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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Initiative sponsor Eyman could face campaign finance law charges

OLYMPIA – Perennial initiative sponsor Tim Eyman could find himself in court over charges he broke campaign finance laws for the way he moved money back and forth in previous initiative efforts.

Some of that money went to Eyman for his personal use, and the transactions were not properly reported under state campaign laws, Public Disclosure Commission investigators said. They recommended the state attorney general’s office start “appropriate legal action.”

Spokane City Councilman Mike Fagan and his father, Jack Fagan, Eyman’s Spokane-based partners in the political action committee Voters Want More Choices, didn’t know about the side deal Eyman had worked out with a signature-gathering organization to funnel money to a separate business named Tim Eyman, Watchdog for Taxpayers LLC, Eyman said.

“It was a business arrangement between me and – well, between my LLC and Citizen Solutions, and (the Fagans) are not members of that group,” he said during a deposition. Citizen Solutions is a company that pays people to collect the signatures to qualify initiatives for the ballot.

The deposition is contained in a staff analysis for two separate complaints against Eyman – some 224 pages of summary, sworn testimony and receipts – and paints a picture of a complicated series of payments among different organizations. Even though other officers in Voters Want More Choices didn’t know about the deal between Eyman and Citizen Solutions, the PAC could also face charges for violating campaign disclosure laws.

Eyman is the most public face of initiative campaigns the PAC mounts. But he isn’t allowed to keep the PAC’s books after a 2002 case banned him from serving as treasurer for any campaign committee because he had concealed payments to himself.

In 2012, Voters Want More Choices paid Citizen Solutions more than $623,000 to collect signatures for Initiative 1185, one of a series of ballot measures the group proposed over a decade that required the Legislature to pass tax increases with a two-thirds supermajority, the PDC report says. The Association for Washington Business, which functions as a state chamber of commerce, paid Citizen Solutions $450,000 and Washington Beer and Wine Wholesalers another $100,000. I-1185 qualified for the November ballot and passed, but the state Supreme Court later ruled it unconstitutional.

Signature gatherers were paid no more than $1.40 per signature, and Citizen Solutions made at least $2.10 per signature, or more than half the money it received, the PDC reported. Citizen Solutions paid Eyman about $308,000 for “consulting” work, which was deposited in a separate company called Tim Eyman, Watchdog for Taxpayers LLC.

Eyman told investigators he used some of that money for “personal family living expenses” and later loaned the rest, interest free, to Citizens in Charge, a conservative Virginia group. Citizens in Charge then funneled at least some of the money back into efforts to get signatures for a different ballot measure, Initiative 517, designed to protect signature-gathering efforts and give them more time to qualify for the ballot. It was eventually rejected by voters almost 2 to 1.

Eyman told investigators he received payments and made loans based on verbal agreements. The money from Citizen Solutions was for “services he would render in the future” directing sponsors of other initiatives its way, he said in a sworn statement. Eyman said he didn’t ask what Citizens in Charge would do with the money he loaned the group.

PDC investigators say the expenses that were reported as paying for signatures – but in fact were payments to Eyman – violate state disclosure laws.

Payments to him violate laws against personal use, they added.

The multiple violations are so serious the commission can’t levy adequate penalties, and the commission should send the matter to the attorney general’s office to take the case to court, they said.