January 3rd, 2005

Tim Eyman and Dino Rossi: Friends and Allies

Threat Analysis

Washington State GOP gubernatorial candidate Dino Rossi likes to promote himself as a sunny independent thinker who will bring prosperity to Washington State.

But what most people don’t know about Dino Rossi is his extremist positions – including his ties to initiative profiteer Tim Eyman, as well as his similarity to previous GOP candidates John Carlson (2000) and Ellen Craswell (1996).

Did you know that:

  • Dino Rossi supported Initiative 200, Tim Eyman’s first initiative, which attacked affirmative action, back in 1998.
    • “He [Rossi] supported anti-affirmative action Initiative 200.” (Seattle Weekly, Dino Buys Big Time, 8/4/2004)
    • “He [Rossi] supported I-200, the successful anti-affirmative-action initiative championed by [John] Carlson.” (The Stranger, The Salesman, 8/19/2004)
  • Dino Rossi supported Initiative 807, Tim Eyman’s 2003 attempt to require a supermajority vote of the Legislature for any tax increases.
  • Dino Rossi supported Tim Eyman’s I-695, which slashed road and transit funding, and defended it in the spring of 2000.
    • ‘”There’s a lot of people politically in a little bit of a box,’ said Sen. Dino Rossi, the ranking Republican on the Senate Ways and Means Committee. ‘They [opponents] said the sky was going to fall if 695 passed, and unless a little bit of the sky does fall they’re going to sound like they were telling stories during the campaign.'” (Seattle Times, Legislators employ I-695 to promote long-held agendas, 1/9/2000)
  • Dino Rossi supported slashing public services, sponsoring bills which proposed more tax cuts in the wake of I-695.
    • “Last year (2000), he [Rossi] was among several lawmakers offering tax-cut bills, catching the momentum generated by Initiative 695, [Tim Eyman’s] $30 car-tab measure.” (Seattle Times, Property-tax-cut talk is big in 5th, 10/18/2000)
  • Dino Rossi supported the “direction” of Tim Eyman’s I-745, which would have required 90% of transportation funding to be spent on roads.
    • “But Sen. Dino Rossi, R-Issaquah, the top Republican on the Senate Ways and Means Committee, said the state has barely tried to keep even with needed highway construction. [Of Eyman’s proposal], he said, ‘It’s going in the direction many of us have been trying to push. That’s not to say mass transit doesn’t have a role, but it’s not the Utopia people say it is.'” (AP, Seattle P-I, I-695 sponsor sets sights on gridlock with initiative, 12/16/1999)
  • Dino Rossi supported an unsuccessful Tim Eyman effort to kill Sound Transit’s light rail effort in 2003.
    • “Sen. Dino Rossi, R-Issaquah, said he hasn’t seen Eyman’s proposal but supports the concept of a revote because the light-rail project has changed in recent years. ‘Why not put it back on the ballot?’ said Rossi, chairman of the Senate Ways and Means Committee. (Seattle Times, Eyman kicks off effort to kill light-rail project, 2/15/2003)
  • Tim Eyman endorsed Dino Rossi’s bid for governor from Day One, and has repeatedly referenced Rossi in his emails to supporters.
    • “Initiative king Tim Eyman cheered on Rossi from the crowd. ‘Taxes are out of control and tax increases should be a last resort,’ Eyman said later. ‘Rossi embodies that philosophy not by what he has said, but by what he’s done.’ After his speech, Rossi posed with his wife and four children as the crowd chanted ‘Dino! Dino!'” (King County Journal, Rossi says he needs $5 million, 11/11/2003)
    • “Our taxpayer-protection efforts over the past six years have changed Washington’s politics forever. This was an incredibly successful election for taxpayers: * Dino Rossi ran for Governor touting his courageous efforts to balance a $2.6 billion deficit without raising taxes. He’s on the verge of victory due to his efforts to protect taxpayers from the insatiable desire of politicians to raise taxes.” (Tim Eyman, Email to Supporters, 11/3/2004)

The Washington State Democrats also have a page where Dino Rossi’s conservative positions are outlined in comparison to Craswell’s and Carlson’s.

It’s clearly apparent, from their own words, that Tim Eyman and Dino Rossi are friends and allies, sharing the same ideals and philosophies on taxation.

Though Dino has supported many of Eyman’s initiatives, this year he tried to skirt the issue and refused to comment on supporting either I-864 and I-892 in order to soften his image as he ran for Governor.

