Freedom Foundation

Freedom Foundation files six complaints against cities and unions for campaign finance violations

This week, the Freedom Foundation filed six complaints with the Washington State Public Disclosure Commission (PDC) alleging three cities and three unions violated campaign finance laws while opposing local ballot propositions in 2014 that sought to make union dues payment optional for public employees and make collective bargaining negotiations involving public-sector unions and government officials open to public observation.

The two policy proposals were based on model language generated by the Freedom Foundation. Citizen activists in Chelan, Sequim and Shelton decided to attempt to pass the ideas as ballot propositions in their respective cities. The activists in each city gathered enough signatures in the summer of 2014 to qualify the propositions for placement on the ballot at the next city election. However, each city council refused to permit a public vote on the propositions.

Justifiably upset, local taxpayers filed suit against the cities to force them to place the propositions on the ballot. In each lawsuit, local labor unions — including Teamsters Local 589 in Sequim, the International Association of Machinists Local W38 in Shelton and the Washington State Council of County and City Employees/AFSCME Council 2 in Chelan — hired outside attorneys to defend the city’s decision to stonewall the propositions.

County superior courts ultimately ruled against the taxpayers, who did not appeal, and the propositions never appeared on the ballot.

But that was just the beginning of the saga.

In October 2015, the Washington Attorney General (AG) filed suit against the Freedom Foundation for violating the Fair Campaign Practices Act (FCPA) by failing to disclose legal services provided to the citizen activists as campaign expenses to the PDC. It was the first time state laws had been interpreted as requiring the disclosure of free legal services as election expenses in situations like this in which no election ever took place.

State courts were divided about whether the law had even been broken.

In May 2016, a Thurston County Superior Court judge determine the Foundation had done nothing wrong and ruled against the AG, finding the law to be “ambiguous and vague.” The AG appealed the decision and, in November 2017, the Court of Appeals reversed the Superior Court’s ruling. Accordingly, the Freedom Foundation appealed to the Washington State Supreme Court, which regrettably ruled against the Foundation in a 5-4 decision. As the four dissenting justices observed, however,

“…both the trial court and the Court of Appeals expressly acknowledged that the FCPA is ambiguous with respect to whether it compels reporting of independent expenditures in support of initiatives not yet on the ballot in noncharter cities. The majority implicitly acknowledges the same thing… The majority resolves that ambiguity against the speaker and in favor of the government. But resolving an ambiguity in a statute implicating free speech against the speaker and in favor of the government violates controlling precedent of this court and of the United States Supreme Court.”

Because the Washington Supreme Court’s decision “(implicated) free speech,” the Freedom Foundation petitioned for the U.S. Supreme Court to review the decision, which it declined to do earlier this year.

Interestingly, none of the cities or unions that opposed the 2014 ballot propositions in court ever disclosed their expenses to the PDC. And while the AG took legal action against the Freedom Foundation, neither the AG nor the PDC have taken any action against the cities or unions.

The Freedom Foundation’s complaints against the cities of Chelan, Sequim and Shelton allege the cities violated the FCPA by failing to disclose legal expenses incurred while opposing placement of the propositions on the ballot. Further, the complaints argue the cities violated a state law prohibiting the use of public facilities for political purposes by having their respective city attorneys oppose the ballot propositions in court.

Similar complaints alleging a failure to disclose legal expenses involved in opposing the 2014 local ballot propositions were also filed against the three unions that participated in the litigation,

Because the Freedom Foundation argued against the AG’s interpretation of the law, it previously filed no complaints against the cities or unions.

However, now that state courts have held that the FCPA requires the disclosure of legal expenses regarding whether local propositions may appear on the ballot, the law must be applied equally to all parties involved. Basic notions of fairness and equal application of the law demand the PDC exercise its authority to hold the cities and unions that opposed these ballot propositions to the same standard as the Freedom Foundation.

Whether the PDC takes enforcement action against the cities and unions will say a great deal about its level of commitment to enforcing state campaign finance rules evenhandedly.