Political activity of builders-group subsidiary assailed

A subsidiary of the Building Industry Association of Washington (BIAW) violated state campaign-finance laws in its effort to defeat Democratic Gov. Christine Gregoire, the state Public Disclosure Commission's staff has concluded.

The PDC, which oversees campaign-finance regulations, began an investigation into the association's political activity after a complaint from a citizens group led by two former state Supreme Court justices.

The staff recommendation will be considered by the commission Monday, when the PDC will decide whether to report the findings to the state attorney general, who could sue the group for the alleged violations.

The PDC is composed of three Democrats and two Republicans.

The investigation found that a BIAW subsidiary committed multiple violations by not registering as a political committee and failing to report more than $500,000 in contributions.

The Olympia-based BIAW has funneled millions of dollars during the past decade to conservative and Republican causes and candidates. The group is widely despised by labor unions, environmentalists and Democrats.

As it did in 2004, the BIAW and its allies are airing television and radio ads attacking Gregoire's record. The BIAW is a major supporter of Gregoire's opponent, Republican Dino Rossi.

The subsidiary in question, BIAW Member Services Corp., is a voluntary workers' compensation insurance program. Several local builders associations that work with the subsidiary were encouraged to route surplus insurance funds through BIAW Member Services Corp. to a political action committee running many of the attacks against Gregoire.

The PDC staff also found similar violations by the Master Builders Association of King and Snohomish counties. The local builders group, smaller than the BIAW, failed to register as a political committee despite raising more than $700,000 in contributions for industry-friendly candidates and causes since 1996.

The PDC staff's recommendation was lauded by the citizens group that filed the complaint as an important step in making the political activities of BIAW and its subsidiaries more transparent.

"This is a huge victory for the public's right to know," said Mike Withey, a lawyer for the group that filed the complaint against the BIAW.

A BIAW representative dismissed the staff's findings.

"It's a ticky-tack violation. We're going to wait to see what the PDC does with it and we'll deal with it," said Timothy Harris, BIAW general counsel.

Not all of the allegations made against the builders association were confirmed by the PDC staff.

Harris said he was relieved that the PDC staff rejected allegations that the BIAW itself or its subsidiary's general fund are political committees with legal obligations to behave according to rules that govern such groups.

Robert Faturechi: 206-464-2393 or rfaturechi@seattletimes.com