Report raises questions about campaign loan for District 9 candidate

Kym Olson has received little media attention since late August, when she designated a treasurer for her campaign for the District 9 seat on Austin City Council. Olson, who serves in the Texas State Guard as a protocol officer and deputy public affairs officer at Camp Mabry, filed her first campaign finance report with the city clerk’s office this week. That report showed that she had received $5,200 in campaign contributions and a $50,000 loan from Krista Olson.

According to the report, Kym Olson still has $55,550 in her campaign bank account. But candidates do not usually receive loans from other people for fear of violating campaign finance laws. City regulations prohibit contributions of more than $450 per person.

Olson told us that Krista is her sister and that she definitely expects the loan to be repaid. She said she intends to raise the money to repay the loan, but if she is not able to she will repay her sister out of her own earnings. Documents filed with the city indicate it is a zero-interest loan without a definite repayment schedule.

While campaign law experts disagreed about whether such a loan is legal, they agreed that the loan looks suspicious.

Austin attorney Jim Cousar told the Austin Monitor, “Under state law there’s no real difference between a loan and a contribution. You could just forgive a loan and turn it into a monetary contribution.”

“(However), under city rules, where we have caps … if a loan is not done on business terms, including a note and expectation of payment, a loan can be just a disguised contribution.”

Cousar and campaign finance expert Andrew Cates, speaking separately, said Austin’s campaign finance laws can be confusing. But they said if there is a conflict between state law and city rules, state law prevails.

Cates expressed doubt about the legality of the loan, but said it may pass muster because of the way city regulations are written. “The way the code is written is vague and ripe for misuse,” he said.

Olson also started her own specific purpose committee, called KYM4ATX. According to an appointment document filed with the city clerk on Sept. 6, Olson appointed Ester Gamez as treasurer of the committee and Matt Hubbard as assistant campaign treasurer. Hubbard is also listed as Olson’s campaign treasurer.

Linda Guerrero, a likely front-runner in the race because of her endorsements, raised $28,885 and maintained $50,100 as of last week.

As for other candidates in the District 9 race: Thomas Wald raised $2,470 with $23,087 maintained; Greg P. Smith raised and maintained $66,366; Joah Spearman raised $15,742 and maintained $6,223; Zohaib Qadri raised $22,872 and maintained $35,522; Ben Leffler raised $17,452 and maintained $84,236; and Zena Mitchell reported raising no money for the race and spending $75 since the July report as she said she would when the Monitor interviewed her.

Photo made available through a Creative Commons license.

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Posted In: Elections, District 9