Joyce Terhaar

From the Executive Editor: Bee's arena stories: Fair?

Published: Sunday, Aug. 25, 2013 - 12:00 am | Page 1E
Last Modified: Saturday, Aug. 31, 2013 - 11:51 am

JOIN THE CONVERSATION: What do you think of The Bee's coverage of the arena project and the revelations about Seattle's Chris Hansen? Add your comment below. To write a letter, go to sacbee.com/sendletter. Or comment on our Facebook page at facebook.com/sacramentobee.

Now that the mystery is solved and we all know hedge fund investor Chris Hansen secretly paid for efforts to force a public vote on Kings arena funding, we can ask these questions:

Were the Maloofs initially unfairly suspected by the media and others?

What about Taxpayers for Safer Neighborhoods, the Orange County political action committee?

And, finally, is The Sacramento Bee's coverage weighted toward those who support public funding for a downtown arena?

First, some background. I have not been inundated with any of these questions. Journalists are terrific Monday-morning quarterbacks, though, so we asked them of ourselves even as we pushed daily to unmask the secret campaign donor. We think those who play in Sacramento politics ought to do so openly.

Yet two key players in this twisty tale – George Maloof and James Lacy, the principal officer for Taxpayers for Safer Neighborhoods – made clear to us they think the coverage was unfair to them, for different reasons.

For Maloof, it's personal and all about how Sacramentans view his family.

Lacy is in a different position. He's from Southern California and not part of this community. He's an attorney who is involved in conservative political action committees. He has a track record of hiding those who want to secretly influence elections, so his goal is the opposite of any journalist. Remember the PAC that funneled $11 million in anonymous out-of-state donations to fight last year's tax initiative and support an anti-union measure? Lacy is one of the leaders of that Small Business Action Committee.

For those of you who unplugged during a recent vacation and haven't followed our coverage, this story started almost a month ago when Bee reporters Dale Kasler, Tony Bizjak and Ryan Lillis, along with Business Editor Mary Lynne Vellinga, tried to find out who, exactly, was paying to gather signatures to force the arena funding vote.

At the time, any notion that Hansen – who lost his bid to buy the Kings and move the team to Seattle – was involved seemed a stretch even for the most conspiracy oriented among us.

July 31 was the required reporting date for any campaign that spent money in the first half of 2013. We obtained those disclosure documents, but none showed payments to people gathering signatures. Instead, Kasler, Bizjak and Lillis decided to just ask those identified with the campaign for updated records. DowntownArena.org, which supports public funding of the arena, gave us everything it had.

Representatives of Sacramento Taxpayers Opposed to Pork (STOP) and Taxpayers for Safer Neighborhoods (TSN), which announced in May it would fund the ballot drive, declined. We reported that.

That story launched several weeks of Bee reporting aimed at uncovering the money behind the ballot drive. By Aug. 7, DowntownArena.org filed a complaint with the Fair Political Practices Commission claiming TSN and STOP paid staff in June, did not disclose the payments, and violated campaign reporting laws.

To say that Lacy was unhappy with The Bee's coverage about the mystery donor would be an understatement. In a post at conservative blog CalWatchdog.com on Aug. 8, Lacy was quoted: "The Bee has manufactured this story in a deliberate effort to undermine the public's right to vote on the arena deal." In his emails to me and Bee reporters, he threatened several times to sue us. He also said he would not release any documents beyond what was legally required, because it would create an advantage for opponents.

Remember, at this point the only entity that had claimed credit for funding the petition drive was TSN. But suddenly, in the aftermath of the FPPC complaint and our reporting, Lacy began disassociating TSN from the campaign, saying the PAC had not provided any money after all.

Kasler, Bizjak and Lillis spent the better part of August trying to untangle this mess, reporting in the process:

• Aug. 7: The FPPC complaint alleged that signature gatherers were paid in June and we confirmed that, quoting Joe Woodruff who was paid $113.

• Aug. 8: Local petition drive manager Eileen Ray received a $25,000 check in June from Tulare political operative Paul Olson.

• Aug. 9: Olson tells The Bee he obtained $80,000 in June for the campaign from the law firm that represents the Maloof family, Loeb & Loeb.

All these developments proved that someone broke campaign finance law because money was spent in June and not reported by July 31 as required.

On Aug. 9, though, the donor still was a mystery and just about everyone connected to the campaign was denying knowledge or quitting.

Brandon Powers, an Orange County political consultant who announced in May that STOP and TSN hired him to run the petition drive, was identified by Olson as the one who arranged the $80,000 payment.

While Powers avoided our reporters, and Loeb & Loeb declined to comment, Olson and another political consultant working with the campaign, Tab Berg of Sacramento, announced they were quitting the campaign.

George and Joe Maloof told us they knew nothing about the funding. The story was headlined "Law firm that represented Maloofs supplied money for arena ballot measure." In that story George Maloof said "I know nothing about it. Zero." Joe Maloof wished Sacramento "all the best."

It took an FPPC lawsuit to finally pry loose from Loeb & Loeb the startling revelation that Chris Hansen was underwriting the campaign. A vote against public funding of the arena, after all, would give him another shot at moving the team to Seattle.

After the fact, George Maloof texted Dale Kasler about his unhappiness with our coverage.

"It's a bit unfortunate that we are considered guilty until proven innocence (sic). But so it be … Maybe someday the Sacramento Bee will realize that four bachelors might have been good for the city," he texted.

Which brings me to my questions for you. Was it unfair to report that Loeb & Loeb was the law firm that represented the Maloofs in the family's attempts to move the Kings to Anaheim and Seattle? That fact naturally placed the Maloofs under suspicion.

Was it unfair to report that TSN would not give The Bee updated information about any campaign spending or donors? At that point in the story, TSN was the only group associated with funding for the campaign so its refusal also raised questions. (As did the fact its spokesman, Brandon Powers, arranged the $80,000 payment.)

And, finally, has our news coverage been objective? Lacy's complaint to me that The Bee's coverage is weighted in support of public arena financing pointed to editorials and opinion columns as evidence.

Indeed, our editorial position and that of many of our columnists clearly support the arena plan. But as I responded to Lacy, we asked both sides of the campaign to provide additional disclosure not required by law. Only one side – DowntownArena.org – did so.

I think the information we reported as this story developed was integral to public understanding of what is shaping up to be a lively local political battle. You may feel otherwise. Let me know.

Reach Executive Editor Joyce Terhaar at (916) 321-1004. Follow her on Twitter @jterhaar. Back columns, www.sacbee.com/terhaar.

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