The Assoicated Press
Tim Eyman, shown in this image from television, speaks to reporters at a post office in Mukilteo on Monday. Eyman said it's up to his army of supporters whether he survives what he called his ''ugly and stinky and disgusting'' behavior.

State to scrutinize Eyman finance reports

Political, legal fallout continues day after stunning announcement

BRAD SHANNON, THE OLYMPIAN

OLYMPIA -- The Public Disclosure Commission will review Tim Eyman's campaign finance reports for the past year to determine whether a wider investigation, including an audit, is needed.

"I'll know by the end of the week," PDC Executive Director Vicki Rippie said Monday, a day after Eyman stunned his closest colleagues and his political adversaries by disclosing that he'd taken $45,000 for personal use in December 2000 from an initiative campaign.

State records show that Eyman and associates have raised about $3.8 million since 1997 for a variety of causes beginning with grassroots lobbying that led to an initiative to repeal state affirmative-action laws in 1998. His most recent venture, I-747, capped property-tax increases at 1 percent a year.

All the while, Eyman has insisted he never took a penny for himself, painting his campaigns as purely volunteer.

Eyman did not return a phone call late Monday seeking comment. He sent an e-mail to news outlets saying, "I won't be taking phone calls or e-mails or TV interviews for a while."

Taking money from a campaign is not necessarily against the law, and payment for political consulting is perfectly legal if properly disclosed, according to Rippie.

"Obviously it gives rise to questions whether reports he helped create and file are accurate," Rippie said.

Suzanne Karr, a former campaign treasurer and business partner of Eyman, said she thinks she was the "catalyst" for paying Eyman. As she explained it, Eyman had decided after Initiative 695 passed in 1999 that he couldn't afford the time away from his mail-order watch-sales business to carry on other initiative efforts.

"I just felt it was terrible that he had to quit; he was so good at it," Karr said. "I felt it was good to have someone to counter the big tax guys. ... I see him as a taxpayer advocate."

So they created Permanent Offense Inc. together -- with Eyman the majority owner and Karr holder of a 49 percent interest. Initially, however, Eyman resisted the idea of taking pay and couldn't accept the thought that he might be like the paid campaign consultants he had so publicly despised during his campaigns.

"He kind of sees people who get paid for this sort of thing as kind of mercenaries. He didn't feel comfortable in that category. He was squeamish," Karr said.

Karr, who was a volunteer, said she left the campaign in late 2000, just before Eyman finally took the $45,000. "At that point he hadn't decided what the money would be spent for. He was kind of evasive," she said. "I said that was fine, but eventually he would have to deal with it. ... He continued to stonewall (the public) on it; I understood why.

"There's no law violation here," said Karr. "All it is, really, is a deception of the people who donated the money. That's what Tim felt guilty about."

How much Eyman took, or planned to take for himself, may be in dispute.

Eyman told reporters Sunday that he paid himself $45,000 out of Initiative 722 proceeds last year as salary. He said he intended to take an additional $157,000 in 2002 as his newest venture, a campaign for $30 car tabs statewide, gets under way.

But Christian Sinderman, the political operative who worked against Eyman during last year's campaign, analyzed the campaign finance reports for last year's I-747 and found Eyman had paid nearly $144,000 to Permanent Offense for consulting fees and directly reimbursed himself $21,468.50 of it for expenses.

The expenses included gas fill-ups for his car and a few hundred dollars worth of maintenance on a Lexus, Sinderman said.

Until his confession to the news media Sunday, Eyman, a Mukilteo-based salesman, repeatedly had denied taking money for his personal use, calling it a desperate ploy by his opponents. And he insisted that any money diverted to Permanent Offense was for contingencies or future initiatives.

According to Rippie, state law "provides certain circumstances under which campaign funds can be transferred" to another use. "We'll also be looking at sections of law that prohibit concealment of the source, both of contributions and of purposes." That is why her investigators are looking at disclosure reports filed by Eyman and his wife, Karen, for I-747, Rippie said.

$3.8 million

A closer look by The Olympian at campaigns that Eyman has been associated with since 1997 shows that he or colleagues have raised about $3.8 million and spent a little less than that. Leftover money from one campaign was sometimes rolled into the next one, according to filings with the PDC.

The PDC review of Eyman's records will look initially at the past year, but Rippie said there is no boundary on the inquiry.

Even before Tim Eyman's confession, Sen. Adam Kline, D-Seattle, was sponsoring a bill to require full financial disclosure by initiative sponsors.

Kline sponsored Senate Bill 6637 along with five other members of the Senate's Democratic majority. He cited the increased use of the initiative in recent years, saying voters deserved to know more about the people proposing major changes in policy. Among other topics, Washington voters have approved medical marijuana, banned animal trapping, raised teacher pay and cut taxes.

"It would allow the people to know about initiative sponsors what they already know about us," Kline, D-Seattle, told the Senate State and Local Government Committee last week.

The Associated Press contributed to this report.

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