Editorial: Checks to K.J.'s Think Big pose big questions

It turns out there's even more reason to be troubled by Mayor Kevin Johnson's network of nonprofits.

The mayor has belatedly disclosed that his umbrella group – the Sacramento Public Policy Foundation – received $380,000 through the Kings to pay for the operations of another nonprofit – Think Big Sacramento – as it boosted a proposed new home for the NBA team.

The money arrived under an arrangement among the mayor, the Kings and some of the companies, which pledged $10 million for the 2011-12 season to help keep the team in Sacramento, to send a cut of the corporate support to Think Big, The Bee's Ryan Lillis reports today.

To say it looks bad is an understatement.

One issue is that Think Big, which repeatedly promised to put taxpayers first in any arena deal, was relying on a financial pact with one of the key parties at the negotiating table – the Kings. Think Big claims there was no conflict because it wasn't the Kings' own money, only corporate cash it was passing through.

The other problem is that the mayor waited so long to report the donations – a delay that has the attention of the state Fair Political Practices Commission. The mayor's people blame a clerical error that was found recently, and say they will do better in timely reporting.

The foundation reported receiving a total of $732,410 in donations last year and spending $529,939, including $276,202 given to Think Big. While the foundation was not required to disclose who gave that money, the mayor must report donations he directly solicits, known as behested payments.

The first donations at issue are $137,000 on June 23, 2011, and $160,500 six days later. That was when Think Big was looking at potential funding sources and trying to drum up regional support.

Another $50,000 arrived on Aug. 11, 2011, and $10,000 more on Sept. 1. Seven days later, Johnson and Think Big unveiled funding options that included ticket surcharges, the sale of city-owned land and the possible privatization of city parking.

It took Johnson more than a year – until Aug. 23 – to file the required forms on the Kings checks with the City Clerk's Office.

A fifth payment via the Kings, for $22,423, came this March 18, just after the City Council approved a term sheet outlining the arena deal. That check wasn't reported until July.

Think Big argues that due to its efforts, the arena deal ended up being better for taxpayers, as evidenced by the fact that the Kings owners, the Maloofs, rejected it in April.

But what if an agreement had been reached, and what if the terms had been more favorable to the Maloofs? City Council members and taxpayers would be right to be suspicious of any deal recommended by a group financially tied to the Kings.

The mayor and his allies say that these nonprofits support worthy causes, stretch the resources of a cash-poor City Hall and increase community involvement.

But this situation demonstrates the very real pitfalls of Johnson choosing to rely so heavily on these nonprofits, which operate with far less oversight and disclosure than public agencies. It should be reason enough for the mayor to think long and hard about continuing to do so in his second term. At the very least, he owes it to the public to be far more open about the finances of his nonprofits.

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