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Thursday, March 30, 2006

Has the "clean money" fraud already begun?

Leave it to The Oregonian to get it exactly backward. Here one of its reporters uncovers apparent fraud in the City of Portland's new "clean money" public campaign finance system, and what do they lead their front-page editorial with? "New system working great -- really opening up the process."

Nonsense. Let's get to the real heart of the matter. Here's what the story reveals about Emilie Boyles's participation in the new taxpayer-financed system:

Nearly 950 of her seed donations came from Russian, Croatian and Slavic immigrants living in east Portland -- at least nine of whom say they don't recall contributing.

* * * * *

There's only one real requirement candidates hoping for public funding must meet: All their contributions must come from Portland residents. To verify that, city regulators pull almost a third of their donations and check addresses on www.portlandmaps.com.

Boyles passed with no problem. Yet in a quick, random survey of her donor list conducted in both English and Russian, nine people said they did not recall giving her money -- and seven said they did not recognize her name.

"I don't know who that is," said Ivan Pukay, who lives on Southeast 137th Avenue, when asked about Boyles. "I don't have work. My money is very low. When I have it, I keep it."

Alex Grainko and his wife are both listed, but he says he does not remember contributing: "How am I going to give money for someone I never heard of?"

Speaking through a translator, Mykola Chubay said someone appeared at his church seeking signatures for Boyles' campaign. But he does not recall whether he gave $5. He and another person from his household are listed as donors.

Aleksander Gorpinich, a 17-year-old high school student, also heard a pitch for Boyles at a church service. But he said he never donated to her campaign. Gorpinich said [Vladimir] Golovan [who gathered signatures and donations for Boyles] is his father.

In many cases, Golovan did the bulk of the work on Boyles' contribution sheets -- writing the donors' name, occupation and address. That's legal. But in some cases, husbands or wives appear to have signed for their spouses. And in a few instances, one person signed for an entire household -- an apparent violation.

What a mess.

I'm not necessarily opposed to the principle of public financing of political campaigns. I do strongly disagree wth the O's statement that it's opened up the process in Portland, for reasons I laid out here a while back, but getting the old West Hills money out of the political driver's seat in our municipal elections is not a bad goal.

The devil, of course, is in the details, and when you put a potentially decent idea into the hands of the Portland City Council -- particularly Commissioner Sten, the architect of the system as well as (surprise, surprise) one of its first three beneficiaries -- it's bound to get screwed up. Five-year-old kids signing, people signing for their spouses, candidates swearing they got cash contributions from people who have never heard of them -- it's a steaming pile of bureaucracy gone wild.

This program is to campaign finance reform what the city's water bureau billing system is to financial management.

If some of Emilie Boyles's signatures are from people who didn't give her $5 before she filed, she should not get a dime of taxpayer money. And somebody down at City Hall had better take a closer look at the veracity of her filings, before the scandal expands.

Where is the county district attorney? Where is the state attorney general? Where is the U.S. attorney?

And where is the City Council? Hey, Fireman Randy, why not take a break from your busy schedule of enforcing animal-related ordinances to take a tough stand on the enforcement of this set of rules? You've done the minks and the dogs -- what about the rats?

UPDATE, 3/31, 1:43 a.m.: It just gets weirder and weirder. Now candidate Lucinda Tate has filed at the 11th hour for "clean money," and she had the same guy that Boyles had (here he is pictured with another fine politician) out collecting alleged signatures and alleged cash contributions for her among the Slavic community. What a joke! Great job, Opie! Read the update here.

Comments (52)

Look on the positive side, as one Mr Burr said, now that poor Erik is not a slave to raising funds he will have more time to reach out to the common voter. Puh-leeze, he is in a deep rathole totally out of touch.

I would love to look at Erik's list of $5 people since I guess the only qualification is that you live (maybe I should say reside since you might be able to copy tombstones) in Portland.

I've looked at his list, and blogged about it here.

I wrote about this issue myself today. And in comments it was noted that part of this might be cultural. In former Soviet block states, you can get into serious trouble if you've supported the candidate that doesn't win. Not many people are willing to own up to supporting someone.

But even if that's not entirely the case for Boyles, I submit that this is a bump in the road to a better system.

