Loophole letting pols tap funds for personal use closed

Published in the Star-Ledger, Saturday, November 3, 2007

State shuts loophole letting pols tap campaign funds
Law block their 'charities' from hiring them

BY TED SHERMAN
STAR-LEDGER STAFF

Gov. Jon Corzine closed a legal loophole in the state's campaign finance laws yesterday that allowed a convicted public official to tap into nearly $2 million in unspent political contributions by creating his own charitable foundation, which he used to fund his retirement in Florida.

The governor signed legislation prohibiting candidates from contributing campaign funds to any charity in which [the] candidate -- or [the] candidate's immediate family -- is an officer or employee, or receives compensation for goods or services provided to the charity.

The bill followed revelations in The Star-Ledger that former Essex County Executive Thomas D'Alessio had contributed the bulk of his leftover campaign cash into a foundation he created shortly after being released from federal prison.

Tax records show D'Alessio, who was convicted in connection with a $59,000 bribe from a Florida garbage-hauling company, was paying himself more than $81,700-a-year as executive director of the foundation, and driving a leased $45,665 Mercedes-Benz.

New Jersey law prevents former political candidates from pocketing leftover campaign cash, although they can give the money to charity. D'Alessio was able to legally get around the prohibition by setting up a foundation called the Evergreen Fund. The charitable foundation, formed two months after he was released from federal prison in 1998, was funded with contributions of more than $1.8 million left in his campaign fund.

Records show the foundation gave thousands in small donations to various organizations over the years, but most of the money has been used for his living expenses in retirement. The foundation also purchased a $432,000 luxury condominium on Marco Island along Florida's Gulf Coast.

Attempts to reach D'Alessio were unsuccessful.

Another former official, onetime Hudson County Executive Robert Janiszewski, similarly tried setting up a charitable foundation, where he transferred his remaining campaign funds after he was arrested in a separate federal corruption case, but contributed the funds to legitimate charities after reports about the transfer became public.

State Sen. Richard Codey (D-Essex), who co-sponsored the legislation in the Senate, said exploiting the loophole had been wrong.

"Campaign funds should not be used that way," Codey said. "It's not right. Any leftover funds should be given to other candidates you support, or to legitimate nonprofits -- not to yourself or your family."

Assemblyman Kevin O'Toole (R-Essex), a sponsor of the legislation in the Assembly, called the law long overdue.

He noted that the bill had garnered wide, bipartisan support.

"Once everyone saw how he was living off this fabricated charity, this con -- and was driving a Mercedes -- all from ill-gotten gains, there was broad support," he said.

Ted Sherman may be reached at tsherman@starledger.com or (973) 392-4278.

Story NOT online; transcribed by DD.

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