And that bid for the governor’s seat was firmly and openly supported by a very eager Tim Eyman, who longed to see someone of his own creed occupying the Governor’s Mansion. Ever faithful, Tim has even recently urged his supporters to back Rossi’s call for a revote.

Permanent Defense exists to oppose people like Tim Eyman and Dino Rossi, who, in positions of power, have shown are capable of contributing to a more regressive tax structure and damaging the public services of Washington State.

December 11th, 2004

Permanent Defense’s post-election December Update is here!

Announcements

Here at Permanent Defense, we’ve been working hard to improve the experience of our supporters and the general public. We’ve made the following improvements to our site, which we’re excited to share.

  • Critics’ Voices: Completely Redesigned! Critics’ Voices now has more quotes and opinions and a brand new, expanding on click navigational interface. Check out all your favorite critics and read more comments from site visitors.
  • Essays: Our Arguments. Read the new essay from Permanent Defense founder Andrew Villeneuve – Victory a triumph for Washington’s communities.
  • Press Box. The Press Box is now updated, with 24 stories accessible at once, and press archives just a click away. You can find all the articles you’ll ever need.
  • Home Page Improvements. Permanent Defense Home is improved, with a smaller, more streamlined Updates Center and a FAQ Center to help you out with your questions. Latest News is also now divided into three sections: News Brief, Spotlight, and Under the Radar to bring you the latest information from Permanent Defense.
  • Action Center Update. Now you can get your own Permanent Defense button from the Action Center to post on your own website!
  • About Us Update. The About Us page received an update, including a rewritten history of Permanent Defense and a more appealing design.
  • Elections Center. Catch the latest news and analysis on the governor’s race from the Elections Center. Also review results from statewide and federal races.
  • Release Center. From the Release Center, you can read Permanent Defense statements, content that appeared in our e-newsletter, Extra!, download PDFs and other files from our Document Library, and access links to resources on current topics.
  • Dangerous Initiatives. Updated for Initiative 892! Dangerous Initiatives gives you a history of all Eyman initiatives that ever made the ballot, with statistics, analysis, and a look at the effects of each initiative on Washington State.

POSTSCRIPT: Since this iteration of Permanent Defense was released in December of 2004, the site has been significantly reorganized, and many sections of the site have new names. Links are current, but names of pages may not be.

November 3rd, 2004

Voters defeat Initiative 892!

Election Postmortem

WE’VE DONE IT! Thanks to your hard work and support, Initiative 892 has been soundly defeated by Washingtonians – right now, 60% of voters are rejecting I-892.

Initiative 892’s failure is Eyman’s fourth defeat in a row and a great victory for this organization. Since our founding in February of 2002, Eyman is 1 for 5 – he’s won on I-776 (though it did not accomplish any of its goals) and he’s failed with I-267, I-807, I-864, and I-892. He has no successes this year. Best of all, Washington’s communities are saved from the proliferation of 18,255 new electronic slot machines in neighborhood bars, restaurants, and bowling alleys.

The 2004 election has been a nail-biter in the presidential race and in other contests which are still not over, but you can take comfort that Initiative 892 is dead, and that common sense has prevailed over Eyman’s lies and misinformation. Eyman, of course, says he’ll be back with a new version of I-892. (He said the same thing about I-864, we haven’t seen anything yet). Eyman is now all talk and no show. His celebrity status is fading away as more and more people realize the fraud he is.

THANK YOU for all of your dedication, your attention, and your willingess to help the cause during this campaign. So many of you volunteered to help that we simply couldn’t get materials to all of you: we apologize, but thank you for standing with us.

In the next few days we will make a couple announcements (in the next issue of Extra!) and let you know where we go from here. But for now, pause to celebrate I-892’s defeat and hope for a good outcome in the presidential race and other tight contests.

Congratulations on our success!

October 27th, 2004

Voter-to-Voter: NO on Initiative 892

Rethinking and Reframing

The following is a letter written by Josef Kunzler of Permanent Defense to help educate voters about the consequences of Tim Eyman’s Initiative 892.

Dear Fellow Voter:

I wanted to take a moment and explain to you the case against Initiative 892, the slot machine initiative that dumps 18,255 new electronic slot machines in the middle of communities across the state.

