Scottsdale political fallout continues as latest legal fight awaits Phoenix opinion

A view of Phoenix City Hall, which is at 200 Washington St. in the heart of downtown Phoenix. (File photo)

Phoenix City Attorney Cris Meyer is expected to render a legal opinion that may send shock waves through the Scottsdale community, its political aficionados and City Hall establishment.

Earlier this summer, Scottsdale City Clerk Carolyn Jagger in a 16-page opinion apart of a more than 150-page document — found reasonable cause to believe the NoDDC organization, its affiliates and agents may have violated Arizona law.

Subsequently, Ms. Jagger sent along her report to then-Scottsdale City Attorney Bruce Washburn — Mr. Washburn has since resigned into retirement — in mid-June awaiting a ruling on her legal opinion.

The Scottsdale city attorney, which is a City Charter officer position, serves as the enforcement officer for campaign finance complaints within municipal bounds.

The May campaign finance complaint was filed on behalf of former City Councilman David Smith, who also served as treasurer of the municipality prior to being elected.

Former City Councilman and Scottsdale Treasurer David Smith filed an extensive campaign finance complaint against NoDDC and it’s agents. (File photo)

However, sometime between June 19 and July 30, the case was forwarded to the City of Phoenix, officials close to the matter say to free the issue from the perception of impropriety.

“The reason the campaign finance law complaint was referred to the Phoenix city attorney was to avoid an appearance of impropriety,” said Scottsdale Public Affairs Director Kelly Corsette in a July 30 statement to the Independent.

Furthermore, the Phoenix City Attorney’s Office confirms the investigation is pending as of Tuesday, July 30.

The complaint, which was originally filed in May on behalf of Mr. Smith, is separated into three sections:

  • Contributions made to NoDDC; NoDDC Inc.; and NoDDC PAC have been misrepresented and/or not disclosed;
  • Donor information has not been disclosed in accordance with Arizona Statutes governing disclosure of donor information; and
  • Funds donated to and held by NoDDC PAC have been and continue to be converted to personal use.

Sour grapes or public service?

Mr. Smith and Jason Alexander have no love lost between them.

“It has all been handed off to the city of Phoenix roughly the same day we filed our response,” said Scottsdale resident and NoDDC co-founder Mr. Alexander of his July 3 response letter.

“We felt the clerk had made some leaps with a few items and my attorney offered a settlement for the City of Scottsdale to pay a fine — they flatly refused and said this is all in the City of Phoenix’s hands.”

Jason Alexander

Mr. Alexander contends the political infighting between residents has gone too far.

“One of the things is we were not admitting any wrongdoing, but set out in the agreement terms that we want to settle and put this behind us. Who wants to pay money who feels like they didn’t do anything wrong? I just want it over.”

Mr. Smith, on the other hand, is seeking justice, he says.

“Because of all of the inappropriate behavior, I will call it,” Mr. Smith said of his reasoning behind his allegations of improper spending behavior by those under the NoDDC moniker.

“Basically, the bottom line is they paid a $5,000 fine for an earlier violation. The fine was paid by a personal check by himself and Rebecca Holmes, who I assume is his wife. That was really the end of the issue.”

But Mr. Smith points out, the November 2018 settlement only spoke to the actions of agents of the NoDDC entity, which failed to register as a political action committee.

NoDDC — officially referred to as NoDDC Inc. — started as an anonymous digital entity in late 2016, aspired to reshape Scottsdale politics and matured into a nonprofit entity. Today, it is registered as a political action committee.

For clarification: The Protect Our Preserve PAC — and now NoDDC PAC — can collect campaign contributions, while the nonprofit Protect Our Preserve entity cannot, which was defined through the outcome of 2018 campaign finance violation filings.

Over the last two years Scottsdale City Hall, at times, became a debate hall for one singular issue: A proposed desert-appreciation venue within the bounds of the McDowell Sonoran Preserve. (File photo)

The NoDDC PAC formed Sept. 20, 2016, and dissolved Dec. 13, 2016. The period from Dec. 13, 2016 to Oct. 5, 2018, when Mr. Alexander created a PAC with the City of Scottsdale is essentially a period of dormancy for the group, the complaint states.

