Energy firm to pay $15,000 fine for elections violation;

Published on

The action stems from efforts to defeat a ballot measure seeking to tax crude-oil production.

Los Angeles Times

SACRAMENTO, CA — An energy company has agreed to pay a $15,000 fine to a state ethics watchdog agency for failing to properly disclose spending $5 million to defeat a ballot measure last year that would have taxed crude-oil production in California, officials said Friday.

Aera Energy LLC admitted it missed deadlines for electronically filing public disclosures of three contributions to fight Proposition 87 on the November 2006 state ballot, according to a proposed agreement with the state Fair Political Practices Commission.

In all, Aera, a joint venture of Exxon Mobil Corp. and Royal Dutch Shell, contributed almost $32 million to the “Californians Against Higher Taxes — No on Proposition 87” committee, about a third of the $93 million the committee received from oil companies and others to fight the measure.

As a major donor, Aera filed written disclosures of the late contributions, but was also required to file them electronically so they could immediately be placed on the state website for public viewing.

The $5 million in contributions were required to be disclosed within 24 hours of being made, or by Oct. 28, 2006, but were not disclosed until Jan. 12.

In fining the company $15,000, the maximum amount possible, commission staff said in a statement Friday that the size of the contribution was a factor.

“In this matter, in aggravation, the violations involved large contributions that were not disclosed in electronic format,” the statement said.

The staff also indicated that there was no evidence the violation was intentional.

Betty Horn, a representative for Aera, said the violation was inadvertent, and noted the contribution was disclosed by the recipient committee.

About 55% of state voters cast ballots against Proposition 87, which would have levied a tax of 1.5% to 6% on the price of every barrel of oil pumped from a California well. The $4 billion the tax was expected to raise over a decade was proposed to fund grants to scientists and universities or to subsidize industries to develop nonpolluting alternatives to petroleum.

The election was the most expensive in California history involving a state ballot measure.

Judy Dugan of the Foundation for Taxpayer & Consumer Rights characterized the violation as “very serious.”
“The public has a right to know who is supporting and opposing a ballot measure,” she said Friday. “In any election, that amount of money can change the outcome.”

The commission is expected to approve the staff recommendation when it meets Wednesday.
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