10/21 Editor’s Note: Charges of unethical activity follow Mike Schaefer into the general election. This includes credible allegations of money laundering. See article.
Through a SactoPolitico.com investigation, Democratic California Board of Equalization member Mike Schaefer (District 4) has been found to have lied in a key campaign filing about being endorsed by Gov. Gavin Newsom. On Monday, he also plans to petition a writ of mandate in Sacramento Circuit Court requesting removal of this and two other listed endorsements from his candidate statement filed last month with the California Secretary of State.
The other two previously claimed endorsements involved Lt. Gov. Eleni Kounalakis and civil rights activist Dolores Huerta.
This comes after both the Newsom and Kounalakis campaigns told SactoPolitico they dispute endorsing the 83-year-old Schaefer. The first-term board member filed his candidate statement last month, and this was published last week on the Secretary of State website. Final candidate statements are published in the Official Voter Information Guide ahead of the June 7 primary.
“Lt. Gov. Kounalakis has not endorsed him,” said Aleksandra Reetz, a spokesperson with Kounalakis’ re-election campaign. “We have no record of this endorsement. I talked with the lieutenant governor, and she has absolutely no recollection of it. We also did an email search and a [phone] text search.”
Gov. Newson’s campaign spokesperson Nathan Click said by email, “We have not endorsed him either.”
In response, Schaefer at first said, “They were each asked to endorse me, and I thought they all had. I’m not sure what happened with the lieutenant governor, who I have endorsed.”
The Schaefer staffer said he believed Kounalakis gave a verbal endorsement at a Feb. 6 event in San Francisco. He said Huerta had also verbally endorsed, but since the campaign was unable to reach Huerta to reconfirm, they are requesting removal of that endorsement as well from Schaefer’s candidate statement. SactoPolitico.com was also unable to reach Huerta.
However, no question exists Schaefer played fast and loose with the Newsom endorsement. Schaefer acknowledged the governor’s office never replied to the endorsement request submitted by his campaign. Schaefer said he didn’t expect any problems getting the endorsement as he supported the governor against the recall effort last year and has enjoyed socializing with Gov. Newsom and his wife at different events.
“I truly believed the reason [Newsom] hadn’t gotten back to me was just bureaucracy, which used to take a few days,” Schaefer said.
But last month with a Feb. 16 deadline looming to submit his candidate statement, Schaefer said he approved including an endorsement from Newsom. He explained, “It was a crap shoot, and I thought the odds were 90% in favor of him endorsing.”
And what about that 10% chance of being wrong about the endorsement? Schaefer explained he subscribes to the approach that sometimes with busy people like Newsom it’s simpler “to ask for forgiveness than permission.”
Each candidate submitting a statement for inclusion in the voter guide is required to include a signed declaration that “the statement being submitted is true and correct.”
The California Board of Equalization administers the state’s property tax system and oversees the 58 county assessors. Its five-member board consists of the State Controller and representatives elected from four equally divided districts. For the 2022 election cycle, Schaefer’s District 4 has been slightly redrawn and contains the southern-most counties of Imperial, Orange, Riverside and San Diego, and a small part of southwest San Bernardino County including Chino Hills, Ontario and Rancho Cucamonga.
As was widely reported during the 2018 election cycle, Schaefer has a checkered legal history, and the California Democratic Party did not endorse either his 2018 primary or general election campaigns. The San Francisco Chronicle recently described Schaefer’s history as including a conviction for “spousal abuse, legal sanctions for being a slumlord and a restraining order keeping him away from” former Everyone Loves Raymond TV actor Brad Garrett. Schaefer has also been disbarred from practicing law in California and Nevada.
For this reason, some eyebrows were raised last weekend when Schaefer earned the state Democratic party endorsement with 82.3% of cast delegate votes.
At least four Republicans and one Democrat have so far filed to challenge Schaefer. (The primary’s filing deadline was Friday.) The most well-known is Republican Randy Economy. The former talk radio host was among the leaders of last year’s signature petition drive that triggered the unsuccessful recall of Gov. Newsom. After the state Democratic party endorsed Schaefer, Economy was quick to criticize.
“When he ran four years ago, the Democrats absolutely refused to be part of his candidacy. Mike Schaefer is an embarrassment,” Economy said. “He has no business being on the State Board of Equalization, let alone a state constitutional officer. For the Democratic Party to embrace him so warmly this time around, it’s a smack in the face of all taxpayers.”
