[House Report 111-409]
[From the U.S. Government Publishing Office]
House Calendar No. 156
111th Congress Report
2d Session HOUSE OF REPRESENTATIVES 111-409 _______________________________________________________________________
IN THE MATTER OF REPRESENTATIVE FORTNEY ``PETE'' STARK
__________
R E P O R T
of the
COMMITTEE ON STANDARDS OF
OFFICIAL CONDUCT
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
January 29, 2010.--Referred to the House Calendar and ordered to be
printed
COMMITTEE ON STANDARDS OF OFFICIAL CONDUCT
ZOE LOFGREN, California JO BONNER, Alabama
Chair Ranking Republican Member
BEN CHANDLER, Kentucky MIKE CONAWAY, Texas
G. K. BUTTERFIELD, North Carolina CHARLES DENT, Pennsylvania
KATHY CASTOR, Florida GREGG HARPER, Mississippi
PETER WELCH, Vermont MICHAEL McCAUL, Texas
R. Blake Chisam, Chief Counsel/Staff Director
C. Morgan Kim, Deputy Chief Counsel
Dan Taylor, Counsel to the Chair
Todd Ungerecht, Counsel to the Ranking Republican Member
Marc Borodin, Counsel
LETTER OF TRANSMITTAL
----------
House of Representatives,
Committee on Standards of Official Conduct,
Washington, DC, January 29, 2010.
Hon. Lorraine C. Miller,
Clerk, House of Representatives,
Washington, DC.
Dear Ms. Miller: Pursuant to clauses 3(a)(2) and 3(b) of
rule XI of the Rules of the House of Representatives, we
herewith transmit the attached Report, ``In the Matter of
Representative Fortney `Pete' Stark.''
Sincerely,
Zoe Lofgren,
Chair.
Jo Bonner,
Ranking Republican
Member.
EXECUTIVE SUMMARY
The Office of Congressional Ethics (OCE) has alleged that
Representative Fortney ``Pete'' Stark violated Maryland
criminal tax law and ethics rules of the House of
Representatives by intentionally filing a false application for
a Maryland property tax credit.
The evidence clearly establishes that Representative Stark
did not receive a tax credit as a result of filing an
application for the credit. The evidence also establishes that
he did not file a false application for the Maryland property
tax credit.
Representative Stark did not seek out the Maryland property
tax credit. The State of Maryland required every homeowner in
Maryland to fill out a form to determine their eligibility for
the tax credit.
Therefore, Representative Stark did not violate House
ethics rules. Nor did he run afoul of Maryland's criminal or
tax laws.
Since 1977, the State of Maryland has had a property tax
credit, called the Homestead Tax Credit (Credit), which limits
tax assessment increases on one's home to 10 percent or less
per year. Previously, the Credit could be automatically
triggered without a homeowner applying for the Credit whenever
property values rose substantially. According to Maryland's
Department of Assessments and Taxation, the Credit was unique
in that it was the only tax credit in Maryland's history for
which a taxpayer did not have to apply, and most people did not
even know they were receiving the Credit. As a result, the
Credit was provided on a widespread basis to homeowners,
whether they knew it or not.
In 2007, Maryland enacted a new law requiring all
homeowners to submit a one-time application to verify their
eligibility or continued eligibility for the Credit. The
applications required by the law were mailed to Maryland
homeowners in stages. One-third of homeowners received the
application in January 2008; one-third of homeowners received
the application in January 2009; and the remaining one-third of
homeowners received the application in January 2010.
Representative Stark owns a home in Anne Arundel County,
Maryland. It is the only home that he owns. He rents living
accommodations in his congressional district.
Representative Stark did not receive the Credit for his
Maryland home between the time he purchased it in May 1987 and
July 1, 2006, because his property taxes did not increase more
than 10 percent in one year at any time during that period.
However, between July 1, 2006, and June 30, 2009 (i.e.,
Maryland tax bill years 2007-2009), his property taxes did
increase more than 10 percent each year. As a result, the
Credit was automatically triggered and applied to
Representative Stark's tax bill for those tax years by Maryland
tax officials, even though he had taken no affirmative action
to seek the Credit.
