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PDC staff report: Inslee campaign finance moves were not illegal

Post by Brad Shannon / The Olympian on Oct. 12, 2012 at 4:41 pm |
October 12, 2012 4:41 pm

Staffers for the state Public Disclosure Commission are recommending dismissal of four campaign finance charges brought against Democratic gubernatorial candidate Jay Inslee by Republican candidate Rob McKenna’s campaign manager.

The five-member citizen commission plans a special enforcement meeting at 2 p.m. Monday to consider the matter.

At issue were transfers of surplus contributions that Inslee made from his congressional campaign accounts to his gubernatorial campaign in 2011 – as well as previous expenditures of federal funds on polling and research to determine his viability as either a congressional or gubernatorial candidate.

Inslee is leading in recent polls in a campaign some consider the hottest gubernatorial contest in the nation. Each side is looking for traction against the other, including hard-hitting ads cutting in both directions. And Inslee’s people have a complaint pending against McKenna’s campaign, too, which the PDC is still investigating.

This is not the first time the PDC has rejected the logic of the McKenna campaign. I wrote about a complaint about the Inslee campaign’s fund transfers in 2011, linked here.

The complaint at hand was filed more recently by McKenna campaign manager Randy Pepple, who said the PDC decision appears to blow a hole in campaign finance law.

In a quick emailed response to an Olympian query about the PDC recommendation, Pepple said:

It appears on a quick read that Congressman Inslee admitted to what we alleged was illegal – using money from his congressional campaign account to do a statewide poll to check his chances on running for Governor and using federal money to pay for opposition research (on himself) to determine if he should run for Governor.
In both instances, he admits to be using federal funds for the state race he is now in. The PDC staff appears to be suggesting that he wasn’t yet in a state race because he didn’t make the results of those expenditures public – and under this definition, is blowing a huge loophole in campaign finance law.
If my interpretation is correct of what the PDC staff is suggesting, you can spend as much money as you want out of the campaign fund from another office, as long as you don’t publically admit you are running for that office. I have not seen that interpretation before.
Guess we’ll have to show up Monday to see whether the Commission wants to weaken campaign finance and disclosure laws in this way.

The PDC staff’s 59-page report lays out its findings on the four charges in some detail. On the charge that Inslee for Congress spent $25,570 for research consulting by the Feldman Group. In its summary, it says the expenditure was for a 20-minute poll in Jan. 18-20, 2011, and that Inslee’s campaign had made it clear he had not yet decided whether to run for governor.

The report goes on to say Inslee sought the poll “to evaluate his prospects as a candidate. Inslee for Governor stated that the results of the survey were not used as a vehicle to influence people or to promote Congressman Inslee.’’

Inslee also spent $34,609 with New Partners Consulting on April 7, 2011. That contract covered research into “Inslee’s personal and professional affairs, such as news analysis, professional history, congressional record, campaign finance, personal financial disclosure, personal and legal records, candidate interviews, and public records research.”

In other words, it looked like a dig to see if there was dirt on the record, and Inslee’s campaign for governor later described it as an effort to “identify his own potential vulnerabilities in a 2012 campaign for congress or governor,” according to the PDC.

But the PDC said those expenditures did not promote Inslee’s candidacy – in that it did not publicize him. The staff report says the evidence suggests that Inslee was exploring but had not decided on running for governor. It also noted that Washington law does not require disclosure of contributions or expenditures related to exploratory efforts until after a candidacy is launched.

Inslee legally became a candidate in April 2011.

The PDC also is investigating a few complaints the McKenna campaign lodged this year against Inslee – including accusations that certain debts and expenditures were reported late.

“We are doing our best to get that wrapped up by the election,” PDC spokeswoman Lori Anderson said Friday. “It won’t be done on Monday.’’

Stay tuned.

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