GO COMMITTEE #3 May 3, 2018 W orksession MEMORANDUM May 1,2018 TO: Government Operations and Fiscal Policy Committee.J(iA FROM: Jean Arthur, Legislative Analyst SUBJECT: Worksession: FY19 Operating Budget: Ethics Commission PURPOSE: Make recommendations on the budget for the Ethics Commission Those expected to attend this worksession include: Robert Cobb, Executive Director, Ethics Commission Phil Weeda, Office of Management and Budget Budget Summary: The Executive is recommending a total budget of $,283 for the Ethics Commission for FY19, a 3.18 percent increase over FY18. Council Staff Recommendation: Council staff recommends approval as submitted by the County Executive. Relevant pages from the FYI 9 Recommended Operating Budget are attached on 1-4. The Ethics Commission's annual report for calendar year 2017 can be found at: http://www.montgomerycountymd.gov/ethics/resources/files/pdfs/annua!%20report%20for%20calen dar"/o20year%202017.pdf OVERVIEW The County Executive recommends a total FY19 budget of $,283, an increase of $13,676 over the current approved budget of $429,607. The recommended budget funds three full-time positions for 3.00 FTEs.
The Commission aims to promote the public's trust of County government through the independent administration, including enforcement, oflaws designed to ensure impartiality and ethical behavior of County employees, including elected officials, in the execution of their responsibilities. The Commission's primary duties are the administration of these programs: financial disclosure, lobbying disclosure, and outside employment approval. In addition, the Commission drafts ethics regulations and legislation for the Council's consideration and provides ethics training for County employees. As is indicated in the annual report, the Ethics Commission has a steady flow of requests for opinions, waivers or guidance and both the number of registered lobbyists and lobbyist activity reports showed a small increase in calendar year 2017. Expenditures by fund FY17 Actual FYI 8 Approved FY19 Recommended General Fund $578,703 $429,607 $,283 Expenditures by type Personnel Cost $374,276 $386,445 $404,400 Operating Expenses $204,427 $43,162 $38,883 Total Expenditures $578,703 $429,607 $,283 Positions Full-Time 3 3 3 Part-Time FTEs 3 3 3 FY19 HIGHLIGHTS Financial disclosure system - The Council approved funding in FY 17 to replace the outdated financial system that was no longer supported by the vendor. The Ethics Commission worked with the Department of Technology Services to acquire a new system. That system was implemented at the end of calendar year 2017. Ethics regulations - Executive Regulation 22-16 is pending before the Council. The regulation would replace the existing outdated regulation as well address some new issues. F:\ARTHUR\FYI 9 _ Budget\Ethics_ GO_ 05032018.docx 2
Ethics Commission RECOMMENDED FY19 BUDGET $,283 FULL TIME EQUIVALENTS 3.00 ROBERT W. COBB, DIRECTOR MISSION STATEMENT The Ethics Commission exercises authorities granted to it under the Public Ethics Law to promote the public's trust of County government and to ensure the impartiality of County employees, including elected officials, in the execution of their responsibilities. BUDGET OVERVIEW The total recommended FYI 9 Operating Budget for the Ethics Commission is $,283, an increase of$13,676 or 3.18 percent from the FY I 8 Approved Budget of $429,607. Personnel Costs comprise 91.23 percent of the budget for three full-time position( s) and no part-time position(s), and a total of3.00 FTEs. Total FTEs may include seasonal or temporary positions and may also reflect workforce charged to or from other departments or funds. Operating Expenses account for the remaining 8. 77 percent of the FY 19 budget LINKAGE TO COUNTY RESULT AREAS While this program area supports all eight of the County Result Areas, the following is emphasized:! A Responsive, Accountable County Government DEPARTMENT PERFORMANCE MEASURES Performance measures for this department are included below (where applicable). The FY 18 estimates reflect funding based on the FYI 8 approved budget. The FY 19 and FY20 figures are performance targets based on the FY 19 recommended budget and funding for comparable service levels in FY20. M Actual Actual Estimated Target Target easure FY16 FY17 FY18 FY19 FY20 Program Measures Number of financial disclosure statements required {calendar year) 1,702 1,723 1,723 1,723 1,723 Number of formal opinions, waivers and guidance (calendar year) 28 23 23 23 23 Number of lobbyists registered (calendar year) 262 266 266 266 266 Number of lobbyist activity reports (calendar year) 372 375 375 375 375 Number of outside employment requests processed (calendar year) 1 1,568 897 897 897 897 1 The number of outside employment requests, not including swom police employment requests, spiked in 2016 due to the one-time impact of transitioning to the onfine outside employment system. Ethics Commission General Government 28-1 @
