Ga. officials’ campaign reports don’t add up

AJC finds major and minor errors in campaign reports of 10 of 12 officials surveyed.

When state lawmakers approved Georgia’s campaign finance law, they said they wanted to protect the integrity of the democratic process and give voters easy access to information about the finances of candidates for public office.

To that end, the law requires candidates to report every penny they raise and spend, allowing the public to monitor an election system awash in cash often intended to curry favor with politicians. But an Atlanta Journal-Constitution investigation has found many of those reports may not be worth the paper they’re printed on.

A review of hundreds of financial reports filed by a dozen state and local officials over the last decade found numerous mistakes and discrepancies — some leaving tens of thousands of dollars in campaign cash seemingly unaccounted for. Lt. Gov. Casey Cagle, for example, reported having $53,331 more in his campaign account than he should, given his reported contributions and expenditures since 2006, the newspaper found.

House Speaker David Ralston, R-Blue Ridge, apparently committed a series of mistakes that led to a $21,508 discrepancy in his campaign records. Other accounting errors uncovered by the newspaper range from a few cents to thousands of dollars.

Gov. Nathan Deal, former Democratic state Sen. Jason Carter, House Minority leader Stacey Abrams, D-Atlanta, and Senate Democratic leader Steve Henson, D-Tucker, were the other state officials whose campaign records didn’t add up, while county commission chairmen in Fulton, Gwinnett, Cobb and Cherokee counties also had accounting issues. Among the public officials examined, only Atlanta Mayor Kasim Reed and DeKalb interim CEO Lee May had completely clean reports, the newspaper found.

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The AJC analysis does not prove that campaign money is missing or that it was used for improper purposes. Many of the problems likely boil down to sloppy paperwork or bad math.

But the newspaper’s findings suggest voters can’t trust reports that are supposed to give them an accurate picture of candidates’ finances. And they show elected officials who oversee billions of dollars in public spending can’t seem to balance their own checkbooks.

The findings echo those of the state ethics commission, which began random audits of campaign disclosures this year. The agency found significant problems — like failing to file reports, filing late or failure to disclose contributor information — in 31 of the 53 audits it’s done so far. That’s nearly 60 percent.

Government watchdogs say inaccurate campaign records are a widespread problem that should alarm Georgia residents.

“If a candidate for office can’t accurately complete their campaign finance disclosure, that should be a huge red flag that they probably aren’t up to par for the job,” said Clint Murphy, chairman of Common Cause Georgia.

After the AJC asked about discrepancies on campaign reports, some of the public officials said they’re auditing their records and will file amended reports, if necessary. Some acknowledged mistakes and pledged to do better.

“In terms of our campaign, my direction will continue to be what it has always has been: do our best to avoid mistakes and correct them promptly if they occur,” Cagle said in a statement issued by his attorney.

Watchdogs and some public officials said some simple changes — like more frequent audits and requiring candidates to file bank statements along with their campaign reports — would go a long way toward ensuring the records are accurate.

Minor and major errors

The Georgia Government Transparency and Campaign Finance Act requires candidates to file regular reports disclosing the contributions they receive, the money they spend and the cash their campaigns have in the bank.

Lawmakers amended the law in 2013, limiting gifts from lobbyists and changing campaign disclosure requirements. Gov. Deal hailed the moves as “a major step in improving ethics, trust and transparency in our state.”

But the newspaper’s investigation casts doubt on how transparent the state’s campaign finance system really is.

The AJC reviewed campaign reports for six state and six local elected officials, including an equal number of Republicans and Democrats. The review included 291 reports filed as far back as 2006, depending on the candidate.

The newspaper checked the basic math on each campaign report, as well as the running tallies of contributions, expenditures and cash on hand from report to report. The AJC found apparent mistakes in the reports of 10 of the 12 officials examined.

Many were minor. For example, in 2011 Gov. Deal reported having about $397 more in his campaign account than he should have, given his reported contributions and expenditures. Deal’s attorney, Randy Evans, said the difference is the result of a state audit of the governor’s campaign records and some adjustments that followed. He noted the discrepancy is a tiny fraction of the millions of dollars the campaign has raised in recent years.

Other discrepancies were substantial.

In 2007 and 2008, Ralston apparently carried over incorrect contribution figures from previous reports. The result: he reported having $21,508 less in the bank than he should have, given his reported contributions and expenditures. The discrepancy was not explained on subsequent reports, and seven years later his reported cash balance remains questionable.

