Mike Salsbury/The Olympian
Tim Eyman is under investigation by the state Public Disclosure Commission over transfer of funds from his initiative campaigns to a for-profit corporation.

The Associated Press
Tim Eyman, who sponsored Initiative 695, rips up a sign in a Seattle courtroom in March 2000 after Judge Robert Alsdorf struck down the measure as unconstitutional.

The rise and fall of Tim Eyman

Lie about finances casts cloud over future of state's anti-tax movement

BRAD SHANNON AND PATRICK CONDON, THE OLYMPIAN

OLYMPIA -- During the past three years, Tim Eyman has become so closely identified with the initiative process in Washington that you could hardly mention one without the other.

Starting with Initiative 695 in 1999, Eyman enjoyed a remarkable run of success at the ballot box with a series of tax-cutting initiatives that earned him both a loyal corps of followers and a rabid set of opponents. But few denied that the 36-year-old wristwatch salesman from Mukilteo had as much influence on government policies as anyone in recent memory.

He also built an impressive money-raising machine that relies on small contributions from thousands of Washington residents. Since 1997, Eyman and his campaign associates have spent nearly $3.7 million.

During that same time, the initiative process moved further from its origins as a populist tool created as a check on elected officials. The process, many have complained, has come to more closely resemble the system it was intended to remedy -- in other words, just another way for special interests to transform their narrow agendas into law.

"It's become a big business," Secretary of State Sam Reed said. "There are people who are just doing this as a livelihood."

That included Eyman, as it was revealed last week when he admitted that he lied by denying that he was profiting from his political activism.

What Eyman did was shift about $226,000 from his initiative campaigns in 2000 and 2001, putting it into accounts controlled by his for-profit company, Permanent Offense Inc. For months, he insisted it was a contingency fund for legal costs or for his next initiative.

He said he hadn't taken a penny for his own uses and promised that he never would.

The truth? Eyman says he took $45,000 in December 2000 and planned to take an additional $157,000 this year while he managed his newest initiative, I-776, to cap car taxes. The state Public Disclosure Commission has launched a full investigation of Eyman's maneuvers, believing he may have diverted more.

Eyman has at least temporarily stepped aside from his leadership of Permanent Offense and gone into seclusion. He could not be reached for comment.

A bigger issue

Eyman was long viewed by many supporters as a lone holdout in the institutionalization of the initiative process. His efforts took on the glow of a holy mission, a tapping of the broad discontent with a state tax structure many viewed as wildly out of whack.

"If you weren't in Washington and you looked at him, certainly up to a year ago or so, you'd look at him and say, 'That's about as grass-roots as it gets,' " said Todd Donovan, a political science professor at Western Washington University who wrote a book about the initiative process.

As he rallied the grass roots, though, Eyman watched as millions of dollars flowed into the coffers for his efforts. Management and political consultants, signature-gathering firms, direct mail outfits and campaign-related businesses all took a piece of the action from his yearly ventures.

Before Eyman's public admissions, though, it would have been naive to view his operation as simply a manifestation of anti-tax ideology, Donovan said.

Permanent Offense Inc. had become as slick and well-oiled as any of the professional initiative machines that have dominated the process in recent years, not just in Washington but in other western states, Donovan said.

"Why did Eyman feel like he had to run a new initiative every year, even when it was obvious some of them would immediately get tossed by the court?" Donovan asked. "It's because that's how you keep the donations rolling; that's how you keep the mailing lists up to date."

Early doubts

As Eyman's reputation as a tax crusader grew, former colleagues from his earliest forays into political activism watched with skepticism as he came to dominate the political landscape.

Leslie Smith worked with Eyman on I-200, which barred affirmative action in state hiring in 1998. Every time Eyman came on TV, she said, "I would leave the room or change the channel."

Her husband, Scott Smith, and Eyman were the original co-sponsors of I-200.

Early on, Leslie Smith served as the campaign's treasurer. Partway into the campaign, the Smiths discovered that Eyman had vastly overstated the number of signatures he had collected in his attempt to put the measure before the Legislature. Eventually, enough signatures were collected.

The Smiths left the experience feeling Eyman had broken their trust, and they haven't talked to him since.

Their doubts resurfaced last Sunday when Eyman publicly admitted that he had lied.

"It seemed like his character, the lying to cover it over," said Leslie Smith.

But the Smiths still found themselves voting for Eyman initiatives again and again.

"I always thought he was doing a good job," Scott Smith said. "I always supported what he did."

Those mixed feelings about Eyman -- strong support for his crusade against the state's tax structure, overlaid with concerns about his honesty -- are shared by others who worked with Eyman before he became so closely identified with the initiative process in Washington.

"I was always a little dubious about everything I heard about Tim ... even though I would vote for his initiatives," said Brett Bader, a Republican political consultant.

Bader worked on I-200 and later watched Eyman launch I-695, which limited car tab fees to $30.

Monte Benham, one of Eyman's partners in his more recent efforts, said almost the same thing last week.

"A character flaw has been discovered in Tim Eyman," said Benham, a retired engineer from Kennewick who has been Eyman's partner on all his efforts since I-695.

Whatever his motivations, Eyman's problems also might have jeopardized the anti-tax movement he helped harness.

"Tim moved the ball far down the field for the anti-tax movement. But this is a major setback, and I don't know yet who can come back in and pick up the ball. ... It remains to be seen," said Bader.

"Believe me, those conversations are going on right now behind the scenes: what next and who to lead," Bader said. "I think the damage is worse than his supporters are willing to concede."

Carlson on Eyman

John Carlson, who rescued I-200 in 1997 after the signature fiasco and later ran for governor as a Republican in 2000, said Eyman needs to give back the money he took. Carlson says Eyman also must remove himself completely from all financial aspects of the I-776 campaign, and subject himself to the authority of a group.

"It's critically important for Tim to separate himself from the issue of money," said Carlson, now an afternoon talk-show host on KVI radio in Seattle. "The issue of money must be off the table because, if it isn't, Tim will overshadow the (new) initiative, and his movement will be paralyzed."

"The irony here really works against Eyman," said Carolyn Long, director of the public affairs program for Washington State University's Vancouver campus. "The basic premise of Eyman's initiative campaigns is the way government is abusing money. ... If he had a different message in his initiative campaigns, the damage wouldn't be as great. It's unlikely he'll be able to recover."

"Knowing Tim, it would not surprise me if this was part of his plan to get publicity for his initiative," countered Sherry Bockwinkel, owner of Washington Initiatives Now Inc., a Tacoma consulting firm Eyman hired to provide paid signature-gatherers for his initiatives.

Bockwinkel said no one has ever raised money on a grass-roots level like Eyman; he has raised close to $3.8 million since his work in 1997 with the Smiths, according to state Public Disclosure Commission records.

Whether Eyman rejoins the I-776 campaign could be decided this week. Benham and two other leaders in Permanent Offense say they will reorganize the group this weekend and make an announcement Tuesday in Olympia.

"I watch him: He is the master of manipulating the mass media. I have never seen anything like it. ... I come at it from the point of marveling," Bockwinkel said. "I'd like to predict that he'll have his signatures (for I-776) faster than he ever did. ... I don't want to jinx him."

Brad Shannon and Patrick Condon can be reached at 360-753-1688.

On the Web:

- Permanent Offense

Sound Off at TheOlympian.com: Is Mr. Eyman's political career over?

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