Campaign finance board’s secret email votes could set dangerous precedent

It’s been more than a week since the Tennessee Registry of Election Finance Board voted secretly by email to reduce the civil penalties against a Memphis state representative by more than $44,000 in a last-minute decision to try to clear him to file for re-election.

The vote appears to violate the Open Meetings law, which says: “All votes of any such governmental body shall be by public vote or public ballot or public roll call. No secret votes, or secret ballots, or secret roll calls shall be allowed.” [T.C.A. 8-44-104(b)]

State Rep. Joe Towns, D-Memphis, had accumulated $65,000 in civil penalties for failing to file campaign finance disclosures over several months. He had to settle his outstanding penalties to be able to file for re-election, and offered a settlement the evening before the noon filing deadline the next day. The Registry board voted in an overnight email to approve the settlement.

The chairman of the six-member Registry board, Tom Lawless, told The Daily Memphian in a story published April 8 that he did not “feel that it was an appropriate meeting and was not an appropriate action under the open meetings (law).”

“More importantly, the whole purpose of our entity is transparency and openness to the public, the media and the Legislature, and I don’t like the way it happened,” Lawless said in the story reported by journalist Sam Stockard.

Bill Young, the executive director of the Bureau of Ethics and Campaign Finance, told TCOG that he “followed the process” that the Attorney General’s office recommended to get approval of a settlement offer proposed by state Rep. Joe Towns, D-Memphis. Young said he contacted each board member individually and asked them to vote by email.

“From my standpoint, if I had been unable to get a vote, he (Towns) would have been disqualified” from being on this year’s election ballot.

Young said that although he is the executive director, in this case, he was acting as the Registry’s legal counsel in the communications with board members about the settlement, and considered those communications privileged. He said he had to call some members to remind them to vote.

Not enough time to call a meeting, issue public notice

Bill Young, executive director of the Bureau of Ethics and Campaign Finance, said he was following the procedure outlined by the AG’s office when he asked board members to vote by email.

A Tennessean story on April 3 by journalist Joel Ebert first reported the secret email vote, which took place in the evening of April 1, and possibly into the morning of April 2, just hours before the election filing deadline at noon on April 2.

The vote was 4-2 with Lawless and Tom Morton voting against reducing the penalty, according to Young. (The actual emailed votes have not yet been produced — Tennessee Coalition for Open Government has requested copies of them under the public records law but has not yet received them.)

Young also told TCOG that calling a meeting of the Registry board was not possible because of the public notice requirements under the law. The settlement proposal came to him about 7:40 p.m. on April 1, and the deadline for Towns to be qualified to file for re-election was noon on April 2.

Under the law, a person cannot qualify to be on the ballot if he has unpaid civil fines to the Registry. If a settlement had not been reached for a lower amount, Towns would have had to pay the full penalty of $65,000 to the Registry (and another $1,100 owed to the Tennessee Ethics Commission) before being allowed to file for re-election on April 2.

Email: Young announces board voted 4-2 by email to reduce Towns’ fines

The bureau provided a copy of the contents of an email from Young stamped at 9:49 a.m. April 2 to TCOG (not the actual email document, but in what appears to be a copy-and-paste of the email’s contents.) In this, Young addressed Registry board members and the Tennessee Ethics Commission chairman about the email vote. The Ethics Commission also had penalties against Towns, which he had not paid.

Here’s what that copied content said:

Tennessee Deputy Attorney General Janet Kleinfelter gave advice to the Registry board on how to proceed on the settlement offer.

“I polled each member of the Registry Board regarding whether to accept the settlement offer of $22,000 from Representative Towns’ counsel to resolve outstanding civil penalties owed by Representative Towns of $65,000 owed to the Registry Board and $1,100 owed to the Ethics Commission. I also spoke by phone with each Registry Board member on this matter both in my capacity as Executive Director as well as acting legal counsel for the Bureau of Ethics and Campaign Finance (“Bureau”). Finally, I have fully discussed this matter with Janet Kleinfelter with the Tennessee Attorney General’s Office.

“The Registry Board has now voted via email 4-2 to accept Representative Towns’ counsel’s settlement proposal. Of the $22,000 to be paid by Representative Towns, $1,100 would be allocated to completely pay off the civil penalties owed to the Ethics Commission, thereby negating the need for the Ethics Commission to approve this settlement proposal, The remaining $20,900 would be applied to resolve the outstanding $65,000 in civil penalties owed to the Registry Board. As you know, Representative Towns is now current on all filings due with the Bureau and has pledged to remain current on a going forward basis.

“General Kleinfelter will work out the details with Representative Towns’ counsel, including establishing a date certain when this settlement amount will be paid to the Bureau. In the meantime, based on the Attorney General’s advice and because this matter is now resolved, Janet Williams with our Office will advise both the Shelby County Election Commission and the Secretary of State that Joe Towns is no longer disqualified from running for re-election to his Tennessee House seat.”

The bureau also provided what appears to be a cut-and-paste of another communication that does not include a timestamp or date, this one addressed to “Tom M” which appears to be Tom Morton.

“Tom M—As we discussed you are wanting the official tally of who voted yea and nay. The votes were:

AYE

Paz Haynes
Paige Burcham-Dennis
Hank Fincher
David Goldin

NAY

Tom Lawless
Tom Morton

All—Please let me know if you need anything further. Bill”

AG says it has authority to settle cases; board meeting not required

The Attorney General’s office issued an initial statement about the email vote: “The Registry is not required to meet for a settlement offer.”

It then followed up with this statement. “The Attorney General has the authority to settle cases; and we normally do that by consulting our clients in communications that are subject to the attorney client privilege.  We had the discretion to settle the case after consulting with our client.  We did that – nothing was done secretly—and our client immediately and publicly announced that it had been settled and disclosed the amount of the settlement.” It pointed to T.C.A. 8-6-109 as setting out the AG’s duties.

Board chair says AG can’t settle cases without board action

Tom Lawless, chairman of the Tennessee Registry of Election Finance board, said he does not thing the board’s action was appropriate under the Open Meetings law.

There appears to be some disagreement about whether the Attorney General can enter into a settlement agreement without action by the Registry board who it is representing in the talks.

Lawless told The Daily Memphian that he was “irritated” because it appeared to him that the Attorney General’s Office was prepared to do whatever it wanted.

“I don’t think they can. And, by God, they’d better not or (Attorney General) Herbert Slatery’s gonna have an opportunity to sit in the chair across from me,” Lawless was quoted as saying.

Lawless also told the Daily Memphian that Towns’ lawyer — state Rep. Mike Stewart, D-Nashville, and the chair of the House Democratic Caucus — threatened to file a lawsuit if the Registry didn’t vote on the matter. Stewart told the Daily Memphian that he “personally” didn’t threaten legal action.

Open Records Counsel says all votes must be public

TCOG also contacted the Office of Open Records Counsel to inquire about whether votes by email by governing bodies were allowed under the law, or under the executive order issued by the governor allowing electronic meetings during the coronavirus emergency.

Open Records Counsel Lee Pope said:

“I took a little time to look at Executive Order No. 16 and Tenn. Code Ann. § 8-44-104 after our conversation yesterday. Paragraph 1, subsection b.,  of the order provides that it does not limit existing voting requirements under the law. Accordingly, all votes of a governing body should be public under Tenn. Code Ann. § 8-44-104. As discussed on the phone, our office would recommend that governing bodies make their votes public in accordance with Tenn. Code Ann. § 8-44-104.”

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