Washington state launches investigation into WFSE’s secret political fund

Washington state launches investigation into WFSE’s secret political fund

Washington state launches investigation into WFSE’s secret political fund

Late last week, the Washington State Public Disclosure Commission (PDC) announced it had opened an investigation into whether a political fund operated by the Washington Federation of State Employees/AFSCME Council 28 (WFSE) — the largest union of state workers in Washington — violated campaign finance laws by failing to register with the state and publicly disclose its political activity.

The investigation comes in response to a Freedom Foundation complaint filed in January 2020 alleging that WFSE’s “separate segregated fund” (SSF) had broken the Fair Campaign Practices Act (FCPA) by not registering as a political committee.

In the nearly 300-page complaint, the Freedom Foundation used incomplete PDC and Internal Revenue Service filings to document that WFSE’s SSF made about $2 million in unreported political expenditures in Washington state during the five-year statute of limitations.

The complaint also relied on information unearthed as a result of previous Freedom Foundation campaign finance complaints against a similarly structured political fund operated by WFSE’s parent affiliate, the Washington, D.C.-based headquarters of the American Federation of State, County and Municipal Employees (AFSCME).

While the PDC resolved the complaints against AFSCME by assessing only a trivial penalty without a formal investigation, the union’s responses to the complaints provided information about the flow of money among AFSCME affiliates that helped document the violations by WFSE’s SSF.

WFSE’s concealment of its political program harmed not only the public’s interest in the transparency of election financing but damaged its members as well, as it is their dues that are unwittingly used to fund the SSF and its political program.

In its response to the Freedom Foundation’s complaint, WFSE’s lawyer claimed that all of the funds in the SSF were “transfer[red] from dues.”

Whether the SSF also received funds from other sources is one of the disputed points the PDC’s investigation will hopefully resolve, but all parties agree that many of the dollars in the SSF come from WFSE members’ dues.

Despite this, the union’s website makes no mention of the SSF’s existence and union officials reportedly state or imply to members that dues are not used for politics.

The PDC has assigned the proceeding Case No. 62411.

Counting the latest investigation into WFSE, the PDC is now currently investigating seven complaints filed by the Freedom Foundation.

In late 2018, following a Freedom Foundation complaint, the PDC launched an investigation into the Amalgamated Transit Union’s Legislative Council of Washington for failing to register and publicly report its activity as a political committee (Case No. 43940). As part of the ongoing investigation, the PDC recently imposed a $150 penalty on the union for disclosing $25,200 in lobbying expenses a year late.

Five additional ongoing PDC investigations, begun following Freedom Foundation complaints filed over the summer of 2019, involve whether a set of private employers violated the FCPA by deducting contributions to the political committee operated by the Pasco-based United Association of Plumbers and Pipefitters Local 598 from employees’ wages without proper authorization (PDC Case Nos. 54324, 54746, 54818, 55698 and 55700).

Though the committee’s illegal fundraising scheme — which resulted in nearly all employees having a percentage of their wages skimmed for the union’s political agenda — was developed by the union, the obligation to comply with state laws governing the deduction of political contributions via payroll deduction rests on the employers performing the deductions.

While the PDC’s investigations into these matters is welcome, the PDC’s handling of other Freedom Foundation complaints has been questionable. In fact, the Freedom Foundation is presently litigating several cases against the PDC in state courts for failing to take proper enforcement action against unions that committed proven and significant violations of the FCPA.

Nevertheless, the latest investigation into WFSE adds another item to the list of Freedom Foundation accomplishments in discouraging the use of dues for union politicking and ensuring government unions in Washington play by the same campaign finance rules as everyone else.

Director of Research and Government Affairs
As the Freedom Foundation’s Director of Research and Government Affairs, Maxford Nelsen leads the team working to advance the Freedom Foundation’s mission through strategic research, public policy advocacy, and labor relations. Max regularly testifies on labor issues before legislative bodies and his research has formed the basis of several briefs submitted to the U.S. Supreme Court. Max’s work has been published in local newspapers around the country and in national outlets like the Wall Street Journal, Forbes, The Hill, National Review, and the American Spectator. His work on labor policy issues has been featured in media outlets like the New York Times, Fox News, and PBS News Hour. He is a frequent guest on local radio stations like 770 KTTH and 570 KVI. From 2019-21, Max was a presidential appointee to the Federal Service Impasses Panel within the Federal Labor Relations Authority, which resolves contract negotiation disputes between federal agencies and labor unions. Prior to joining the Freedom Foundation in 2013, Max worked for WashingtonVotes.org and the Washington Policy Center and interned with the Heritage Foundation. Max holds a labor relations certificate from the University of Wisconsin-Madison and graduated magna cum laude from Whitworth University with a bachelor’s degree in political science. A Washington native, he lives in Olympia with his wife and sons.