Inslee campaign says it will continue to follow law

Governor race: It moved federal account money only when told it could

August 7, 2011 

U.S. Rep. Jay Inslee’s campaign for governor faces no fixed deadline for reporting the names of those who donated $191,050 that he transferred anonymously from his old congressional accounts into his new 2012 campaign.

State campaign-finance regulators say Inslee must eventually identify the donors – and transfer no more than $3,200 for each donor who gives permission – under a clarified interpretation of state campaign law given July 29 to Inslee’s campaign.

Inslee, a Democrat, has $1 million more that his campaign also wants to transfer, if donors agree, and the first anonymous transfers were based on erroneous advice given by the state Public Disclosure Commission to Inslee’s campaign lawyer.

“I told them it was so early in the process they can (file) it as they get at it,” PDC state Public Disclosure Commission interim director Doug Ellis said late last week, adding that there is no firm deadline. “They said they are going to do it right away and as fast as possible.”

Rival Republican candidate Rob McKenna’s campaign says Inslee already is in violation of state law by failing to name the donors.

“They were seeking to hide contributions and put over-limit contributions into their state account,” McKenna campaign manager Randy Pepple said in an interview.

Inslee’s campaign and the PDC both dispute that nefarious intent, but Inslee’s campaign acknowledges that it did tell donors who had given to congressional campaigns that their roll-over donations could be kept anonymous. Past donors also were told their rolled-over or transferred congressional donations would not count against their $3,200-per-election-cycle limit for the governor’s race, Inslee campaign manager Joby Shimomura said Friday.

But Shimomura said those statements to donors were based on bad advice from the PDC that the PDC now admits was in error.

The PDC’s Ellis said his staff simply gave incorrect advice to Inslee’s attorney, Kevin Hamilton, over the phone a few months ago.

“There was nothing illegal and nothing inappropriate. In fact, what the Inslee campaign did was appropriate,” Ellis said. “They came to us to learn what was legal to do before they transferred anything. … I don’t see the conspiracy under the rock that other people may infer.”

Ellis said that after an Associated Press story raised questions about Inslee’s transfers, he went back and looked closer at the law and past decisions by the PDC.

Ellis found 1998 memos from PDC staff members – including Melissa Warheit, the director at the time, and Vicki Rippie, who succeeded Warheit in that role. Their emails laid out the procedures for handling transfers of federal funds brought into state campaigns.

In one email memo, Rippie wrote that candidates may make transfers only with written permission of the contributor and that the amount transferred for each contributor must not exceed the campaign-cycle limit established in state law (in 1998, it was $1,150 per election cycle; today it is $3,200).

Ellis gave this “new” advice to Inslee’s campaign July 29, and a listing of names is expected fairly soon.

“We’ll probably be ready to do that in a week or two,” Shimamura said.

Shimomura also said none of the transfers authorized by donors so far has exceeded state contribution limits, which are lower than federal campaign limits.

Pepple said he is sticking by his position that Inslee was trying to get around the law. He said some of Inslee’s congressional donors were political action committees that gave $10,000 or individuals who gave $5,000 – both of which would exceed state limits. Moreover, he speculated in an interview, some of those PACs would be ineligible to donate in a state campaign because they don’t meet a state requirement to have collected 10 donations of at least $10 in the past 180 days.

But Ellis, a former television journalist and a 10-year executive director for the state Republican Party before joining the PDC, said Pepple’s claim that a violation has occurred is “not true.” Ellis said the Inslee campaign assured him it had not transferred amounts greater than what individual donors can give in the governor’s race, and there is no evidence that it did.

Brad Shannon: 360-753-1688 bshannon@theolympian.com www.theolympian.com/politicsblog

Updated to correct spelling of Joby Shimomura's surname.

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