State may crack down on lawmakers’ campaign filing errors
If Arizona voters want to know how political candidates and elected officials make a living, who donates to their campaigns and how they spend the money, the information is publicly available in state records.
But they can’t learn anything when politicians file those mandatory forms with incorrect information — or don’t fill them out at all.
That’s the case for multiple members of the Arizona Legislature.
According to the latest records available, three sitting lawmakers reported that they had zero sources of income over the past year. One failed to mention a debt to a law firm. And four failed to file reports that show who donated money to their campaigns and how they spent that money.
Few candidates and officeholders are ever held accountable for mistakes, omissions or late filings, though. Tardy filers may incur thousands of dollars in late fees, but the Secretary of State’s Office has typically waived them upon request.
But new state leaders took office as of January: former Democratic Secretary of State Katie Hobbs is now the governor, and Democrats Adrian Fontes and Kris Mayes now hold the offices of secretary of state and attorney general. A crackdown on incomplete, incorrect or untimely forms could come.
Fontes, whose office oversees elections in the state, is gathering information for a planned action against campaign committees (which can include individual candidates or groups) that have failed to file three consecutive campaign finance reports.
“Compliance procedures are under review as to how best to address the numerous committees that currently are out of compliance,” said Fontes’ spokesperson, Paul Smith-Leonard, adding that the office “is currently engaging in a top-to-bottom review of how to best serve the public.”
Yet strict compliance with the maze of laws and rules for existing and wouldbe officeholders can create challenges, even for political veterans like Fontes. He submitted his financial disclosure statement two days after the Jan. 31 deadline, which could net him a $100 fine.
Several Arizona lawmakers in noncompliance
State law dictates that failure to file financial disclosure forms or campaign finance reports should spark investigations and penalties.
For financial disclosure forms, candidates must list any source of income over $1,000 in the prior 12 months. Exact dollar amounts aren’t required, but the names of employers, owned businesses, trusts, investments funds, retirement funds and the income sources of household members are.
In addition, candidates for office, as well as political action committees and lobbyists, must file campaign finance reports periodically throughout the year, updating their latest campaign donations and spending for the public.
Several lawmakers appear to have fallen short in both those areas:
Sen. Catherine Miranda served in the Legislature from 2011 to 2019 before returning to the state Senate this year. Despite her prior experience, she filled out her mandatory financial disclosure forms incorrectly.
The Laveen Democrat put “n/a” (not applicable) in every field on the forms she filled out in March 2022 and January of this year, as if she has no income sources whatsoever.
Miranda told The Arizona Republic that as a retired school teacher and administrator, “I don’t think I am required to disclose my meager pension from the Arizona State Retirement System.”
Under state law, she is. The disclosure forms define compensation as “anything of value or advantage,” and other lawmakers who are retired teachers listed their pensions.
Two other lawmakers, Rep. Leezah Sun, D-Phoenix, and Rep. Myron Tsosie, D-Chinle, filed disclosure forms with zeros, similar to Miranda’s. Tsosie didn’t return calls or emails seeking comment. Tsosie, now in his third term, could have at least disclosed his $24,000 a year legislator salary as most other incumbent lawmakers did.
Sun, a first-time lawmaker who first registered to vote in 2018, thanked a reporter for letting her know her form was incomplete. She’s a stay-at-home mother with no income and inadvertently omitted her spouses’ salary as an electrical engineer with Keller Electrical, she said.
“I’m going to update it,” she said. “I should have been more due-diligent with these reports.”
Tsosie, who raised about $4,300 and spent $2,600 for his 2018 run for office, reported no campaign donations or expenses for his 2020 and 2022 races.
Deydrek Scott, who ran unsuccessfully last year for a House seat in Legislative District 6 against Tsosie and nowRep. Mae Peshlakai, said it’s possible Tsosie’s campaign reports are accurate.
“He was absent from Democratic events throughout the whole election,” Scott said. “I really don’t know if he raised any money, but I know he didn’t campaign like Ms. Peshlakai and myself. We even had to help him gather signatures to get him on the ballot.”
Tsosie may not be much of a fundraiser, but his zeroed-out reports aren’t always filed on time. He owes the state $2,330 for two late filings in 2022 and another $1,075 — and counting — because he hasn’t yet filed a report that was due Jan. 17.
Rep. Lydia Hernandez, D-Phoenix, previously served in the Legislature from 2013-15 and learned how the system works, filing accurate reports mostly on time. When she ran unsuccessfully for the Legislature again in 2016, though, she failed to officially terminate her campaign finance account with the state, triggering filing deadlines for multiple reports that she then filed years late, in some cases. That account now owes $53,450 in late fees.
