Violating ethics laws rarely yields repercussions in TX — and it's Paxton's fault

In 1989, Bo Pilgrim, an East Texas chicken plant magnate, strolled the floor of the Texas Senate and dispensed $10,000 checks to nine members in an effort to stop a worker’s compensation bill from passing.

The scandal, dubbed “Chickengate,” was shocking but legal.

But the chicken man’s brazenness — what he called campaign contributions, many Texans saw as bribes — ruffled enough feathers to usher in a rare era of good government reforms.

Lawmakers would soon pass laws prohibiting themselves from accepting donations inside the Capitol and creating the Texas Ethics Commission, an independent body with investigative power, that would enforce the state’s campaign finance laws.

Three decades following its inception, the commission is toothless. Compliance of Texas’ ethics laws is largely voluntary. That’s because the agency relies on the Texas attorney general to enforce payment of fines for violations.

And under Ken Paxton, who himself owes $11,000 in ethics fines, that has rarely happened.

A review by The Texas Tribune found that the number of politicians, lobbyists and political action committees that owe fines for breaking state campaign finance laws has exploded in recent years.

The Texas Ethics Commission issues the penalties for violations of state campaign finance laws, most often when entities fail to file required reports detailing their fundraising, spending or personal financial holdings. Those penalties could also be for infractions like spending campaign dollars on improper expenditures, failing to register as a lobbyist or using government resources to campaign.

Fines are the primary enforcement mechanism to ensure political actors follow the law. But when the fines go unpaid, the responsibility for forcing delinquent individuals and groups to pay up falls on the attorney general’s office, which can take them to court.

Since Paxton took office in 2015, the ethics commission has referred 2,500 unpaid fines to the attorney general for enforcement, the Tribune found. During that time, Paxton’s office has filed just 175 enforcement lawsuits, or 7% of the cases referred to it. Most occurred early in his tenure. After filing none in 2020 and 2021, the attorney general’s office brought 18 cases in 2022, 25 last year and just one so far in the first six months of 2024.

As enforcement has lagged, the number of delinquent candidates and elected officials has soared. In 2019, 327 filers owed $1.3 million in fines. Through June, 750 filers owed $3.6 million.

That trend is alarming in a state with few regulations in its political system, said Anthony Gutierrez of open government advocacy group Common Cause.

“Candidates are supposed to be telling Texans who they’re taking money from, what they’re spending money on,” Gutierrez said. “If any of that information is not being disclosed, it’s a big deal. It could be being kept secret for a reason.”

For years, the worst offender has been Rep. Ron Reynolds, D-Missouri City. He owes $77,013 dating back to at least 2014. During that period, he’s been referred for enforcement by the ethics commission 20 times for missing deadlines to file campaign finance reports or personal financial statements. The attorney general’s office has sued him six times, seeking $34,500. Despite this, and a criminal conviction for barratry, he has been reelected five times and remains in good standing with the Democratic caucus. He reported maintaining just shy of $64,000 in his campaign account on the last report he did file, in February.

Reynolds did not respond to an interview request.

This year, Democratic Rep. Shawn Thierry, dogged by accusations that she had bankrolled her primary runoff campaign with Republican donors, did not file the campaign finance report due weeks before the May 28 election. The omission deprived voters in her Houston district of timely information about her financial backers while they mulled who to support in a race where her party loyalty was in question.

Thierry, who lost her race, said she missed the deadline because the aide in charge of the filing had a death in their family. When Thierry filed the missing report in July, 56 days late, it revealed that more than half of the $200,000 she raised came from donors or political action committees who traditionally support Republicans.

Thierry said she paid her $500 ethics commission fine, though the commission said she hasn't.

Paxton himself is a delinquent filer whom the TEC has referred to attorney general’s office for enforcement. Unsurprisingly, Paxton’s office has not sought repayment from him.

He owes $11,300 for fines that piled up from filing three late reports. Paxton’s campaign account, which he could use to pay the fine, contained more than $1.8 million as of January.

As a matter of policy, the ethics commission only refers cases for collection for fines that reach $1,000. The attorney general’s office strategy for collecting these delinquent fines is unclear. Paxton, First Assistant Brent Webster, Bankruptcy and Collections Division Chief Rachel Obaldo and Assistant Attorney General John Adams did not respond to requests for comment.

Paxton has sparred with the ethics commission in the past. He refused to allow the attorney general’s office to represent the commission in lawsuits filed by the conservative political action committee Empower Texans, which had contributed hundreds of thousands of dollars to Paxton’s campaign. As a result, the commission spent $1.1 million hiring outside counsel. It ultimately won the case.

Adrian Shelley, of left-leaning consumer rights advocacy group Public Citizen, said the lack of enforcement of Texas’ ethics laws makes way for grave consequences for transparency in future elections.

“If I am a candidate for office and I want to conceal who I’m taking political donations from, the message the candidates get right now is there’s really no teeth in the agency,” Shelley said. “There’s really no risk to me in not filing my report before the election… there’s an incentive to game the system”

Of the 25 delinquent filers who owe the largest sums, an average of $29,029, the attorney general’s office has only filed suit against six. The largest fine-ower in this group currently in office and who has not been sued is State Board of Education Member Staci Childs, who owes $23,417. Reached by phone, Childs speculated that she has not ended up in court because she is actively working with the ethics commission to pay down her debt.

Texas has permissive campaign finance laws. It is one of just 11 states where donors can contribute unlimited amounts. They are also not required to disclose their occupations. Candidates and elected officials can spend these contributions on almost anything, including flowers for constituents’ funerals, overseas travel and office décor.

Ethics Commission Chair Randall Erben and Executive Director J.R. Johnson declined to comment. Both referred the Tribune to a self-evaluation report the commission prepared for the Legislature last year, which identified unpaid fines under the “major issues” heading.

The report suggested the Legislature could create non-monetary penalties for delinquent filers and give the ethics commission more enforcement power. Other states, including Missouri and Illinois, bar candidates from running for office until they have paid outstanding fines and are up to date on disclosure reports. The TEC report also noted that the outstanding fines, if collected, would supplement the state’s general fund.

Thirty-seven states have campaign finance regulatory bodies that can levy fines, according to an index created by the Coalition for Integrity. Large states including California, Illinois and New York allow enforcement on delinquent fines without involving their attorneys general — though New York also has a longstanding problem of politicians let off the hook.

The appetite for reform in the Texas Legislature is unknown. Reps. Reggie Smith, R-Sherman, and John Bucy, D-Austin, who are chair and vice chair of the House election committee, did not respond to requests for comment. Neither did Sen. Bryan Hughes, R-Mineola, chair of the Senate state affairs committee.

Gutierrez said allowing the ethics commission to file lawsuits on its own would be “a huge step,” towards restoring accountability to the state’s campaign finance system. Allowing the commission more independence, rather than having to rely on an elected attorney general, would help separate the body from political influence.

“It feels like any system where there’s a politician who’s subject to the laws and is also subject to enforcing the laws is just a flawed system,” Gutierrez said. “The ethics commission, as it exists today, just doesn’t have the powers it needs to enforce the laws on the books.”

Disclosure: Common Cause has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

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This article originally appeared in The Texas Tribune at https://www.texastribune.org/2024/07/23/texas-ethics-campaign-finance-attorney-general/.

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