Fact Check: Campaigning On The 'Taxpayer's Dime'

May 23, 2018

The four candidates seeking the GOP nomination for the U.S. Senate. From left to right: Russ Fagg, Troy Downing, Matt Rosendale and Al Olszewski. They faced off for their first debate at Montana State University at an event sponsored by the College Republicans at MSU.
Credit Jackie Yamanaka

The charge ‘campaigning on the taxpayer’s dime’ is a perennial issue elected officials confront. This time, U.S. Senate Candidate Russ Fagg has been hammering his primary election opponent Matt Rosendale for doing that and alleging he’s using a “slush” fund to mix official and campaign business.

YPR did some digging into those charges, as well as what may be the long term impact on our democratic institutions.

Let’s start with just one example of what Fagg has been leveling at Rosendale on the campaign trail. This excerpt is from an April debate in Billings:

“You talk about reducing spending and yet you’re in the middle of a 19 city tour using state slush funds,” said Fagg. “I just find that unconscionable. During a campaign.”

Fagg then pointed out the next day Rosendale and his staff were holding its Invest in Montana Tour in Billings. He wanted to know who was paying for all of the expenses for Rosendale and his staff.

“It sounds like swamp-like activity to me,” he said.

Rosendale responded that expenses were paid for through the Investor Protection Fund, a grant program that gets its money from the securities industry.

“No tax dollars,” he said. “Which also covers the meals. And it also covers the rooms for my staff as we travel around the state.”

YPR asked Rosendale later about the slush fund allegations. He said the term is blatantly false. According to the dictionary, one definition of a slush fund is “an unregulated fund often used for illicit purposes.”

He said the office used the same trust money that was left over from the previous state auditor to start the Invest in Montana Tour. He said the office re-applied to the national Investor Protection Trust on April 19, 2018 to pay for the remainder of the events.

“That money is not taxpayer money,” he said “It is not state money. And it is awarded through a grant process that a board reviews to make sure we are using it for educational programs.”

The Montana Legislature’s non-partisan budget staff confirmed that.

And, staff confirmed the state Auditor’s office itself is not funded with taxpayer dollars, in budget lingo with General Fund. Operations, including staff salaries, are paid for through fees, fines, and penalties assessed on the industries the office regulates, insurance and securities. Making those dollars, again in official budget lingo, “state special revenue” and not from taxpayers.

So the slush fund charge is false.

Now about calling into question the scheduled Invest in Montana events around Rosendale’s campaign appearances. Rosendale said they didn’t happen last year because of the regular Legislative session and then the special session. He added there were other events already scheduled by his staff, leaving those events for late winter into spring of this year.

The former legislator from Glendive said he was careful to separate official expenses from his campaign.

“I took my vehicle whenever there was an additional event involved in this and I did not charge that off to the state,” Rosendale said.

Commissioner of Political Practices Jeff Mangan
Credit State of Montana, COPP

That is part of the balancing act for elected officials, said Commissioner of Political Practices Jeff Mangan. He pointed to a 2005 opinion from then-Attorney General Mike McGrath that clarifies when a public officer may engage in political speech, including when travel is involved.

“Say they travel from Helena to Billings and they do whatever work they’re doing in Billings. If they have a political event as a candidate they can certainly do that so long as it doesn’t involve public facilities, equipment, supplies, funds, etc,” he said summarizing the finding.

Mangan said state law does not specifically prohibit an elected official from coordinating official travel with campaign travel. He said the best way to address this is with “sunshine and light bulbs,” in other words public disclosure to head off this charge.

Credit Montana State University, Office of University Communications

And it’s a charge that Montana State University political scientist David Parker finds very frustrating. He said there are only so many hours in a day and elected officials – even if they’re running for office - need to talk to and listen to constituents across the state.

“Imagine a world where somebody says I’m going to run for office and I don’t really care what you think and I’m going to do what I want over 4 years and never get any input from anybody and not only that I don’t care what you think about me when I run for re-election,” he said. “It’s perverse.”

The charge “campaigning on the taxpayer’s dime” gets leveled against elected officials regardless of political party affiliation. Democratic Governor Steve Bullock got hit hard by Republicans two years ago over use of the state airplane.

That’s why Parker said it’s no surprise that Rosendale is facing the same charges. He said it’s nonsense talk and it needs to stop.

“I think that is silly season stuff and should just go away,” he said. “It should be banned from our collective campaigning and electioneering vocabulary.”

Parker is troubled by the damage of this perennial charge.

“I think it just mounts over time to where people are like, ‘well, yeah they’re just politicians we expect them to be deceitful. We expect them to be not trustworthy,’” he said. “That has really bad consequences for democratic institutions in the U.S. and elsewhere too.”

He said in his fondest dreams instead of this accusation being slung around political discourse will be on substantive, honest dialogue to find middle ground on the real problems of citizens.

Four candidates - Troy Downing, Russ Fagg, Al Olszewski, and Matt Rosendale - are vying for the Republican nomination in Montana's June 5, 2018 primary election. The winner will advance to the general election ballot to take on Democratic incumbent U.S. Senator Jon Tester.