Public Comments 2020 (224-

The New Progressive Alliance periodically makes Public Comments by itself or with other organizations  in support of the Unified Platform. The Public Comments are often made to to federal agencies and legislative bodies in the United States and Canada. They are reproduced here in full and also briefly mentioned with our other activities in the Annual Reports and on our website under "News." 

  • Public Comment 224: January 2020 - SEC allow shareholder Free Speech
  • Public Comment 225: February 2020 - SEC allow shareholder Free Speech
  • Public Comment 226: February 2020-CA Sec. State – Fair Voting
  • Public Comment 227: March 2020-Congress-Clean Budget

 

Public Comment 224: January 2020 - SEC allow shareholder Free Speech

January 2020

To: Vanessa Countryman, Secretary

Securities & Exchange Commission

100 F St., NE

Washington, DC 20549

Re: File Number S7-23-19

We, the undersigned, are deeply concerned about the need to build an economy that will be successful over the long term. This means we need to ensure that social, environmental, and corporate governance issues facing corporations are effectively addressed. As we know, significant improvement across these issues is needed if our economy and society are to thrive for generations to come.

Investors, including small investors, have an important role to play in identifying for corporations a number of risks and corporate impacts of which they may not be aware. These risks and impacts may damage specific companies and the larger economy.

Since 1934, the shareholder proposal process (Rule 14a-8) has been a positive tool that enables investors to share important information with fellow investors and with corporate management. It is working well and should certainly not be weakened. We are very concerned about the following proposed changes and write to oppose the following:

  • Increasing the stock ownership level from $2,000 to a whopping $25,000 for shares held for a year. This flies in the face of the SEC’s claimed support for the “main street individual investor.” The ownership level for filing a resolution should remain at $2,000 regardless of the number of years of ownership. In addition, shareholders should retain their long-standing ability to combine their shares if needed in order to meet the $2,000 threshold needed to file a resolution.
  • Increasing the percentage of support a shareholder resolution needs in order to be resubmitted for consideration. The current levels of support are working well and allow new, cutting-edge issues to garner support over time. At present, a first year-resolution needs 3% support, a second-year resolution needs 6% support, and subsequent submissions need 10% support. Increasing those thresholds to 5%, 15%, and 25% will prevent important resolutions from being re-filed, and will not help companies improve.
  • Limiting investors or their representatives to one shareholder resolution per shareholder meeting. There is no evidence that this is needed and only serves to limit shareholder engagement.
  • Requiring investors to be available for dialogue with corporate management even when they have hired financial professionals for their shareholder advocacy. This disrupts the client-manager relationship and represents a major change to the well-established process.

While some companies claim that the current shareholder resolution process is onerous to them, the average company in the Russell 3000 receives only one shareholder proposal every seven years. The benefits of hearing from investors on key issues should be a priority of corporate management.

Thank you for your attention to these concerns. We look forward to hearing that the shareholder proposal process, Rule 14a-8, will be preserved.

 

Public Comment 225: February 2020 - SEC allow shareholder Free Speech

(In January 2020 the New Progressive Alliance in Public Comment 224 joined many other individuals in individually writing the Security and Exchange Commission not to blindly back corporate power by restricting shareholders from making comments. In addition in February we also signed onto this collaborative letter to the SEC with 16 other organizations urging the same goal.)

 

February 3, 2020

 

Hon. Jay Clayton, Chairman

Hon. Robert J. Jackson Jr., Commissioner

Hon. Allison Herren Lee, Commissioner

Hon. Hester M. Peirce, Commissioner

Hon. Elad L. Roisman, Commissioner

Vanessa A. Countryman, Secretary U.S. Securities and Exchange Commission

100 F Street, N.E. Washington, D.C. 20549

 

RE: Proposed Procedural Requirements and Resubmission Thresholds Under Exchange Act Rule 14a-8 (File Number S7-23-19) 

 

Dear Chairman Clayton and Commissioners Jackson, Lee, Peirce and Roisman,

 

On behalf of the undersigned organizations we respectfully submit comments on the regulation proposed by the Securities and Exchange Commission (SEC, Agency) regarding shareholder resolutions. The proposal process is one of the key ways that shareholders engage with corporate managers about emerging issues that impact long term risks and performance. The proposed changes to the shareholder proposal rules would make it harder for investors to access the levers of shareholder democracy and should not be advanced.

