Election Coordinator
CalPERS
400 P Street
Sacramento, CA 95814
Protest
October 20, 1998
Dear Ms. Daggao:
This is a formal protest, under the provisions of section 554.9 of Title 2, California Code of Regulations, of the current election for the state member representative on the CalPERS Board of Administration. The grounds for the protest are possible violations of section 554.4 (Candidate Statements) of Title 2, California Code of Regulations. The parties directly involved in making the decision to violate that regulation appear to have been William D. Crist, President of the Board of Administration for the California Public Employees Retirement System (CalPERS), and Kayla Gillan, General Counsel for CalPERS. Others knowing of the possible violation appear to include James E. Burton, Chief Executive Officer, and Michael W. Koester, Chief of the Operations and Support Services Division.
The effect of the violation is to deny active state members the ability to fairly elect an individual to the Board, under the provisions of Government Code section 20090 (g)(2), by injecting a high degree of bias in favor of the incumbent, William D. Crist. Because CalPERS General Counsel may have been involved in violating the regulations governing the elections, I respectfully request that a Protest Panel be formed but that Kayla Gillan should not be involved in selecting panel members. Because the possible violation may also include actions taken by Chief Executive Officer James Burton and Board President William Crist, I request that panel selection be made by someone of the highest integrity who is not employed by CalPERS and that panel members should also not be drawn from CalPERS employees or Board members.
If the Protest Panel finds the actions to be in violation of section 554.4, I hope they will require CalPERS to print new ballot booklets to be mailed to all state and university employees. The booklet should explain the circumstances which necessitate a second ballot. Candidate statements included in the ballot booklet should be limited to those which were approved prior to Mr. Crist's memo dated July 20, 1998.
Section 554.4 reads in part as follows:
Each candidate for an elective Board member position may provide a statement? The statements shall be filed with the Election Coordinator at the time the candidate accepts nomination. Once filed, statements may not be changed or withdrawn except by the Election Coordinator. The Election Coordinator shall reject or edit any statement which contains obscene, vulgar, profane, scandalous, untrue, libelous or defamatory matter or which does not meet the statement limitations state above. The Election Coordinator may request the candidate to verify the truthfulness of any factual statements. The candidate shall provide timely verification upon request.
Candidate statements for this election cycle were due June 8, 1998. Prior to July 13, 1998 a number of e-mails and other correspondence were exchanged between CalPERS staff and both myself and Mr. Crist to confirm the accuracy of various statements made in our candidate statements. On July 13, 1998 Michael Koester sent an express mail letter with a draft copy of the ballot booklet to each of the candidates asking us to check for "errors or omissions" and to respond "no later than noon, this Friday, July 17, 1998, firm."
On July 20, 1998, William Crist sent a memo to Jim Burton, Kayla Gillan and Michael Koester thanking them for "granting me an extension in which to comment upon and revise my candidate statement." In the memo Mr. Crist states that I have made personal attacks on him (in my statement I mention that the incumbent has accepted gifts from those doing business with CalPERS and sits on a private investment board) and that his revisions were to "correct relevant omissions that, if not corrected, would result in the electorate receiving what I believe is misleading information." Attached to the memo, Mr. Crist includes a new candidate statement with the following changes:
- The style moves from passive voice in third person, to a more active first person voice.
- He now starts out as follows: "I do not believe in, and will not engage in, negative campaigning. I stand on my record:"
- Further on he states: "Authored Board ethics policies to require full disclosure of gifts and prohibit campaign contributions from those who do business with CalPERS."
- He now indicates he is endorsed by "CSEA."
None of these statements were included in the candidate statement originally submitted by Crist or attached to Mr. Koester's letter of July 13th.
Crist indicates his revisions are "to correct relevant omissions that, if not corrected, would result in the electorate receiving what I believe is misleading information." However, his new statement does not offer any correction of "misleading information." He simply attempts to address my statement by putting himself in the best light. This would have been entirely in keeping with the regulations, had he submitted his revised statement by the June 8th deadline. However, he did not.
In a public records request dated October 12, 1998, I asked Ms. Gillan who made the decision to include the new statement from William Crist and what was the authority which allowed such a change contrary to CalPERS regulations. In her response, dated October 16, 1998, Ms. Gillan indicates that she made the decision. Her basis for that decision was that instructions from Mr. Koester to correct only errors or omissions was "vague." In addition, Mr. Crist's characterization of his revisions as correcting relevant omissions and CalPERS' policy "supporting candidate freedom of expression" combined to cause her to "conclude that the revisions should be permitted." No legal authority was provided or referenced.
Mr. Koester's letter of July 13th indicates that elections staff reviewed the information which each candidate provided to the Board Elections Office. They verified certain information and obtained clarification where necessary. Candidates were asked to check the ballot information for "errors or omissions. No other changes will be made in the text."
First, this instruction is not as vague as Ms. Gillan contends. Clearly, candidates were to review the draft ballot booklet for errors or omissions by CalPERS staff or their contractors, not for errors or omissions which the candidates themselves may have made to their own statements. If candidates were allowed to make changes to statements which they themselves had written, Mr. Koester would not have included the sentence "No other changes will be made in the text." Inclusion of that sentence clearly restricts candidates from making changes to text which they have already submitted, otherwise the sentence loses its meaning. It is clear that Mr. Koester's intent was for candidates to limit their "corrections" to errors or omissions by CalPERS staff or their contractors. That intent was violated by accepting Mr. Crist's substantial revisions.
Second, the deadline for corrections was clearly July 17th. Mr. Koester emphasized the finality of the deadline by noting it was "firm." However, an exception was made for the incumbent.
Third, and most importantly, the regulations (section 554.4) clearly indicate that, once filed with the Election Coordinator, candidate statements cannot be changed or even withdrawn by the candidates themselves. Changes can only be made by the Election Coordinator. The regulation goes on to outline the Election Coordinator's role as including specified duties for editing and fact checking. Allowing a candidate to edit their statement to address the statement of another candidate is clearly not provided by the regulation.
I have enclosed relevant materials. I look forward to a resolution of these issues which places the interests of CalPERS members in a fair and impartial election above individual interests. If you need further information, please contact me during office hours at 916-327-1194 or at my home number, 916-452-5338.
Sincerely,
Jim McRitchie
CalPERS Board Candidate
Enclosures
Contact: 
jm@perswatch.net