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1 STATE OF FLORIDA FLORIDA ELECTIONS COMMISSION,,?'"l,.. j "< '' :....._; FI"ORIDA ELECTIONS COMMISSION, PETITIONER, v. AGENCY CASE No.: FEC F.O. No.: DOSFEC 06-77W RUBENCOTO, RESPONDENT ~/ FINAL ORDER THIS CAUSE came on to be heard at an informal hearing held before the Florida Elections Commission (Commission) on May 19, 2006, in Tallahassee, Florida. APPEARANCES For Commission For Respondent Charles A. Finkel General Counsel 107 W. Gaines Street Collins Building, Suite 224 Tallahassee, FL Ruben Coto 8867 Byron A venue Surfside, Florida STATEMENT OF THE ISSUE Whether the Respondent violated Section (1)(c), Florida Statutes, when he made several purchases for the five-member slate of candidates; Section (5), Florida Statutes, when he certified to the correctness of campaign treasurer's reports that were incorrect, false, or incomplete; and Section (1), Florida Statutes, when he published a political advertisement that failed to contain the correct disclaimer; and Section (1 )(b), Florida Statutes, when he accepted and failed to report an in-kind contribution. Faa004 (11/05)

2 PRELIMINARY STATEMENT On March 24 and March 28, 2005, the Commission received sworn complaints alleging violations of Florida's election laws. Staff of the Commission conducted an investigation to determine whether the facts alleged in the complaint constituted probable cause to believe that the Respondent violated The Florida Election Code. On January 11, 2006, staff drafted Staff Recommendations recommending to the Commission that there was probable cause to believe that The Florida Election Code was violated. On February 24, 2006, the Commission entered an Order of Probable Cause finding that there was probable cause to charge the Respondent with the following violations in FEC : Count 1: On or about February 17, 2004, Respondent violated Section (1)(c), Florida Statutes, by giving, paying, expending, or contributing money or other thing of value to another candidate when he purchased $ of postage for the five-member slate of candidates. Count 2: On or about February 25, 2004, Respondent violated Section (1)(c), Florida Statutes, by giving, paying, expending, or contributing money or other thing of value to another candidate when he spent $64.10 for postcard paper for the five-member slate of candidates. Count3: On or about March 2, 2004, Respondent violated Section (1)(c), Florida Statutes, by giving, paying, expending, or contributing money or other thing of value to another candidate when he spent $212 for T-shirts for the five-member slate of candidates. Count4: On or about March 8, 2004, Respondent violated Section (1)(c), Florida Statutes, by giving, paying, expending, or Faa004 (1106) 2

3 contributing money or other thing of value to another candidate when he spent $ for finger food and sodas for the fivemember slate of candidates. Count 5: On or about March 8, 2004, Respondent violated Section (1)(c), Florida Statutes, by giving, paying, expending, or contributing money or other thing of value to another candidate when he spent $185 for postage for the five-member slate of candidates. Count 6: On or about February 27, 2004, Respondent violated Section (5), Florida Statutes, by certifying to the correctness of his 2004 G3 report that was incorrect, false, or incomplete, when he reported $49.20 in kind contribution from Orestes Jimenez as "Postage," while other candidates reported it as "Postage/Voter List"; reported $15.00 in-kind contribution from Ruben Coto as "Copies/Envelopes," but did not record a specific value for each item; and reported $14.11 in-kind contribution from Frank MacBride as "Labels/Supplies," but did not record a specific value for each item. Count 7: On or about March 12, 2004, Respondent violated Section (5), Florida Statutes, by certifying to the correctness of his 2004 G4 report that was incorrect, false, or incomplete, when he failed to report three in-kind contributions from Tim Will, one inkind contribution from Frank MacBride, and one in-kind contribution from Steven Levine; reported two $25.00 in-kind contributions from Paul Novack as "Copies/Postage," but did not record specific value for each item; reported $25.00 in-kind contribution from Alan Rubin as "Postage/Labels," but did not record specific value for each item; and reported $30 in-kind contribution from Mickey Novack as "Copies/Postage," but did not record specific value for each item. Count 8: On June 14, 2004, Respondent violated Section (5), Florida Statutes, by certifying to the correctness of his Amended 2004 G4 report that was incorrect, false, or incomplete, when he failed to report one in-kind contribution from Steven Levine. Count 9: Faa004 ( 1/06) 3

