State Fines Wilson Campaign $100,000 for Disclosure Errors : Politics: Governor and his operatives admit violating reform laws. Penalty is among 10 biggest imposed by FPPC.

In an unprecedented action against a California chief executive, Gov. Pete Wilson and his 1990 gubernatorial campaign operatives were fined $100,000 on Wednesday for violating political reform laws.

The fine was announced by the state Fair Political Practices Commission in a settlement in which the Wilson campaign organization conceded that it failed to report $7.4 million in contributions and expenditures in a proper and timely manner.

The fine, among the 10 highest ever imposed by the commission, was paid immediately by Wilson’s campaign organization.

“The governor will not pay a dime, nor should he,” said Wilson’s private attorney, Vigo G. Nielsen Jr. He said Wilson “was as surprised as anybody” in August when he learned about the results of a state audit of his campaign.

Shortly after the audit was released, the nonpartisan organization California Common Cause applied pressure on the FPPC by filing a formal demand for an investigation.

The biggest sum at issue involved the Wilson campaign’s failure to comply with a law requiring swift and detailed public disclosure of about $7.1 million in television advertising paid for in the closing days of the 1990 election race against Democrat Dianne Feinstein.

Additionally, the Wilson campaign organization conceded that it failed to disclose $106,000 in late contributions, did not properly report $127,000 in other expenditures and neglected to notify 244 big contributors that they were required to file publicly as “major donors.”

Wilson did not comment Wednesday on the politically embarrassing fine, but chief spokesman Daniel Schnur said the violations were “relatively inconsequential accounting errors.”

“As soon as the governor was briefed on the nature of the inaccuracies, he immediately ordered his counsel to do whatever was necessary to settle the problem,” Schnur said. “The governor was insistent that the matter be handled as quickly and appropriately as possible.”

Ben Davidian, chairman of the Fair Political Practices Commission, said Wednesday that the case involved significant reporting errors. Davidian, an appointee of the Republican governor, noted that the state’s Watergate-era political reform laws require full disclosure so the public “knows exactly who is contributing to campaigns and how the money is spent.”

The commission previously filed a civil action against Feinstein for allegedly misreporting about $8.4 million in campaign funds. She denounced the charges as a politically motivated attempt to derail her recent successful campaign for the U.S. Senate.

Auditors for the state Franchise Tax Board, which reviews the ledgers of campaigns and turns its information over to the FPPC, made a distinction between the Feinstein and Wilson cases. Wilson’s campaign had achieved substantial compliance with reporting laws but Feinstein’s committee had not, auditors said.

Davidian refused Wednesday to discuss details of the Feinstein litigation but indicated that “we’re moving toward trial in that case.”

In addition to Wilson, fines were levied Wednesday against F. Laurence Scott Jr., treasurer of the Pete Wilson for Governor Committee; Target Enterprises, a firm that bought the television advertising, and the committee.

Attorney Nielsen said Wilson campaign staffers knew that the contributions and expenditures were being audited by the state Franchise Tax Board last summer but had told the governor they believed their accounting of funds was “squeaky clean.”

“He was the most surprised person in the world,” Nielsen said of Wilson when the violations were announced nearly three months ago. “His (campaign) staff was paid well and trained well. They could have and should have done it right.”

In a letter to the FPPC, Nielsen said the governor does, however, “accept his responsibility as the controlling candidate of this committee and the ultimate boss of the staff and the vendors whose actions resulted in these errors.”

A spokeswoman for the commission, created in 1974 by California voters, said the charges and fine involving Wilson represent a first against a sitting governor. The biggest FPPC fine ever imposed was $292,000 levied against a former Sacramento County supervisor.

Davidian said Wilson’s fine was steep and said it reflected the seriousness of failure to properly report huge sums of campaign money. “When you are dealing in the big (campaign) leagues like this, even a small error can result in a large amount of money being misreported,” he said.

Chiefly at issue was the $7.1 million spent in the final drive of the campaign for television advertising by Target Enterprises, which had been hired to make Wilson’s media buys.

Target, the commission said, failed to properly itemize broadcast stations with which it had purchased advertising time, including such legally required information as the organization’s call letters, address and city.

The Wilson campaign did identify Target as a recipient of campaign funds but did not itemize details of the transaction until after the election. Amended reports subsequently were filed.

Davidian said state investigators have determined that $3.5 million of the $8.4 million at issue in the Feinstein case was also spent for television advertising.

He said the difference in the two cases is “critical” because the public had no knowledge of how Feinstein spent the $3.5 million until the audit last March.