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Note: For updates on Tuesday, visit Easley hearings, day 2

ANALYSIS

RALEIGH — It would not have been illegal for then-Gov. Mike Easley to have spent more than $11,000 in campaign donations to fix up his private Raleigh house in 2004. The Democrat leased it out while he occupied the executive mansion downtown, and the renters said some work needed to be done.

But would spending campaign cash on personal expenses have been politically untenable, a flash point for outrage that would have distracted from governing and fueled an already building campaign finance reform effort?

You bet.

That’s why, if the narrative laid out by the State Board of Elections on Monday can be believed, Easley arranged for two separate home repairs to be recorded as “travel expenses” and charged to his campaign committee for payment.

If investigators can prove that the former governor intentionally lied on his campaign-finance documents, it would be one more thread removed from his increasingly tattered legacy as a law-and-order governor and once-attorney general who held himself above the common political fray.

Board hearings continue at 9:30 a.m. today, and Easley himself is expected to testify Wednesday or Thursday.

The former governor has been under scrutiny from the media and law enforcement for months. Reports in the News & Observer of Raleigh and The Associated Press have detailed a pattern of the governor gaining perks — unusual lease deals on cars, air travel to campaign events, sweet land deals — while in office.

At the same time, a federal grand jury has called witnesses and subpoenaed documents related to Easley’s dealings while in office.

The State Board of Elections provides the first public venue for investigators to air parts of the Easley saga. In recent history, such hearings have been a prelude to federal and state prosecutors bringing charges.

In the case of former House Speaker Jim Black, a Democrat, testimony from witnesses connected to video poker interests was so transparently false, board Chairman Larry Leake warned explicitly about the perils of perjury. In hearings over the campaign finances of former Rep. Thomas Wright, also a Democrat, failure to disclose campaign contributions led to questions about falsified loan documents.

On Monday, questions about whether thousands of dollars worth of air travel may have been unreported campaign expenses pointed to what might be lies of a different sort.

McQueen Campbell, a friend and political ally of the then-governor, testified that he regularly flew Easley around the state. Some flights were for pleasure; most were associated with work for the campaign.

Campbell testified he never billed the campaign for any of $87,895 worth of campaign flights. But documents show that in February and August of 2005, the Easley committee paid Executive Aircraft Services, a company owned by Campbell, more than $11,000.

Why?

When Easley heard from his tenants in late 2004 that repairs were needed to his private Raleigh home, Campbell testified, the governor asked him to take a look. When Campbell reported that yes, some repairs were needed, Easley asked him to take care of the job.

In 2005, when a leak at the house caused damage, Easley again asked Campbell to hire workers and pay for the job.

Easley never paid for those repairs with a personal check, nor do they show up in the campaign finance logs. But there were those two payments to Executive Aircraft Services.

“Those two checks,” Leake said as he questioned Campbell, “although purporting to be for aircraft travel had a completely different purpose.”

Campbell replied, “That’s correct.”

Campbell told Leake he had called Easley to collect payment for the home repairs. The governor, he said, asked Campbell if there were any “unbilled” flights.

“I just remember understanding what he was saying, for me to bill the campaign for unbilled flights to cover those amounts,” Campbell said.

Thomas Hicks, a lawyer for Easley, tried to rattle Campbell, bringing up instances where he misled — unintentionally or not — reporters and others about his role in getting Easley’s wife a job. He asked how Campbell expected to be paid for anything if he didn’t submit a bill.

Other testimony came from a secretary for a key Easley fundraiser who said the bills from Executive Aircraft Services raised alarms in their office, and ultimately the governor himself ordered her to pay them.

There were other interesting bits of testimony Monday. For example, donors to the Democratic Party testified they were led to believe their contributions would be funneled back to Easley — a sketchy practice at best.

But it was the details surrounding campaign spending on home repairs that raised the most questions Monday.

“That would be illegal today; it was legal then,” Leake said, noting a change in law made during the height of the Black scandal. “It would have other significance obviously, arguably, unrelated to the campaign finance laws...It would be for the public to decide whether they had an issue with it and that’s why I believe there are campaign reporting requirements on the expenditure side.”

Evidence introduced Monday showed that Easley collected money from his homeowners insurance company to pay for the repairs. Leake said that money never made its way to either Campbell or the Easley campaign.

Contact Mark Binker at (919) 832-5549 or mark.binker@news-record.com