It is my sincere hope that as you think about whatever tax relief this initiative may or may not deliver, that the sound of electronic gambling machinery at over 2,000 locations and possibly more throughout the state goes through your mind. Sure, some say that’s a cheap shot – maybe that’s true, maybe not.

Take a moment and imagine two very different visions for our state:

Vision 1: We make I-892 law and we allow 18,255 electronic slot machines to be dumped into our communities all because a majority of us bought the sound bite of an initiative that promises property tax relief with no consequences. The end result will be a giant expansion of gambling, and the number of gambling addicts will skyrocket along with the profits of foreign business conglomerates. This means an increase in crime, including drug use, home invasions and theft, because addicts often resort to desperate measures to satisfy their addiction to gamble over and over again. We will walk through our communities fearing the pickpocket looking for change to plop into those machines and then we will realize gambling isn’t a destination activity any longer: it is now a local activity in our communities.

Vision 2: We reject I-892 and send a clear message that we do not want any more gambling in this state. We also respect the need of our Native Americans to have a means of self sufficiency – and as we do so, we tell the out-of-state gambling industry to butt out of our politics. Finally, by rejecting Tim Eyman’s latest initiative, we reject his ideology of tax cuts on the backs of our way of life.

Now, which vision would you like? Do you want those bandits taking over your community and your taxes, making you liable if this gamble turns out to cost more than promised? I seriously doubt that.

Washington State deserves better than this degradation into gambling dependency.

Vote NO on Initiative 892. Protect your local community and your way of life.

September 29th, 2004

Voters support public services in primary

AnnouncementsElection Postmortem

Permanent Defense today released the results of its research into the fate of levies and propositions statewide on the September 14th primary ballot to the public and the press. The research, which took over a week to compile, is an extensive look at levies and propositions from the twenty four counties (out of thirty nine) that had levies and propositions on their primary ballot.

The results indicate an overwhelming support of public services from voters, says NPI’s founder and executive director, Andrew Villeneuve, who launched Permanent Defense in 2002 as a first line of defense against threats to Washington’s common wealth.

“Out of 132 levies and propositions that were on the primary ballot, 100 were approved. That’s a huge measure of success, especially considering that more than half of the measures that were approved required a 60% supermajority vote and 40% minimum turnout, which they met.”

“Voters are willing to pay for increased taxes because they know that their local fire department, library, school district, or parks system needs money to operate,” Villeneuve said. He noted that communities benefit from strong public services.

“The government cannot provide these services for free. It’s important that we fully fund them so that our communities remain safe, vibrant places to live. And funding public services contributes to the economy because it provides good-paying jobs for citizens.”

Tim Eyman, however, often says public expenditures are too high, and rails against elected officials for not lowering taxes.

Voters clearly disagree with this sentiment, as evidenced by their votes in the primary.

The results of local levies and propositions in the primary election are an excellent measure of what voters think about taxes and public services. They surpass polls and surveys as a way to gauge voters’ moods and feelings towards government.

To create the report, Permanent Defense contacted each county’s auditor or elections officials to determine requirements for each levy or proposition’s passage, as well as election returns and a description of the levy or proposition.

The results, broken down and analyzed by county and by category, are accessible on Permanent Defense’s website.

September 13th, 2004

PDC opens investigation into complaint

Eye on Money: Developments

The Public Disclosure Commission Monday informed Permanent Defense and its co-complainants TaxSanity.org and Taxpayers For Washington’s Future that it was launching a formal investigation of their complaint against Tim Eyman and his three political committees. The complaint, filed August 26th, accused Eyman of shifting money between committees, as well as failing to timely and accurately report campaign expenditures and contributions.

Seeking to address the complaint, Mr. Eyman wrote a letter to the Public Disclosure Commission on September 10th which he made available to the media. He apparently sought to refute the charges, but all he ended up doing was confirming their legitimacy.

He admitted to the most serious charge – namely, that his campaign committee, Voters Want More Choices (VWMC), pays the all of the bills and expenses for Help Us Help Taxpayers, (HUHT), his personal compensation committee. Mr. Eyman states very clearly, “Our campaign committee [VWMC] pays for these mailings and the accounting and other costs associated with our compensation fund [HUHT].”

