OLYMPIA — Initiative promoter Tim Eyman broke state law for years by hiding the source of nearly $800,000 he raised to fund his political activities, a Thurston County Superior Court judge ruled Friday.
Judge James Dixon concluded Eyman failed to report $766,447 collected between September 2012 and July 2018 to compensate himself while conducting one initiative campaign after another.
He rejected Eyman’s contention the money was gifts from family, friends and political allies to defray his and his family’s living expenses.
Rather, the judge ruled it is “undisputed fact” that Eyman “has an expectation of receiving funds toward electoral goals,” which makes him a “continuing political committee,” under definitions in the state’s Fair Campaign Practices Act.
As such, Eyman needed to register as a committee and file regular reports of contributions and expenditures. Friday’s ruling says Eyman had failed to file a combined 110 monthly reports and those were a combined 173,862 days late.
There’s now a potential for a huge fine. A penalty of $10 a day can be assessed for each day a required report is late. It could climb to $30 if a judge deems the violation to be intentional. A penalty of up to $10,000 for each missed monthly report can be assessed as well, according to the attorney general’s office. And there’s the potential for an additional penalty equal to the concealed amount, $766,447.
Friday’s ruling is a branch of a 2017 civil lawsuit in which Attorney General Bob Ferguson accused Eyman of secretly moving campaign funds between two initiatives in 2012 and receiving a $308,185 kickback from one of the signature-gathering vendors.
Ferguson sought $2.1 million in penalties and to bar Eyman from managing, controlling, negotiating or directing financial transactions of any kind for any political committee in the future. Eyman has been in contempt of court for an extended period for not turning over information and is racking up daily monetary sanctions as a result. A trial is set for July.
The issue of unreported donations emerged in January 2019. That’s when Dixon allowed state attorneys to amend the original lawsuit to add new allegations that Eyman employed “a wide variety of schemes to solicit and collect funds that should have been reported as contributions.” Attorneys said Eyman offered supporters different ways to assist him financially including making direct gifts to him.
Bellevue developer Kemper Freeman is one who did. Freeman, in a deposition, said he made “three or four” payments of $10,000 to support Eyman’s work on initiatives which he described as “Ten for Tim.”
“He puts his whole life into what he does passing these initiatives and tells me that he’s short on grocery money and literally just traditional family expenses, and I’ve seen him work, I believe that’s true, and I’ve helped him,” Freeman said.
In September, Dixon ruled Eyman needed to reveal the names of those like Freeman who had been plying him with money since 2012.
“The law requires that all contributions be reported to the public at the time they are made. He ignored the law, and shielded his contributors from public view,” Ferguson said at the time. “Translation — this means that Tim Eyman concealed more than $766,000 in campaign contributions and the state can and will seek additional penalties for every day he fails to report them.”
This July, when the original suit goes to trial, Dixon will decide what, if any, penalties to levy for the late reports.
Meanwhile, on Friday, Eyman, who is now running for governor, and his attorney, Richard Sanders, sharply criticized the ruling.
It’s just “plain weird,” Eyman wrote in an email to supporters. “AG & judge say that I, Tim Eyman, am a PAC. It’s absurd.”
In an interview, Sanders said, “Mr. Eyman solicited money to pay his family and personal expenses and that’s what he spent it on. Eventually I am going to get this turned around.”
Sanders said the conclusion that his client is a ‘continuing political committee’ — a point argued by state attorneys — is an “obvious constitutional violation. By their logic, Martin Luther King would have been a political committee.
“The objective behind this is to destroy the governor and the attorney general’s political opposition,” Sanders said. “In the long run, they don’t have a leg to stand on.”
In a press release, the Attorney General’s Office notes that in 2002 the Public Disclosure Commission advised Eyman in writing that donations, such as for personal living expenses, “designed to enable you to continue your efforts of supporting initiatives” were political contributions subject to disclosure.
“Eyman is being held in contempt of court — and today’s ruling reveals his contempt for our campaign finance laws,” Ferguson said Friday. “Eyman will say anything to avoid accountability for his conduct, but his lies won’t work in a courtroom.”