Schaefer’s campaign responded to Economy’s various criticisms by noting: “Governor Newsom beat back Randy Economy and the recall election resoundingly and triumphed by a 2-to-1 margin. And that is what Mike Schaefer will do as well when voters re-elect him this year.”
3/15 update: Economy also filed his own lawsuit against Schaefer Monday because “I was so outraged at what [Schaefer] pulled that I retained legal representation immediately.” Economy’s suit sought “to enforce legal requirements that candidate statements, published in official election materials, contain only truthful statements” and have Schaefer’s candidate statement pulled completely. But once the court judgment approved changing Schaefer’s candidate statement with elimination of the previously claimed endorsements, Economy withdrew his lawsuit.
On the Democratic side, Schaefer is opposed by David Dodson, a 30-year staff veteran of the Board of Equalization who manages the agency’s Southern California office. Dodson also ran in the 2018 primary and narrowly failed to make top 2, finishing 2.1 percentage points behind Schaefer. Dodson said he hoped this cycle state Democrats would again not endorse any one in the race.
“I was disappointed by the party’s endorsement [of Schaefer],” Dodson said. “But apparently the delegates didn’t bother to do their research this time.”
Then when the Secretary of State’s office posted candidate statements last week, Dodson said he couldn’t believe the endorsements Schaefer listed.
“Honestly, I was surprised to see the endorsements from Gavin Newsom, Eleni Kounalakis, [state Controller] Betty Yee and [state Treasurer] Fiona Ma. I thought it was unlikely that any of those statewide officials would endorse ‘L.A.’s most notorious slumlord,’ as Schaefer has been called,” he said.
However, both Ma and Yee re-confirmed their endorsements of Schaefer when contacted last week. Yee added she has no plans to change her endorsement.
“It comes from our good working relationship on the board. With all due fairness to Mr. Schaefer, he has been a pretty fair advocate for his constituents,” Yee said. “I endorsed both Democrats on the board who are seeking re-election, but it should be noted, I am also looking to abolish the board because the duties have changed so radically in recent years.”
This included changes enacted six years ago by Gov. Jerry Brown and the state legislature that moved most Board of Equalization staff and duties elsewhere. This followed state-auditor findings that accused board members and some staff of putting $350 million in sales taxes into the wrong accounts and some prior board members of improperly using staff for political activities. According to Dodson, the Board of Equalization used to have about 5,000 employees, but now has roughly 200.
Another curiosity on Schaefer’s 2022 candidate statement was the listing of his Democratic party endorsement. He received this endorsement on the weekend of March 5-6, but the deadline for filing his candidate statement was Feb. 16 – or 17 days before he received the endorsement. So technically, his candidate statement about this endorsement was inaccurate at the time of filing.
The Secretary of State’s office didn’t provide information about what the current penalties are for knowingly submitting untrue candidate statements. But in 2016, a trustee with the Contra Costa County Board of Education received 20 hours of community service on a misdemeanor charge of falsely claiming on election paperwork to have earned a bachelor’s degree and master’s degree.
The following year, Assemblyman Jim Frazier, D-Discovery Bay, introduced a bill (AB 894) to increase penalties for submitting knowingly false candidate statements to include forfeiture of office and reimbursement of costs for any subsequent special election. Although AB 894 passed, amendments stripped out those penalties and simply increased the fine from $1,000 to $5,000. But Gov. Brown ultimately vetoed the bill.
Brown explained in his veto statement, “I am not convinced this is a widespread problem in California elections or that this bill would be much of a deterrent. The conventional response to résumé puffing is exposure by the press or political attack by the opposition.”
Schaefer’s campaign said he has not been in touch with Newsom or Kounalakis to apologize or discuss the situation. In his interview with the SactoPolitico, Schaefer seemed to deflect full responsibility, suggesting others could have done more to help him avert the situation.
“I would hope that all state officials would respond within a matter of three days when they get a request with a deadline coming up. And the governor’s office knows the Secretary of State’s office has a deadline to fish or cut bait, and if they are not going to endorse, they should let it be known,” he said.
March 15 update: This article was updated to include court filings, a judgment, and information on a lawsuit by an opposing candidate, Randy Economy.