I found the irony of the O getting statements from the likes of Jason Williams a much more bizarre thing than the whole issue surrounding Boyles.

you can get into serious trouble if you've supported the candidate that doesn't win. Not many people are willing to own up to supporting someone.

What a bunch of baloney.

If each and every person who signed didn't in fact give her $5, she doesn't get the taxpayers' $150K. It's that simple.

I don't think its appropriate or realistic to dismiss possible cultural issues as "baloney". Its a valid and very viable issue here.

If Boyles didn't validly get her money from those who signed in..fine. Yank it from her. But not before thoroughly checking it out and investigating it.

Its seems completely irresponsible to me to dismiss the cultural issue out of hand, however.

I think Carla and Jack are both right in a way.

Jack wrote:

If each and every person who signed didn't in fact give her $5, she doesn't get the taxpayers' $150K. It's that simple.

Agree -- the system is more important than any one candidate or campaign, and if they violated the rules, they shouldn't get a dime of Voter-Owned funds.

However, I think an investigation's appropriate -- which is not the same thing as guilty before proven innocent. If Boyles has legitimate supporters who were reluctant to publicly talk with a reporter from the Oregonian because of cultural reasons, fine. But if there were violations -- as the Oregonian implies -- then Boyles should not get VOE funds. Period. That's how the system was designed.

Many supporters of Voter-Owned Elections -- including the League of Women Voters -- are already publicly calling for this to be reviewed.

To put it in perspective, Bill Sizemore may have gamed our initiative system on a statewide level, but I certainly wouldn't want to abolish the ballot measure system b/c of one bad actor breaking the rules.

While you're investigating Boyles, of course, you have to investigate Sten and Fritz, too, right? More bureaucrat time spent. What a wonderful system. I can't wait to vote on it in November.

I completely agree that this should be looked at, and the system possibly tweaked if it's not responsive to problems that are found. That's exactly what the Citizen Campaign Commission is for - we don't need to bring the feds into it :-)

But I disagree that the article's headline is wrong. I think it's exactly right. Election dynamics have been changed. If VOE was not in effect, what we would see right now is:

- Dan would have salted away $200K or so and scared off any real opposition, as he did four years ago.

- Erik and Ginny would each be well on the way to raising $500K each, mostly in checks of $1000 and more.

Instead Dan has to engage in a campaign and be accountable for his record and Erik is scratching his head figuring out how to get his message out on $150K. It remains to be seen how much Ginny will spend.

I don't see how anyone can say there's been no impact.

Fritz would have run eventually anyway. Now Boyles may lose her money. But Sten gets a free campaign. Some impact.

Realistically, Amanda would have needed to wait for an open seat to have as much of an opportunity as she has now.

So what's more in the public interest - Erik with $150K in taxpayer money or Erik with $500K from special interests. I pick the former!

Come this time next year, this whole experiment will be a dim memory.

Well, to figure out all this mess, Portland's city attorney just needs to send in Secretary of State Bradbury. I'm sure he'll be as diligent as he has been with some other potential candiates on the other side of the political spectrum.

While you're investigating Boyles, of course, you have to investigate Sten and Fritz, too, right? More bureaucrat time spent.

It's not "bureaucratic time" to have the citizen campaign commission look into this, and I would be among the first to call for an investigation if Sten or Fritz faced credible allegations of fraud with their campaign's qualifying contributions.

This is a system with rules and safeguards. One candidate breaking those rules -- if that's the case -- doesn't mean the sytem is broken, it means she shouldn't get the benefits of the system if she isn't following the rules.

Charlie, are you going out with a Russian translator to interrogate the purported contributors? What is this, the volunteer fire department?

There may be rules -- very lax -- but at the moment I'm seeing no safeguards. Do local reporters now decide who gets "clean money"?

Just to be clear -- the citizen campaign commission -- should look into this, but so should the Auditor's office and the state. I'm not citizen on the commission, btw.

But another obvious safeguard -- the allegations we're talking about are criminal aren't they? This is basically voter fraud if proven, which would involve state law too.

One more thing: I compared this to Sizemore abusing our initiative system earlier. In that episode, it was private citizens raising questions about his petitions at first, not the Secretary of State. But to their credit, investigators from the state of pursued the issues raised and of course found profound violations.

