Ethics complaints filed against mayoral candidate Doug Greco and incumbent Mayor Kirk Watson will move to a final hearing next month, but an anticipated court ruling could circumvent the proceedings.
In a preliminary hearing Wednesday, the Ethics Review Commission determined there were reasonable grounds to believe that both Greco and Watson violated the city’s campaign finance ordinance based on separate complaints that accused both candidates of exceeding the $46,000 contribution threshold from donors who live outside of postal ZIP codes within Austin city limits.
The commission voted 8-0 in favor of the complainant, former Ethics Commission member Betsy Greenberg. Her complaint also alleged Watson violated the ZIP code contributions limits in his 2022 campaign. Greenberg has said she supports Carmen Llanes Pulido in the mayoral race.
Wednesday’s preliminary hearing was unusual for two reasons.
First, Greco has a lawsuit pending in federal court claiming the city’s limitations on contributions from outside the city of Austin violate donors’ constitutional rights. Given the approaching election, the lawsuit is on an accelerated timeline, and Greco is seeking an expedited hearing and ruling by Oct. 4.
Second, in a surprising move, Ethics Commission Chair Michael Lovins denied Watson’s representative, veteran campaign finance lawyer Jim Cousar, an opportunity to present documents to the commission to support his argument that Watson’s campaign complied with the ordinance.
Cousar is no stranger to the city’s Ethics Commission and Austin’s strict campaign finance ordinance. He has served as the commission’s special counsel numerous times over the years, has represented respondents before the commission and has advised Watson on campaign finance matters since the 1990s. As such, Cousar was confounded by Lovins’ ruling.
Lovins, after conferring with special counsel Chris Feldman and referring to the commission’s rules for preliminary hearings, said he would only allow Cousar’s verbal testimony and that written materials would be presented if the commission determined the case should go to a final hearing.
Cousar later told the Austin Monitor he was left speechless by the ruling.
“I’ve never been in a proceeding where the respondent was not given the right to provide a written statement and supporting evidence before a decision was made,” he said.
The Watson documentation, which Cousar provided to the Monitor, included a statement from the campaign with a detailed summary of each of the four accompanying spreadsheets.
The spreadsheets are identified as Exhibit A, which lists donors residing outside the city’s ZIP codes who contributed a total of $45,015 – below the city’s $46,000 cap; and Exhibit B, which lists 60 donors whose contributions totaled $23,000. Greenberg’s complaint alleged it was the $23,000 figure that put the campaign over the allowable “ZIP code limit.” The Watson narrative states those donors live within the city’s eligible ZIP codes.
Exhibits C and D are in response to Greenberg’s complaint concerning Watson’s 2022 mayoral campaign. The exhibits demonstrate the campaign was in compliance, Cousar said.
Because campaign donors are able to list their business address or their P.O. box when making contributions, Greenberg suggested to the commission that the city should modify its ordinance requiring contributors to provide their residential address. That way, she said, “you can actually tell whether or not people live in the ZIP codes and are eligible to vote.”
In the complaint against Greco, the candidate is not challenging the allegation that he exceeded the contribution limits from donors outside the city limits. Rather, his attorney Holt Lackey said, Greco is challenging the ordinance on constitutional grounds.
“For the reasons stated in the lawsuit we believe that this rule is illegal and that it unjustly favors incumbents and candidates with the ability to self-fund with no limit,” Lackey said. “It discriminates against candidates like Mr. Greco, a former AISD teacher and longtime community organizer who was organizing and running a grassroots fundraising campaign from friends, family, colleagues and supporters both inside and outside of Austin.”
Nevertheless, Lackey said, “We are confident that that limit cannot be reconciled with clear First Amendment precedents from the Supreme Court and courts across the country.”
In a statement released after Wednesday’s action, Greco said: “We are suing the city in federal court because the underlying rule is illegal and unconstitutional since it unfairly benefits incumbents who use the power of their office to attempt to silence support for their opponents, as well as wealthy candidates who can self-fund without limits. As an Austin community organizer and former teacher, I’m going to continue to run my campaign to fight for working families and stand up to Greg Abbott and state leaders against attacks on our civil rights as the process plays out.”
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City of Austin Ethics Review Commission: The Ethics Review Commission is charged with review of, among other issues, ethics complaints leveled against City of Austin boards and commission members. They meet quarterly.
