January 14, 2013 Print

The Lazar Loophole - How to beat the PDC

If anyone wants to know how to benefit your favored political candidate and avoid some of those pesky Public Disclosure Commission restrictions, Thurston County leftist and environmental extremist Jim Lazar has helpfully provided a roadmap.  Most people believe that the Public Disclosure Commission was created as a way to improve transparency in elections, and this is generally true.  However, anywhere there is a government agency, there is a way to bypass the rules.  Jim Lazar, a favorite local Leftist has shown everyone the way.  In the interest of ensuring that everyone from all political perspectives can utilize the same techniques that have been limited to the shadowy Left until now, this post is a public service to everyone who wants to go the extra mile for the political candidates they support.

First, some background on the PDC, and the rules that matter in this case.  The Public Disclosure laws in Washington State can be traced back to the early 1970s which culminated in Initiative 276, which was passed in 1972 with 72% approval by the voters (legislative efforts at reform had largely failed before this).  In 1992, these rules were strengthened with contribution limits and other restrictions.  The Public Disclosure Commission has been around since 1973 and consists of appointed 5 member citizens and an agency budget of around $2.1 million with 23 full-time employees.  This is one of the few state agencies created directly by a vote of the people, and while we can debate the merits of certain campaign laws – the agency itself and the disclosure efforts are to be generally applauded by fans of open government.

When it comes to elections in Washington State, the PDC runs an excellent website that provides a lot of information about the funding of candidates and initiatives.  We have written several articles encouraging citizens to use this resource.  I wrote one last August linked here

The PDC also deals with campaign limit violations and other similar issues.  For example, the amount of I beat the systemmoney that an individual can donate to a campaign is restricted.  This prevents people from Warren Buffett or George Soros from directly funding candidates for public office with unlimited funding (in theory).  It also forces the candidates for office to spend most of their time trying to fundraise to pay for their campaigns.  You need lots of campaign donors to ensure the funding of a real campaign, unless the candidate is wealthy enough to fund the whole process themselves.  In addition to cash donations to the candidate (so they can pay for signs, brochures, mailing, and advertising), a citizen can donate items “in kind” or “in lieu of cash.”  This would be a citizen donating stakes for signs or perhaps their home for a fundraiser. 

Historically, these in-kind donations needed to be accurately evaluated for their true value.  For example, when I ran for office in 2010, I had a local citizen make stakes on his portable saw mill in Yelm and donate them to me “in kind” for use with my yard signs.  I had to accurately report the value of these stakes in my PDC filings, for example at fair market value.  This would normally apply to printed material as well – which is a big part of the costs for a candidate. 

This is where we get to our local leftist Jim Lazar who has helpfully created what has now been called the “Lazar Loophole.”  Jim Lazar bought some fancy printers and lots of paper.  He used these printers to print substantial campaign material for his favorite politicians including Mayoral candidate Steven Bauxbaum (D-City Council, Olympia), Thurston County Commissioner Valenzuela (D), Thurston County Commissioner Sandra Romero (D), and others.  He was able to provide these services and supplies to his favorite politicians for substantially below cost and declare it far below cost with the PDC.  A complaint was filed against him – read it Download file Complaint against Jim Lazar and Stephen Buxbaum .  Jim Lazar’s attorney responded – read it Download file Lazar Response .  The response was challenged - read it Download file Lazar Complaint Email Response .  In the end, the PDC outlined how everyone can do the same thing for their preferred candidates – read it here.  For serious activists and people who want to maximize their support for their preferred candidates – Jim Lazar (with the help and support of the PDC) has provided the template for everyone to do the same thing.  While Jim Lazar did have a business, he claimed to not be in the business of campaign advertising – the PDC agreed that he does not have to accurately report what he donated to the candidates, and that (unlike with a commercial advertiser) – nobody could audit the donor’s books.  Since he did not have to report as a commercial advertiser, he was free to donate as much printing as he wanted to his favorite candidates, claim whatever value he wanted to invent, and nobody could challenge anything.  In review:

  1.  Purchase commercial printing material and printers.
  2. Pick you favored candidates, and print whatever they need (brochures, invitations, thank you letters, etc).
  3. Claim you are not in the commercial advertising business, so you don’t make a living doing this.
  4. Report whatever you feel like to the PDC (just make sure it matches what the candidate claims).  In the end it won’t matter because nobody can audit you anyway.  To make life easier – be as general as possible.
  5. Copy all the attached documents referenced in this posts and send it to anyone who dares complain.

Sure, it violates the spirit of the law, but it is technically legal and the PDC has formally gone on record that the “Lazar Loophole” is okay.  For any candidate of any political party (or no party affiliation), it will be beneficial to their campaign to find a local supporter who is willing to invoke the “Lazar Loophole” on their behalf.  For that service, we should all thank Jim Lazar.

beat the system

(Author Commentary Added below):

I think the PDC does good work and they have a great website for disclosure purposes.  Their attempt to restrict amount of donations given to specific candidates are ignored or bypassed using a variety of legal loopholes like the “Lazar Rule.”  In the end, it is unrealistic to close all these loopholes.  Transparency is the most important task of the PDC.  The attempt to restrict the size of the donations just encourages more corruption and rewards incumbents over challengers.  The Lazar Loophole illustrates this in a minor way.  There is not the political will to reform the political campaign system at this time, so we can expect to see more examples like this which will further undermine the credibility of the system.  However, it starts with exposing more “Lazar Loopholes,” as they appear.


Glen Morgan

Property Rights Director

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