 

We are most concerned about the effect these rules will have on the shareholder proposals filed every year calling on corporations to disclose their political activity to their investors. 

 

Since the U.S. Supreme Court’s decision in Citizens United v. FEC came down in 2010, corporations have been allowed to spend unlimited undisclosed amounts of money to influence American elections and in turn affect policy outcomes. In his majority opinion in Citizens United, Justice Kennedy assumed that with this new paradigm of spending, there would at least be robust disclosure so that shareholders could assess whether the political activity of their companies presented significant risk. This robust disclosure regime did not exist then and it doesn�t exist now.

 

A company’s political activity- both its election spending and lobbying- is relevant to its shareholders because it can present significant reputational risk if not disclosed and managed properly. Many customers and the purchasing public are paying close attention to whether a company�s political activity lines up with its corporate values. If there is a disconnect companies can face bad press, boycotts, or targeted social media campaigns. 

For example, AT&T came under public scrutiny after it was revealed that the company paid attorney Michael Cohen--who has since been sentenced to three years in prison for campaign finance violations and fraud--$600,000 to consult on policy matters without disclosing that information to shareholders. This was following five years of calls from AT&T�s shareholders to disclose the full extent of its lobbying activity and oversight policies, including payments for direct and indirect lobbying. Clearly shareholders were right to make this demand. It is important for companies to be transparent in order to prove corporate integrity and reputational soundness. 

 

Corporations are vulnerable on the election spending front as well. For example, in 2018 it was reported in the press that Florida- based grocery chain Publix and its leadership donated at least $670,000 to Gubernatorial candidate Adam Putnam who publicly declared himself a “proud NRA sellout.” Publix�s support of this pro- National Rifle Association candidate caused a public uproar as the revelation came only months after the massacre at Marjorie Stoneman Douglas High School in Parkland, Florida. The students protested the company’s support of Putnam by staging �die- ins� at two stores, which led to the company suspending its political contributions.

Understanding the risks posed by undisclosed political activity, shareholder proposals calling on companies to be honest about their political activity are one of the most frequently filed proposals every year, with 93 filed at the start of the 2019 proxy season. 

The shareholder proposal process has been used for successful dialogues between shareholders and management around disclosure. As of 2019, 316 companies in the influential S&P 500 reported to the CPA- Zicklin Index that they disclose some or all of their election-related spending or that they prohibit such spending. Additionally, investors have filed nearly 400 shareholder proposals on lobbying disclosure since 2011, which have resulted in more than 75 agreements that provide greater transparency around corporate lobbying activity. 

 

The new rules the agency is proposing would halt this important progress and make it incredibly difficult for investors to raise political activity disclosure with their companies. Recent analysis from the Sustainable Investments Institute, looking at all environmental, social, and governance (ESG) resolutions voted on in corporate elections from 2010 through late 2019 found that about 30% would not have been eligible for resubmission under the new thresholds. Of those proposals, the ones on political activity, human rights, and climate change would have been most impacted. Of those three most affected categories of resolutions, political spending disclosure resolutions are more than 3 times more impacted than the next impacted issue, human rights reporting. Further analysis found that 40% of political spending disclosure proposals would have been excluded if these rules had been in place from 2004- 2018.

 

Ultimately, the SEC should move forward with a rule requiring all public corporations to disclose their political spending. Investors want more information about how their corporations engage in politics. That is why 1.2 million comments- the most in the agency’s history- have come into the SEC on this rulemaking petition from diverse stakeholders including the late founder of Vanguard, John Bogle, five state treasurers, a bi- partisan group of former SEC chairs and commissioners, and investment professionals representing $690 billion in assets. 

 

However, in the absence of that rule, the SEC should absolutely not move forward with rules that make it harder for shareholders to engage with their companies over these issues. 

 

The federal agency tasked with protecting American investors should be encouraging a robust system of checks and balances between the owners of corporate wealth and companies’ management, not shutting down the main path for providing shareholder input. The SEC should be facilitating shareholder democracy, not undermining it. This new set of rules should not be advanced.

