New speaker's FPPC troubles

Feb. 16, 2010

By ANTHONY PIGNATARO

One of John A. Perez’s first acts as a state assemblyman was to introduce AB 9, which partially amended the Political Reform Act of 1974. In fact, the official bill history says Perez introduced it on Dec. 1, 2008, one day before the Los Angeles Democrat, cousin of Antonio Villaraigosa and soon-to-be Speaker of the Assembly first took his oath of office.

AB 9 clarified some language dealing with contributions and expenditures made by state and local government entities, but the really relevant matter here is that Perez wasted absolutely no time once he got to Sacramento in addressing an issue concerning the state Fair Political Practices Commission (FPPC), which enforces the Political Reform Act. This is ironic, to say the least, because in 2003 Perez ran afoul of the FPPC while still a labor leader in Southern California.

Perez was a longtime political director for the UFCW’s Local 324, based in Buena Park. He resigned the post after getting elected to the Assembly in 2008. His record with the FPPC offers a previously unexamined look into the career of the freshman legislator who becomes Assembly Speaker on March 1. Despite being publicly available, I could find no instance of any news organization reporting on the matter, either when it first occurred, when Perez got elected to the Assembly in December 2008 or when he won the speakership last month.

The whole point of the Political Reform Act, according to the FPPC, “is to ensure that receipts and expenditures affecting election campaigns are fully disclosed to the public, so that voters may be better informed, and improper practices may be inhibited.” In other words, so that voters can get some idea of who’s spending what to pass initiatives or elect candidates.

According to Stipulation, Decision and Order No 01/388, signed on July 15, 2003 and approved by the Fair Political Practices Commission during its Aug. 11, 2003 hearing, John A. Perez violated this act — and thus deprived voters of seeing UFCW campaign actions when it might have made a difference in at least two elections — 11 times from 1997 to 2000, during his time as treasurer for United Food and Commercial Workers (UFCW) Issue Education Fund. John Sperry, another UFCW treasurer, violated the act an additional three times, according to the Stipulation, making a total of 14 violations.

“Respondents violated the Political Reform Act by failing to timely file late independent expenditure reports (8 counts), failing to properly report contributions (1 count), failing to properly report miscellaneous receipts (1 county), failing to file supplemental independent expenditure reports (3 counts), and failing to timely file a late contribution report (1 count),” said the FPPC Stipulation, which Perez and Sperry signed on July 15, 2003.

Five of the unfiled late expenditure reports dealt with Proposition 226, an unsuccessful 1998 initiative that would have required employers and union officials from getting an employee’s permission before withholding dues for political purposes. The FPPC Stipulation totals more than $60,000 in expenditures – voter lists, mailers, newspaper ads and postage – that the UFCW fund made against the measure that weren’t reported in a timely manner. The Stipulation also said that the UFCW fund failed to disclose a $75,000-expenditure against Proposition 25, an unsuccessful 2000 campaign finance reform measure.

In addition, the FPPC found that the UFCW fund “failed to properly itemize contributions and miscellaneous receipts on the pre-election campaign statement for the reporting period July 1, 1998 through September 30, 1998.” Most alarming, the union initially reported receiving $32,448 in contributions that were less than $100 each, meaning they did not require the disclosure of any contributor information. But during a subsequent audit, conducted in August 2000, the FPPC found that “all of this amount should have been itemized.”

Perez and the UFCW fund also failed to file late independent expenditure as well as supplemental independent expenditure reports concerning three payments, all donated on Oct. 19, 1998: $10,838 to gubernatorial candidate Gray Davis, $2,710 to Attorney General candidate Bill Lockyer and $2,710 to Superintendent of Public Instruction candidate Delaine Eastin.

Neither the union nor Perez and Sperry had a record with the FPPC before these incidents. Ultimately, the FPPC concluded that Perez and Sperry had been “negligent” in filing expenditure reports with the commission. FPPC auditors found that the union had failed to timely report $78,172 in expenditures, “which is over 8% of the total expenditures made during the 1997-1998 audit period.”

In the end, Perez and Sperry agreed that the union would pay a $23,000 administrative penalty for the 14 violations. This was pretty close to the maximum fine of $2,000 per count, which would have totaled $28,000.

Perez’s office acted at least somewhat cavalierly when I called for comment. “So this is old news, right?” Shannon Murphy, spokeswoman for Perez, asked rhetorically. Though she admitted that she hadn’t heard of the matter – meaning it was at least news to her – and a second call asking for comment, no one from Perez’s office responded to this story.

An FPPC spokesman would not comment for this story beyond what appeared in the July 15, 2003 Stipulation, Decision and Order. Sperry, who retired from the union in 2003 and also spent a year on the California Horse Racing Board, was both more talkative and inscrutable when I called asking what had happened back then.

“Nothing happened,” Sperry said. “As far as I know, nothing happened. I was never interviewed, and as far as I know, neither was John Perez.”

At first, Sperry denied knowledge of the FPPC Stipulation. When I pointed out that he had signed the document on June 25, 2003, he said, “To my knowledge, I didn’t.”

After further discussion, Sperry said he remembered the matter slightly. “A $23,000 fine seems like a serious matter, but to be very honest, I don’t recall what happened, and I don’t have Alzheimer’s. It was nothing illegal that I can remember. There was no intent to do anything illegal.”

PHOTO COURTESY JOHN A. PEREZ’s WEBSITE (http://democrats.assembly.ca.gov/members/a46/default.aspx)