I first heard about Bernero's City Administrative Account in a 9/29/09 story in the Lansing State Journal by Derek Melot. $194,900 had been raised since 1/1/2006, including $2500 from the Lansing Board of Water and Light. Other stories followed. Here are the ones I am aware of:

• BWL check finds way to mayor's fund, Derek Melot, Lansing State Journal, 9/29/09
• Big bucks cost mayor credibility, Derek Melot, Lansing State Journal, 10/6/09
• A closer look at the “527” account of Lansing Mayor Virg Bernero, Neal McNamara, Lansing City Pulse, 10/07/09
• Mayor's political fund draws criticism, Rob South, WKAR Radio, 10/12/09
• Union wants donation to mayor back, Derek Melot, Lansing State Journal, 10/15/09
• Electrical workers union local sues Bernero, wants $5,000 back, Kathryn Prater, Lansing State Journal, 10/28/09

And here is an article from way back in 2006: Michigan politicians use loophole to collect corporate cash, Alex Nixon, mlive.com, 10/26/06.

Supposedly it is all legal, but it sure smells funny. The payments are not campaign contributions, for which there are strict limits. They are not reported to the county clerk, as campaign contributions are. It is a "political organization", yet not a campaign committee. This IRS Fact Sheet may or may not clarify these "527" accounts.

The custodian of the account is Charles L. Moore of C.L. Moore & Associates, P.C. He describes the purpose of the organization on a Form 881, Political Organization Notice of Section 527 Status that he filed with the IRS:

To collect and administer funds to pay expenses incidental to the holding of the Office of Mayor for the City of Lansing, which if incurred by Mayor Virgil Bernero, would be allowable as a deduction under Section 162 of the Code; To sponsor and organize activities in connection with the Lansing mayoral inauguration, and other acts incidental thereto; and To organize and conduct activities in connection with the Lansing mayoral transition to Lansing Mayor-Elect Bernero, and other acts incidental thereto.

Does Bernero really need all this spending money ($229,350 in 4.5 years)? Doesn't he get a salary and an expense account? I'd say that if money isn't budgeted for "expenses incidental to the holding of the Office of Mayor", he shouldn't incur them. It would be the people's way of saying "Stay in your office and work."

The contribution and expenditure reports are available online at the IRS site. I've compiled the data from the reports through 6/30/2010. Here are the reporting period totals:

Reporting Period	Contributions	Expenditures
1/1/2006-3/31/2006	85000	45208
4/1/2006-6/30/2006	6600	24405
7/1/2006-9/30/2006	43250	5614
10/1/2006-12/31/2006	2000	19486
1/1/2007-6/30/2007	9250	16509
7/1/2007-12/31/2007	17500	7836
1/1/2008-3/31/2008	0	6029
4/1/2008-6/30/2008	14000	5871
7/1/2008-9/30/2008	5000	5137
10/1/2008-12/31/2008	7800	1758
1/1/2009-6/30/2009	4500	8743
7/1/2009-12/31/2009	15500	9808
1/1/2010-3/31/2010	13950	17054
4/1/2010-6/30/2010	5000	3262
Totals	$229,350	$176,720

Here is the detail:

• Contributions Sorted by Date
• Contributions Sorted by Employer
• Contributions Sorted by Employer Total
• Expenditures Sorted by Date
• Expenditures Sorted by Recipient
• Expenditures Sorted by Purpose

My two Excel files are also available, one for contributions and one for expenditures.

Lists of contributions (but not expenditures) are also available at the site CampaignMoney.com.

If you would like to look at the actual IRS data, go to IRS.gov, click on the Charities & Non-Profits tab, then Political Orgs. Next, click Political Organization Filing and Disclosure. Scroll down and click Search Political Organization Disclosures. Under Basic Search, click the box for Form 8872 and in the box for Employer Identification Number (EIN), enter 20-3950788. Then click "City Administrative Account". Ignore the "initial" reports for 12/31/2008 and 4/15/2006; they've been replaced by "amended" reports.

Some observations:

• Only 26 of 121 contributions were for less than $1000.
• When you look at the contribution list sorted by date, you see some popular contribution dates. 1/1/2006, for example. Or 7/31/2006. It's like a request went out on those dates. Also, out of 6 contributions dated 8/31/2006, 5 were for $5000. It is as if the solicitation contained a "suggested donation amount".

We do have a copy of one solicitation letter: the one sent to IBEW Local 665. It was attached to their lawsuit, which was the subject of stories in the Lansing State Journal on 10/15/09 and 10/28/09. It invites the recipient to become a founding member of the Lansing Booster Club at one of 3 levels: Player for $1000, Coach for $5000 or Director for $10,000. And if the recipient did not wish to become a member at this time, they could still support the Lansing Booster Club for $250 or $500: "Corporate checks are welcome." The letter states that the purpose of the Lansing Booster Club is to "provide a core foundation of support for public/private initiatives . . ." An examination of the list of expenditures suggests that the main private initiative is to keep Virg Bernero well fed.

On 10/7/09, I sent a letter to City Council members that said:

I am writing all Council members asking that you consider an ordinance (or whatever is appropriate) that bans the use of “527” accounts by City of Lansing office holders.

I assume you have read the recent articles by Derek Melot of the Lansing State Journal. He said that since 2005, Mayor Bernero’s account “has housed about $194,000 in contributions from an array of corporate leaders, attorneys and others.”

It is bad enough that candidates are subject to the influence of contributors to their campaigns. Why allow another way for special interests to gain the favor of office holders at the expense of Lansing citizens? The 527 account has features that make it more susceptible abuse than campaign contributions. One, there are no limits on contributions. Two, there are no reporting requirements that make the information available to the public.

I am sure you are as concerned as I am about this matter, and you know better than I what can be done about it.

I did hear back from council member Sandy Allen. She told me she was having an intern look into the matter. Sandy was defeated in the November 2009 election.