 

Should staff have any questions, please do not hesitate to contact Rachel Curley at signing organization Public Citizen via email at rcurley@citizen.org or via phone at 202-454-5195.

 

Sincerely,

 

Amazon Watch

American Federation of State, County and Municipal Employees (AFSCME)

Campaign for Accountability

Citizens for Responsibility and Ethics in Washington (CREW)

Fossil Free California

Friends Fiduciary Corporation

Greenpeace USA

Harrington Investments, Inc.

Interfaith Center on Corporate Responsibility 

New Progressive Alliance

No Coal in Oakland

Public Citizen

Sierra Club

U.S. Public Interest Research Group

Voices for Progress

Women's Earth and Climate Action Network (WECAN)

YourStake.org

 

Public Comment 226: February 2020-CA Sec. State – Fair Voting

February 2020

The Honorable Alex Padilla

Secretary of State

1500 11th Street

Sacramento, CA 95814

 

Cc: Los Angeles County Registrar

Dean Logan

Los Angeles County

Supervisors

Senate Elections Committee

Chair Tom Umberg

Assembly E

lections Committee Chair Marc Berman

 

RE: Request for revisions to Voting Solutions for All People’s

(VSAP 2.0) Conditions for Approval

 

Dear Secretary Padilla:

 

The organizations and individuals listed below write to you bec

ause we are gravely troubled by remaining fundamental security flaws in Voting Solutions for All People (VSAP) 2.0, and to respectfully request that you require additional conditions on the approval of VSAP 2.0 to enhance voters’ trust in the integrity of elections in Los Angeles and wherever it might be used in the future.

 

Los Angeles’s VSAP 2.0 has the potential to positively influenc

e the election system market as the nation’s first publicly-owned voting system while also modernizing elections in Los Angeles County. But Los Angeles County has not yet complied with provisions stipulated in SB 360 for research and development that require disclosure of the source code used, which leaves unfulfilled the promise that VSAP 2.0 could become the nation’s first open-source voting system1. We ask the County and State to work diligently to comply with SB360 and to lead California and the nation toward increased election transparency and security by releasing VSAP 2.0’s source code as open-source under a prudent governance plan.

 

We are appreciative that the State imposed key certification re

quirements in your January 24th 2020 conditional approval, particularly the conditions that enhance security, require the option for voters to use hand-marked paper ballots, and require a review of the functionality and usability of the “More” button on BMDs. However, we remain concerned that VSAP 2.0 still has serious flaws that necessitate further conditions on approval. Though we understand it might not be possible for Los Angeles to resolve these issues before the March 3rd primary, we respectfully request that you impose these conditions to the extent possible before the November 2020 election and certainly before granting full certification.

 

  • VSAP 2.0 must be re-designed to either use separate ballot b

oxes or to redirect the paper path so that a ballot does not pass under the print head after being reviewed by the voter. 1 SB 360’s explicitly stated intent included that “California receive the benefits of the publicly funded development of a nonproprietary voting system in the state.“ Section 19202(e)(1) allowed local jurisdictions to contract and pay for “Research and development of a new voting system that has not been certified or conditionally approved by the Secretary of State and uses only nonproprietary software and firmware with disclosed source code...” Though Los Angeles County contracted with Smartmatic to develop VSAP, it has not yet disclosed the source code it created and used, and so California has not yet received the benefits that SB 360 intended and explicitly called for.