INITIATIVES 0 The Commission submitted to the County Council for approval a set of regulations providing guidance in several areas under the County's ethics law, including outside employment approval; misuse of position, gifts; and financial disclosure. ACCOMPLISHMENTS GZ:J The Commission instituted a new compliance program a mandatory ethics training for executive branch financial disclosure filers, in May 2017. The initial training cycle (training is every three years) is to be completed by June 30, 2018. By the end of calendar year 2017, 1,260 employees had received the mandatory ethics training, constituting more than 90 percent of employees subject to the requirement. INNOVATIONS AND PRODUCTIVITY IMPROVEMENTS ~ The Commission worked with the Department oftechnology Services (DIS) on a new Financial Disclosure System as the existing system is built on a server that is no longer supported by Microsoft. The new system was implemented at the end of 2017. PROGRAM CONTACTS Contact Robert Cobb, Director of the Ethics Commission at 240.777.6674 or Phil Weeda of the Office ofmanagernent and Budget at 240.777.2780 for more information regarding this department's operating budget. PROGRAM DESCRIPTIONS Ethics Program Compliance Financial Disclosure: The Public Ethics Law requires filing of financial disclosure reports by certain County employees. The Ethics Commission administers the electronic filing system for reporting and coordinates with the Office of Human Rescurces and all County agencies regarding the status of filers. It resolves all anomalous circumstances and questions from filers that routinely arise associated with the filing of financial disclosure reports and the system designed for that purpose. Outside Employment: The Public Ethics Law requires that County employees obtain approval from the Ethics Commission prior to engaging in any employment other than County employment. The Ethics Commission administers an online process pursuant to which requests are made and reviewed by the employee's agency. The Ethics Commission staff prepares all requests for consideration by the Ethics Commission, including obtaining additional information from requestors and County agencies and conducting preliminary legal analysis of requests. The Ethics Commission approves requests, as appropriate, setting conditions on approval as necessary to ensure compliance with ethics requirements, and staff notifies requestors by letter of the disposition of requests. The Ethics Commission publishes and updates approved outside employment information required to be made public by the Public Ethics Law. 28-2 General Government FY19 Operating Budget and Public Services Program FY19-24
Lobbying: The Public Ethics Law requires certain persons who spend or receive over $500 to communicate with County officials and employees to register as lobbyists and to file semi-annual activity reports with the Ethics Commission. Annual registration fees are required and are paid to the Ethics Commission and processed and deposited in the General Fund. The Ethics Commission publishes and updates information required to be made public by the Public Ethics Law. Complaints, Investigations, and Hearings: Pursuant to the Public Ethics Laws, the Ethics Commission receives complaints and, as appropriate, conducts investigations, and/or hearings; makes findings,; and imposes sanctions and penalties if warranted. Advisory Opinions, Waivers, and Advice: In accordance with the Public Ethics Law, the Ethics Commission answers inquiries on the application of the Public Ethics Law, publishes opinions, and grants waivers of Ethics Law requirements, as appropriate. Education: The Ethics Commission conducts public education and other information programs regarding the Public Ethics Law. Legislative and Regulatory: The Ethics Commission recommends and prepares new ethics legislation and regulations. Coordination and Outreach: The Staff of the Ethics Commission coordinates with the Office of the County Attorney and the Office of the Inspector General as necessary on legal and investigative matters. The staff also serves as the principal public resource on the County's ethics laws, including managing a website that reflects Ethics Commission programs, activities, and publications such as annual reports, approvals of outside employment requests, lobbying data, and waivers and opinions. Administration: The staff of the Ethics Commission is respoosible for ensuring that Ethics Commission meetings are conducted in accordance with 1he Open Meetings Act and oilier applicable Jaw, and 1he Ethics Commission members are informed and advised as to all material matters under their jurisdiction, Efuics Commission staff is also responsible for budges procuremen, human resources, and resource management for 1he operation of the office in accordance wifu Montgomery County policies. BUDGET SUMMARY COUNTY GENERAL FUND EXPENDITURES Actual Budget Estimate Recommended ¾Chg FY17 FY18 FY18 FY19 Bud/Rec Salaries and Wages 300,105 312,090 319,729 325,812 4.4 % Employee Benefits 74,171 74,355 77,521 78,588 5.7% County General Fund Personnel Costs 374,276 386,445 397,250 404,400 4.6% Operating Expenses 204,427 43,162 34,570 38,883 ~9.9 % County General Fund Expenditures 578,703 429,607 431,820,283 3.2% PERSONNEL Full-Time 3 3 3 3 Part Time 0 0 0 0 FTEs 3.00 3.00 3.00 3.00 REVENUES Ethics Commission General Government 28-3
BUDGET SUMMARY Miscellaneous Revenues County General Fund Revenues Actual FY17 35,125 35,125 Budget FY18 Estimate FY18 Recommended FY19 ¾Chg Bud/Rec FY19 RECOMMENDED CHANGES COUNTY GENERAL FUND Expenditures FrEs FY18 ORIGINAL APPROPRIATION 429,607 3.00 Other Adjustments (with no service impacts} Increase Cost Annualization of FY18 Personnel Costs Increase Cost: FY19 Compensation Adjustment Increase Cost Retirement Adjustment Increase Cost: Printing and Mail Decrease Cost: Other Professional Services 10,087 7,626 242 21 (4,300) FY19RECOM\IIENDEO,283 3.00 FUTURE FISCAL IMPACTS CE RECOMMENDED ($0005) Title COUNTY GENERAL FUND EXPENOOURES FY19 FY20 FY21 FY22 FY23 FY24 FY19 Recommended No inflation or compensation change is included in outyear projections. Labor Contracts 0 4 4 4 4 These figures represent the estimated annualized cost of general wage adjustments, service increments, and other negotiated items. 4 Subtotal Expenditures 447 447 447 447 447 28-4 General Government FY19 Operating Budget and Public Services Program FY19-24