Pa. treasurer candidate's campaign raised, spent money months before it actually existed

Erin McClelland, who is seeking the Democratic nomination to run for state treasurer, campaigned and accepted donations months before registering a fundraising committee with the Pennsylvania Department of State, as candidates for state office are required to do.

While McClelland’s campaign chairperson said the donations and spending were properly reported to Allegheny County, election law experts say Pennsylvania’s campaign finance reporting rules are clear that statewide candidates must report their campaign donations and spending to the state.

“Once you are seeking state office and accepting donations, you need to register with the secretary of state,” Philadelphia Democratic election lawyer Adam Bonin said.

McClelland, a substance abuse and mental health counselor and program director by profession, is running against state Rep. Ryan Bizzarro (D-Erie) for the Democratic nomination to challenge Republican state Treasurer Stacy Garrity in November. McClelland also was the Democratic nominee for Pennsylvania’s 12th Congressional District in 2014, when she lost to the Republican incumbent U.S. Rep. Keith Rothfus.

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Public campaign finance reports and other documents obtained by the Pennsylvania Capital-Star show McClelland received donations and spent money on campaign expenses after announcing her candidacy for the statewide treasurer position in September using a campaign committee registered with the Allegheny County Board of Elections. McClelland ran a primary campaign for Allegheny County executive last year.

But McClelland’s treasurer campaign did not register her fundraising committee with the Department of State until Jan. 29, according to a registration statement filed with the Department of State. The committee filed an annual report for 2023 but did not include spending that it reported to Allegheny County.

A 2023 annual report filed in Allegheny County for the Committee to Elect Erin McClelland shows the committee received three donations totaling $700 and spent about $1,900 between October and December. Additionally, McClelland spent about $2,150 of her own money listed as in-kind contributions in the Allegheny County report.

McClelland’s annual report to the Department of State shows she contributed $100,400 of her own money to the state committee and received $4,601.21 from her Allegheny County committee. The state report did not separately list any of the donations or expenditures that were listed in the Allegheny County report.

Since filing her reports, McClelland said she and her campaign staff have discovered a number of mistakes.

“Going through all of this we have a whole bunch of systemic learning,” McClelland told the Capital-Star.

Among the mistakes is the listing of the $100,400 donation from McClelland to her campaign, she said. McClelland made a $100,000 loan to the campaign with a check that was deposited at the same time as several donation checks totaling $400. The deposit was incorrectly reported as a single sum, McClelland said.

McClelland said “glitches” with Allegheny County’s online campaign finance reporting system also caused the balance of her campaign account to be reported incorrectly twice. In the first instance it was reported as about $6,000, or nearly $4,000 more than it should have been. In the second, it was reported as nearly $79,000.

John Feeney, a manager in the Allegheny County Elections Division, said McClelland’s campaign has submitted two reports to the county so far. Both are incomplete, Feeney said, because the campaign has not submitted signed and notarized copies of the cover pages.

“I have contacted the committee about these discrepancies and will continue to do so until they have successfully submitted a correct report,” Feeney told the Capital-Star.

After the Capital-Star inquired last week about donations and spending that were not reported to the state, McClelland’s campaign finance committee chairperson Chuck Pascal said all of the money that passed through the Allegheny County committee would be reported to the Department of State in an amended report.

“It’s now being filed again so there’s no confusion,” Pascal said, adding that McClelland’s campaign has been transparent about its support and spending in its report to Allegheny County. “Everything was reported from the get-go.”

Neither the report to the state or the report to Allegheny County were due until Jan. 31, so no information was hidden from the public, Pascal said.

But election law experts note that the intent of requiring candidates running for statewide office — such as governor or treasurer — is to report donations and spending to the secretary of state is so voters don’t have to guess where to look for information about a candidate’s supporters.

The Department of State’s Bureau of Campaign Finance and Lobbying Disclosure reviews all complaints it receives regarding potential violations of the campaign finance reporting law, a spokesperson said. Any apparent violation may be referred to the attorney general’s office.

The bureau cannot confirm or deny whether any candidate or committee is under investigation, the spokesperson said.

Kathy Boockvar, who was secretary of state during Gov. Tom Wolf’s administration, said she found it frustrating that the Department of State didn’t have more authority to enforce the law beyond collecting fines for late reports.

Boockvar added that the election and campaign finance arms have historically been underfunded.

“I think we’re dealing with laws that don’t have sufficient enforcement mechanisms combined with a lack of resources,” Boockvar said, noting that lawmakers who are at the peril of their campaign financing mistakes every few years lack a strong incentive to improve the system.

According to the Department of State, Pennsylvania’s Campaign Finance Law requires candidates for statewide office to register a fundraising committee within 20 days of receiving a contribution or making an expenditure in excess of $250.

Timothy Ford, chair of the political and election law group at the law firm Dilworth Paxson, said the law requires campaign committees to be registered and file reports with the “appropriate supervisor.”

“If you run for a county office, the county is the supervisor. If you run for a statewide office, the Department of State is the supervisor,” Ford said.

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Ford added that if a candidate for statewide office already has a political committee, they need to cross-register their committee with the Department of State within 20 days of receiving $250 for their statewide campaign. “If you’re a candidate for statewide office, you can’t just accept money into a committee registered somewhere else.”

Asked when McClelland began her state treasurer campaign, Pascal said it was “hard to define.” McClelland’s campaign Facebook page first showed her as running for treasurer in a Sept. 14 post.

Records show McClelland received numerous warnings from the federal campaign finance watchdog about not meeting reporting requirements for her congressional campaign.

Federal Election Commission records show the agency administratively closed McClelland’s 2014 congressional campaign committee account in 2023 after the committee stopped filing reports. The last report in July 2020 shows the committee had more than $54,000 in debts and obligations.

The FEC records show the largest unpaid debt was a disputed $35,000 bill from a political consulting firm that sued the committee. McClelland said the lawsuit prevented her from closing the congressional committee account and she was unaware of whether the suit was resolved. Allegheny County Court records show the case was dismissed for a lack of activity in 2021.

The debts also included $18,100 in legal fees owed to Pascal, which McClelland said Pascal forgave.

Failures to follow campaign finance reporting requirements, even by mistake, are particularly concerning for a state treasurer candidate, Bonin, the Philadelphia election lawyer, said

“Given the nature of the particular public office she’s seeking, I think there’s a strong obligation to get that right,” Bonin said.

The Pennsylvania Treasurer’s Office handles more than $150 billion in commonwealth funds and is responsible for receiving all state revenue, managing deposits and investments and overseeing withdrawals and deposits from state agencies.

Before current Treasurer Stacy Garritty, her predecessor Joe Torsella, the treasurer’s office had a rocky history. Former Treasurer Rob McCord was sentenced to 30 months in federal prison in 2018. McCord pleaded guilty to attempting to use his office to threaten potential donors if their contributions to his 2014 gubernatorial campaign weren’t large enough.

Former state Treasurer Barbara Hafer was also snared in the same broad FBI investigation of pay-to-play corruption in the Pennsylvania government. She pleaded guilty to making false statements to law enforcement officials about her relationship with a Chester County businessman with interests in businesses that provided asset management services to the Treasury. Hafer was sentenced to three years of probation.

Pennsylvania Capital-Star is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Pennsylvania Capital-Star maintains editorial independence. Contact Editor Kim Lyons for questions: info@penncapital-star.com. Follow Pennsylvania Capital-Star on Facebook and Twitter.

This article originally appeared on Erie Times-News: PA treasurer candidate McClelland's campaign missed report obligations