  • We recognize that VSAP 2.0’s design was aimed to give all voters, even those that can’t handle a paper ballot, the opportunity to mark, verify, and cast a paper ballot privately and independently and we commend the intention of this mechanism. However, VSAP 2.0’s design includes a major inherent security flaw in that the ballot passes under the print head after the voter has cast it. This security flaw exists even though the print head is normally lifted by VSAP 2.0 software when the ballot is reinserted. The problem is that if the software is hacked, it can direct the print head to tamper with the verified ballot. University of California at Berkeley Professor Dr. Philip Stark, inventor of risk-limiting audits, summarized the danger in VSAP 2.0’s current design in his January 20th public comment: “The design of the VSAP BMD is defective from a security perspective: the ballot passes under the print head after the voter last sees the paper. This allows the ‘opportunity to mark’ flaw.2 The use of a cam to lift the print head while the ballot is cast is not adequate protection, because that cam is itself controlled by software. The paper path for casting the ballot should not include the print The ballot box should be physically separate from the BMD, or at least not in the same path as the printer.” This flaw could be addressed by redesigning VSAP 2.0’s BMDs to make it mechanically impossible for verified ballots to travel under the print head before being deposited in the ballot box. We understand this change will take time. In the interim we ask you to require Los Angeles to disable the automatic feed mechanism for verified ballots in VSAP 2.0 BMDs and to remove the attached ballot boxes. Instead, the County should provide unattached ballot boxes into which voters can deposit the ballots printed by the BMDs after the voters have verified their votes. This will significantly reduce the risk profile of the VSAP 2.0 system in the short term. Los Angeles could make the same kind of accommodations for voters with disabilities as do other California counties that use BMDs and separate ballot boxes. In the long term it should be possible to redesign VSAP 2.0 so that it’s mechanically impossible for the ballots to pass under the print head after being verified by the voter. Until then, or if that is too costly, requiring the use of traditional ballot boxes, as done in other counties, is necessary to avoid this major security flaw. 2) VSAP 2.0 must be re-designed to not rely on QR codes or barcodes for tabulation. We are also gravely concerned that VSAP 2.0 uses QR codes for actual tabulation. Although voters can verify the selections that the BMD prints on their ballot in their own language, they cannot do so on the QR codes that VSAP 2.0 will actually use to tally votes. This concern is shared broadly by computer scientists and election security experts, who instead recommend that jurisdictions not use ballot-marking devices with QR codes or barcodes.3 In the seminal 2 “Serious design flaw in ESS ExpressVote touchscreen: ‘permission to cheat’”, 9/14/2018, https://freedom-to-tinker.com/2018/09/14/serious-design-flaw-in-ess-expressvote-touchscreen-permission-to-cheat/ 3 See, e.g., Hursti, Harri. Presentation to the Presidential Advisory Commission on Election Integrity, September 12, 2017; Andrew W. Appel, Richard A. Demillo, Philip B. Stark, “Ballot-Marking Devices (BMDs) Cannot Assure the Will of the Voters,” pp. 16-17, April 21, 2019, https://ssrn.com/abstract=3375755.

The election security publication released last year by The National Academies of Sciences, Engineering and, Medicine, the authors stated that barcode-based devices “raise security and verifiability concerns”.4As described in a discussion document from the US’s National Institute of Standards and Technology (NIST): “Malicious or faulty production of a barcode may cause a vote capture device to present the voter with different ballot selections than what will be interpreted by the voting machine. If barcodes are used for tabulation of cast ballots, any modification of a voter’s ballot selections may go undetected and impact the election results.”5Although the State’s conditional approval admirably requires that the jurisdiction verify that the information in the QR code or barcode matches the voter-verified human-readable text when conducting post-election audits, this is not enough. The number of ballots verified in this fashion is too small to catch sophisticated malicious discrepancies, and there would be major questions about how to handle any discrepancies found. Colorado’s Secretary of State has disallowed the use of QR codes and other printed barcodes, saying they pose a threat to election security and verifiability of ballots. Here’s an excerpt from the state’s September 16, 2019 press release: “Colorado Secretary of State Jena Griswold announced that Colorado will stop using ballots with QR codes. The removal of QR codes will increase the security of vote tabulation and ensure voters can accurately verify that their ballots are correctly marked... Although voters can see their vote choices, they cannot verify that the QR code is correct... QR codes could be among the next target of an attack and are potentially subject to manipulation.” We acknowledge that modifying VSAP 2.0’s tallying system to use optical character recognition (OCR) to tally the actual voter-verified human-readable text instead of relying on QR codes would likely take time. However, it is completely feasible. Both the Hart InterCivic Verity Voting system6 and Smartmatic BMD A4-6007 use OCR to tally votes on ballots printed by their ballot marking devices. This change is absolutely crucial for ballots to be truly voter-verified. 3) Please require ballot-on-demand printers for voters who prefer hand-marked paper ballots. We are pleased that the conditional certification of VSAP 2.0 includes the requirement that all polling locations offer voters the option to hand-mark a paper ballot. This provision recognizes that many voters prefer hand-marked paper ballots and many election experts believe they have inherent advantages including creating a paper trail that — unlike a BMD printout — cannot be hacked which increases voter confidence. Nevertheless, using write-in absentee ballots will be highly problematic because requiring voters to actually hand-write their selections — offices, candidates, ballot measure numbers, etc. — will slow voters down dramatically, induce errors that may disenfranchise voters, and make votes hard to read and count. It also 4 “Securing the Vote: Protecting American Democracy,” National Academies of Sciences, Engineering, and Medicine, p. 80, https://www.nap.edu/catalog/25120/securing-the-vote-protecting-american-democracy.5 NIST discussion paper, https://collaborate.nist.gov/voting/pub/Voting/CyberSecurity/BarcodesEncodingPaperJune14-2019.pdf, June 14, 2019. 6 “New Jersey Certifies Newest Hart InterCivic Voting System”, June 4, 2019, New Jersey Certifies Newest Hart InterCivic Voting System 7 “Smartmatic Response to eRFI – New Voting System”, August 24, 2018, https://sos.ga.gov/admin/files/Smartmatic%20RFI_Redacted.pdf

