20% didn’t file campaign finance reports

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A dozen candidates running for elected positions at Houston City Hall failed to file required campaign finance reports in July, continuing a sloppy reporting period for the slate of candidates hoping to lead the city.

The omissions account for nearly one in five of candidates running in the November elections, after about 25 percent failed to file the mandatory reports in January as well. Top mayoral contenders also had to refund contributions from those who exceeded the city’s cap and from prohibited city contractors. 

The campaign finance reports show who is donating to city campaigns and how candidates are spending that money. Candidates must file the documents every January and July, along with two more in the month before the election.

BACKGROUND: Nearly 1 in 4 Houston Council candidates haven’t filed their campaign finance reports from last year

The candidates who did not file a report include Richard Nguyen, who served as the District F council member and now is running for an at-large seat. Orlando Sanchez, who is running in second place for controller, according to a recent poll, did not file a report with the city, but he did file one with the state. Election officials say candidates who have announced a bid for city office — as Sanchez did in April — should file their reports with the city.

Others who skipped the report entirely include Theodis Daniel and Gaylon Caldwell, both of whom are running for mayor; Koffey El-Bey,  District B; Ralph Garcia, District I; Bernardo Amadi, At-Large 3; Chad Cossey, At-Large 5; and Charles Onwuche, undeclared. Another three candidates failed to file the report in the correct format, according to the city secretary’s office. 

The city lacks the power to enforce the reporting requirements, which are enshrined in state law. It could send reminders to candidates to ensure they know about the mandate, but it does not.

Former City Attorney David Feldman told the Chronicle last month that the office used to send reminders during his tenure under then-Mayor Annise Parker, which usually led to compliance.

City Attorney Arturo Michel said he thinks Feldman may have been thinking of a separate requirement for office holders to file financial disclosure forms, revealing businesses they invest in and real estate they own. 

Michel, who is serving his second stint as the city’s top lawyer, said nobody in the city attorney’s office remembers sending reminders for campaign finance reporting, though he acknowledged they could do so. Feldman died on July 22.

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The result leaves enforcement up to the Texas Ethics Commission and opposing candidates or residents, who can file complaints with the state agency. That commission sends reminders to candidates running for state and county offices, but not city races.

“The TEC is able to send notices to all candidates for state office because state candidates must provide their contact information to the TEC and create an account in the TEC’s filing system,” said J.R. Johnson, the commission’s executive director. “The same is not true for local elected offices. There are an estimated 22,000 elected offices of local governments in Texas. With current funding, it would be impossible for the TEC to identify and notify every candidate for those offices of their filing requirements.”

Sanchez, the candidate for controller, said his legal advisors told him it was acceptable to continue reporting to the state for now. His report shows he raised $4,500 and spent $3,000 in the first six months of the year, with about $2,700 in the bank, trailing his competitors.

“Orlando had not even begun actively fundraising for Controller before the end of the last reporting period, and thus had not triggered the requirement to file a treasurer appointment for Controller,” said Jerad Wayne Najvar, Sanchez’s attorney.  

Both Michel and the TEC, though, said candidates who have announced campaigns for a city office must file reports with the city.

“Section 252.010 of the Texas Election Code says that if someone who already files reports with one authority (e.g., the TEC) decides to seek a different office that would require filing with a different authority (e.g., a political subdivision), that person must file a campaign treasurer appointment with the new filing authority and begin filing reports there,” said Johnson, from the TEC. 

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Many of the candidates who skipped the reports are running low-budget and comparatively low-profile campaigns. Amadi, for example, said he did not raise any money and therefore did not file a report, though he still is required to file one. Daniel said he was trying to get an exemption to file the report in paper, instead of submitting it online.

“I wanted to wait until the fee was paid,” said Daniel, referring to the $1,250 fee candidates must pay the city to get on the mayoral ballot. “Everything before that is just words.”

Nguyen, the former council member, did not respond to requests for comment, nor did Caldwell, El-Bey, Garcia, Cossey, and Onwuche.

A candidate who did not file a January report told the Chronicle the TEC said it is more lenient on local candidates because they do not get reminders to file the reports. Johnson, from the TEC, said that is not an official policy. 

“However, the TEC does take all relevant facts into consideration when assessing a civil penalty, including whether or not a candidate received notice of their requirement to file,” he said. 

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