An indictment of the state's broken campaign finance system

by Patrick Gannon, The Insider, July 7, 2015.

The most shocking disclosure made in a recent hearing by the State Board of Elections about Sen. Fletcher Hartsell's campaign spending wasn't that the longtime Republican legislator from Concord allegedly paid for National Geographic videos with campaign dollars.

Or car repairs or gas for his five vehicles. Or finance charges on personal credit cards. Or hundreds of dollars worth of shoe repairs. Or a life insurance policy. Or three speeding tickets. Or driver's license renewals. Or haircuts.

It was that the State Board of Elections has never – in Hartsell's roughly a quarter of a century of service in the General Assembly – audited his campaign spending, even though red flags should have arisen over the years from the reports he files regularly about how he receives and spends campaign cash. It took a News & Observer article in early 2013 to get the ball rolling on this investigation.

After a two-and-a-half-hour hearing last month, the five-member state board, which includes three Republicans, unanimously voted to refer the Hartsell situation to prosecutors for possible criminal charges. State board officials said they already have met with federal and local prosecutors from Wake and Cabarrus counties to turn over a nearly 800-page report on Hartsell's spending and answer questions.

But in the bigger picture, the situation represents a bruising indictment of a campaign finance system that is supposed to ensure campaign dollars are received and spent lawfully. We've heard for years that the Board of Elections is too undermanned and underfunded to take a close look at campaign finance reports as they come in, even though they are obligated by law to do so. At times, it has taken months or years just to get them online for public review.

As he explained his decision to refer the case for prosecution, board member Joshua Malcolm, a Democrat, said he hoped the General Assembly and all state residents "get a good whiff of what happened here" and "call the folks in the big building" to address the need for better disclosure and monitoring of spending.

Under a new state law that took effect in 2006, state legislators aren't allowed to spend campaign contributions on personal expenses. Prior to that, they could spend their money for any purpose as long as they disclosed the purchases. Today, the test they are advised to ask themselves on whether an expense should be attributed to the campaign is whether they would spend that money if they didn't hold public office. Take a look at the examples at the top of this column and run them through that test.

Although the Hartsell situation goes far deeper, you get the idea.

Board chairman Joshua Howard, a Republican, said Hartsell's actions seem to be a "cavalier disregard for the spirit of our campaign finance reporting requirements." He pointed out evidence showing Hartsell had tens of thousands of dollars in credit card debt at the time much of the questionable spending took place. An attorney who argued for Hartsell at the hearing said the senator believes he used his best efforts to report campaign spending and never intentionally violated the law or tried to hide anything.

The legal system ultimately will decide what, if any, laws Hartsell broke. Today, more than two years after that newspaper article that launched the investigation, Hartsell still serves in the Senate.

Ironically, he didn't attend the hearing in part because it was the same day the Senate was deciding how to spend $21 billion-plus in taxpayers' money in the state budget. He wanted to be there instead.

The General Assembly should fix what's broken in the campaign finance system. Until then, the Hartsell hearing should be required viewing for all candidates and their campaign treasurers.