A $5,000 fine was levied, and paid by personal check drawn on the Bank of America account of “Jason Alexander and Rebecca Holmes.”

According to Mr. Smith’s complaint, investigation into the initial campaign finance complaint, and a review of NoDDC PAC financial disclosure reports, “lead to the conclusion that the violations of Arizona campaign finance laws by the named entities and the named individuals have been (and continue to be) more pervasive, systemic and serious than identified in the September 17, 2018 complaint.”

At its core, Mr. Smith alleges PayPal contributions were not made to NoDDC Inc., and presumptively, the contributions were instead made to the personal bank account of a NoDDC Inc. director, who is not named.

The PayPal account summaries that were provided to the city covered only a portion of the dormancy period, from March 7, 2018 through Oct. 18, 2018, but disclosed more than 100 individual donations, the complaint states.

The same PayPal report shows four account withdraws, totaling $8,156.24, without giving indication of whether such withdraws were deposited to the account of NoDDC Inc., or the personal bank account of a NoDDC Inc. director.

“I quickly ran out of places the money would have gone,” Mr. Smith said of his investigative efforts. “It, the money, came in and went out. To tell you the truth I don’t really know where it went and is part of what the complaint is about. It would seem surprising to me that the only way they were collecting money was through PayPal and I am not sure the PayPal account didn’t show records they actually enjoyed.”

— David Smith, former Scottsdale city councilman

Mr. Alexander sees this is a personal vendetta, plain and simple.

“I believe flat out that David Smith paid $10,000 to take a crap in my living room,” Mr. Alexander said. “I cannot see how this is not double-jeopardy. I am biased, but I can’t see how this is not double jeopardy.”

ACTIVATION: The scene at Scottsdale City Hall in September 2017 as opponents of the proposed Desert Discovery Center came out in force to voice their frustration with the project. (File phot)

Political fallout to come?

Co-founder of NoDDC and co-founder of the Respect our Scottsdale Students Facebook fanpage Mike Norton says he believes in the integrity of the investigative process.

“The city thoroughly and carefully reviewed each claim against me by former Councilmember Smith and came to the obvious conclusion — Smith didn’t bother to state one single fact that connected me to any of the allegations made,” said Mr. Norton, who some have nicknamed “Mad Dog” on social media sites, for his determined, tenatious, and at times, fearless political commentary.

Mike Norton

“He threw me in this action frivolously, having refused on two occasions to provide even a scintilla of evidence tying me to the activities he recited. Thank you, Ms. Jagger, for your careful analysis of the claims against each of the parties involved. I trusted the process and it worked.”

Mr. Alexander says he is confused by the legal process underway and the gaps in communication.

“I would say my best case is the City of Phoenix throws this out and my lawyer turns around and sues the city,” he said. “I just want it over. It is really crazy, the gaps in the process.”

But, Mr. Alexander admits, this is a first-world issue fueled by those with means.

“You would have no defense,” he said of the situation someone would find themselves in without disposable income.

“You would have a court-appointed attorney. You would be defending yourself as a layperson. I think this was nothing but revenge on behalf of David Smith. This is no different than hiring a thug. I fully believe that David Smith knew what he was doing when he hired his lawyer.”

— Jason Alexander, Scottsdale resident and co-founder of NoDDC

Mr. Smith agrees he knew what he was doing when he filed the complaint — but not for convenient reasons, he contends.

“No. Not at all. I lost the election and I can live with the consequences,” he said being asked directly if his legal filings are a product of ballot box disappointment.

“That’s not the issue at all and it’s a complaint that is carefully crafted and identifies the laws that were allegedly broken. Some of these issues go beyond campaign finance issues.”

Mr. Smith suggests the behavior of NoDDC agents ascends to a higher level of prosecution.

“If anything turns out to be true, there are issues that someone committed perjury,” he said. “I am doing a public service for what I believed to be right. It appears to be a breach of law on a collection of the money and went to the benefit of the individuals involved.”

Independent Newsmedia Arizona Managing Editor Terrance Thornton can be contacted at tthornton@newszap.com

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