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It was a busy weekend for both Sam Adams and Sho Dozono. Both candidates defied the crazy weather and hit the streets to stick lawn signs in any yard that would take them. The blue Dozono signs speckle my upper NE Portland neighborhood, but I haven’t seen Adams’ signs in that neck of the woods. I did, however, see Adams himself installing a sign in a front yard facing the traffic circle at NE 39rd and Glisan.
In other mayoral news, both candidates are busy fundraising. Adams has only $67,396.70 in the bank, having spent nearly $100K so far. Meanwhile, Dozono got busy raising private money in the week since he announced he’d stay in the race, but cap donations at $500, with a total $200,000 cap.
Dozono pulled in $15,159.00 in the past week—including a $1,000 contribution that seems to break his self-imposed cap (both Dozono and Adams have other over $500 contributions that are listed as one transaction for two or three people, but this one is for a single person). I’ve asked Team Dozono for clarification on that one. UPDATE: “The contribution was from Pat and Rosemary Lockhart and for some reason it’s not reflected in Orstar. [Campaign Treasurer] Vicki [Tagliafico] is correcting now. Thanks,” says Dozono’s campaign manager Amie Abbott.
In other big money news, the auditor’s office asked the John Branam campaign for detailed info regarding the $15,000 lump sum payment to campaign manager Phil Busse (he says he’ll eventually take home $25,000), as they are “evaluating whether there have been violations of City Code.”
The request (PDF), sent to the campaign last Monday, listed all kinds of documentation the auditor and his staff wanted to take a look at, like copies of contracts, Busse’s resume, any timesheets, invoices or “other documentation describing work performed” and any correspondence between Busse and Branam regarding the payments. Lastly, the auditor requested an “Explanation of payments to John4PDX staff, including Phil Busse, including: (1) the reason for larger payments on February 27-29, (2) the work performed for each payment, and the basis for overall compensation to each staff member, and (3) whether any Seed Money or Qualifying Contributions were used for these payments.”
More on this after the cut.
Branam replied on Friday night—a few hours after the auditor's "no later than 5 pm" deadline, citing a "crazy week on the trail."
The 10-page reply, including Busse's resume and the contracts, contained the same explanation Branam's given me—Busse will be working overtime, without health benefits, from now through the end of May, and he's got multiple talants that the campaign will tap. "Phil Busse volunteered as the campaign manager for John4PDX from mid-September through February 21, 2008, more than five months. During that time, Phil displayed efficiency in his work performance, a competency to complete duties outside the normal range of campaign managers’ duties and a significant commitment to the campaign," Branam writes. "I was well aware of his loyalty and commitment to the campaign. I paid Phil an initial “down payment” on his contract. I was confident that Phil Busse as well as staff member Beth Roberts, who also had shown similar qualities and loyalty, would continue to display the same work ethic going forward." Branam writes that Busse's pay breaks down to about $30 an hour, for 60 hour work weeks through the end of May.
Other notes of interest: There are no timesheets or invoices or other things outlining what of the $25,000 is campaign management, what's copywriting, what's consulting, etc. "The 'documentation' of the work performed during the period following certification is the work-product itself," writes Branam, "including, but not limited to, the design, placement and execution of blogs ads, newspaper ads and radio ads; the design, execution of delivery of lawn signs, platform sheets, buttons, bumper stickers, etc.; etc., etc. Time sheets have not been kept."
Correspondence between the two has been ongoing, via phone and meetings. Consequently, there's nothing to turn over the auditor: "John Branam and Phil Busse have worked closely, on a daily or near-daily basis since September 2007. During this time, there have been numerous conversations, phone calls and in-person meetings discussing the campaign finances, budget and payments. There have not been any written agreements regarding payment structure."
And finally, Busse's contract stipulates that he has Thursday nights off: "Phil Busse shall be 'on call' during all reasonable hours for reasonable correspondences from campaign staff members and candidate...the one exception is Thursday evening from 7 pm to 10 pm when Phil watches 'Lost.'"
City elections officer Andrew Carlstrom—who was out of the office last week—says they don't yet have a timeline for what happens next in their evaluation of the new information. I'll keep you posted if there's any development.
bushmaster,
Yep, you're right.
I had one paid person in my campaign. I set up a Fed ID # to do the payroll reporting, withheld FICA, Medicare and state withholding and made the quarterly payroll deposits as required by law.
Most campaigns don't do that, and choose to pay their employees as contractors. But I've had employees for 23 years and know a couple things.
An employee cannot be considered a contractor unless:
They perform similar services for other customers, provide their own workspace and tools, and make their own quarterly payroll deposits covering both sides of FICA and medicare.
Doing proper payroll accounting and withholdings, including producing w2's at year end, for short term campaign employees is a royal pain, but that's the way it should be done, unless their employees meet the contractor test.
Branam also spent more than $6500 paying an outside consultant for web design (https://secure.sos.state.or.us/eim/transactionPubDetail.do?tranRsn=245378)
I think he will lose this race due largely to mismanagement of money and overspending. Back at the beginning of the year, his star was burning bring and on the rise. Not looking so great right now.
So what I don't get is who ends up paying the payroll taxes then? Should the campaign be witholding these and counting the amount towards their VOE funds? Since it appears that Busse is not a contractor how does the auditor reconcile this or does the state and feds get involved since this has to do with taxes? This could be a big issue since we have so many novice candidates.
If a 1099 is issued to the "contractor" at the end of the year which is of such an amount that the "contractor" should have made estimated tax deposits but did not, the IRS can go back on the issuer of the 1099. If the IRS then deems that the "contractor" was actually an employee, the employer (the campaign) can be held liable for the late taxes, including interest and penalities.
You would need a CPA to tell you for sure, but I'm pretty sure a couple of lump sum payments totalling 25 grand would be of an amount that would require making estimated tax deposits.
If Branam is actually guilty of mismanagement of money and overspending, he'll be a perfect fit for Portland City Hall.
Hey! That was my house at the traffic circle Sam was sticking a sign in front of! I'm with Sam!
Huh, looking through these forms it looks like Mr. Busse is a full time employee and not a contractor. I don't see ANY payroll taxes or payroll services mentioned here or in the public filings for the payroll of the Branam staff. I thought employers were required to withhold these taxes under penalty of law. Other more knowledgable readers, am I understanding this right?