In response to questions, Ralston’s press secretary issued a statement: “The records in question date back nearly a decade and will take some time to review thoroughly. Once a review is conducted, Speaker Ralston will address any issues that are identified.”

Likewise, Cagle’s June and December 2008 campaign disclosures contain contribution and expenditure numbers that don’t match his previous reports. The result: he reported having $53,331 more in cash on hand than he should have if his previous reports were accurate.

Cagle’s attorney, Anne Lewis, said the problem is those previous reports weren’t accurate. She said his campaign had under-reported expenditures, primarily during 2005 and 2006.

Lewis said that a few years ago Cagle’s campaign staff tried to reconcile his campaign bank records to past disclosure reports. As a result, he filed five years’ worth of amended reports in January 2014.

Lewis said the reports filed since then are accurate. As evidence, she provided a copy of a recent bank statement that shows an ending balance that’s just $390 off from Cagle’s most recent campaign disclosure report for the same month.

But the reports prior to 2008 remain uncorrected. Lewis said that explains the discrepancy uncovered by the AJC. She attributed the erroneous reports to the inexperience of Cagle’s campaign during his first run for lieutenant governor in 2006.

“First-time statewide campaigns sometimes do not have the best accounting and compliance processes in place and that was the case here,” she said.

Lewis said the campaign has since “made several changes to ensure compliance, including investing in software, consulting regularly with an attorney and an accountant and putting specific processes in place for review of all filings by multiple individuals.”

‘Unintentional human error’

Some officials said disclosure requirements can be difficult or complicated. Fulton County Commission Chairman John Eaves said such mistakes are “inexcusable, but understandable.”

“I don’t know if people realize how difficult it is to be in public office, and all the demands,” Eaves said. “There is a tendency to be slack in some areas (like) campaign reporting. There’s a tendency to be slack because you’ve got so many things you have to juggle.”

The newspaper found a discrepancy of nearly $13,000 in Eaves’ campaign account, the result of apparent errors in reports from 2011 and 2014. Eaves said he’s hired an accounting firm to correct any mistakes and file amended reports.

“I balance my checkbook a whole lot better than I do this other stuff,” Eaves said. “I didn’t take any money, even if there’s some bad reporting. I may look bad, but I’m not going to go to jail.”

The AJC found a $2,833 discrepancy in Cobb County Chairman Tim Lee’s campaign reports dating to 2012. He attributed it to “unintentional human error” and has filed numerous amended reports since the AJC inquired about his campaign finances.

In an email, Lee said the “constant changing of the process in which local elected officials file reports (from filing online with the state to handwritten reports with the county and now to online reports with the county) has, as you can imagine, complicated things and resulted in these issues.”

William Perry, president of Georgia Ethics Watchdogs, said candidates have been sloppy and sometimes dishonest because they knew no one was paying attention.

“I think it gets messed up so much because there hasn’t been any sort of auditing on it,” Perry said. “There isn’t any sort of accountability.”

The Georgia Government Transparency and Campaign Finance Commission is supposed to ensure the accuracy of campaign reports through regular audits. But in recent years the agency has been so underfunded and dysfunctional that is had audited almost nothing, Perry said.

Regular audits needed

That may be changing. This year the General Assembly nearly doubled the commission’s budget to $2.6 million, allowing the agency to hire four attorneys and four investigators. The commission also hired a new executive director, Stefan Ritter, who has pursued some high-profile investigations.

After the AJC, the Georgia News Lab and Channel 2 Action News reported that former Fulton County Commissioner Bill Edwards could not account for $80,000 in campaign cash earlier this year, the commission launched an investigation, which is still pending.

The commission also is investigating former Insurance Commissioner John Oxendine after the AJC reported he had failed to return hundreds of thousands of dollars in contributions for a failed gubernatorial campaign, as required by state law.

Ritter said he’s not surprised by the AJC’s findings. He said the commission has begun random audits on campaign disclosure reports. But he wants to develop a computerized system that will automatically search campaign reports for accounting discrepancies.

In addition to regular audits, Perry said the state should require candidates to file bank statements to support the cash balances reported in their campaign disclosures.

Cagle said he’d support such a change. He also favors a “safe harbor” provision that would allow campaigns to report past errors without penalty.

“We’ve made significant progress at improving our ethics structure in Georgia over the past several years,” Cagle said in his emailed statement. “The most important step we can take is continuing to ensure the ethics commission has adequate funding and staff to perform its mission.”

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