Do you ever wonder how it is that two people who witness the same traffic accident can walk away with two completely different impressions of what happened?
There was a political traffic accident of sorts that happened this past Friday. The
Georgia State Ethics Commission settled a case that was filed against
Governor Sonny Perdue by the
Democratic Party of Georgia. By "settled", we mean out of thousands of allegations levied at the Governor, a handful (literally, a "handful") stuck to the Governor and he signed a consent order to pay a fine and admit wrongdoing on a few of the allegations.
Before we get into the "eyewitness accounts" on the traffic accident, we feel the need to explain what this state's "ethics laws" are and, most importantly, are not.
Up until the 2005 legislative session,
96.9569% of the so-called "ethics laws" were nothing but a load of crappola of what the Democrats, who held legislative power in this state for the prior 138 years, thought constituted ethical behavior.
There were/are requirements like filing on time, disclosing all contributions, legal limits on contributions from individuals and other legal entities, disclosing expenditures, etc.
There was nothing, not ever, anything remotely resembling prohibitions on conflicts of interest, or similar violations of a commonsense nature.
There was no "true" business disclosure requirements. For the longest time, legislators could merely put down "restaurant owner" without ever really disclosing the fact that they owned a lot of Huddle House restaurants, and the legislation they sponsored was designed to specifically help their business, and their business only.
There was no prohibition against lying, cheating, or, stealing for that matter contained within the construct of the Ethics Act.
Furthermore, until Republicans gained the governorship and the state senate, the Ethics Commission pretty much consisted of a majority of Democrat sychophants who went out of their way to levy major fines on Republican legislators who had ethics complaints filed against them, and sought to ignore the "Rule of Law" when it came time to apply the same standard to their fellow Democrat breathren.
Now that there is a majority of Republican-appointees who sit on the Ethics Commission, perhaps this state can look forward to equitable applications of the law in terms of violations and punishment. Maybe they will consider "standardizing" the fines such that filing a disclosure a day late
is not equivalent to an armed robbery whereby the perp gets nailed with a $5000 fine while someone like
Charles Walker gets "forgiven" by the Ethics Commission for his multitude of ethical lapses...lies...and, grand thefts of government funds.
SO, we will present two different "spins" on the Governor's traffic accident: The first one is written by
J. Randolph Evans, the Governor's attorney, and the second was written by the
Democratic Party of Georgia.
We should note that the violations against the Governor were based on the pre-2005 ethics laws. As much crowing as the Dems do in their press release, you should keep in mind that these are the same folks who wrung their hands and whined about
former President Bill Clinton's lies under oath not amounting to much because he was a Dem, while they appear to be acting like the Governor's ethical violations are tantamount to a multi-million dollar diamond heist.
Statement of Randy Evans - June 17, 2005The Democratic Party of Georgia responded to Governor Perdue’s 2002 election by facilitating the filing of complaints with the Attorney General, the Federal Election Commission, and the Georgia State Ethics Commission. The complaints alleged thousands of violations and sought the imposition of hundreds of thousands of dollars in fines and penalties.
The result of these complaints has been (i) a final report by the Attorney General’s office that the allegations “failed to establish a credible basis” for the allegations and warranted no further investigation; (ii) a unanimous decision by the bipartisan Federal Election Commission to close the claim without further inquiry; and, (iii) dismissal by the bipartisan Ethics Commission of all of the over one thousand alleged violations except four technical reporting violations, two excessive contributions, and a failure to pay to his wife Mary Perdue’s company campaign dollars for the use of her company’s 1973 vintage, four seat propeller plane.
Complaint Filed With Attorney General Thurbert Baker (Democrat)On September 10, 2004, the Attorney General’s office submitted a 10-page, single-spaced report after a thorough investigation of the allegations. Here are the essential findings of that report:
"In addition, interviews with the recipients of many of the questioned calls failed to establish any credible basis for concluding that [the Governor’s Chief of Staff] was using state telephones or other resources to conduct fundraising activities on behalf of President Bush or anyone else.
ConclusionIn light of the above, and given the absence of credible evidence rebutting [the Chief of Staff’s] explanation for the various calls referenced in Mr. Anderson’s complaint, it is my recommendation that this inquiry be closed without further action.
Complaint Filed With Federal Election CommissionOn May 11, 2004, the Federal Election Commission formally dismissed the complaint filed with it against Governor Perdue’s campaign. The Commission unanimously voted by a 6-0 vote of both Democrats and Republicans to close the file without any further investigation.
State Ethics CommissionOn October 15, 2004, the Georgia State Ethics Commission dismissed, as having no reasonable basis, charges relating to the use of the State plane, use of offices and equipment, and mention of a website in a speech.
