Dems Clear Up FEC Problems
The Colorado Democratic Party was fined $105,000 by the Federal Elections Commission for bookkeeping and compliance errors during the 2001-2002 campaign. Among the factors the FEC audit found was the party had not disclosed donor information (occupation, etc), expenses allocated between federal and non-federal accounts were in error and some financial records were incomplete.Pat Waak, current chairman of the CDP, noted in her statement on the party blog:
An ongoing audit by the Federal Elections Commission from 2001-2002 has finally been settled. During the past two years we have been clearing up questions of documentation and allocation. For the past several months we have been negotiating a fine. The final fine is $105,000.
The audit is old news. The press has covered it twice. The only thing that is new is the amount of the fine. Last month we paid $50,000 of the fine and will pay the remainder over the next five months.
Nothing illegal was done in the 2001-2002 cycle. Instead this is a reminder of how important careful and thorough bookkeeping is, especially during a campaign cycle. Two years ago we put into play a new accounting system, hired a compliance firm, and added a full time accountant. Routine audits are done so that nothing like this happens again.
The Bipartisan campaign Reform Act (also known as the also known as the McCain-Feingold Act) had not been initiated at the time, so the regulatory requirements were much different than today. Larger amounts of donations passed through political parties at that time, so budgets were much larger.
During the 2001-2002 campaign, the Democratic Party was headed by Tim Knaus with Larry Beer as Treasurer and Mike Melanson was the executive director. The financial activity was over $7 million at that time, according to the audit records.
Vice-Chair Dan Slater explained more about the audit:
Our State Party Treasurer, Mark Ferrandino, walked into the office and walked right into the ongoing FEC audit. He (as well as prior treasurer Shawn O’Buckley) has done a great job sorting out the issues raised by the FEC, answering their questions, and cooperating with the investigation. In theory, the fine from the FEC could have been much worse; I’m convinced that they took our cooperation – and that means Mark Ferrandino’s work – into account in this instance.
The Party has already paid $50,000 of the FEC fine, and we’ll pay the remainder in the months ahead. We saw this coming, and we budgeted for it in our 2007 budget approved last December.
Here’s some good news, though: according to the most recent FEC reports, we’ll still be in good shape relative to the Colorado Republican Party even after we pay our fine. The CDP currently has about $160,000 on hand in its federal account with no debt. The state GOP? They have just $24,000 on hand, and they have a staggering $272,000 in debt still to repay! In other words, the Colorado Republican Party took out loans to end up with the results we saw in 2006!!!