The state Public Disclosure Commission is considering whether to sanction state Rep. Dennis Flannigan for failing to report stock he owned in three companies.
The Tacoma Democrat failed to disclose that he owned 4,000 shares of stock in Hythiam Inc., the company that licenses the Prometa drug treatment program. Flannigan helped secure state funding for Prometa last year.
According to a commission complaint filed Dec. 20, Flannigan also failed to disclose that he owned stock in Yahoo and Disney.
Flannigan acknowledged the oversights Friday and echoed past comments that he’s sloppy about financial disclosure requirements. The state has cited him four times since 1994 for campaign reporting violations.
“I failed to file timely reports,” Flannigan said. “That’s because I don’t – to be honest – think about it. It’s inappropriate.”
In a related matter, the disclosure commission has decided not to file a complaint against Pierce County Executive John Ladenburg, who also owned Hythiam stock. Ladenburg had disclosed his ownership of the stock but later revised his disclosure because he said he’d overstated its value.
State law requires elected officials to disclose some details of their personal finances each year. The law is intended to give the public information about financial interests that might influence the conduct of elected officials.
In November, The News Tribune reported that Flannigan failed to report his ownership of Hythiam stock in his 2007 financial disclosure, filed last April.
Flannigan told the newspaper that he bought 4,000 shares of Hythiam stock valued at $28,000 in summer 2006. He said a House of Representatives attorney advised him that the stock purchase would be legal.
Flannigan helped secure $395,000 in state funding for Prometa last year. The Legislature also approved $105,000 for a University of Washington study of the treatment program.
Flannigan said he voted on the $33.4 billion, two-year state operating budget that included Prometa funding but decided not to vote on a specific Prometa funding measure.
After the newspaper reported Flannigan’s failure to report the Hythiam stock, he filed amended financial statements for 2005 and 2006 with the Public Disclosure Commission. The updated 2006 form included his Hythiam stock.
But the updated disclosures also show that Flannigan previously failed to disclose stock he owned in Disney and Yahoo. According to his updated statements, Flannigan’s Disney stock was valued at less than $3,000. His Yahoo stock was valued at $3,000 to $14,999. The disclosures indicate he has sold the Disney and Yahoo stocks.
In its complaint, the disclosure commission cited The News Tribune report and Flannigan’s updated financial statements as evidence that the lawmaker might have violated disclosure laws.
Commission spokeswoman Lori Anderson said investigators will review evidence in the case and decide whether to recommend enforcement action to agency commissioners. She said such action is likely.
A single violation is punishable by a fine of up to $1,700. Multiple violations could lead to a fine of up to $4,200.
Meanwhile, Anderson said the commission has decided not to further investigate Ladenburg’s financial disclosures.
The county executive initially told The News Tribune that he bought $900 worth of Hythiam stock in 2006 and sold it at a loss a few months ago. However, he reported to the state last year that the value of the stock was between $3,000 and $14,999.
Ladenburg later said that he held $2,700 worth of Hythiam stock, and amended his state disclosure form to reflect that.
Like Flannigan, Ladenburg helped lobby for public funding of Prometa. In October, the County Council suspended funding to use Prometa in county drug court after a report questioned its effectiveness.
David Wickert: 253-274-7341
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