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Privatized campaign finance database could make it tougher to track illegal political spending

"That's like saying that because Joe Smith cheated on his income tax, we need to sue TurboTax."

Noting that amendment-tracking capabilities are on NetFile's long-term wish list, Montgomery said, "We want to make sure everyone is happy with the transition, but some people don't like change."

Joe Lynn, who was campaign finance project for the Ethics Commission when San Francisco went online, believes NetFile represents a degradation of Ethics audit capacity. "The biggest fine issued by the SF Ethics Commission, and the biggest in California, involved this principle, the auditing of an amendment," he said, referring to the $100,000 fine that a Pacific Gas and Electric Co.–funded committee incurred from the city (plus $140,000 from the state) when its amended filings showed it failed to disclose $800,000 in last-minute donations from the utility to help defeat a 2002 public power measure. Ethics auditors caught one of PG&E's violations, while the media, using Ethics' amendment review tools, caught the other.

"But thanks to the way NetFile's system is set up, it doesn't have the capacity to display amendments the way we do," Lynn said. "This demonstrates the dangers of privatization."

Lynn said NetFile's less sophisticated ability to track amendments stems from the fact that it was set up in 1998 to help committees fill out campaign finance reports, "and not from what makes sense for public disclosure.

"It's unfortunate, but not necessarily negligent, that this fell through the cracks," added Lynn, who suggests the Ethics Commission should work to resuscitate its amendment-tracking ability by requiring that committees filing amendments fill out a form stating just how filings have been amended.

"We need to have ordinance," Lynn said. He doesn't buy the argument that NetFile's system is adequate just because it's used by San Jose, Santa Clara, and San Bernardino.

"San Francisco should have a first-class system," Lynn said. "This is another mechanism by which a committee can skirt the law."

Robert Stern at the LA Center for Governmental Studies worries that by signing on with NetFile, San Francisco will lose "the ability to find electronically information on what was changed and to see whether voters had this amended information before an election and what they were learning through amendments afterwards."

Luby also worries that because Ethics' old database won't have technical support, it could irreparably break down in the future and that even if it remains functional, "auditors will have to look in two places to see every local contribution Chevron made."

Luby e-mailed his concerns to management Dec. 7, 2007, then provided them with his detailed analysis Jan. 2 — submissions that raised St. Croix's ire.

"I cannot attest to the accuracy of the information in this report," St. Croix wrote in a Jan. 11 memo to the commission. "I believe that many of its conclusions are inaccurate and many are spurious. Further, the information appears to be based on false assumptions and the language implies dishonest motives that are quite simply non-existent."

But St. Croix's reply earned a swift rebuke from Luby's union, Service Employees International Union Local 1021. "We believe the report was written in accord with Mr. Luby's previously recognized duties," SEIU work-site organizer Cristal Java wrote Jan. 15.

Claiming St. Croix implied that Luby's report was a "misuse of City resources," Java added, "While Mr. Luby's act of forwarding his report may not satisfy the technical requirements of filing a complaint, we believe that Mr. Luby's bringing of a report about work-related problems to your attention was whistleblowing."

Luby said St.