American Federation of State, County and Municipal Employees Special Account (2): Alleged violations of RCW 42.17A.250 for failure to timely and accurately report as an out-of-state political committee (Oct 19)

Case

#59678

Respondent

American Federation of State, County and Municipal Employees/Special Account

Complainant

Freedom Foundation (Maxford Nelsen)

Description

A complaint was filed against American Federation of State, County and Municipal Employees, AFL-CIO Special Account (AFSCME Special Account). The complaint alleged that AFSCME Special Account, a separate segregated fund registered with the Internal Revenue Service as a 527 political organization, may have violated RCW 42.17A.250 by failing to timely and accurately file Out-of-State Political Committee Campaign Finance Reports (C-5 reports) disclosing contributions made to Washington State Candidates and Political Committees during calendar years 2014 to 2018.

An earlier complaint was filed on July 3, 2019 against AFSMCE Special Account (PDC Case 54145) that provided copies of AFSCME’s 8872 forms filed with the IRS as a 527 segregated fund, alleging that the C-5 reports filed by AFSCME Special Account for calendar years 2014 through 2018, failed to disclose all contribution and expenditure activities undertaken by the committee on the C-5 reports.

AFSCME Special Account legal counsel stated that on October 4, 2019, the PDC and AFSMCE executed a stipulated agreement in Case No. 54145, acknowledging violations of RCW 42.17A.250 were committed by AFSCME Special Account for failing to timely and accurately file C-5 Reports that included a $5,250 civil penalty being assessed, of which $2,000 was suspended on several conditions, and “AFSCME tendered payment of the other $3,250 on October 7.”

Counsel stated the Freedom Foundation “filed a new complaint, alleging that AFSCME failed to timely file the same C-5 reports disclosing additional transfers made from AFSCME International to AFSMCE Special Account in calendar years 2014 and 2016. While none of the additional transfers included funds spent in Washington State, she noted that all of the new allegations “were either indirectly contemplated by, or were addressed directly in, the final order in Case No. 54145.”

Staff’s review of the facts found that: (1) the late reported contributions received and disclosed on the December 3, 2019 amended C-5 reports were transfers from AFSCME International to AFSCME’s Special (segregated) Account made in calendar years 2014 and 2016; (2) the 2014 late reported transfers were beyond the five-year statute of limitations for PDC action; (3) of the total funds transferred from AFSCME International AFSCME to Special Account for calendar years 2014 through 2018, $790,000 was disclosed as being spent to make contributions to Washington State candidates and political committees, which represented less than one percent of all funds transferred ; and (4) AFSCME took prompt corrective action by filing the amended reports when their noncompliance was brought to their attention by your complaint, and after conducting an internal audit.

Based on these findings, staff has determined that the issues raised in the complaint were previously resolved by the Commission pursuant to Case No. 54145, and this complaint does not raise new issues warranting further investigation. The PDC has dismissed the complaint in accordance with RCW 42.17A.755(1).

Disposition

Case Closed with No Evidence of Violations

Date Opened

November 04, 2019

Areas of Law

RCW 42.17A.250