In the Order entered today, the Commission dismissed claims relating to the posting of a speech on the state website, a claim alleging an excessive contribution, and a partnership contribution. Of the over one thousand allegations, only 8 remained.
Notwithstanding my advice and firm belief that the campaign would prevail on the few allegations that remained, we have today consented to the entry of a Consent Order to clarify key legal issues and establish precedents for the 2006 campaign cycle. By virtue of this Order, the standards are higher, the precedent clearer, and the ability to police campaigns stronger. Here is how:
First, the Order draws a clear line for limits on contributions by spouses’ companies, including family owned businesses.
In the past, while closely held corporations have been upheld as effective in shielding individuals from liability and in connection with the application of some tax laws, they have generally been disregarded in connection with ethics rules and contribution.
For example, notwithstanding separate corporate status, affiliated entities are treated as one for purposes of limits on contributions. (See Commission Rule 189-6-03). In various disclosures, the assets of closely held corporations are disclosed. And, under a myriad of federal and state ethics rules, corporate status is ignored for purposes of applying travel restrictions, gift rules, and disclosure requirements. Basically, while the corporate veil is recognized for liability and tax purposes, it has been transparent for ethics, contribution limits, and campaign purposes.
The reason has been obvious. The purpose of disclosure and contribution limits requirements is to prevent illegal, improper, or undue influence by undisclosed principals. If hiding behind the corporate veil of a closely held corporation was effective, then donors could easily form solely owned closely held corporations to conceal their identity. But, by peeking behind the corporate veil in the disclosure and contribution limits area, supervising entities such as the Ethics Commission can verify that principals are not evading the contribution limits through corporate structures. Indeed, this is exactly the procedure used in determining whether entities are affiliated for purposes of applying the contribution limits.
Georgia law recognizes, however, that members of the immediate family of a candidate exercise influence over the candidate by virtue of their relationship. As a result, contributions limits do not apply to members of the immediate family as their influence is presumed under the law.
As applied in the context of this case, no one seriously suggested that Mary Perdue’s influence with her husband increased as a result of her willingness to permit her husband to use her company’s plane. No one seriously suggested that the public was unaware of Mary Perdue’s influence with her husband by virtue of the fact that her permission to use the plane was not reflected on campaign reports.
Under existing law, Mary Perdue could have given her entire company to her husband as a campaign contribution without violating contribution limits. The reason is that contribution limits in this context serve no legitimate purpose since her influence is already presumed. The absurdity of the allegation in this case is that while Mary Perdue could have given her entire company to her husband’s campaign, she could not let her husband’s campaign use the company plane because of the application of the contribution limits.
Worse yet, there is little question that had the Governor’s campaign paid campaign dollars to his wife’s company, there would have been a complaint alleging conversion of campaign dollars to personal use since he would be giving campaign dollars to his wife’s company. This was a no win situation when these decisions were made.
But this is a Governor about setting new higher standards. The standard set in this case by today’s Consent Order makes clear that contributions by candidates’ and spouses’ companies, including specifically costs of transportation, must be reported and are subject to campaign contribution limits. This means that if a candidate uses his spouses’ company car, then mileage must be kept and the in-kind donation of the value computed, reported, and not exceed the contribution limits. To establish this clear precedent so that it may be applied in next year’s election, the Order includes a finding of both an excessive contribution violation of $500 and a reporting violation of $500 so as to extend the contributions limits requirements to spouses’ companies providing in kind contributions to candidates which would include planes, trains, buses, and automobiles.
In addition, the campaign, with the direction of the Ethics Commission, has paid to Mary Perdue’s company $12,155 reflecting the value of the use of the plane. Oddly, Mary Perdue may take this money out of the company and personally re-give it to her husband’s campaign without regard to the contribution limits.
Second, the Order establishes a clear line regarding receipt of contributions received after the primary but before the General Election for the retirement of a debt from the primary campaign. In this case, there was a genuine dispute regarding whether the word “last” referred to “the most recent” or the “final” election in an election cycle. Because of issues like this, the campaign retained professional bookkeepers, accountants, and lawyers to review, analyze, and decide matters involving such interpretations.
The professionals advised that, based on the dictionary definition, common usage, and existing law, the correct interpretation was that "last" meant "most recent". No one disputes that if this interpretation is correct, then there are no violations.
As applied in this matter, the issue involves 2 contributions out of tens of thousands received. For each contribution, an amount was allocated to the general election in 2002. And, there was an amount which was allocated to the retirement of debt from the “last” or “most recent” election which was the primary in 2002. Professionals, including attorneys, concluded that the amounts were properly allocated to the retirement of debt from the primary in 2002.