  • · 4 violates California Elections Code Section 13103’s requirements that all ballots must list the title of each office and all the qualified candidates in addition to the titles and summaries of measures. Although write-in ballots may be the only solution available for the March primary, this issue must be rectified for the following elections. We therefore urge you to change the conditional certification provisions so they require all vote centers to offer standard, printed paper ballots, either printed in advance or by ballot-on-demand printers, as provided in many other California counties. 4) Please require new, full, and independent testing before final certification. We are very concerned that many of VSAP 2.0’s violations of the California Voting System Standards (CVSS) will not be fixed by the March election — and some not until 2021 — but we appreciate that the State’s conditional certification directed the County to develop modifications to VSAP2.0 to bring it into compliance with the CVSS requirements. However, it is not clear whether the State intends to require the system to undergo further independent testing to affirm that the modifications do, in fact, remediate the violations of the CVSS, and also do not adversely impact the system in another way. As the National Election Defense Coalition and Free Speech For People wrote in their January 20th comment: “VSAP should not receive certification until the areas of non-compliance have been remediated fully, and the modified system is re-tested by an independent testing authority to independently and transparently establish conformity with the CVSS.” Voting system testing and certification best practices dictate that any modifications to a voting system to address non-compliance with standards must be tested by an independent testing authority to establish compliance with the standards. It is improper to simply accept assurances from the County and its contractor(s) that the system has been brought into compliance and no new liabilities created. We therefore respectfully request your office require a completely new set of independent tests and reports by Freeman, Craft, McGregor Group before certification. Summary We understand that some of these requests may be impracticable to implement before the March 3rdprimary. Therefore, we respectfully request that the above additional conditions for certification be adopted by the State and implemented in time for the November 2020 election or as soon as feasible depending on the requirement. In a time when foreign governments and other bad actors are attacking our election systems, it is incumbent upon you as Secretary of State to address these issues to lessen voters’ well-founded doubts about election security. Given the vast resources of those who would attack our elections, such vulnerabilities must be addressed, whether they’re easy or difficult to exploit, because voter confidence is the cornerstone of our democracy. Thank you.  

 

FROM:

California Clean Money Campaign

Trent Lange Californians for Disability Rights

Randy Hicks Free Speech for People John Bonifaz  

5 Indivisible

California Green Team Jennifer Tanner

Money Out Voters In Michele Sutter

National Election Defense

Coalition Susan Greenhalgh

Progressive Democrats of America Alan Minsky

Indivisible San Jose Rebecca Elliott

Indivisible Marin Susan Morgan

SoCal 350 Jack Eidt

Normal Heights Indivisible Mala Wingerd

Indivisible Ventura Adriene Couter

Indivisible CA-33 Duane Bindschadler

Feminists in Action Jessica Craven

Rooted in Resistance Ruth Richardson

Indivisible East Bay Andrea Lum

Indivisible CA-43 Vlad Popescu

Indivisible Sausalito Lisa Bennett

Indivisible San Francisco Anna Krasner

New Progressive Alliance

Progressive Democrats of S.

