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COUNTY SCHOOLS

Panel hears testimony in campaign finance report complaint

Tom Klein
Posted 3/4/15

REGIONAL - A three-judge panel at the Office of Administrative Hearings heard testimony on Feb. 25 on whether St. Louis County School District Business Manager Kim Johnson failed to file a proper …

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COUNTY SCHOOLS

Panel hears testimony in campaign finance report complaint

Posted

REGIONAL - A three-judge panel at the Office of Administrative Hearings heard testimony on Feb. 25 on whether St. Louis County School District Business Manager Kim Johnson failed to file a proper campaign finance report, as ordered by a previous panel of administrative law judges last May.

The matter came before the OAH yet again following the filing of a new complaint by former Tower Mayor Steve Abrahamson and Tim Kotzian, who had co-signed the original complaint that led to the court order requiring the district to file a campaign finance report. The complainants and Timberjay publisher Marshall Helmberger had repeatedly asked the district to file an amended report (and avoid another hearing), but were unsuccessful in convincing school officials to take that course.

“The whole thing was entirely avoidable,” said Helmberger, who testified at the Feb. 25 hearing. “The concerns we have raised about the report are valid and we’re confident that the OAH panel will agree. Why the school district chose to go to court rather than simply provide full disclosure of how they spent our tax dollars is beyond me.”

St. Louis County School District Superintendent Steve Sallee did not respond to phone and email messages seeking his comments on the hearing.

In May, an OAH panel had ordered the district to file the campaign finance report after concluding that the district had waged a one-sided and misleading campaign to win passage of its 2009 bond referendum. Having done so, the panel concluded that the school district had acted as a campaign committee, and was subject to the same reporting requirements as any other campaign. The panel gave the district until Aug. 30, 2014, to file the report. The report, which Johnson officially filed on Sept. 22, listed no contributions or any source of funding, and listed approximately $12,500 in expenditures.

State law requires campaign committees to report all contributions, including cash and services, as well as all disbursements.

But at last week’s hearing, Business Manager Kim Johnson testified that she reported only those expenses that she and representatives from Johnson Controls Inc. deemed to be directly “promotional,” and excluded other related expenses. She acknowledged listing no contributions, having determined that since the campaign funds came from the school district’s general fund that those dollars did not need to be reported.

State law defines a campaign contribution as “anything of monetary value that is given or loaned to a candidate or committee for a political purpose.”

Helmberger, testifying on behalf of the complainants, argued that by directing school district funds to the campaign effort, the district clearly contributed funds to the campaign committee. In addition, he cited invoices from Greenfield Communications, which assisted the school district campaign under a contract between the school district and Johnson Controls, noting that the company had documented more than $4,000 in services that were never billed to the district. Helmberger testified that by providing such services at no cost, JCI had made an in-kind contribution to the school district’s campaign, which was never reported.

In addition, Helmberger testified to thousands of dollars in Greenfield services included on the invoices for which the district was charged, but Johnson had never reported. Those services included developing school district talking points on the referendum, producing brochures, ghost-writing editorials for school officials, and campaign planning. Helmberger testified that such services were plainly related to the school district’s campaign effort.

Helmberger also cited work done by a polling firm, Decision Resources, as well as the political consulting firm, Himle-Horner. Helmberger testified that the poll, conducted in August 2009, was used by the school district to gauge public responses to various arguments in favor of the referendum and resulted in strategic communications recommendations included in a 26-page report presented by Himle-Horner and JCI. Johnson’s report makes no mention of the costs associated with the polling or the consultant’s report.

All of the campaign work was completed under a Phase III contract signed by the school district and JCI in the summer of 2009. The $300,000 contract included $58,000 for “communications” work related to the referendum, which complainants argue should all have been included in the campaign report.

Throughout the hearing, school officials argued that they were unclear about their reporting requirements, given that no school district had previously had to file a campaign finance report. Johnson said she had contacted the Secretary of State’s Office as well as the Campaign Finance and Public Disclosure Board about their report, but that neither state office was authorized to provide any guidance.

Johnson said she determined that the report should include only “promotional” items, such as newsletters or brochures, based on the guidance included in the original OAH panel decision.

But school officials struggled to identify where in that decision the original panel had suggested that the campaign report should be limited in such a way. The actual order from the OAH panel stated that the school district was reprimanded for failing to file the campaign report and that it had until Aug. 30 to produce the required document.

Helmberger testified that campaign finance reports must include all expenses, and that routine costs such as office expenses, travel costs, polling, political consultants, and salaries and benefits for any paid staff, are all routinely reported by political campaigns.

Throughout the hearing, school officials and their attorney John Colosimo suggested that Helmberger was simply harboring a grudge against the school district, citing editorials and news reports that were critical of the school district’s actions, and one that called for Johnson to be fired.

But a large number of emails, included by both sides in their exhibits in the case, suggest it was Johnson’s unwillingness to amend her report to address concerns raised by Helmberger and the complainants that ultimately led to the complaint.

Indeed, Superintendent Sallee, who was hired as superintendent just last summer, testified that he first learned of the court- ordered report from a meeting with Helmberger last August. At the time, Helmberger had urged Sallee to ensure that the report was complete so that the longstanding legal case could be concluded.

When Johnson’s report was filed, Helmberger contacted Sallee and some board members by email, outlining specific concerns and urging that the report be amended to include all the necessary expenditures and contributions. Helmberger also sent Sallee a copy of the campaign handbook published by the Secretary of State, which provides guidance on campaign finance reporting obligations.

Abrahamson and Kotzian followed up those concerns with a letter to the superintendent in late September, again outlining the report’s deficiencies and seeking an amendment. In a response, school district attorney John Colosimo dismissed the concerns and suggested that complainants take the matter up with the county attorney.

Some school officials agreed on the need for filing an amended report. Board members Troy Swanson and Nancy Wall Glowaski had both advocated for full disclosure of the $58,000 in communications expenses incurred under the Phase III contract with JCI. Sallee, in his testimony, said he didn’t care what number was reported, as long as it was accurate.

At some point, board members and the superintendent had apparently agreed to ask Johnson to amend the report.

In a Sept. 3 email, Swanson provided an update to Helmberger: “It’s going to be amended again +57,000 to the complete disgust of Kim.”

Yet Johnson still refused to amend the report to address concerns of the complainants, despite pressure to do so.

Weeks later, on Nov. 2, Helmberger provided Sallee with a draft complaint to the OAH. “I know this is unusual to provide this ahead of formal filing, but I want you to understand the legal basis for our campaign finance complaint prior to filing to make one last pitch for the district to do the proper thing,” wrote Helmberger in an accompanying email.

A month later, with no response from the district, Helmberger filed the complaint.

Following the day of testimony, the judges asked both sides to submit written briefs, which will be due in April. A decision in the case is expected by the end of June.