4 On or about March 8, 2004, Respondent violated Section (1), Florida Statutes (2002), by failing to mark prominently the political advertisement with the conect disclaimer, when the political advertisement failed to state who paid for the ad. Count 10: On or about March 8, 2004, Respondent violated Section (1)(b), Florida Statutes, by failing to report a contribution required to be reported by Chapter 106, Florida statutes, when he accepted an in-kind contribution in the amount of $66.55 from Steven Levine and failed to report it on his 2004 G4 Report. On February 24, 2006, the Commission entered an Order of Probable Cause finding that there was probable cause to charge the Respondent with the following violations in FEC : Count 1: On or about March 12, 2004, Respondent violated Section (5), Florida Statutes, by certifying to the correctness of his 2004 G4 report that was incorrect, false, or incomplete, when he failed to report three in-kind contributions from Tim Will, one inkind contribution from Frank MacBride, and one in-kind contribution from Steven Levine; reported two $25.00 in-kind contributions from Paul Novack as "Copies/Postage," but did not record specific value for each item; reported $25.00 in-kind contribution from Alan Rubin as "Postage/Labels," but did not record specific value for each item; and reported $30 in-kind contribution from Mickey Novack as "Copies/Postage," but did not record specific value for each item. Count 2: On June 14, 2004, Respondent violated Section (5), Florida Statutes, by certifying to the correctness of his Amended 2004 G4 report that was incorrect, false, or incomplete, when he failed to report one in-kind contribution from Steven Levine. Count3: On or about March 8, 2004, Respondent violated Section (1 )(b), Florida Statutes, by failing to report a contribution required to be reported by Chapter 106, Florida statutes, when he accepted an in-kind contribution in the amount of $66.55 from Steven Levine and failed to report it on his 2004 G4 Report. Faa004 (1106) 4

5 Respondent timely requested an informal hearing and was noticed to appear before the Commission on May 19, At the informal hearing, staff presented the undisputed facts contained in the StaffRecommendation. Respondent appeared at the hearing. FINDINGS OF FACT 1. The Respondent, Ruben Coto, was elected to the Surfside Town Commission, Seat Two, on March 16, Respondent was a first-time candidate. Respondent's term of office is two years and his compensation is $1 a year. Respondent is a broker/owner of a mortgage company in South Florida. 2. The Complainant in FEC , Michael Szafranski is a financial advisor with Onyx Options Consultants Corporation and a resident of Surfside, Florida. He has written several editorials to the newspaper speaking out against the Surfside town commission. 3. The Complainant in FEC , Jay Senter, is a resident of North Miami, Florida; he was not a candidate in the election. Complainant is an officer of "Victims for Truth, Inc.," an independent non-profit corporation that uses nonviolent methods to expose abuse at the local government level and to ensure transparency in governmental decisions. 4. Respondent and four other candidates for public office in Surfside campaigned as a five-member "slate" of candidates. Campaign literature, such as campaign signs and flyer advertisements, was published and distributed in support of the five-member slate of candidates. 5. Respondent's 2004 G3 report listed an expenditure for postage for $ on February 17, In his affidavit, Respondent stated that the postage was used to send out flyers and letters. The 2004 G3 CTRs for candidates Will, Jimenez, and MacBride list an in-kind contribution of $44.40 on February 17, 2004, from Ruben Coto for postage. Steven Levine's 2004 G3 report shows an in-kind contribution on February 17, 2004, from Ruben Coto for postage without stating an amount. There is no evidence that Respondent was reimbursed by the Faa004 (J/06) 5

6 other candidates for this expenditure. Therefore, this was a contribution to each of the candidates. 6. Respondent's 2004 G4 CTR listed an in-kind contribution of$64.10 for "postcard paper" on February 25, When asked why this contribution was only reflected in his campaign report and not in the campaign reports of the other candidates, Respondent stated, "I bought the postcards, I am not sure why they don't show it." This constitutes an expenditure for which there is no evidence that Respondent was reimbursed by the other candidates. Therefore, this was a contribution to each of the candidates. 7. Respondent's amended 2004 G4 CTR listed an in-kind contribution of $42.40 for T -shirts on March 2, In his written response to the complaint, Respondent stated that he spent $212 on T-shirts that he felt had to be split up between the five candidates. Therefore, each candidate's CTR showed an in-kind contribution from him for $ Respondent's amended 2004 G4 CTR listed an in-kind contribution of $65 for food/refreshments on March 8, In his written response to the complaint, Respondent stated that he spent $ for finger food and sodas at Publix. 9. Respondent's amended 2004 G4 CTR listed an in-kind contribution of $37 for postage on March 8, In his written response to the complaint, Respondent stated the cost of postage, stamps, and copies were usually split up among the group. He further stated that on a couple of occasions he bought a small amount of stamps, but another time he spent as much as $ When asked whether the $37 in-kind contribution he reported was associated with any of the joint advertisements, Respondent stated in his affidavit that he could not specify because it was a year and a half ago, but "we tried to make sure we reported correct amounts,..." The other four candidates each reported the $37 in-kind contribution from Respondent for Faa004 ( 1/06) 6