Though he was willing to tell the PDC the truth in his September 10th letter, Eyman did not tell the truth to his supporters. Throughout the Initiative 864 campaign, a standard disclaimer at the end of each fundraising email read:

“Voluntary donations to the 25% Property Tax Initiative will be used to qualify this important tax reduction initiative for the ballot. A different political action committee, Help Us Help Taxpayers, raises money for a compensation fund for Tim Eyman, Jack Fagan, & Mike Fagan. These two campaign committees are kept separate and donations and expenditures for each fund are publicly reported every month.”

Clearly, even according to Mr. Eyman, the committees are not kept separate because Voters Want More Choices is paying the bills and expenses for Help Us Help Taxpayers.

Eyman is using campaign committee funds to pay for personal mailings and other expenses to maximize the amount of money that he makes from his personal compensation committee. This transfer of funds is clearly an in-kind contribution, and it hasn’t been reported.

Permanent Defense Chair Andrew Villeneuve said, “Tim Eyman has long attempted to deceive the public and distort the truth about his numerous personal compensation efforts and compliance with public disclosure law. He claims that our complaint is all lies, and then in a letter to the PDC, he admits our main allegation is true.”

“He only tells the truth when it is most convenient, and even then, he tells his supporters something different.”

Besides investigating the main allegation, the PDC announced it will also investigate numerous other reporting violations, including failure to timely and accurately report contributions to Help Us Help Taxpayers, failure to report polling expenditures by Voters Want More Choices, and failure of Just Treat Us The Same to meet reporting deadlines.

The PDC has assigned the complaint Case No. 05-066 and Case No. 05-068.

August 27th, 2004

Eyman refuses to answer charges

Eye on Money: Developments

Tim Eyman has responded to a complaint jointly filed by Permanent Defense, TaxSanity.org, and Taxpayers For Washington’s Future, but refuses to address any of the charges it presents.

Calling it “our opponents’ latest slime attack”, Eyman said he had reviewed the complaint “and it’s all lies.” But the initiative profiteer didn’t counter or address any of the charges against him.

If the contentions made in the complaint are so easily disproved, why didn’t Eyman try to refute them? His refusal to answer them lends credence to the truth of the contentions.

Eyman’s past history suggests that he is indeed willing to violate public disclosure law over and over again. He’s notorious for taking a salary while lying about it, but his history is more extensive than that.

More than once, he’s been late filing his records, has twice solicited supporters for personal checks made out to “Tim Eyman, Taxpayer Advocate” – even in the midst of one of his initiative campaigns.

It seems that Tim likes raising money even more than he likes running initiative campaigns. Why else would he be willing to apparently spend $26,305 of donations to Initiative 864 on a mailing for his personal compensation fund?

The answer is that Tim’s political activism is his income. He cares more deeply about making money than he does about making policy. Even when his initiatives fail, Tim comes right out and asks supporters to compensate him for his “effective work on behalf of taxpayers”.

To Eyman, supporters are like ATM machines. Punch in the right code and you can collect the money. And never mind that Tim Eyman is like an identity thief.

He promised supporters repeatedly that, “Voluntary donations to the 25% Property Tax Initiative will be used to qualify this important tax reduction initiative for the ballot,” and that Help Us Help Taxpayers was completely seperate.

Apparently, Help Us Help Taxpayers isn’t so seperate after all. It’s one thing to lie about taking money for personal use. It’s another to continue doing it again.

Eyman figured he wouldn’t be caught. But that’s what he thought before he was forced to confess about taking a salary in February of 2002.

Eyman can think it’s “borrowing”, but he’s run out of excuses. He told supporters all the way up to July 2nd that their money was being used to qualify Initiative 864 for the ballot. When apparently, a sizable chunk wasn’t, after all.

Eyman’s silence on the charges raises their credibility. The PDC must now act to ensure that the public disclosure law was not violated. And if it was, Eyman should be penalized for not following the rules like everyone else.

It’s only fair to the citizens of Washington State.

August 26th, 2004

PDC should penalize Eyman for violations

Eye on Money: DevelopmentsStatements & Advisories

Permanent Defense, TaxSanity.org, and Taxpayers For Washington’s Future today filed an official PDC complaint against Tim Eyman alleging that the initiative profiteer appears to have been spending Initiative 864 campaign funds for his personal compensation PAC, Help Us Help Taxpayers, among other charges.

The complaint also accuses Eyman and his associates of a broad range of public disclosure violations- including delinquent reporting, as well as conspiracy to commit wire fraud and mail fraud.

