Texas Republicans Dodge Criminal Campaign Finance Bullet

In a far-reaching deal between the Republican Party of Texas and Travis Co. Attorney David Escamilla, the state party last week escaped criminal charges stemming from its use of corporate money during the 2002 election. As part of the agreement, party officials will comply with a deferred prosecution deal forbidding them from using corporate money to pay for political activities, such as voter-registration drives and campaign ads that specifically name candidates.

Government watchdog groups, including Public Citizen, Common Cause, and Texans for Public Justice, applauded the move, saying it proves the state Republican Party violated election laws. Party leaders, on the other hand, deny wrongdoing and blame campaign finance laws they say are "vague and difficult to interpret." Still, in a signed statement within the agreement, the GOP admitted using $49,600 in corporate funds to pay for voter registration and get-out-the-vote mailers, and another $12,000 for postage and $3,000 for political consulting. Texas law clearly prohibits the use of corporate or union contributions to pay for political activities. Such money may only be used for overhead and administrative costs.

The GOP's "own filings with the ethics commission show that they collected more than $5.7 million for the 2002 elections and may have used $2.2 million of that illegally," said Suzy Woodford of Common Cause, one of the groups whose complaint triggered the investigation. Texans for Public Justice director Craig McDonald said this case mirrors the way another group accused of campaign finance violations – Texans for a Republican Majority – transferred corporate funds through a maze of national GOP party accounts, then back to Texas to be used in state races. While the money used by the state GOP benefited a broader slate of candidates than the TRMPAC effort, McDonald said many of the same major contributors funded both groups. The corporate money, he added, "bought special interest policies that have harmed the consumers, workers, and families of Texas."

In a statement, the state GOP said the party worked with Escamilla to "clarify unclear areas of the law where possible, while recognizing bona-fide differences in the interpretation of other areas of the law," and said that the agreement "effectively concludes this matter." However, under the terms of the deal, effective through March 31, 2007, the county retains the right to file Class A misdemeanor charges for "at least three violations" of the state election code, as well as any new violations. The agreement also requires party officials to file campaign finance reports electronically to be posted on a searchable online database, and to send the party's executive director and accountant to 10 hours of training on state election laws.

Campaign finance watchdogs say more reforms are needed to avoid future violations. "The Texas Ethics Commission needs to pass regulations defining exactly what administrative expenses are, pronto, and if they don't, the Legislature should," said Campaigns for People President Fred Lewis. The commission, he added, "is as guilty as the Republican Party – they're the cop who negligently turned a blind eye."