Respondent Hjelle did accept corporate contributions from his own business, Erik Hjelle & Associates, Inc., in the amount of $636.65 for printing of campaign material. However, with respect to its prohibited corporate contribution claim, the Complaint alleged only that MFA violated Minn. Stat. § 211B.15 by making a corporate contribution. There was no allegation that Erik Hjelle & Associates, Inc. violated Minn. Stat. § 211B.15 by making a corporate contribution and Hjelle & Associates, Inc. was not named as a party. Likewise, Complainant’s motion to amend the complaint to add a claim that Respondent Hjelle violated Minn. Stat. § 211B.13, subd. 2, by accepting something of monetary value was limited to Hjelle’s acceptance of the lawn signs and campaign literature from MFA. There was no allegation in the amended complaint that Respondent Hjelle violated Minn. Stat. § 211B.13 by accepting something of monetary value from Erik Hjelle & Associates, Inc. The panel also notes that Respondent Hjelle later took steps to rectify the prohibited contribution by writing a personal check for the $636.65 amount in exchange for Honsa Printing’s refunding the check amount written on his business account. (See Finding 49.)
[86]
[87] Minn. Stat. § 211B.35, subd. 2.