State audit finds Hill skirting campaign finance law

July 11, 2014

By JOSH FRIEDMAN

An audit conducted by the California Franchise Tax Board has revealed that San Luis Obispo County Supervisor Adam Hill failed to properly disclose nearly $70,000 in campaign expenditures during his most recent run for office.

The California Political Reform Act, passed by voters in 1974, requires the Franchise Tax Board to audit state and local campaigns to determine whether they maintain compliance with elections regulations. The Franchise Tax Board audits different areas in each election cycle, and it recently completed an audit of the 2012 San Luis Obispo County supervisorial campaigns.

In an April 30 report, a tax board auditor wrote that the campaigns of Frank Meacham, Ed Waage, Debbie Arnold and Jim Patterson prepared financial statements that were substantially accurate and complete. But, the report stated that Hill did not disclose $68,059 in payments that firms made on his behalf.

State law requires candidates to disclose payments of $500 or more made by agents or contractors on behalf of political campaigns. For instance, if a candidate pays an advertising agency to purchase radio and television commercials, the campaign must disclose how the agency spends the money.

In May 2012, Hill reported making payments totaling $60,220 to an advertising and public relations firm to use for television and radio advertising. He did not disclose, though, what advertising the firm purchased on his behalf.

The tax board did not indicate that Hill faces any penalty for the violation. The April 30 report states that the tax board contacted Hill’s treasurer, Sharon McMahan, and she said she would try to report sub-vendor information correctly in the future.

Earlier this year, another state agency also notified Hill that he had violated a campaign finance regulation. In March, the California Fair Political Practices Commission (FPPC) issued a warning letter to Hill for misstating the occupation of developer Gary Grossman.

Last year, Grossman donated $1,000 to Hill in the same week that the supervisor attended a groundbreaking for one of Grossman’s Pismo Beach developments. But, Hill listed Grossman, the president of Coastal Community Builders, as retired on a campaign financial statement.