7 postage on March 8, The total contribution from Respondent to each of the five candidates (including himself) was $ Information that was either falsely reported or not reported on Respondent's campaign treasurer's reports is summarized in Table 1: TABLE 1: MISSING AND INCORRECT INFORMATION ON RESPONDENT'S CTRs Date Reporting Missing Information Incorrect Information Filed Period 02/27/04 02/09/04 to Reported $15.00 in-kind 02/20/04 contribution fi: om Coto as "Copies/Envelopes." Did not record 2004 G3- Original a specific value for each item Reported $14.11 in-kind contribution from MacBride as "Labels/Supplies." Did not record a specific value for each item. Reported $49.20 in-kind contribution from Jimenez as "Postage," while other candidates reported it as "PostageN oter List." Faa004 ( 1/06) 7

8 03/12/04 02/21/04 to Did not report the $2.14 in- Reported $25 in-kind contribution 03/11/04 kind contribution from from Novack as "Copies/Postage." MacBride for "paper." Did not record specific value for each 2004 G4- MacBride has said that he item Original was unsure why the in-kind Reported $25 in-kind contr ibution contribution was reported on from Rubin as "Postage/Labels.." Did his report but not the reports not record specific value for each of Respondent and the other item. candidates. Reported $25 in-kind contr ibution Did not report the $ infrom Paul Novack as kind contribution from Will "Postage/Copies." Did not record for "Envelopes." Will specific value for each item. acknowledged that the envelopes were used for Reported $30 in-kind contribution political flyers that contained from Mickey Novack as the name of each candidate "Copies/Postage." Did not record and added his campaign specific value for each item. absorbed the cost rather than distribute and assign immaterial $2.00 increments. Did not report the $3.37 inkind contr ibution from Will for "Signs, supplies, paint, etc." Will acknowledged that the signs contained the name of each candidate and added that his campaign absorbed the cost rather than distribute and assign $3.50 increments to the other candidates. Did not report the $2.52 inkind contr ibution from Will for "Signs, supplies, paint, etc." Will acknowledged that the signs contained the names of each candidate and added that his campaign absorbed the cost rather than distribute and assign $2.50 increments to the other candidates. Did not report a $66.55 in-kind contribution from Levine for "Signs." 06/14/04 02/21/04 to Did not report an in-kind 03/11/04 contribution from Steven Levine for 2004 G4- "Signs.." Amended Faa004 (1/06) 8

9 12. Respondent's original and amended 2004 G4 reports were void of any expenditure to or in-kind contribution from Steven Levine and Tim Will regarding signs. Respondent certified that both reports were true, correct and complete. 13. In his response to the complaint, Respondent stated that he reviewed his reports and noticed that he did not record the in-kind contributions for the signs. He said, "I will not make any excuses for my mistake. I was not involved in the purchase, the painting or even the distribution of these signs." Respondent added, "I was aware that some of the candidates were buying and painting these, but I was not directly involved in doing this and this is why I made the mistake and did not have these on my reports." 14. When asked to explain the system or procedure he had in place when reviewing his campaign reports to determine the accuracy of each report, Respondent stated, "We met a few times with the other candidates & each explained what they had spent..., we did our best to do it correctly." Respondent's wife, Lea Coto, served as his campaign treasurer during the 2004 campaign. Respondent said that his wife had not served as the campaign treasurer for any candidate or political committee in the past. 15. Complainant submitted a number of political advertisements in the form of flyers, and a picture of a sign, that advocated the election of Respondent and the other members of the slate for public office. Table 2 summarizes the advertisements that were distributed during the months offebruary and March 2004: TABLE 2: POLITICAL ADVERTISEMENTS DISTRIBUTED IN FEBRUARY & MARCH 2004 Description of advertisement Political disclaimer 1. Two-sided flyer reads, "STOP "Paid political adv.. By Tim Will Campaign; OVERDEVELOPMENT." Approved by Tim Will." 2. Two-sided flyer address to "VOTERS: IT IS "Pd. Pol. Ad. Tim Will For Mayor Campaign, VITAL TO KNOW THE FACTS.." Approved by the Candidate." 3 One-sided flyer reads, "STOP "Paid Political adv. By Tim Will Campaign; Faa004 (1/06) 9