But, this is a Governor about setting new higher standards. The standard set in this case by this Consent Order makes clear that contributions in excess of the General Election limits received by campaigns after the primary but before the General Election constitute a violation. This means that if a candidate incurs debt during the 2006 primary, they may not accept contributions for the retirement of that debt either before or after the general election. To establish this clear precedent so that it may be applied in next year’s election, the Order includes a finding of both an excessive contribution violation and a reporting violation with a $250 civil penalty for each of the 2 contributions. This will effectively ban post-primary contributions to retire primary debt. In addition, the campaign has returned $1,000 to one donor and $5,000 to the other as excessive contributions.
Third, this Order sets a new standard for accuracy in reporting. The rule has long been at the federal level, in other states, and even among candidates in Georgia that donations may be re-designated after receipt to the appropriate election. Indeed, as reflected by the September 30, 2002 and October 8, 2002 filings and reports of Labor Commissioner Mike Thurmond reflecting donations by the Democratic Party of Georgia, re-designation has been an accepted custom, practice and usage for years.
Notwithstanding this accepted practice and the laws permitting it, there were four (out of over 13,000) contributions identified as improper because they were re-designated from one election to another. While 99.9875% accuracy is pretty good assuming they were violations, it was not good enough for this Governor. With perfection as the standard (100%), the Order identifies four technical violations with a $100 penalty for each.
ConclusionIn sum, the Attorney General’s office found the claims lacked a credible basis. The FEC dismissed the complaint. The Ethics Commission dismissed all but 8. The total penalty imposed was $1,900 (after political opponents suggested hundreds of thousands of dollars) based on 5 reporting violations and 3 excessive contributions out of tens of thousands of contributions. Half of the violations were nothing more than technical violations with $100 penalties.
Through the Order today, the Governor raised the bar for candidates in the 2006 election cycle. But then this is a new Georgia with a governor who is prepared to walk the walk.
Statement from the Democratic Party of Georgia - June 17, 2005(Atlanta) It’s now official - Gov. Perdue is the least ethical governor in modern times. The first Republican governor in 135 years is now also the first governor in Georgia history to be found guilty of violating state ethics laws. Coincidentally, the last Republican governor in Georgia - Rufus B. Bullock - fled the state in 1870 to escape an ethics scandal. At least he was eventually exonerated. No such luck for Gov. Perdue. Even an Ethics Commission that he stacked with what he called “his own team” had to find him guilty of seven violations of Georgia’s ethics laws.
According to the Consent Order, Gov. Perdue is ordered to pay multiple civil fines totaling $1,900 from personal funds, as well as to repay more than $18,000 in illegal campaign contributions. He was found guilty of the following violations:
- 187 hours of illegal use of a plane. The State Ethics Commission found that the 187 hours of transportation provided by Perdue, Inc. exceeded legal contribution limits in violation of O.C.G.A. 21-5-41(a). In addition, the failure of the Perdue campaign to disclose such illegal contributions violated O.C.G.A. 21-5-34 (b).
- Unauthorized re-designation of funds. The State Ethics Commission also found the Perdue campaign guilty both of accepting multiple contributions over the legal limit, and attempting the illegal re-designation of such funds. On more than one occasion, the Commission found that the “attempted re-designation nearly two years after the election was not authorized.” [State Ethics Commission Consent Order, case number 2004-0002, 6/17/05]
All of the spin in the world couldn’t save Gov. Perdue from the day of reckoning. For over a year, his spokesman Dan McLagan has shrugged off revelations of Perdue’s egregious conduct as “partisan mudslinging”. He even boasted that “none of them have stuck". Well, they just stuck, and that honor places Perdue in a league of his own - the first governor ever found guilty of breaking state ethics laws. . [Suggs and Badertscher, “Ethics Panel Fines Key State Senator,:” 10/16/04, p. A1; Pettys, “Ethics Panel Orders Hearing on Perdue Complaint,” Associated Press, 10/15/04]
Democratic Party of Georgia Chairman Bobby Kahn said, "As I’ve said before, Gov. Perdue’s ‘New Day’ in Georgia looks more like an old day in Louisiana. Gov. Perdue talks a good game on ethics, but his new status as the only Governor in history to be found guilty of breaking Georgia’s ethics laws should put an end to that charade."
Final PV Note to Kahn and the Dems: Note that we are immortalizing all of your crowing on our Website. We predict that the DPOG itself will have to eat a whole lot of this crow they now spew, whether it's from complaints filed against itself, or against their stellar candidates...at least, those who remain official "Democrats." :-)