She opened a new account with the secretary of state for her latest run for office last year and now avoids late fees by filing on time — but with zeroed-out reports that show no activity. Hernandez acknowledged that her campaign did raise and spend money last year. As of early March, she hasn’t amended her reports.
Two sister lawmakers from Tucson, Reps. Alma and Conseulo Hernandez (who aren’t related to Lydia Hernandez), haven’t filed a campaign finance report with the state since summer, denying voters the chance to see who funded their campaigns and what they did with the money for months before their elections.
Online records with the Secretary of State’s Office, which shares responsibility for enforcement of election-related violations, show that as of March 4, Alma and Consuelo Hernandez owed the state $13,100 and $8,400 respectively for late filings that in Alma Hernandez’s case go back to 2018.
“I have a lot going on,” Consuelo Hernandez told The Republic last month. “There’s nothing shady about anything. It’s just we have not had the time.”
Officeholders not only have to report their income sources to reveal potential conflicts of interest but also any personal debts over $1,000 they or a household member owes.
Rep. Justine Wadsack, R-Tucson, in her March 2022 and January 2023 forms, does not list a debt she accrued in 2020. That was the year the law firm of Munger Chadwick & Denker, PLC, settled a lawsuit it had filed against Wadsack and her husband for unpaid bills. A Pima County judge ordered the Wadsacks to pay back the settled debt of $35,000 at the rate of $250 a month.
If they have paid at that rate, they still owe about $26,000 that should have been disclosed to the public.
Wadsack wouldn’t respond directly to questions, but her legislative assistant, Sebastian Rembao, related that “she did report it and if she didn’t it was a simple mistake and will fix it.”
Enforcement needed for late or incorrect filings
Cooperation between the two state entities that deal with these issues could solve issues that have hobbled potential punitive actions against violators in recent years.
The Secretary of State’s Office oversees elections and election law while the Attorney General’s Office handles civil and criminal enforcement issues. They usually have to work together to make a case stick, but that didn’t always happen under previous administrations.
In one recent example, the Secretary of State’s Office’s under Hobbs squabbled for 20 months with the office of former Republican Attorney General Mark Brnovich over each other’s legal duties in processing complaints against two former lawmakers.
The cases involved missing income information on forms from former Republican secretary of state candidate Mark Finchem and former Corporation Commissioner Sandra Kennedy, a Democrat. Hobbs’ office wanted the attorney general to move forward with enforcement actions. Brnovich’s office said the secretary of state had to submit a formal referral before it could proceed. No investigations ever took place.
Knowingly filing an incorrect disclosure form is a Class 1 misdemeanor in Arizona and could result in stiff fines if enforced. It can also mean forced resignation from office: That’s what happened to former Mesa lawmaker David Petersen in 2006 following an investigation by former Attorney General Terry Goddard.
Misleading campaign finance reports rob the public of vital information about a candidate’s connections and can result in a perjury charge. But state officials don’t regularly perform audits or reviews of what is actually in the filings, relying instead on media reports or complaints by political groups or a candidate’s opponent.
The main priority for the Secretary of State’s Office is whether a form was filed on time. Enforcement is spotty in that regard, as well.
Late fees accrue at a rate of $10 per day per report for the first 15 days, then $25 per day. But officeholders are usually allowed to easily fix discrepancies with minimal penalties once they’re found.
Fontes’ filing is dated two days after deadline
The Financial Disclosure Handbook published by the Secretary of State’s Office says that all elected officials must fill out the forms every year, starting when they first file to run for office. They also need to file by Jan. 31 following an election that they won, it states. Officials can see fines of $50 a day, up to $500, for missing these deadlines.
Fontes’ form is dated Feb. 2, two days after the deadline. He didn’t return a message directly for this article. But Smith-Leonard said the office is checking into whether Fontes needed to file the form at all in January.
Smith-Leonard said that although the handbook tells candidates to file the form in January even if they didn’t hold office the previous year, state statute isn’t so clear.
“We are reviewing the handbook guidance and making edits to clarify the filing requirements,” he said.
If the handbook is correct, Fontes may owe a $100 fine.
Other statewide officeholders who didn’t hold office last year filed the form in January. Mayes’ form is dated Jan. 31, right on the deadline. No form was on file in early March for public schools Superintendent Tom Horne, but Horne said he filed it in mid-January.
The forms for both Fontes and Mayes only showed up online on March 6, which backs up Horne’s contention that his form was not yet posted to the secretary of state’s website.