Andrew Villeneuve, Chair of Permanent Defense, said “When it comes to the public disclosure law, Eyman acts as if the rules somehow don’t apply to him.”

“In his mind, it’s okay to file late, to use funds from one committee to apparently pay for another’s expenses, and to lie about taking a salary.”

“But when opponents do something that Eyman thinks is running afoul of the law, he puts up a big racket and acts like a victim. He clearly has a double standard.”

He said he expects the PDC to take action on the sixteen page complaint, saying “Last March, when Eyman filed his forms late, the PDC made clear that future infringements would not be tolerated. Unless Eyman is penalized, he will continue to ignore the law and get away with it.”

Previously, in March of 2004, Permanent Defense joined TaxSanity.org and Taxpayers For Washington’s Future in filing a complaint to the PDC that accused Eyman of not filing the names and addresses of his contributors on time.

The PDC condemned the delay and dismissed the complaint but warned Eyman that future violations could result in enforcement action.

Once again, Eyman has been caught in violation of the public disclosure law. Money is disappearing from the Initiative 864 campaign war chest, mailings for Eyman’s compensation PAC are suspiciously not costing anything, and donations Eyman has said he’s received aren’t being reported on time, and even when reported late, have discrepancies.

“This entire operation, including all three committees, needs an audit,” said Chair Andrew Villeneuve. “It’s all in shambles. He keeps making mistakes and filing late. Then he has to file amended returns with new versions of his records. And it appears that Eyman is using funds from one committee to pay for another’s mailings, even though he insists they’re separate.”

The complainants believe Eyman is clearly culpable of breaking the law, and has been allowed to get away with too many violations for too long.

It’s time for the Public Disclosure Commission to condemn these violations and penalize Eyman for not following the rules like everyone else.

August 26th, 2004

Permanent Defense, allies file PDC complaint against Tim Eyman

Eye on Money: DevelopmentsStatements & Advisories

PDC complaint alleges conspiracy to defraud contributors, demands audit

A formal complaint filed today with the Public Disclosure Commission (PDC) alleges that during the final weeks of its failed signature drive, Tim Eyman fraudulently spent over $26,000 of I-864 campaign funds on a fundraising letter for his personal compensation PAC, “Help Us Help Taxpayers” .

The complaint — filed jointly by TaxSanity.org, Taxpayers for Washington’s Future (TWF), and Permanent Defense — accuses Tim Eyman, his associates, and his three PACs of a broad array of campaign finance and public disclosure violations, including conspiracy to commit wire fraud and mail fraud. The 16 page complaint includes supporting documentation.

“Once again, Tim Eyman has been caught lying to contributors,” said David Goldstein of TaxSanity.org. “He promised to keep campaign contributions separate from his compensation fund… a promise he never intended to keep.” The complaint suggests that since its inception in June of 2003, Help Us Help Taxpayers’ operations have been entirely subsidized by “Voters Want More Choices” (VWMC), including over $10,000 of reported in-kind contributions.

Steve Zemke of TWF called the misreported June 2004 expenditure “doubly deceptive” because it occurred at a time Mr. Eyman was aggressively soliciting funds for what he claimed to be a close I-864 signature drive. Mr. Zemke, a veteran of many successful initiative campaigns, said Mr. Eyman deliberately misled contributors about where their money was going: “I-864 was dead in the water, and Tim knew it. Yet he continued to solicit contributions, while diverting money to his compensation fund.”

Andrew Villeneuve of Permanent Defense emphasized that the complaint includes a number of charges that together establish a pattern of abuse and deception. “These violations aren’t just isolated incidents. They’re part of a long-running history of infractions. The PDC should demand full compliance with the law and take immediate action to ensure that Eyman is following the rules like everyone else.”

Text of the complaint

August 26, 2004

Ms. Vickie Rippie
Executive Director
Public Disclosure Commission
711 Capitol Way No 206
Olympia, WA 98504

Dear Ms. Rippie,

The complainants named below hereby give notice of a formal complaint against Voters Want More Choices (VWMC), Just Treat Us The Same (JTUTS), Help Us Help Taxpayers (HUHT), and their officers, including Tim Eyman, Jack Fagan and Mike Fagan. The complainants request a full investigation of the allegations within, and expect enforcement actions commensurate with Mr. Eyman’s documented history of public disclosure violations and the Public Disclosure Commission’s (PDC) prior warnings that subsequent violations would not be tolerated.