M. Mountains Dorothy Reik

Dr. Richard DeMillo, Professor of Computer Science, Georgia Ins

titute of Technology*Dr. Douglas W. Jones, Associate Professor of Computer Science, University of Iowa

Dr. Trent Lange, President and Executive Director, California Clean Money Campaign Dr. Philip Stark, Professor of Statistics, University of California, Berkeley*

 

Public Comment 227: March 2020-Congress-Clean Budget

 

Dear Member of Congress,

 

The Clean Budget Coalition, an alliance of labor, scientific, consumer, research, good government, faith, civil rights, community, health, environmental, and public interest groups, writes you to urge FY21 appropriations bills that are free from policy riders that harm the public.

 

No appropriations titles, package of bills, or continuing resolutions (should that be deemed the appropriate path to continue funding the government), should move forward if they contain poison pill policy riders that go against the public interest.

 

Unfortunately, such poison pill riders have existed as favors to corporate and special interests in previous appropriations cycles and therefore a set of “legacy poison pills,” must be removed from the FY21 appropriations bills.  We ask that you take that stance as Congress processes the FY21 appropriations bills—keeping out new policy riders that would harm the public as well as removing those that have become embedded.

 

The American people oppose the abuse of the budget process to roll back public protections. The budget should fund the things that Americans care about, not undo essential safeguards. The American people support policies to: 

  • Ensure safe and healthy food and products;
  • Restrain Wall Street abuses;
  • Secure our air, land, water and wildlife;
  • Safeguard fair and safe workplaces;
  • Guard against consumer rip-offs and corporate wrongdoing;
  • Defend our campaign finance, election, census systems and support DC statehood;
  • Provide access to justice and fair housing;
  • Protect human and civil rights; and
  • Guarantee continued access to vital health care services including comprehensive reproductive health care, among other things.

Again, the public does not support including damaging policy in must-pass appropriations bills that would undo any of these protections, and any previously included policy of that nature must be removed. .

 

We urge Members of Congress to fully fund important public services and to reject any flawed bills that fail to remove poison pill policy riders that would undo essential public safeguards.

 

Sincerely,

 

20/20 Vision

AFL-CIO

AFSCME

Alaska Wilderness Action

American Association for Justice

American Bird Conservancy

Americans for Financial Reform

American Federation of Teachers

Animal Wellness Action

Austistic Self Advocacy Network

Bend the Arc Jewish Action

Center for American Progress

Center for Biological Diversity

Center for Reproductive Rights

Center for Science in the Public Interest

Coalition on Human Needs

Coalition for Health Funding

Common Cause

Communications Workers of America

Consumer Action

Consumer Federation of America

Defenders of Wildlife

Democracy 21

Earthjustice

Endangered Species Coalition

GreenLatinos

Greenpeace USA

Harrington Investments, Inc.

Hispanic Federation

Humane Society Legislative Fund

Impact Fund

Innovative Green Builders

The Institute for Agriculture and Trade Policy

International Fund for Animal Welfare

Jewish Council for Public Affairs

The Leadership Conference on Civil and Human Rights

League of Conservation Voters

Main Street Alliance

NARAL Pro-Choice America

National Association for College Admission Counseling

National Association of Consumer Advocates

National Center for Lesbian Rights

National Coalition for the Homeless

National Community Reinvestment Coalition

National Council of Jewish Women

National Employment Law Project

National Employment Lawyers Association

National Fair Housing Alliance

National Low Income Housing Coalition

National Partnership for Women & Families

National Women's Health Network

National Women’s Law Center

Natural Resources Defense Council

New Jersey Association on Correction

New Progressive Alliance

Ocean Conservancy

Partnership for Policy Integrity

Planned Parenthood Federation of America

People for the American Way

People’s Action

Public Citizen

Public Knowledge

Rachel Carson Council

Safe Climate Campaign

SEIU

Sexuality Information and Education Council of the United States

Sierra Club

Union of Concerned Scientists

The United State of Women

U.S. PIRG

Voices for Progress

The Wilderness Society

Woodstock Institute

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