It appears that Assemblyman Todd Gloria (D-San Diego) has improperly funded a bogus committee for his re-election to the Assembly in order to use funds left over from his successful 2018 run for that office to now fund his campaign for Mayor of San Diego. According to many in the Capitol, nearly everyone knew that Gloria said when he ran for Assembly, his plan was to run for San Diego Mayor during the next election cycle.
Attorneys representing two San Diego residents are pushing the city to file a lawsuit against Todd Gloria for conspiracy to launder campaign money from an illegal campaign committee (Todd Gloria for Assembly 2020), to a candidate to replace him in the Assembly, and to several sitting members of the Assembly who all knew he was running for San Diego Mayor, and even endorsed him, prior to accepting the campaign contributions.
“Gloria’s mayoral campaign manager, Nick Serrano, told the San Diego Union-Tribune in an email Thursday that the issue was an oversight that Gloria self-reported to the California Fair Political Practices Commission, not a conspiracy,” the San Diego Union Tribune reported.
However, whatever the motive, this did not have to happen this way; Assemblyman Gloria could have used his 2018 Assembly account up to 90 days after he left office. If a lawmaker loses a race or leaves office, the money remaining in the account can be used for contributions to other campaigns. Left-over campaign money can be used after the election for political purposes, however, until it becomes legally “surplus.” Once it becomes surplus, it cannot be used except to donate to a charity or to refund donors. That happens 90 days after the election concludes if a candidate loses, and 90 days after a winning candidate leaves office. What he cannot do is raise money for the old account. It appears in this case, that to be clever, Gloria opened the new account, but never filed the required Notice of Intent because he had no intention of running for Assembly reelection in 2020.
The Lawsuit Ask
The first step in a lawsuit was the letter to the San Diego District Attorney and San Diego City Attorney with the allegations, and more than 115 pages of evidence. The San Diego attorneys have 120 days to reply and file a civil case under the Political Reform Act.
“My clients have reason to believe that there is a conspiracy to launder campaign money from an illegal campaign committee controlled by Mr. Gloria to the San Diego County Democratic Party, to a candidate to replace Mr. Gloria in the Assembly, and to several sitting members of the Assembly,” Attorney David E. Kenney wrote. “Such illegal activity would violate the PRA and, for those participants aware of the criminal nature of their wrongdoing, also violate Penal Code section 186.10 (Money Laundering).”
“Mr. Gloria has formally been running for Mayor of the City of San Diego since December 2018, he established a separate campaign committee earlier this year, ‘”Todd Gloria for Assembly 2020,” for an office that he never intended to run for, Assembly District 78. (Exhibit 4.) Not only did he record contributions into his Assembly 2020 committee’s bank account, but he transferred nearly $300,000 from his Assembly 2018 committee to his Assembly 2020 committee a few days before those funds would have become “surplus” by operation of law,” Kenney said.
Assemblyman Gloria did not file his declaration of intent to run for re-election to the Assembly in 2020 until August 13, 2019, which is one day after the first article on this subject ran, Kenney explains. (Exhibit 5.) “The PRA and the Fair Political Practices Commission (FPPC) both prohibit him from soliciting or receiving contributions into his Assembly 2020 committee without first filing his declaration, known as Form 501. Clearly Mr. Gloria created the Assembly 2020 committee for the sole purpose of extending the expiration date on the money left over from his Assembly 2018 committee and allowing him to continue to raise money from sources who would not be qualified to donate to his Mayoral campaign and in amounts exceeding city limitations. Because it was illegal for him to receive money into his 2020 Assembly committee prior to August 13, 2019, it was also illegal for him to use the money for any candidate-related purpose.
Speaking with attorney Julie Biggs, who is involved in the case, she offered the following facts:
- Gloria was re-elected to the Assembly in November of 2018 and had funds remaining in his 2018 Assembly committee amounting to nearly $300,000.
- Gloria filed a Statement of Intention to run for the office of Mayor of San Diego (form 501) and established an election committee for that campaign on December 18, 2018. He formally announced his candidacy for that office and has been actively campaigning since that time.
- Apparently to avoid having his 2018 funds declared surplus and therefore subject to strict limitations as to use, Gloria filed papers to form a new 2020 Assembly committee on March 19, 2019. That filing, however, did not include filing the required Statement of Intention (form 501) to run for that office.
- Gloria transferred his 2018 Assembly committee funds to the 2020 Assembly committee on March 19, 2019.
- Gloria contributed $4,700 to the candidate who declared his candidacy for Gloria’s seat on March 28, 2019.
- The 2020 Assembly committee has raised an additional $25,000 or so and has expended about $45,000 to support other campaigns and to contribute to the Democratic party in support of events attended by Gloria as a candidate for Mayor.
- Gloria has affirmatively stated in response to questioning by another candidate for Mayor that he is not running for the Assembly seat but is running for Mayor.
- Gloria submitted his Statement of Intention to run for the Assembly seat on August 13, 2019, the day after the story was published locally.
Attorney Biggs explained that California law precludes a campaign committee from collecting contributions prior to the filing of the Statement of Intention (Form 501) to run for the office for which the committee will be raising funds. Knowing and willful violation of that law is a misdemeanor which may be punished by a fine of $10,000 or three times the amount of the contribution illegally made or accepted, whichever is higher.
Gloria clearly knew he had not filed the Statement of Intention to run for re-election at the time he made the transfers to the 2020 Assembly committee.
Additionally, very important to note is that the two elected offices also have differing campaign contribution limits. The Assembly limit is $4,700 per donor and the Mayor limit in San Diego is $1,150. By transferring the 2018 Assembly funds to another 2020 Assembly fund, no reduction in the amounts contributed was required. Had that money been transferred to the Mayor committee, any donation over the City imposed limit of $1,150 would have had to be reduced.