SC representative agrees to plan that pays off House ethics fines by September



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COLUMBIA, South Carolina — South Carolina Rep. Harold Mitchell said Tuesday he expects to pay off more than $16,000 in ethics fines by September.

The House Ethics Committee agreed to a payment plan one year after ordering the 49-year-old Spartanburg Democrat to pay $16,100 in fines on what it called unintentional violations between 2008 and 2013. Mitchell was also ordered to reimburse his campaign account nearly $7,400 for improper expenses.

Mitchell, first elected in 2005, has paid $4,600 so far this year directly toward the fines, not realizing he could reimburse his account and then apply that money to the fines, said his attorney, former GOP Rep. Doug Smith of Spartanburg.

State law allows elected officials to pay ethics fines from their campaign account. But Mitchell's has a negative account balance, according to his first-quarter filings.

Under the agreement, the reimbursements to the campaign account will be complete in July. At the same time, his campaign will use the monthly payments to pay down the fines. Additional monthly installments will then pay it off completely, Smith said.

House Ethics Chairman Kenny Bingham said the 10-person committee recognized from the outset that a payment plan would be necessary.

Last May, it found Mitchell lacked required receipts, improperly withdrew cash from his account, paid campaign expenses with cash, failed to report contributions and expenses, and took out cash while depositing donations. It was attributed to a habit of using cash and shoddy record-keeping, combined with a misunderstanding of state law.

"We want to make sure we're reasonable in our approach," Bingham, R-Cayce, told Mitchell on Tuesday. "We want to work with you. We understand hardships."

The order came amid calls for an ethics overhaul. The House passed an ethics reform package earlier this year that would include removing legislators from investigating their own. But the issue appears dead for the third consecutive year.

Smith said Mitchell is still recovering financially after paying hefty fees to another attorney who defended him from allegations brought by the Department of Revenue. That case was ultimately resolved in November 2012. Shortly after being re-elected without opposition, Mitchell pleaded guilty to two misdemeanor counts of not paying his 2007 and 2008 taxes on time. That case also led to the House Ethics review, after prosecutors filed a complaint.

"With all due respect to his counsel, that was very expensive. It cost him to the point he was having difficulty making mortgage payments and his car payments. That puts a heck of a strain on somebody," Smith said.

"In the end, he's in recovery mode. He believes he's almost back to where he needs to be. ... He's done everything he can to get square and settled."

The tax allegations against Mitchell involved the nonprofit he founded. But Mitchell has said he drew no salary from ReGenesis, which received a national award earlier this year from the American Planning Association for its environmental cleanup work in two poor Spartanburg communities. The Environmental Protection Agency awarded ReGenesis a 2009 achievement award, saying the nonprofit had leveraged more than $250 million in public and private funding to revitalize a poor community.

Smith said part of Mitchell's financial struggles stemmed from legislators' low pay. Legislators receive a base salary of $10,400, plus mileage and per diems during the January-through-June session, as well as a $1,000 monthly stipend for unspecified "in-district expenses."

Legislators sought to double that stipend last year in the budget to $24,000 per year, but Gov. Nikki Haley successfully vetoed the pay raise.

Smith, the House's former speaker pro tem, said he's long advocated paying legislators more, so "people could make ends meet."

"I'm a big fiscal conservative, but I want to get good people serving," he said.

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