The state's ethics commission is looking into allegations that a conservative public policy group failed to register as a political action committee when it channeled more than $235,000 dollars toward campaigns that placed two tax relief initiatives on this fall's ballot.

Roy Lenardson spent most of the afternoon fielding a series of probing questions posed by Jonathan Wayne, the Executive Director of the state Ethics Commission. Lenardson is the President and CEO of Maine Leads, a conservative organization whose self-stated mission is to promote government accountability and citizen activism.

A long-time behind-the-scenes soldier in state Republican politics, Lenardson was asked by Wayne to explain why his organization did not report a payment of more than $160,000 to a signature-gathering group that was attempting to get three citizen initiatives on the state ballot two years ago.

"Because this $165,500 has never been reported publically in a campaign finance report," Wayne said.  "Is there some other motivation that you'd like to point to to respond to the suggestion that's been made that Maine Leads was trying to conceal the scope of its fundraising and spending."

"It wasn't my intend to spend this much money from the beginning," Lenardson said.  "It's not how I wanted the resources used and it's had an impact on the organization.

Lenardson says it's true that his group gave $25,000 each to three citizen initiative efforts. Although one dealing with health care failed to get off the ground, another that cuts the motor vehicle excise tax in half and a new tax cap plan known as TABOR II will both appear on the November ballot. 

But Dan Billings, Lenardson's attorney, maintains that PAC laws in existence two years ago didn't apply to Maine Leads, since the organization's primary stated purpose did not include passing citizen initiatives.

"The law that was in place at the time in 2007 and 2008 talked about a PAC being an organization which had its major purpose advancing a ballot question," Billings said.  "It's our position here that during the signature-gathering phase of the citizien-initiated referendum process, there is no ballot question -- no one knows whether or not anything is going to end up on the ballot.  And even if something is going to be voted on, no one actually knows the ballot question to be until after the Legislature has dealt with the initiated bill."

Still, because Maine Leads raised a large percentage of the funds that fueled the effort to place two of the initiatives on the ballot, former Democratic lawmaker Deborah Hutton maintains the group devoted enough staff time and funding on the ballot questions to become a de facto PAC. That point was emphasized by the commission's Jonathan Wayne

"One of the terms in the PAC definition is what's the major purpose of the organization," Wayne said.  "The Commission has received assertions from Deborah Hutton that the major purpose of the organization is to promote citizen initiatives.  So one of the determinations that the Commission may want to make is what is the organization's major purpose."

Lenardson maintains that Maine Leads is an advocacy group for citizen empowerment to fight for lower taxes. He says he was really trying to model other Democratic-leaning groups such as the Maine People's Alliance which have been successful in Maine.

"My job was, or my mission was, to build capacity," Lenardson said.  "It was to be a place where other center-right groups could come together and to work on ideas and advance an agenda, whether it's day-to-day in the Legislature, whether it's working with local mayors in Waterville or Biddeford.  It really is just strictly out of envy of how the left has organized."

Lenardson's attorney Dan Billings acknowledges that, in retrospect, the group could have avoided the ethics probe by filing a supplementary financial statement. But he says the suggestion that the organization sought to mislead the commission is politically motivated -- "People who are opposed to the particular referendums trying to put a nefarious purpose on it to score some political points."

The Ethics Commission is expected to continue its review of Maine Leads at its October meeting.