June 28, 2016

SOS candidate says PAC-to-PAC donation broke campaign law

A Secretary of State candidate is accusing her opponent of an ethics violation for campaign contributions in 2014 from PACs unconnected to the campaign.

State Rep. Nora Espinoza

State Rep. Nora Espinoza

Nora Espinoza, the Republican candidate, says that Maggie Toulouse Oliver, the Democrat, violated ethics rules when a donation from Verde Voters PAC paid money to another PAC, SOS for Democracy, earmarked for “TV ad buy–Maggie Toulouse Oliver.”

Both PACs are unconnected to the Toulouse Oliver campaign. The PAC-to-PAC donation happened during Toulouse Oliver’s first unsuccessful run for Secretary of State.

Zach Cook, an attorney and state representative representing Espinoza’s campaign, wrote a complaint to the Secretary of State saying that state law says the PAC money transfer should be considered an in-kind donation to Toulouse Oliver’s campaign.

Viki Harrison, the executive director of Common Cause New Mexico which advocates for campaign finance and ethics laws, said that this argument “just doesn’t make any sense.”

“The enforcement would be a nightmare because compliance would be impossible,” she said. “You don’t know what other people are doing.”

The Espinoza campaign cites a portion of the state Campaign Reporting Act that says, “all contributions made by a person to a candidate, either directly or indirectly, including contributions that are in any way earmarked or otherwise directed through another person to a candidate, shall be treated as contributions from the person to the candidate.”

Bernalillo County Clerk Maggie Toulouse Oliver

Bernalillo County Clerk Maggie Toulouse Oliver

“It is ironic that Mrs. [Toulouse] Oliver is making ‘ethics’ the centerpiece of her campaign, while trying to run against the previous secretary of state, and meanwhile she is violating the Election Code, accepting illegal contributions and failing to report them,” Espinoza said.

The previous Secretary of State was Dianna Duran, the first Republican Secretary of State since the early days of New Mexico’s statehood. Duran resigned last year shortly before pleading guilty to campaign finance violations and other charges.

Duran spent 30 days in jail for her crimes.

“This complaint is about a PAC-to-PAC contribution and has nothing to do with Maggie Toulouse Oliver’s campaign committee for secretary of state,” Toulouse Oliver campaign manager Alan Packman said in a statement. “Republicans are falsely attacking Maggie because they are trying to cover up for the corrupt legacy of Republican former Secretary of State Dianna Duran who pleaded guilty to violating the law.”

The PAC donation the Espinoza campaign cites went from Verde Voters PAC to SOS for Democracy, a federal Super PAC. Both PACs are not allowed to coordinate with campaigns, campaign committees or parties.

“It’s not coordinated with [Toulouse Oliver’s] campaign,” Harrison said of the cash transfer. “They’re making that contribution saying ‘spend it on behalf of that particular candidate’—they’re not coordinating with that candidate. That’s what PACs do.”

Verde Voters PAC says they did not receive the complaint yet, but NM Political Report shared a copy with the PAC.

“From what you shared with us, we don’t believe there’s any merit to this,” Liliana Castillo said in a statement. “If and when we receive the complaint from the Secretary of State, we will work with our attorney to file an official response. More detail will be available in that response.”

NM Political Report reached out to the Secretary of State’s office for more information, including what the next steps would be on the complaint.

The Espinoza campaign said they asked the Attorney General to open an investigation into the donations.

“The Office of the Attorney General has received a copy of the complaint, however the complaint is addressed to the Secretary of State and that office has not referred it to the Office of the Attorney General,” AG spokesman James Hallinan said in a statement.

Meanwhile, Harrison said the wording of the law and changes made by courts following challenges highlight the need for updates to the Campaigning Report Act.

She said if anyone is just reading the campaign law without knowing that courts have struck down provisions, “they’re not operating on the right information.”

One of those court cases was Republican Party of New Mexico v. King. In that case, a federal district court struck down state contribution limits to independent PACs, such as SOS for Democracy.