10 OVERDEVELOPMENT." Approved by Tim Will and candidates listed." 4. Two-sided flyer headed, "PRIORITIES" "Pd.. Pol. Ad.. Approved by the named candidates." 5. Two-sided flyer headed. "FOR THE "Pd. PoL Ad. Approved by each of the named FUTURE OF SURFSIDE." candidates." 6. Postcard advertisement "Pd. PoL Ad. Approved by the named candidates." 7. One-page flyer headed, "THEY'LL TELL Flyer is void of any political disclaimer YOU EVERYTHING BUT THE TRUTH." 8. Campaign yard sign "PAID Pol. Ad. approved by the named candidates.. " 16. Tim Will acknowledged that he was solely responsible for the wording of the political disclaimer for the flyers listed as numbers 1-5 in Table 2. Mr. Will stated that he looked for pertinent examples in the candidate's packet that was given to him but found no samples for candidates running as a slate. 17. Respondent acknowledged that he was responsible for creating and designing the postcard advertisement (number 6). Respondent said that he used the same type of political disclaimer that had been used in other advertisements. He also asked Mr. Will and a former commissioner about the political disclaimer and believed it was good. 18. In his affidavit, Respondent said that he did not assist with the creation, design, wording of the disclaimer, or distribution of the one-page flyer headed, "THEY'LL TELL YOU EVERYTHING BUT THE TRUTH," (number 7). Additionally, the other members of the fivemember slate attested that they did not create, design or distribute the flyer advertisement. 19. In his response to the complaint, Respondent stated that he did not assist with the creation of the yard signs. Candidate Levine acknowledged that he was solely responsible for paying for the yard signs and that none of the other candidates reimbursed him or helped him with the cost of the signs. Mr. Levine said that he could not recall who came up with the disclaimer, but added, "I thought putting paid political advertisement and approved by the above named candidate was enough." Faa004 (1106) 10

11 20. Regardless of whether the cost of the advertisements was equally shared by the five candidates or whether some or all of them constituted in-kind contributions, the various advertisements that are the subject of this complaint and are attached as exhibits to the Report of Investigation fail to meet the requirements of Section (1 ), Florida Statutes (2002). Advertisements number 1, 2, and 3 in the above chart endorsing and exhorting the electorate to vote for the five named candidates indicated that the ad was paid by the Tim Will Campaign. The three advertisements failed to state that MacBride, Jimenez, Levine, and Coto approved the ad. 21. Advertisements number 4, 5, 6, and 8 in the above charted indicated that all of the candidates approved the ad, but failed to state who paid for the ad. 22. Respondent was responsible for creating and designing the post card advertisement and therefore was responsible for the improper disclaimer. However, the evidence is insufficient to conclude that Respondent had any control over the production and publication of advertisements 1 through 5 and 8 listed in the chart above. 23. Table 3 lists alleged unreported contributions received by Respondent during his 2004 campaign: TABLE3: UNREPORTED CONTRIBUTIONS RECEIVED BY RESPONDENT Date Received CONTRIBUTOR Contribution Type AMOUNT 02/25/04 Ruben Coto In-Kind, Postcard paper $ /08/04 Steven Levine In-Kind, Signs $ /02/04 Tim Will In-Kind, Envelopes $ /06/04 Tim Will In Kind, Sign Supplies $ /07/04 Tim Will In-Kind, Sign Supplies $ /10/04 Frank MacBride In-Kind, Paper $2.14 TOTAL $ Faa004 (1106) 11

12 24. The items in Table 3 are in-kind contributions because Respondent failed to reimburse Levine and Will for his share of the expenditures. However, with the exception of the in-kind contribution for the signs, the amounts involved were too small to warrant an additional civil penalty. 25. Respondent willfully violated Sections (5), (1),and (1)(b) Florida Statutes Included in each of the candidate's package received from the Surfside Town Clerk, was the 2004 Qualifying Handbook for Municipal Candidates, which includes Chapter 106, Florida Statutes, as well as the 2004 Candidate and Campaign Treasurer Handbook. The handbook was accompanied by a letter from Penelope Townsley, an assistant director of operations with the Miami-Dade Supervisor of Elections office, which advised the candidate that the booklet was an informational package compiled by the Miami-Dade County Supervisor of Elections and was not intended as a complete digest of the election laws. The letter further advised the candidate that it was the candidate's responsibility to become familiar with the election code. The letter also notified the candidate of the internet address of both the Miami- Dade Elections Department and the Division of Elections and reminded the candidate that a copy of the "State of Florida Election Law" may be viewed from the Division of Elections website. CONCLUSIONS OF LAW 27. The Commission has jurisdiction over the parties to and subject matter of this 1 I , Fla.. Stat, provides that a person willfully violates Ch. I 06, Fla. Stat: If the person commits an act while knowing that, or showing reckless disregard for whether, the act is prohibited... or does not commit an act while knowing that, or showing reckless disregard for whether the act is required.. A person knows that an act is prohibited or required if the person is aware of the provision which prohibits or required the act, understands the meaning of that provision, and performs the act that is prohibited or fails to perform the act that is required. A person shows reckless disregard for whether an act is prohibited or required under this chapter if Faa004 (1 /06) 12

