Horne rejects plea deal in campaign-finance case - East Valley Tribune: Capitol Media Services

Horne rejects plea deal in campaign-finance case

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Posted: Friday, January 31, 2014 2:00 pm

Attorney General Tom Horne rejected what amounts to a plea deal in his campaign finance case, setting the stage for hearings later this month on whether he actually broke the law.

Horne told Capitol Media Services he was willing to settle claims by the Yavapai County Attorney's Office that he illegally coordinated his 2010 campaign with what was supposed to be an independent committee. That would have short-circuited the need for several days of public hearings that could have proven a political liability.

But Horne said the sticking point was a requirement that he admit he actually broke the law.

“Even if I decided that settling was in my best interest, I could not get those words through my teeth,” he said. “It's not true.”

Deputy Yavapai County Attorney Jack Fields said he would not get into details of the closed-door negotiation.

“Obviously ... we believe he was not in compliance with state law,” Fields said.

Neither Horne nor Fields would discuss any financial proposals.

The complaint by Yavapai County contends he controlled and improperly spent close to $500,000 which needs to be refunded. But the law also permits an administrative law judge to impose penalties equal to three times the misspent amount.

Despite Horne's political problems, the latest campaign finance reports show he has outraised fellow Republican Mark Brnovich by a factor of more than to five to one. But $100,000 of the $277,000 Horne lists in contributions includes a $100,000 loan from his sister; Brnovich has raised about $50,000 so far.

The case against Horne stems from an FBI investigation of him and a group known as Business Leaders for Arizona. That was being run by Kathleen Winn who had worked for Horne when he was state school superintendent and works for him now in the Attorney General's Office.

Some polling near the end of the 2010 campaign showed Democrat Felicia Rotellini making headway, at least in part because of money spent by a group of Democratic attorneys general attacking Horne. So Winn raised more than $500,000 that was spent on a last-minute commercial. Horne eventually won the race.

But Yavapai County Attorney Sheila Polk said emails and records of phone conversations involving the two leads her to believe that Winn was not acting independent of Horne.

Technically speaking, there is no specific law banning coordination between a candidate and an independent committee, but Polk said that if Horne exercised control of the funds that Winn's committee had raised, these effectively became contributions to his campaign. And several of the donors to Winn's committee had given far more than the $840 that state law allowed Horne to accept from any one source.

Polk issued a “compliance order” requiring Horne to refund the excess — about $400,000 — and for he and Winn to amend their campaign finance filings accordingly. Both have refused, with a multi-day hearing set to begin Feb. 10 before Tammy Eigenheer, an administrative law judge.

Whatever she rules may not be last word, with whoever loses likely to appeal.

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