No decision in Masek complaint

ANCHORAGE -- Alaska Public Offices Commission members broke Monday without reaching a resolution after more than two hours of discussion about whether and how much to fine former representative Beverly Masek for allegedly improperly using leftover campaign funds in 2003. The commissioners planned to take up the matter again at a Thursday afternoon teleconference.

The complaint is the first of its kind after APOC laws were revamped in 2003. Through that process, each complaint is sent through an automatic process of response, investigation and hearing before the commission, and each step in the process is afforded a certain number of days. It was an attempt to streamline the complaint filing process undertaken after the gubernatorial election, when APOC complaint filings were an area of focus during the 2002 election.

Eric Musser, a legislative aide who worked with Masek for 14 months in 2002 and 2003, filed the complaint in May. Musser's complaint cites 10 ethics violations, including that Masek used more than the allotted $5,000 from her public office expense term, or POET, account, and that she used the POET account funds, intended to cover office expenses, for things such as credit card payments, home heating fuel and vehicle payments.

Masek's attorneys said although Masek's account shows nearly $11,000 in expenditures from her account, she didn't use more than the allotted amount of campaign funds -- the rest was personal funds she transferred into the account. The credit card payments, they said, were made to offset legislative business expenses, and the home heating fuel delivered was actually used to fuel her vehicle so she could conduct legislative business. They also said the vehicle payments covered the cost of using her vehicle for legislative business.

APOC staff countered Masek's attorneys' statements, stating that the alleged repayments for office expenses charged to personal accounts were not itemized, and receipts documenting the expenses were not included.

"Campaign finance law requires all disclosures," Ellingson said.

APOC staff took issue with Masek's use of heating fuel for powering her vehicle, as well, and called Newman's Hilltop Service owner, Walter E. "Eugene" Newman, as a witness.

Newman testified that he had never seen a nozzle on Masek's home heating fuel tank that would allow for vehicle fill-ups, despite an affidavit from Masek and her son that there was such a nozzle. Newman said he often sells fuel in bulk to Valley residents who use it both for heating and for vehicle use, but must charge a road tax of more than 20 cents on the fuel if a portion of it may be used in vehicles. The road tax was not charged to Masek for the purchase of the fuel she submitted as a legislative expense.

Ellingson also argued that vehicle payments on a vehicle that, because it was wrecked in a moose collision in 2002, could not be used in 2003 for legislative business, was not a proper use of legislative office funds.

But Ellingson said the office's overall concern was to the apparent use of the POET account as both a legislative expense account and a personal account -- a mix of uses that made record-keeping difficult and could pose issues with the security of a legislator's personal information.

"What's really troubling to staff is that, because we are a public agency, a candidate's personal records would be open to the public for scrutiny," Ellingson said. "I do not believe that's what the reporting is for."

Masek's attorneys at the hearing, Phillip Eide and John Miller, argued that although Masek could have kept neater records, she acted within the realm of her understanding of Alaska statutes -- which don't prohibit adding personal funds to a POET account or using the personal funds within a POET account, once added.

The differing interpretation in state statutes is what the case hinges on. Alaska Statute 15.13.116 (a)(8)(B) states: "The public office expense term account established under this paragraph may be used only for the expenses associated with the candidate's serving as a member of the legislature."

"It's clear here, they're referring to funds deposited into that account; leftover campaign funds," APOC Commissioner Larry Wood said at the Monday hearing. "The statute doesn't say … that you can deposit any personal funds into the account."

Miller said the statute doesn't refer to personal funds in the account.

"There's no question that, had Ms. Masek not put personal funds into her POET account, she could have spent that money any way she wanted to," Miller said. "… Is it truly so clear that she should be penalized to the extent that's being recommended?"

Commission staff, in reviewing Musser's complaint and Masek's supporting documents, said a fine of nearly $29,000 was in order -- but recommended that fine be reduced in half, and in half again, settling at $7,200. Masek's attorneys said that amount would be financially crushing, because a recent divorce settlement is all but settled and she has property in arrears.

According to an affidavit from Sarah Tugman, a lawyer who represented Masek in divorce proceedings, Masek's former husband, Jan Masek, has not paid outstanding debt on their marital home, as he agreed to in the divorce filings. In addition, according to Tugman's affidavit, property given as security on the debt was found to be without clear title, and therefore of little value. Earlier this year, several properties in Masek's name were listed on the Mat-Su Borough's 2002 tax foreclosure list.

Tammy Clayton, finance director at the Mat-Su Borough, verified that Masek's home had been listed on the borough's 2002 foreclosure list, but Masek paid the taxes owed from 2002 and prior. Taxes for 2003 and the first half of 2004 are still outstanding, Clayton said, totaling more than $6,100. Clayton said eight properties in Masek's name are currently in foreclosure, with taxes owing from 2001, 2002, 2003 and the first half of 2004. About $1,400 will bring the properties out of foreclosure, Clayton said.

After Masek's attorneys and APOC staff presented closing arguments, APOC commissioners weighed the case before them.

"She's been penalized pretty heavily by losing the election," Commissioner John Dapcevich said. "But … I think there should be some financial penalty established here, also."

Commissioner Larry Wood asked whether Alaska statutes mandated that the commissioners deliberate the matter in public. Commission Chairman Mark Handley said the commission has made it a practice to deliberate such matters openly, but the commission is exempt from Open Meetings Act requirements to deliberate in public. Miller asked the commissioners to discuss the matter privately.

"I think her reputation has been beat up enough," Miller said.

The commissioners agreed unanimously to go into executive session and, when deliberations were not finished Monday afternoon, agreed to return to executive session Thursday afternoon, with a written decision to follow.

Contact Rindi White at rindi.white@frontiersman.com.