Its seems completely irresponsible to me to dismiss the cultural issue out of hand, however.

Agreed. And these same folk who are "afraid to acknowledge" their signing a petition of support and paying five dollars...they wouldn't be intimidated by the head of the Russian Chamber of Commerce telling them --excuse me, asking them-- to sign this petition. "You don't even need to write in your name, Comrade...we've done it all for you! We who can get you jobs, social services..."

C'mon folks...this guys SON doesn't know who the candidate is.

If we're defending Voter Owned Elections, let's not turn into pathetic apologists for what seems a little dubious. That puts a stain on this effort. Let's put the checks and balances into play, and do a little more investigative work then just sitting back and blame the commies.

IMO....clean money/VOE was fraudulent when conceived. Silly then (and a fraud), blatantly abused and more a fraud now. Leaderless Portland, stumbling...bumbling along....awaiting Blind Tommy's "vision". What a pathetic mess.

Forget VOE - what a sick joke in the first place. I say we just set up pinball games, and have all comers take them on. Whoever gets the highest score gets $150k for the campaign. The best pinball wizard wins, and taxpayers save a bundle. To ensure that the competition is fair, we just put the Oregon Lottery Commission in charge of the event.

If each and every person who signed didn't in fact give her $5, she doesn't get the taxpayers' $150K. It's that simple.

But Jack, that would build in the world's easiest way to sink a prospective opponent's campaign: get a handful of people to contribute money, and then if they are asked after the fact they can deny that they've ever heard of him/her.

Isn't that what receipts and signatures are for?

When this was sold, there was talk of a requirement of 1,000 $5 "checks." Once they changed the tune and said cash would be good, the whole thing became a cesspool.

This pipedream needs a quick interment, just like the city takeover of PGE, the reservoir covers, regionalizing Bull Run, and all the other recent City Hall blunders. Too bad the downtown power set screwed up the repeal petitions for May. They should have no problem for November after this fiasco.

The clean election system is a scam because it takes organization to convince 1000 residents to cough up $5 each. So, an individual running for office will generally have to rely on some group (immigrants in Boyles' case) to assist the candidate in collecting the requisite number of donors. This group will have some inherent interest, like unions, churches, industries of various kinds, or activists.

So, instead of a candidate accepting $100K from various sources that have to be disclosed on the requisite forms, elected officials can now rely on one group to essentially raise $155,000 ($5000 in donations and $150K in tax grants). Except, now the group organizing the donation collections is a step removed from the process and it does not have to disclose its existence.

To add insult to injury, the interest group leverages our tax money to support its cause.


So, do the rules and safeguards prevent me from paying every "contributor" $20 for their $5 check so I can get at the $150,000? I think I could find 1000 people willing to do that. I'm also sure I could find someone friendly to run my campaign so I'd get the difference back from their fees. Sounds like almost-free money.

I can see having a check-off on a tax bill so I could voluntarily contribute to public financing--and I might--but I have no interest at all in being compelled to fund this nonsense. It's not like there's been much responsible spending in the past.

I'm repulsed by siding with those who tried to repeal this, but cannot side with its supporters, either.

It may be too late to get the money back from Boyles. It looks like $144,095 in tax money has already been disbursed to her.

Travis, what interest group is Amanda Fritz, political genius, beholden to?

Jack, there's an allegation that Boyles broke the rules. That doesn't make the whole system a "fiasco" -- it means that she should not be entitled to the money if guilty. And she should get a good lawyer.

OK, last comment here, but I don't think so Jack. It's a little apples and oranges, but remember when Sizemore was convicted, he had to repay OEA's total campaign expenditures. So, if Boyles violated the system but already spent the money, seems she'd still be on the hook to repay the funds. That's my guess -- Im not the expert on this.

"And in comments it was noted that part of this might be cultural. In former Soviet block states, you can get into serious trouble if you've supported the candidate that doesn't win. Not many people are willing to own up to supporting someone"

This is cultural hyperbole...inaccurate, stereotypical, and baloney.

Unless, of course, the US received all the wimps.

Do you think she has $140K lying around to repay? If she's already spent it, good luck getting it back.

