Franz, Hilary - Alleged Violation of RCW 42.17A.235, .240, .710 for failure to timely and accurately disclose contributions, expenditures, debt, offices held.

Case

#21353

Respondent

Hilary Franz

Complainant

Glen Morgan

Description

The Public Disclosure Commission (PDC) has completed its review of the complaint filed by Glen Morgan on June 25, 2017. The complaint alleged that Hilary Franz, a 2016 candidate for the office of Washington State Commissioner of Public Lands, may have violated Chapter 42.17A RCW as detailed below. 
PDC staff reviewed the allegations; the applicable statutes, rules, and reporting requirements; the responses provided by Dmitri Iglitzin, an attorney with Barnard, Iglitzin, Lavitt, LLP, on behalf of the Hilary Franz Campaign; queried the Respondent’s data in the PDC contribution and expenditure database; and reviewed the Candidate Registrations (C-1 reports), Monetary Contributions reports (C-3 reports), and Summary Full Campaign Contribution and Expenditure reports (C-4 reports) filed by the 2016 Friends of Hilary Franz (Campaign) to determine whether the record supports a finding of one or more violations. 

As noted in the letters dismissing this case, several the allegations listed in the complaint concerned information disclosed on amended C-3 and C-4 reports filed by the Campaign.  Staff’s review of the initial and amended C-3 and C-4 reports filed by the Campaign confirmed the Campaign made a good faith effort to comply with the statutes, rules and reporting requirements for the 2016 election.  The Campaign filed 11 amended C-3 reports and 15 amended C-4 reports during the 2016 election cycle, demonstrating a good faith effort to provide additional and/or updated disclosure information as the Campaign became aware of it. 

Staff found there were expenditures made by the Campaign, either as reimbursements to individuals or volunteers, or payments made to a consultant or vendor for which it appears a more detailed description and/or a sub-vendor breakdown likely should have been disclosed.  Staff also identified expenditures made by the Campaign where the run dates for political advertisements and the number of brochures or letters printed should have been disclosed. 

At the request of PDC staff, the Campaign amended their reports to provide additional detailed disclosures and bring the 2016 Campaign into compliance, which included filing amended C-4 reports disclosing the run dates and the number of items printed for political advertising expenditures.  Staff would classify these issues as reporting discrepancies which are minor or technical in nature, and do not believe the violations rise to the level of any enforcement action. 

Staff would note that the Campaign took corrective action once they were notified and became aware of this issue.  The two expenditures are minor in proportion to the overall contribution and expenditure activities undertaken by the Campaign and the two political party committees during the 2016 election and did not materially impact the public interest. 

The issues in this matter are mitigated by the fact that the Campaign: (1) was in frequent contact with PDC staff throughout the 2016 election in order to comply with the reporting requirements; (2) timely filed the overwhelming majority of the initially filed C-3 and C-4 reports, including the 21-Day and 7-Day Pre-Primary and General Election C-4 reports; and (3) disclosed receiving more than $530,000 in contributions received and expenditures made for a statewide elected office. 

PDC staff found no evidence of a violation that would require conducting a more formal investigation into the complaint or pursuing enforcement action in this instance. However, staff has reminded the Campaign to provide a more detailed breakdown for expenditures made to reimburse individuals or payments made to consultants or vendors, including the number of items printed for political advertising, and to pay only the actual cost of goods or services for any events sponsored by other candidates or political committees in the future. In addition, please be aware of the changes to the disclosure of debt and other reporting requirements as part of the passage of ESHB 2938 (2018).  

Based on this information, the PDC finds that no further action is warranted and has dismissed this matter in accordance with RCW 42.17A.755(1). 
 

Disposition

Case Closed with Reminder

Date Opened

July 05, 2017

Areas of Law

RCW 42.17A.205, RCW 42.17A.235, RCW 42.17A.240, RCW 42.17A.430, RCW 42.17A.710

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