Councilman-at-Large Ravi Bhalla and 2nd Ward Councilwoman Beth Mason publicly lobbed complaints last week at each other, each saying the other had violated state campaign finance regulations.
Last weekend, a local newspaper found that Bhalla had not filed political contribution reports with the state for three years, and Mason on Monday called for his resignation. The forms declare which political campaigns his private law firm had donated to and which government contracts it has received. The forms are only required when amount thresholds are passed.
But the day after Mason called for Bhalla’s resignation, Bhalla held a press conference to say that Mason’s financial filings from one of her campaigns for mayor last year showed apparent payments of $15,000 in cash to various election workers, in violation of state laws restricting cash payments for campaign work.
Fines start at $6,800 and up for the first offense.
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Bullseye on his back
In the past two months, some ethical landmines have exploded around Bhalla. First, he voted in February to approve a city-contracted lawyer with whom he shares an office and secretary, then downplayed the potential conflict of interest when it was made public. The city attorney has since released a report saying there was no conflict. However, the “appearance of a conflict” has since been debated publically.
Then, two weeks ago, Bhalla was exposed in a statewide newspaper as one of 10 vendors who contributed over $35,000 to a political action committee (PAC) linked to Newark Mayor Cory Booker. The 10 vendors subsequently received millions of dollars in contracts from Newark. Bhalla contributed $2,500 to the PAC and the next day his Hoboken law firm was awarded the first of two $60,000 no-bid contracts from the city of Newark.
The PAC did not contribute directly to Booker’s campaign; thus this case was not considered “wheeling,” or circumventing pay-to-play regulations. Instead, the PAC contributed to Board of Education candidates whom Booker was backing.
Bhalla said he has contributed to several PACs because he believes in their missions, not because the contribution would get him city contracts.
No one directed him to contribute to the Newark PAC, Bhalla said, and he maintains his contract with the city was not based on the donation. He heard about the PAC through a mass mailing, he claims, not from Booker.
Guilty on one count
It was after those contributions came to light that a different daily newspaper reported about Bhalla’s failure to file certain financial disclosure documents for three years, and Mason said he should resign.
But after the newspaper questioned Bhalla, he admitted to failing to file his business contribution documents, and filed them. He may still be liable for a fine from the state.
“I should have been aware,” Bhalla told the Reporter last week. He said that at first he didn’t know it was required, but he recognizes that ignorance is not an excuse.
Mason was not convinced.
“How can an attorney with so many public contracts who is also an elected official possibly be so incompetent?” Mason questioned in a press release last week. She claimed Bhalla is “big time player” in a political machine who “masquerades as a reformer.”
Having not been officially charged with any offense, Bhalla is not stepping down. “I don’t think it was warranted,” he said.
Understands the disappointment
Bhalla said he understands the disappointment that good-government backers see in the overall picture painted by the PAC contributions in Newark.
“I acknowledge that a reasonable person, when viewing the facts before them, can reach a different conclusion, and how this can create an appearance of impropriety,” Bhalla said in an e-mail to the Reporter. “If there is a perceived loophole in the law, the best means for me to address this issue as a public official is to work with [People for Open Government] and my council colleagues to identify ways to strengthen pay-to-play laws in Hoboken.”
Mason on her election payments
Bhalla is an ally of Mayor Dawn Zimmer, who beat Mason twice in last year’s mayoral elections. Supporters of both Mason and of Zimmer have been at war with each other for over a year on the internet and in other places, so it is no surprise that Mason might take shots at a close Zimmer ally like Bhalla.
On Tuesday, Bhalla fought back against Mason’s comment that he should resign.
At Bhalla’s press conference on Tuesday, he released campaign records from last May’s mayoral elections that showed that Mason herself may have problems correctly following the law. Mason’s filings were sent to the state several months late, to boot.
“Councilwoman Mason should not be casting stones when she herself lives in an ethical glass house,” Bhalla said in a release.
Mason’s campaign ledger shows 48 checks made out to “cash,” or checks that were written in order to draw cash from the campaign account. Mason and her campaign team had signed and verified the reports.
Checks made out to cash can be used for small purchases like supplies, but the purchase has to be documented. Checks cannot be made out to cash to pay street workers of the campaign.
Bhalla said the money may have been used illegally to pay election workers.
Last week, Mason denied wrongdoing. She said no cash was paid out of her campaign, even if the records submitted to the state said so. She said an accountant on her campaign staff made 48 identical “clerical errors” due to the fact that the word “cash” was used as a placeholder for campaign workers’ names in a checkbook not available to the accountant. Mason said the error would be corrected on Friday.
Proof and disproof
Mason provided carbon copies of several original checks last week to show that before the accountant put the files together, her campaign had made out the checks to individuals, not to cash. However, if that is the case, Mason may still have violated another to ELEC code: One check per person.
She admitted that she wrote single checks to cover work done by multiple people, which was documented in her campaign filings. Mason said they used single checks for several people because her campaign crew had run out of checks to write.
“Look, I know what it feels like to not get paid. I wanted to pay [the workers],” she said.
In one instance, six people received payment from one check, according to her campaign records.
Since the state regulations require documentation for transparency and accountability, Mason complied in that regard by listing each person paid from each check even if it wasn’t made out to them, she said. But Mason cannot explain how people who were not listed on the check were actually paid from it. Did one person distribute the money to the others? And did that person hand over cash?
Asked these questions on Thursday, Mason first said that what happened to the money after it was distributed to several workers via one check was not a under the control of her campaign.
But she added later that she would look into who in her campaign administered the practice, why it was used, and how the payments were made.
Joe Donohue, deputy director of ELEC, said it is against the law to use cash to pay street workers in a campaign, even if the campaign were to write a check that was cashed and distributed first. Donohue could not comment directly on any particular situation.
Donohue said the law is used to keep a record of who was paid what and when.
So what if the campaign documented everything but still wrote a check that was distributed as cash?
“That would depend on the case,” Donohue said, as to whether sufficient documentation could excuse a possible violation of the law.
Fines possible
The state commission can issue fines for violations that are assessed on a case-to-case basis. Fines start at $6,800 and up for the first offense and $13,600 and up from the second offense.
ELEC investigations can stem from internal monitoring or an outside complaint, but officials do not comment on whether investigations are ongoing.
Timothy J. Carroll may be reached at tcarroll@hudsonreporter.com.