13 cause, pursuant to Section , Florida Statutes. 28. Section (1)(c), Florida Statutes, prohibits a candidate from directly or indirectly contributing any money or thing of value for the furtherance of the candidacy of another candidate. Candidates may voluntarily form a slate of candidates, but they must share equally in the cost of any joint advertisement. For example, a joint advertisement by three candidates that costs $300 must be paid and reported as a $100 expenditure from each of the candidates. Each candidate should pay for his share directly to the vendor providing the service. See DE Section ( 1 ), Florida Statutes (2002) reqmres that any political advertisement circulated pnor to any election shall identify the persons or organizations sponsonng the advertisement or must state who provided or paid for the advertisement if different from the source of sponsorship. The requirements contained in Section (1 ), Florida Statutes, related to political advertising, apply to each of the candidates included in the slate. See DE The Respondent committed three counts ofviolating Section (5), Florida Statutes, when he certified to the correctness of his 2004 G3, G4, and Amended G4 reports that were incorrect, false or incomplete; Respondent committed one count of violating Section (1 ), Florida Statutes (2002), when he failed to mark prominently the political advertisement with the coitect disclaimer; and Respondent committed one count of violating Section (1)(b), Florida Statutes, when he accepted an in-kind contribution and failed to report it on his 2004 G4 report. 31. Respondent's conduct was willful. Respondent committed the acts while the person wholly disregards the law without making any reasonable effmt to determine whether the act would constitute a violation. Faa004 (I /06) 13

14 knowing that, or showing reckless disregard for whether, the acts were prohibited or failed to commit an act while knowing that, or showing reckless disregard for whether, the acts were required. 32. Respondent did not violate Section (1)(c), Florida Statutes, as charged in Counts 1-5 of the Order of Probable Cause. 2 Additionally, the three counts charged in FEC are duplicative and will not be the subject ofrespondent's civil penalty. 33. In determining the amount of the civil penalty, the Commission considered the mitigating and aggravating circumstances set forth in Section , Florida Statutes. 34. The Commission finds that Respondent has sufficient financial resources to pay the fine imposed by the Commission. ORDER WHEREFORE the Commission finds that Respondent has violated the following provisions of Chapter 106, Florida Statutes, and imposes the following fines, inclusive of fees and costs: A) Respondent violated Section (5), Florida Statutes, on three occasions. Respondent is fined $20 for each of the three counts for a total of $60. B) Respondent violated Section (1 ), Florida Statutes, on one occasion. Respondent is fined $20 for this count. C) Respondent violated Section (1)(b), Florida Statutes, on one occasion. Respondent is fined $20 for this count. Therefore, it is ORDERED that Respondent shall remit a civil penalty in the amount of $100. The civil 2 Because of Fugate v. Florida Elections Commission, 924 So..2d 74 (Fla. 1st DCA 2006), the Commission could not use Section , Florida Statutes, as the "willfulness" standard dming this hearing. Faa004 (1/06) 14

15 penalty shall be paid to the Florida Elections Commission, 107 W. Gaines Street, Collins Building, Suite 224, Tallahassee, Florida, , within 30 days of the date this Final Order is received by Respondent. It is further, ORDERED that Counts 1-5 of the Order of Probable Cause in FEC is hereby DISMISSED. DONE AND ENTERED by the Florida Elections Commission and filed with the Clerk of the Commission on May 26, 2006, in Tallahassee, Florida. Chance Irvine, Chairman Florida Elections Commission NOTICE OF RIGHT TO APPEAL Pursuant to Section , Florida Statutes, the Respondent may appeal the Commission's Final Order to the appropriate district court of appeal by filing a notice of appeal both with the Clerk of the Florida Elections Commission and the Clerk of the district court of appeal. The notice must be filed within 30 days of the date this Final Order was filed and must be accompanied by the appropriate filing fee. Copies furnished to: Charles A. Finkel, General Counsel Ruben Co to, Respondent (certified mail) Michael Szafranski, Complainant Jay Senter, Complainant Town of Surfside, Filing Officer faa004 (1/06) 15