The complainants also request that Mr. Goldstein’s email dated 8/11/04 be considered the initiation of this formal complaint, and that this email be considered an amendment to it.

This complaint includes five main charges: 1) failure to report VWMC expenditures on behalf of HUHT, 2) fraudulently soliciting contributions to I-864, 3) improper reporting of donations to HUHT, 4) failure to report expenditures on behalf of VWMC, and 5) failure of JTUTS to meet reporting deadlines.

1) Failure to report VWMC expenditures on behalf of HUHT

The complainants contend that VWMC made substantial expenditures in June of 2004 on behalf of HUHT, without proper reporting by either committee. VWMC’s Schedule A filed 7/12/04 reports two expenditures dated 6/18/04, to Data Resources, Inc., totaling $26,305.72 for postage and printing for I-864. It is the complainants’ contention that there was no such mailing on behalf of I-864.

The complainants, through their independent watch-dogging activities, had received all three previous bulk mailings from VWMC in 2004, within one to three weeks following the reported expenditure date. No such mailing was received following the 6/18/04 Data Resources, Inc. expenditure. However in early July, each of the complainants received a fundraising letter from HUHT — in the form and fashion of previous VWMC mailings — apparently sent to VWMC’s bulk mailing list. HUHT however, reported no corresponding expenditure or in-kind contribution; indeed, with cash reserves of only $11,522.34, HUHT clearly did not have the financial resources to fund such a large mailing during the time period in question.

It is the complainants’ contention that the July HUHT mailing was funded by the 6/18/04 VWMC expenditures, and that both of Mr. Eyman’s committees conspired to misreport the transactions, thus hiding a transfer of funds from VWMC to HUHT. Both committees are equally culpable in violating the public disclosure laws, and both committees should be subject to potential penalties. Furthermore, the HUHT mailing was in violation of statute by failing to include notice that it was paid for by VWMC.

The complainants also strongly suspect that a similar incident occurred in 2003, when VWMC reported printing and mailing expenditures for I-807 totaling $14,904.45 on 6/12/03 and 6/20/03 at a time when signature gathering efforts for the initiative had clearly ceased, but HUHT was just being started.

These efforts to conceal VWMC expenditures on behalf of HUHT would be consistent with the committees’ 2003 activities, during which VWMC misreported postage and mailing expenses in July, August, September and October, only to restate them as in-kind donations to HUHT in amended returns filed in December. HUHT has in fact, never reported fundraising expenditures – indeed, apart from disbursements to its officers, the committee reported less than $50 in expenditures its entire first year of existence, yet raised over $160,000 in contributions… an unbelievable return on investment.

Mr. Eyman and his associates have clearly made a concerted effort to hide the fact that most, if not all, of HUHT’s activities and operations are paid for with funds purportedly raised to support VWMC’s initiative campaigns. The full extent to which VWMC monies have been diverted to HUHT can only be determined after a thorough investigation of VWMC, HUHT and Data Resources, Inc.

2) Fraudulently soliciting contributions to initiative campaign I-864

Through June of 2004, Mr. Eyman repeatedly emailed supporters, soliciting contributions to the I-864 signature drive. As late as 6/25/04, Mr. Eyman cajoled supporters to “hit ‘reply’ to this email and pledge generously to this critical effort”. Indeed, his final fundraising email, sent one day before the 7/2/04 signature deadline included a payment form with the following standard disclaimer:

Voluntary donations to the 25% Property Tax Initiative will be used to qualify this important tax reduction initiative for the ballot. A different political action committee, ‘Help Us Help Taxpayers’, raises money for a compensation fund for Tim Eyman, Jack Fagan, & Mike Fagan for their effective political work on behalf of taxpayers. These two campaign committees are kept separate and donations and expenditures for each fund are publicly reported every month.

The complainants contend that VWMC ceased its paid signature gathering efforts on 6/2/04, the day Citizens Solutions withdrew the petitions from its subcontractors. Apart from overhead, the only June expenditure related to signature gathering was a 6/14/04 final payment of $10,574.40 to Citizen Solutions for signatures previously collected. As stated above, the complainants contend that the actual purpose of the 6/18/04 expenditures to Data Resources Inc. totaling $26,305.72 was printing and mailing the HUHT fundraising letter sent in early July.

