State Sen. Don Benton, R-Vancouver, can skip disclosing most of the top clients of his sales consulting business, the Washington State Public Disclosure Commission unanimously ruled Thursday.
Benton still must report clients paying him $10,000 or more a year, but only if those clients operate in Washington state, or if they are listed as a client anywhere in the public domain. Benton’s company’s website has included testimonials from a few of his clients, and Benton said Thursday that less than 1 percent of his clients are in Washington.
The PDC requires state elected officials to disclose financial information on an F1 report so the public can see whether they have any potential financial conflicts of interest. Benton has omitted a list of his top clients from his F1 reports since 1999.
The PDC took note of the lapse in Benton’s reporting after an inquiry from The Columbian. After being contacted by the PDC, Benton filed a request asking the commission to exclude him from the requirement.
In his exemption request, Benton said he shouldn’t have to provide a list of top clients because most of his clients are TV stations that are in financial trouble. The stations don’t want their competitors to know they’re in need of sales advice, he said. He also said it’s too time consuming to determine which of his clients has paid him $10,000 or more.
“The company database does not separate customers based on the dollar amount of their contracts, so to pull out that information would create a significant burden on the company’s small staff,” Benton wrote. The request says his company, which is operated out of his Vancouver home, makes about $600,000 a year and has two to five employees.
Benton founded National Consulting Services Inc. in 1989, and the company provides marketing, sales and political advice for media companies, politicians and some law firms.
In addition to his consulting work and his Senate job, Benton is Clark County’s environmental services director, a job that he was appointed to earlier this year.
On Thursday, Benton phoned in to the PDC’s meeting in Olympia and fielded questions from the commission. Board members asked Benton, who was under oath, if reporting his clients in Washington would create an undue hardship for his company.
Benton said he couldn’t recall having any television clients in Washington state within the past several years, but there’s a chance he might have one in the future. Still, he said, “it would be rare and probably not a big deal to the overall company.”
PDC board members also noticed that Benton reported his top clients in 1998.
At that time, Benton sent a letter to the PDC requesting an exemption from reporting his top clients from 1997. “National Advertising Consultants Inc. is a corporation, and ALL compensation paid to me has already been reported as income,” he wrote. Ultimately, Benton withdrew his request for an exemption and supplied the PDC with a client list of five out-of-state TV stations, and a company called Ellis Communications. The very next year, however, Benton was back to not disclosing his top clients.
“Why are we getting this request now, and not five years ago?” PDC Chair Amit Ranade asked Benton on Thursday. Elected officials are supposed to get approval before keeping certain information on an F1 private.
“I was an investor in a real estate company, and I was told at the time, this was some time ago, that if you own a car dealership or you own a real estate company, you can’t possibly disclose everyone who buys a car from you, so does that mean that car dealers then, you know, can’t be politicians?” Benton said. “When the real estate issue was upon us, I was told and was under the clear impression we didn’t have to write down everyone who had bought or sold a house through the brokerage.
“It was my assumption that it would be the same for any company,” Benton continued. “Especially since the overwhelming majority of business is out of state anyway … and the type of work that I do is sensitive to them. And so that’s why I was obviously, erroneously under the impression that I didn’t have to (disclose).”
Similar cases
The PDC’s ruling on Thursday only applies to disclosure reports Benton has filed since 2009. He isn’t required to disclose any additional information for earlier F1 reports, because the PDC rules in question have a five-year statute of limitations. Benton faces no fines for his lack of disclosure, and the PDC will ask that he submit any revised F1 reports for the past five years, if necessary.
The PDC has granted similar client reporting exemptions for elected officials who can make the case that reporting the information would put their businesses at a competitive disadvantage, Ranade said Thursday. They also allow some elected officials, such as judges, to keep their home addresses private.
Benton thanked the commission for their ruling, adding: “I too am big on transparency, as you know, but at the same time, I want to make sure that quality individuals are not scared away from public service because of an onerous reporting system.”
Benton was actively running National Consulting Services, also known as the Benton Group, until May, when he took his $109,656-a-year job with the county. His wife now runs the business while he retains the title of CEO.