It's a "fiasco" already, Charlie, because it's clear that the "system" doesn't work. Already someone is being accused of cheating, and the city has no resources to determine whether it's true. The rules as drafted are ludicrous, and enforcement of what little rules there are is equally laughable. "We checked a third of the addresses on PortlandMaps, to see if there are really houses there." That's it, before you hand someone $150K of scarce tax dollars? Typical Portland. Typical Sten.


I really don't know and that is the problem. But I would be interested to learn how many nurses donated. A quick view of her website shows quite a few "RN" supporters as well as the Oregon Nurses Association, ie: Nurses Union.

I have no problem with people getting their $5's from organized groups like unions. But I do have a big problem with a candidate saying that someone gave them money, and that person saying he or she didn't. And cash contributions should be absolutely forbidden.

Of course, there's also the matter of Sten taking 300 grand (and counting) for himself without a public vote. What a sick joke. Only in Portland.

Jack, let's keep the numbers straight. Erik has received $150K so far. How much more he may receive will depend on how Ginny's fundraising and the primary play out.

Ahem, I think there's little doubt that there will be a runoff, and that Opie will be in it.

"I have no problem with people getting their $5's from organized groups like unions."

I do but not because it is a union. I believe the Nurses Association is a pretty well run organization and I would have no problem with it donating a sizable chuck of money to Amanda Fritz.

But fundamentally the system allows the union to significantly contribute to a $155,000 campaign by raising only a fraction of that amount and leveraging the balance with tax revenue.

And what if, in the extreme, a group of donors comes from some organization you don't agree with, like an evangelical group, supremacy organization, OSPRIG, anti-WTO group, whatever. I do not want tax money to be used by some fringe group on the right or left to have a $150,000 platform simply because it can organize 1000 people to donate $5.

The myth that this idea is founded upon is that 1000 donations will diversify interest, when in reality it will simply substitute one interest for another, whether it is the West Hills crowd or a crowd whose platform is that bottled water violates human rights.

a crowd whose platform is that bottled water violates human rights.

Please leave OSPIRG out of this.

My question is why didn't more people do this? You'd think the Voodoo Doughnut Boys have 1,000 customers come into their shop easy over the course of a few weeks - and half of them are drunk. Strike that, three quarters. (But many are probably from the suburbs)

But anyway, how hard would it have been to ask customers who are three sheets to the wind to add a $5 voter pledge to their order? Any restrictions on being full of liquor (or donuts) to this law?

Ah, heck. Let's just keep things the way they always were. Gosh, why are people always screwing around trying to change things?

Jeez- I mean, they're not called the "political elite" for nothin'. How are the politicla elite going to continue making laws and imposing rules & regulations if the uninformed rabble take the ability to frame & fund campaigns away from them?

What Portland needs is a good ol' Boss. Potter just aint cutting it....

Goldschmidt was much better in the Richard Dailey role.

I've been as open, transparent, and accountable as humanly possible in this first run of the Campaign Finance Fund system. So I'll answer some of the questions/comments posed above, from my unique experience as the first to qualify.

Overall, whatever happened to "innocent until proven guilty", folks? Hasn't the tram [rimshot] saga taught you there may be more to a story than is printed in The Oregonian?

Charlie Burr and others - If found guilty of fraud or otherwise disqualified (e.g. for accepting donations after being certified), the candidate has to pay back all the money. Each candidate signs a statement declaring understanding of that expectation, before being allowed to start collecting.

Jack, I was planning to run in this election, with or without VOE. Without VOE, I doubt I would still be in the race. The ability to call people to ask them for money for a political race, even $5 let alone $5000 or $25,000, is not a skill I value nor one I wish to improve at, and certainly not one I'm willing to pursue for six months or a year. So if you believe my candidacy may have some value for Portland, please consider VOE as a real factor in allowing those who care about people to run.

Travis - I think it was about 60 nurses who donated to help me qualify. Many of those are community members I know through neighborhood work rather than my OHSU colleagues. The largest demographic group (for occupation) donating to my campaign was retired people at about 175, then teachers/educators at 70-ish and parent/volunteers at about 65. Unions aren't allowed to give on behalf of their members - it has to be individuals who donate and sign at the same time.

