Easy Money

For politicians, campaign funds beat credit cards any day.

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A honeymoon trip isn't public business under any circumstances. A "trade mission" to Australia at Easter may technically be public business but is fishy enough to warrant an extensive investigation by the media. A Shelby County politician meeting with state education officials in Nashville to discuss report cards is clearly public business.

But between those extremes there's a gray area of entertainment, travel, lunches, telephones, and other expenses that prompt this question: What sorts of things can people who work in government write off as public business or political activity with a clear conscience?

That's the question local elected officials and top government administrators are grappling with in the wake of the ongoing investigation into misuse of Shelby County government credit cards. The question is particularly relevant to city officials, including Mayor Willie Herenton and members of the Memphis City Council, who are up for reelection in 2003. Shelby County elected officials, who took office in September just before the credit-card scandal broke, don't have to run again until 2006.

For elected officials, campaign contributions rather than credit cards present the greatest opportunity to spend other people's money. For one thing, credit cards are scarce and getting scarcer. Shelby County mayor A C Wharton has called in most of the county credit cards that were abused in the previous administration. The city doesn't issue credit cards, even to the mayor, although he has both a six-figure campaign fund and a personal expense fund paid for by private donors.

Hundreds of thousands of dollars in campaign funds will change hands in the next six weeks as the mayor and council members hold Christmas parties and prayer breakfasts that double as fund-raisers and political rallies. Some members of the city council who expect challengers next year aim to raise more than $100,000 in campaign funds.

Because the money comes from donors rather than taxes, how politicians spend it is basically up to them. The Shelby County Election Commission requires regular reporting and disclosure, and the Tennessee Registry of Election Finance gives specific rules for raising funds ($1,000 maximum from individuals and $5,000 from political action committees) and general ones for spending them. But enforcement is, for the most part, up to political candidates themselves -- and the media.

The published guidelines of the registry say the purpose of an expenditure "depends upon all the facts and circumstances surrounding the expenditure." An expense which is "directly related to and supports the selection, nomination, or election of that individual to public office is considered political activity. An expense which would be incurred by an individual regardless of that person's candidacy for public office is considered an expenditure for a nonpolitical purpose."

With that in mind, how would you classify these expenses?

* A new suit of clothes. "I've had candidates ask about this, and my first reaction was to laugh," says Brian Green, administrator of the Registry of Election Finance. "But after I thought about it I would say yes. Some people campaigning in jeans this year didn't get elected."

* Taking a trip to Dallas with spouse to study downtown development. "I would say yes," says Green.

* Dinner with a group of constituents at Folk's Folly. "Yes, if the candidate is trying to get their views," says Green. "It depends on what is discussed."

* Buying tickets for a Grizzlies game at The Pyramid for campaign workers. "Yes, and the drinks and pizza as well," says Green. "It's a way to say thank you and get votes."

* Donation to charity. "Yes, we see this all the time," says Green.

* Membership in the Plaza Club. "That depends," says Green. "The guidelines specifically mention membership fees as long as the organization has an up-to-date exemption from the Internal Revenue Service."

* Donation to another candidate for political office. "This is one of the most common uses of funds," says Green.

* A cable television subscription. "Is it for the purpose of getting knowledge or for entertainment?" Green asks. "The mayor of Lebanon, where I am from, has cable on all day to stay informed."

* Cell-phone bills. "Yes," says Green. "I see them on almost all forms." But some politicians like City Councilman Tom Marshall say they shun the practice because they don't want their calls open to the prying eyes of reporters.

* Newspaper subscriptions. "Yes," says Green. "It's a way to keep up."

* A Christmas party. "As long as it helps the candidate get elected or stay elected it's okay," says Green.

Green says his office gets a few calls a week from candidates asking about proper and improper spending. Enforcement is up to the state attorney general.

"Somebody has to make a complaint," says Green. "Then we pass it on to the attorney general." Green says he hasn't seen it happen in the two years he has been with the registry.

A spot-check of filings at the Shelby County Election Commission shows that most candidates file reports in a timely fashion, but losing candidates in particular can file late or not at all with impunity. The interpretation of "political purpose" is so broad that it makes no sense to hide something. Receipts are not required. As one Shelby County commissioner says, "I've heard of candidates basically living out of their campaign fund."

The bottom line: Campaign contributions beat a city or county credit card any day.

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