Whatever the actual date that Mr. Eyman abandoned the I-864 signature drive, it is clear that by the latter half of June he was fraudulently soliciting contributions for an initiative campaign that was no longer active. Furthermore, his solicitations throughout 2004 included a promise that all contributions would “be used to qualify this important tax reduction initiative for the ballot”, when in fact the month’s largest expenditure by far was a $26,305.72 unreported in-kind donation to HUHT.

Indeed, VWMC has already reported over $10,000 of in-kind contributions to HUHT, effectively compensating Mr. Eyman and his associates with contributions raised to support initiatives.

HUHT is a personal compensation fund, and any expense on its behalf by VWMC constitutes personal compensation from I-864 campaign contributions. By hiding the true purpose of this expense, and continuing to solicit contributions under false pretenses, VWMC, HUHT and its officers conspired to commit mail fraud and wire fraud. The complainants thus urge the Commissioners to refer this serious legal breach to the appropriate prosecutorial authority.

3) Improper reporting of donations to HUHT

The complainants contend that HUHT improperly reported a $20,000 donation. On 7/23/04, in an email to over 3600 supporters, Mr. Eyman claimed that “Yesterday, one of our supporters donated $20,000 to our compensation fund Help Us Help Taxpayers.” However, on HUHT’s 8/10/04 disclosure filing, there was no mention of a $20,000 donation.

On 8/11/04, the complainants issued a press release with the allegation that Mr. Eyman had failed to report a corresponding donation, and forwarded a copy to the PDC suggesting further investigation. In response to PDC inquiries, HUHT filed an amended return on 8/12/04, reporting a $20,000 “pledge” on the date of 7/31/04.

The complainants contend that Mr. Eyman filed an amended return only in response to inquiries from the PDC, and that the reported date of the donation — now called a “pledge” — does not match the timeline of events. According to Mr. Eyman’s public statement, the pledge could not have been received later than 7/22/04, and yet the 8/12/04 amended Schedule B reports a pledge date of 7/31/04. There is also a discrepancy in that Mr. Eyman originally claimed this to be a “donation.”

It is not clear that Mr. Eyman’s 7/22/04 “donation” and 7/31/04 “pledge” are one and the same. Was there really a $20,000 “donation/pledge” on 7/22/04 as Mr. Eyman claimed in his email, or was the 7/31/04 “pledge” merely reported to cover up a false claim? Does the donor really intend to contribute the full amount, and on what date was it really pledged?

Failure to promptly report a $20,000 donation is not a trivial matter. Given Mr. Eyman’s history of false and misleading disclosure reports and unreported pledges – including the 12/2003 “gift” from the jail guard’s union (Case #04-438) – his amended 8/12/04 return should not receive any more credence from the PDC than his 7/23/04 email. The complainants urge the Commissioners to investigate this incident fully, and to levy penalties within the context of Mr. Eyman’s record of noncompliance.

4) Failure to report expenditures on behalf of VWMC

In emails, press releases, and fundraising letters, Mr. Eyman has repeatedly referenced an opinion survey conducted on 10/09/03 by Rasmussen Reports LLC. The survey was clearly commissioned on behalf of the 25% property tax cut initiative that later became I-864, and should have been reported as either a campaign expenditure or an in-kind contribution.

The complainants can find no VWMC expenditure to Rasmussen Reports LLC, or any other firm, for an opinion survey during the fall of 2003. If the survey was paid for by a third party, or performed at no charge by Rasmussen Reports LLC, then it should have been reported as an in-kind contribution, with the contributor clearly identified.

While I-864 had not yet been filed at the time of the survey, a nearly identical initiative to the legislature, I-309, was filed by Mr. Eyman on 9/8/03, and any expenditures on its behalf would have required full disclosure, presumably by VWMC. It should be noted that throughout the summer and fall of 2003 VWMC made numerous other expenditures on behalf of a “property tax cut initiative”, and this was clearly the primary focus of the committee since the initiative was first announced on 6/8/03.

5) Repeated failure to meet PDC reporting deadlines

The complainants contend that Mr. Eyman’s JTUTS PAC filed monthly C4, Schedule A, Schedule B and Schedule L forms on 8/24/04, thirteen days past the 8/11/04 deadline for ballot committees. This failure to meet reporting deadlines is part of a flagrant pattern of violating PDC requirements — as acknowledged by the PDC in response to our previous complaint dated March 17 (Case #04-443 and #04-444) – and which has continued to this date.