Tom R - Don Smith tried paying people to donate, and wasn't able to get to 1000.

Sirajul - Michael Casper is a bartender who thought it would be easy, and now realizes it isn't. And the donut boys weren't able to do it either, which I think was your point.

VOE reminds me of Churchill's quote on democracy -it's the worst system except for all the others that have been tried. The alternative is the traditional system where rich people and companies shell out up to $25,000 in anticipation of the Council votes that will return the investment into their coffers. And that costs taxpayers far more than the current VOE system, even with its start-up flaws that can be corrected as they're discovered.

Amanda, in two hours you and I could have sat down and written a system that would have been so much better than this clunker. Cash contributions, no age limit, no voter registration requirement, no meaningful verification of anything -- it's just more half-baked Sten cell research.

This thing needs a complete rewrite, a property tax checkoff, and a popular vote. Given what a lousy job was done with it, it will fail at the polls when it's voted on -- presumably in November. That is, if the big money that everyone's so afraid of can manage to avoid shooting itself in the face again.

I am glad you have a legitimate chance to unseat What's-His-Name, but it looks to me as though you will be one of two people who ever get "clean money," and the other will be Mr. Sten himself.

On another note, it looks as though Tate and Nasset will not have any real money, and so your race will likely be decided in May. You've got only a few more weeks to pull into first place. I wish you luck.

I heard that Tate just turned in her signatures. So she may end up being another VOE candidate as well.

Yes, but she used the same guy that Boyles did to collect a good number of them, and I'm sure he used the same, ahem, fundraising "techniques."

You have to do more than get signatures -- you have to get a $5 contribution from each person who signed.

Amanda Fritz at March 31, 2006 12:33 AMThe alternative is the traditional system where rich people and companies shell out up to $25,000 in anticipation of the Council votes that will return the investment into their coffers. And that costs taxpayers far more than the current VOE system, even with its start-up flaws that can be corrected as they're discovered.
JK: I would like see us to consider a system where if you donate to a campaign, you donít get any city money in any form for any purpose, including employment, welfare, contracts, sales, purchases, low interest loans, real estate at other that appraised value, tax breaks, UR etc. Of course I think there is a, mostly ignored, constitution clause about spending to benefit any person.


So they dont have to verify signatures or that they are even registered voters?? (One would think the latter would be a major requirement, just like the intiative process.)

Gee, whoodathunk there would be fraud?

And here I heard it was only the GOP that dabbled in campaign fraud.

Overall, whatever happened to "innocent until proven guilty", folks?

Thats only in a court of law, not public opinion..

I don't think the Citizen's Commission was appointed with the intent of policing this system, just monitoring it and making recommendations for the future.

To suddenly dump a major investigation like this on a newly appointed commission is problematic.

"Major investigation"? I hope so. But now that Sten's got his money, I suspect City Hall couldn't care less.

Who's Richard Dailey?

And Goldschmidt is exactly what I'm talking about! We need somebody like him- or, rather, him and his various protegees to settle into entrenched political power for decades to come.

Sheesh. VOE just throws a wrench into a system that worked beautifully!

Who's Richard Dailey?

Mayor of Chicago during the 1968 Chicago Democratic convention --and police riots--famously mouthing "f*** you" at, well, I can't remember (hey, I was 17) when someone FINALLY protested from the podium of the convention that cops were beating the crap out of protesters against the war.

One of those ward bosses of days of old who got out the deceased vote for the democratic party machine. His son, Daley Jr --I think that's the proper spelling-- followed him into office.

Ah...the good ol' days of boss/machine politics, when you knew whose palm to grease when you wanted to get something done!

You are correct, it's spelled Daley.

Dear Amanda:

Good counterexample re Don Smith, but it doesn't patch the obvious holes in the system.

Of course I hope that all participants are as altruistic and forthcoming as you are, but recent events seem to contradict that rosy hope.

Best of luck in your campaign,

Tom R.

Yes, I knew who Richard Daley was.

Glad to see that everyone agrees that we need to keep Goldscmidt's crew or Gard & Gerber's big-money clients to run Portland for the next few decades...

Scrap VOE! Let big money & the political elite assert their rightful place once again!


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