register for email updates
Will GA lawmakers tighten oversight of PAC spending?
Since 1990, Georgia has barred politicians from spending campaign cash for personal benefit. But regulators still pretty much allowed candidates to define “personal.”
The upshot: Candidates used campaign accounts to buy cars, throw lavish parties and treat themselves to junkets. One legislator paid the mortgage on his condo for several years with campaign money.
Now, Gov. Sonny Perdue and former House Speaker Glenn Richardson are among those using a relatively new type of political action committee, commonly known as a “leadership PAC,” to collect hundreds of thousands of dollars. In Georgia, these PACs operate with little or no oversight. The State Ethics Commission said as much in a 2008 advisory opinion, finding that nothing in campaign law addresses what PACs do with their money.
In fact, Georgia doesn’t even require PACs to report spending that’s not campaign-related, says Rick Thompson, the commission’s former executive secretary. Nor does the law require any disclosure if they spend less than $25,000 a year on behalf of candidates.
“We did some advisory opinions because we were hoping people would get outraged enough and push for legislation,” said Thompson, now a private consultant on issues of ethics and campaign finance.
The PAC opinion was one of them, but it hasn’t worked so far. Georgia lawmakers are sifting through a slew of bills labeled as ethics reform, but none of them address PAC spending.
Thompson thinks the Legislature should prohibit leadership PACs and tighten reporting requirements on other PACs’ income and expenses.
“It’s ripe for the opportunity for corruption,” Thompson said. “Most states require that you have regular reporting and some kind of oversight of what kind of money’s coming in and going out.”
Both Perdue and Richardson have used their PACs to further their political goals. MMV funneled more than $350,000 to the Georgia GOP and Republican candidates, while PerduePAC focused on ensuring the governor remained “viable in the political marketplace” in his second and last term, its chairman has said.
Richardson’s PAC hit the headlines last week as the Ethics Commission opened a preliminary investigation into his use of campaign money. The ex-speaker cleaned out his re-election account on New Year’s Eve by shifting $219,915 to the MMV Alliance Fund. A day earlier, MMV filed new registration papers naming Richardson as chairman.
State law allows candidates to give excess campaign funds to other candidates, political parties or educational, philanthropic and tax-exempt organizations. MMV does not appear to fit any of those categories, and the commission wants to know if the fund transfer broke the law.
MMV registered with the IRS on Tuesday as a tax-exempt political organization. It’s unclear whether that will affect the ethics investigation.
Perdue initially set up his PAC differently, registering as a non-profit with the Georgia Secretary of State and the IRS after the Ethics Commission ruled that a non-profit could receive excess campaign funds. In 2007, prohibited from seeking a third term, the governor moved $787,000 left in his election account to PerduePAC.
PerduePAC has not hit the $25,000 threshold so it’s not required to file disclosure reports in Georgia. It does file quarterly disclosures and an annual tax return with the IRS.
So far, Rep. Wendell Willard (R-Sandy Springs) has introduced the only ethics bill addressing PACs in 2010. It would prevent candidates for transferring more than $10,000 of excess campaign money to PACs or other candidates in a two-year election cycle.
Some say that doesn’t go far enough.
Michael Jablonski, general counsel of the Georgia Democratic Party, called for an outright prohibition on candidates re-gifting donations to PACs or even to other candidates.
“There are several obvious ways in which that mechanism could be manipulated,” Jablonski said Monday in testimony before the House and Senate ethics committees.
“If money is given for political purposes, for campaign purposes, it must be used for campaign purposes, and if there is money left over it needs to be taken out of the election system.”
Common Cause Georgia is pushing for a ban on campaign-to-campaign and campaign-to-PAC fund transfers.
Bill Bozarth, the good government group’s executive director, said he doesn’t care about the distinctions between the Richardson and Perdue PACs.
“It’s beside the point,” he said. “We shouldn’t be setting up a system where money comes in in huge amounts and is simply spent for the benefit of the officeholder.”