In dismissing the previous complaint the Commission cautioned Mr. Eyman that further late reporting “will not be tolerated, and may result in enforcement action.” As independent watchdogs, the complainants rely on full and prompt public disclosure to help safeguard the integrity of our electoral system; while Mr. Eyman may consider his delays and obfuscations trivial, they interfere with the public’s right to know, as demanded by voters in overwhelmingly passing the Public Disclosure Act. The complainants therefore urge the Commission to back up its previous warning with action.

Summary

In summary, the complainants contend that Mr. Eyman fraudulently used VWMC campaign funds to pay for printing and mailing on behalf of HUHT, that both committees and their officers conspired to hide the transaction, and that HUHT failed to included proper notice on fundraising materials that said materials were paid for by VWMC. The complainants further contend that Mr. Eyman fraudulently solicited funds for VWMC, that HUHT failed to timely and properly report a $20,000 donation, that VWMC failed to report a campaign expenditure for an opinion survey, and that JTUTS has continued Mr. Eyman’s pattern of flagrantly ignoring filing deadlines.

In light of the seriousness of these allegations, the weight of Mr. Eyman’s history of public disclosure violations, and the potential for charges of conspiracy to commit wire fraud and mail fraud, the complainants request a full investigation of all these matters, and any others that might turn up in the course of further investigation. Mr. Eyman’s persistent efforts to obscure the source of contributions and the true nature of expenditures renders the public disclosure process useless, and thus warrants a thorough audit of VWMC, HUHT, JTUTS, their officers’ personal financial records, and the records of major vendors, including Data Resources, Inc., Citizen Solutions, and Hawthorne & Co., for the years 2003 and 2004.

The complainants look forward to cooperating with the Commission, and will provide supporting documentation upon request. The complainants further request that they be kept informed of the progress of the investigation, and be given the opportunity to comment on or refute any supposedly exculpatory evidence provided by Mr. Eyman and his associates.

A copy of this formal complaint has been forwarded to the complainants’ attorneys, the Attorney General, and to the media.

Thank you for your time and consideration.

Sincerely,

The Complainants:

David Goldstein, TaxSanity.org
Steve Zemke, Taxpayers for Washington’s Future
Andrew Villeneuve, Permanent Defense

CC: Rodney L. Brown, Jr. (Brown Reavis & Mann PLC)
CC: Attorney General Christine Gregoire
CC: the media

August 19th, 2004

New report discredits Eyman’s claims

Rethinking and Reframing

A new report released by the Department of Revenue has just discredited initiative profiteer Tim Eyman’s claims that taxes are skyrocketing and out of control.

Indeed, the report found that Washington State’s tax burden has been declining since 1981- just the opposite of what Tim Eyman continues to claim.

Eyman tried to dismiss the report, calling it “election-year politics”. But it’s Eyman, and not the state Department of Revenue, who has skewed statistics.

Eyman tries to take the total amount of revenue collected each year by the state and stack it up in ever-increasing bars on a graph, then point to it and say that property taxes are obscene and uncontrollable.

But you can’t measure property tax growth, or any kind of tax growth, by looking at the dollar amount collected each year. Any smart economist can tell you right away that Eyman’s method of looking at tax growth is extremely distorted.

Tax growth is best measured against personal income. This accounts for factors such as inflation and population growth- factors essential for a correct calculation.

The Department of Revenue’s new report measures tax growth against personal income, and finds that Washington is not the first, second, third, or fourth highest taxed state in the nation.

We rank 32nd in the nation in the new report (from 1998-2002) in comparative state and local taxes. And our tax burden has been on the decline since 1981.

That’s hardly “obscene” tax growth. When it comes to taxes, Washington is actually in the upper tier of states- states with a lower tax burden.

And having a lower tax burden isn’t always a great thing, because taxes pay for essential public services. Without enough revenue, the quality of those services can be degraded.

It’s clear that Tim Eyman’s rhetoric about skyrocketing and obscene property taxes is useless hype. No wonder, though, that Tim Eyman doesn’t want voters to believe this report. If they do, it will give them no reason to vote for his initiatives.

If his initiatives are voted down, Tim makes no money. It’s somehow in his best interest, then, to keep the lies coming and the fabrication machine on full spin.

Washington’s voters deserve to know the truth, not the spin, about property tax growth in this state. And clearly they’re not going to get that from Tim Eyman.

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