Silicon Valley congressman raised less than $2,000 for legal defense amid ethics probe, spends $0

Despite a pending ethics complaint about misusing House office funds, Rep. Michael Honda’s campaign and legal defense trust fund reported spending no money on legal services so far this year.

The San Jose Democrat’s bid for another term has been closely watched as he attempts to fight off a repeat challenge from fellow Democrat Ro Khanna. The ethics complaint dates back to Honda’s costly and contentious 2014 reelection campaign against Khanna in the 17th Congressional District.

“The Legal Expense Trust is created to handle the disbursements for legal expenses,” Honda campaign manager Michael Beckendorf said. “The campaign is confident that we will have the resources to deliver a winning message in this election, much like how Congressman Honda has delivered for the 17th District as a senior appropriator.”

Khanna’s campaign on Monday accused Honda of masking legal expenses until after California’s June 7 primary.

“These filings raise significant questions in light of how Mike Honda has handled the ongoing ethics investigation into his use of his office to benefit his top donors,” Khanna campaign spokesman Hari Sevugan said.

Allies of Khanna filed the complaint after a September 2014 report in the local politics website San Jose Inside that revealed emails between Honda’s chief of staff, Jennifer Van der Heide, and his campaign manager, Lamar Heystek, corresponding about the guest list for an official State Department round-table discussion in 2013. They discussed who should be invited to the event hosted by the congressman — based on whether they had or may in the future contribute financially to Honda.

The House Office of Congressional Ethics determined in its 41-page introductory report in September there is “substantial reason to believe” that Honda and his congressional staff used taxpayer resources to benefit his campaign. The report pointed to allegations that staff members in his congressional office were expected to work for his campaign and research his opponents and that the campaign was discussed during office meetings.

That report was referred to the separate House Ethics Committee, which is investigating. It has not yet determined guilt or whether Honda should face any penalties.

Legal defense costs over the case have mounted since April 2015. In campaign finance filings, Honda’s campaign has reported spending $176,000 on legal services with five law firms located in Philadelphia, San Jose and Washington.

In January, Honda got permission from the House Ethics Committee to create a separate legal defense trust fund. About a dozen House members have such funds and can use the money to pay for legal services for themselves or any staff member.

The fund’s first report, which was due over the weekend, shows the congressman has raised just $1,750 from three donors for his legal defense since the beginning of the year and has not spent any of that money.

The donations are considered gifts under federal law. Unlike campaign contributions, which are capped at $2,700 per individual each election, donors can contribute up to $5,000 to the legal defense trust fund.

The donations were $250 from Jadine Nielsen of Honolulu, a frequent donor to Honda and other Democratic candidates; $1,000 from JD Strategies Inc., a workforce services company in Sunnyvale, Calif., and $500 from the Santa Clara location of coffee chain Tom N Toms Coffee.

Beckendorf said there have been additional contributions since March 31, the end of the filing period for the report. He declined to answer questions regarding whether legal services had been performed since the beginning of the year that had not yet been paid for either through the campaign or the legal expense trust fund.

The next quarter’s campaign finance report and legal expense trust fund report are each due after the primary, and Khanna’s campaign said Honda should disclose the additional donors now.

“Given that the next reporting period isn’t until two months after primary day, and Mike Honda’s pattern of providing special favors to his top donors, the voters have the right to know who is funding his legal defense before they vote. Congressman Honda should immediately disclose all contributions to his legal defense fund between April 1 and today and all expenses incurred for legal work done this year related to his defense before the House Ethics Committee.”

The most recent campaign finance reports, filed with the Federal Election Commission by the campaigns in mid-April, show Khanna with $1.95 million in cash on hand, more than double the $792,209 Honda had in the bank headed into the final weeks of the primary.

Honda and Khanna are expected to make it past the top-two primary and face each other on the Nov. 8 general election ballot. Honda defeated Khanna by 3.6 percentage points two years ago and is considered vulnerable this time around.

Also in the race are Republican Peter Kuo, who had $2,711 in cash on hand, and Republican Ron Cohen, with $1,057 in the bank. The other Democrat in the race, Pierluigi Oliverio, reported raising and spending just the $3,052 needed for his filing fee. Libertarian candidate Kennita Watson hasn’t filed with the Federal Election Commission.

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