In May 2003, a Multnomah County Circuit Court judge ordered damages
of $2.5 million, dissolved Sizemore’s Oregon Taxpayers United
Education Foundation, and issued an injunction restricting his political
activities for five years.
But Sizemore sought ways to get around that judgment, just as
he earlier got around — and crossed over — laws on signature-gathering
and campaign finance reporting. He emptied his group’s bank
accounts. He renamed his group. And he appealed the jury verdict.
In October 2006, an appeals court struck down the third of three
counts of his conviction, on a legal technicality. That reduced
his civil liability to about $300,000. Sizemore was jubilant. Both
sides are now appealing to the Oregon Supreme Court. The Supreme
Court doesn’t have to review the case, and normally does so
only if it wants to use it to settle a particular point of law.
Lawyers expect to learn some time in the next six months whether
the Court will look at the case.
So far, the unions have gotten very little out of Sizemore. They
went after him personally for collection, and when he sold some
property were able to get about $16,000 out of him.
But union leaders say they have no regrets about the suit, despite
close to a $1 million they’ve paid in legal bills. The suit
revealed a great deal of unflattering information about Sizemore’s
operation, and must have made many Sizemore donors pause, particularly
when it seemed his motive was as much personal gain as furthering
the cause.
Sizemore was not the first chief petitioner to pay for signatures,
but he may be the first in Oregon to make a vertically integrated
business out of it. As revealed in the lawsuit, Sizemore made money
at every stage. His 2000 personal tax returns reported $213,000
income that year. In the 2000 election cycle, Sizemore collected
a $65,000 salary from his Oregon Taxpayers United, but his signature-gathering
company I&R paid Sizemore $50,000 directly and as much as $170,000
indirectly, including: up to $25,000 for construction work on his
property; a $123,919 loan to Sizemore’s failing radio station;
payments on his automobile, and $20,000 in American Express bills.
And his operation brought the initiative process to new levels
of lawlessness.
“Until our suit exposed rampant abuse, it was like the initiative
process was run on the honor system,” says Oregon Education
Association staff attorney Mark Toledo.
The honor system assumes integrity.
But well before Bill Sizemore became a well-known political figure,
his conduct raised questions about his integrity. During Sizemore’s
1998 campaign for governor, an Oregonian investigation brought to
light the messy details of his failed carpet and toy companies.
Sizemore walked away from $358,000 in debts when Sizemore Carpet
Brokers liquidated under bankruptcy protection in 1987. His Illuminated
Toy Inc., founded in 1984, ceased operations in 1994, with unpaid
debts of about $795,000.
Anybody can have a business failure. It was Sizemore’s business
practices that raised eyebrows. Sizemore raised funds for his businesses
by persuading members of his church and his softball team to loan
him money, promising to double their money in six months. One fellow
member of Portland Bible Temple cashed a life insurance policy to
lend Sizemore $30,000, which the entrepreneur promised to return
in one month with $3,000 in interest (That’s 120 percent annual
interest). Instead it took years, and a lawsuit to recover the money.
And he was the only creditor to get repaid. Another church member,
dying of cancer, asked Sizemore in 1997 to return the $98,000 he
was owed, and was told it would be repaid after he became governor.
Later, Sizemore asked the widow to recant what she had told the
Oregonian about the incident.
In the end, Sizemore stiffed his landlord, the factories that
made his products, the IRS, and a printing company he wrote a bad
check to. He used toy company money to buy land that he would then
build his family’s home on. Later, he sold the company property
and used proceeds to pay off personal income tax liens. The explanations
he gave to the Oregonian of the details were contradicted by most
of the individuals.
That was how he operated his toy business.
By 1994, Sizemore’s business was politics. The businessman
who hadn’t paid his taxes now formed Oregon Taxpayers United,
a political action committee, and devoted himself to raising money
to wage ballot initiative campaigns. That year his Ballot Measure
8 won by 1,000 votes, requiring public employees to contribute 6
percent of their salary to their pensions. The measure was later
overturned by the Oregon Supreme Court as a violation of contract
rights.
In 1996, Sizemore was back with a referendum that overturned the
Legislature’s plan to build statewide light-rail system. He
also won passage of Measure 47, a property tax limitation to cap
property taxes, limit increases to 3 percent per year, and establish
a double-majority requirement for local temporary future tax increases.
In 1998, he went after public employees unions again; his Measure
59 would have restricted their ability to participate in politics.
It was narrowly rejected by voters, but union political action committees
reportedly spent over $4 million opposing the measure.
Sizemore had a sure thing: Win or lose, his measures would drain
union treasuries, weakening their ability to pursue other issues.
It was a cynical purpose, said judges on the appeals court panel,
and the cynical means by which he conducted the campaigns spurred
voters to approve Measure 46 in 2004, which banned the “bounty,”
by prohibiting initiative campaigns from paying by the signature.
But abuses continued. Media accounts about circulators paid in
cash on street corners led the Bureau of Labor and Industries to
aggressively prosecute whatever violations of Measure 46 they could
prove.
Now, the Oregon Legislature is preparing to clean up the initiative
process. The House Committee on Elections, Ethics and Rules, chaired
by Diane Rosenbaum, began hearings on initiative abuse in January.
“I am not an opponent of the initiative process,”
said Rosenbaum, who herself was a chief petitioner on a ballot measure
that increased the minimum wage. “But we believe it has been
hijacked.”
“A lot of people wonder why can’t we just ban paid
petitioning altogether. Rosenbaum said. “The problem is the
Oregon constitution doesn’t allow it.”
“By 2002 the ideal of citizen volunteers gathering signatures
from their friends, neighbors and colleagues had long ago disappeared,”
Ellen Lowe told Rosenbaum’s committee Jan. 31. Lowe was a
longtime lobbyist for Ecumenical Ministries of Oregon, a social
justice group. “Instead,” Lowe said, “every initiative
season, armies of mercenary signature gatherers descended on our
state looking for a quick and easy buck …. Too often last
year Oregon’s initiative system looked more like drug deals
than democracy.”
Legislators expect to look at a number of reform proposals in
the coming months, including:
