State Finds City Manager Violated Campaign Finance Law

Above: City Manager George Lahanas and City Attorney Tom Yeadon, courtesy City of East Lansing

Michigan’s Department of State has determined that East Lansing City Manager George Lahanas violated the Michigan Campaign Finance Act (MCFA) when he used his column in the City’s Dialog newsletter to encourage voters to vote “yes” on a ballot initiative in the fall of 2014. In a letter dated March 2, 2016, a representative of the Bureau of Elections advised Lahanas, “you are not entitled to use public resources to solicit a favorable vote regarding a ballot question.”

The letter warns Lahanas “to refrain from any further conduct that violates the MCFA. If this notice fails to prevent [you] or the City from engaging in any other violations of the law, it will be used in future proceedings as evidence that tends to establish a knowing violation of the Act.”

 The matter concerns a question that was put to East Lansing voters on the November 4, 2014 ballot—namely, whether to authorize City Council to sell City-owned parking lots in the Park District area for redevelopment. Lahanas used the Dialog newsletter, which is printed and mailed out to East Lansing residents at taxpayer expense, to tell citizens, “As East Lansing’s registered voters go to the polls…it is my hope that they will consider voting ‘yes’ on the ballot proposal of the ‘Sale of City-Owned Properties.’”

Lahanas was advised by City Attorney Tom Yeadon that this was legal under Michigan campaign finance law. When the matter became controversial, Yeadon advised City Council of the same opinion. Yeadon had told Council at that time that, because tax money was already committed to paying to print and mail Dialog, "no public funds were expended."

But shortly thereafter, City resident Don Power, a leader of the Political Action Committee Neighborhoods 1st, filed a formal complaint with the Department of State. Lahanas was defended in the matter of the complaint by Yeadon at City taxpayer expense.

It is Power’s November 2014 complaint on which the Department of State has now ruled against Lahanas.

In its determination letter, the Department of State advised Lahanas: “Here, an expenditure of public funds was made to disseminate the newsletter containing your explicit ‘vote for’ message to households in the City. Utilizing public resources in this manner plainly violates the MCFA.”

The letter also notes that most of the Dialog newsletter was devoted to other matters not of issue in terms of campaign finance law, and notes that Lahanas “sought an opinion from the City’s legal counsel” and had been advised by Yeadon that he would not be in violation of the law.

Lahanas has not yet responded to a request for comment.

Power told me that he is satisfied with the Department of State’s response. He says, “I just want the City to comply with the law.”

The parking lot ballot question failed to pass, garnering a “yes” vote of about 57% and a “no” vote of about 43%. At the time, the City Charter required that more than 60% of voters vote “yes” for a ballot initiative to pass. City voters subsequently voted approximately 52% to 48% to change the City Charter, and as a consequence, now a simple majority can pass an initiative of the sort Lahanas was weighing in on.