Following passage of the 2007 law, Representative Stark
received the Homestead Tax Credit application from Maryland's
Department of Assessments and Taxation in January 2009. In
compliance with Maryland's legal requirement, he submitted the
required application electronically in February 2009.
With respect to one question regarding voter registration,
Representative Stark's response, as initially recorded
electronically by Maryland, indicated that he was registered to
vote at his Maryland property address. This mistaken response
was soon corrected in March 2009.
Maryland did not grant a Homestead Tax Credit to
Representative Stark as a result of his application. His tax
bill, which was issued in July 2009, reflected that
Representative Stark received no tax credits whatsoever.
These facts were available to OCE, and in many instances,
were known to OCE or in its possession.
The Committee on Standards of Official Conduct (Standards
Committee) concludes that OCE conducted an inadequate review,
the result of which was to subject Representative Stark to
unfounded criminal allegations.
Maryland issues its tax bills on a fiscal basis, which runs
from July 1 to the following June 30. OCE failed to acknowledge
this key point. As a consequence, OCE erroneously found that
Representative Stark received $3,769.79 in tax credits as a
result of his Homestead Tax Credit application. OCE relied on
an irrelevant document, which was from and issued in the tax
year before Maryland mailed Representative Stark the required
Homestead Tax Credit application.
A search of the Internet or retrieval of Representative
Stark's publicly available tax bill issued on July 1, 2009,
would have made clear that Representative Stark received no tax
credit as a result of submitting the required application and
that Maryland did not classify his property as a principal
residence. The first page of the first document OCE appended to
its Findings noted that Maryland had classified Representative
Stark's home as not being a principal residence. OCE's own
summary of its staff's interview with Maryland tax officials
indicated that Maryland had removed any Homestead Tax Credit
previously associated with Representative Stark's Maryland
residence (and automatically provided by Maryland tax
officials) by May 1, 2009. OCE's own summary of its staff's
interview with Representative Stark noted that Representative
Stark told OCE's staff that he did not receive a tax credit
after he filed the newly required application form.
It is apparent from OCE's work that they treated
Representative Stark inconsistently with the way they treated
four other Members of Congress with similar situations whose
cases were properly dismissed.
First, OCE ignored a conclusion that it had reached in four
similar matters. Maryland's application form, OCE had
previously opined, is vague, unclear and subject to
misinterpretation. OCE had concluded previously that the form,
as worded, put Members of Congress at risk of making mistakes
when filling out the form.
Second, OCE omitted favorable information from
Representative Stark's report that it included in the four
other similar cases without explanation. OCE omitted from a
witness interview summary, appended to its Findings in
Representative Stark's case, a paragraph that it had included
in witness interview summaries of the same interview in every
other similar case it reviewed. That paragraph would have been
favorable to Representative Stark.
The Standards Committee notes that OCE reported that
Representative Stark was belligerent and rude to OCE Staff and
videotaped his interview. It is the Standards Committee's
understanding that OCE routinely does not use a court reporter
with witnesses.
The Standards Committee finds that Representative Stark
provided overall truthful answers and, at the worst, made a
mistake when answering one question that had no bearing on the
approval of the application. That mistake was corrected before
Maryland adjudicated Representative Stark's application.
In sum, Representative Stark's responses on his
application, taken as a whole, did not establish his
eligibility for the Homestead Tax Credit or evince an intent to
lie or evade payment of Maryland property taxes. Maryland did
not, in fact, grant any tax credits, including the Homestead
Tax Credit, to Representative Stark as a result of his
application.
Accordingly, the Standards Committee finds that no further
action in this matter is warranted. The matter is dismissed and
the Standards Committee considers it closed.
C O N T E N T S
----------
Page
I. BACKGROUND........................................................1
A. Procedural History.................................... 1
B. Summary of OCE's Allegations.......................... 3
C. Summary of Representative Stark's Response to OCE's
Allegations.......................................... 3
II. JURISDICTION OF THE STANDARDS COMMITTEE...........................4
III.FACTUAL FINDINGS..................................................4
A. Background Information on Representative Stark........ 4
B. The Maryland Homestead Tax Credit..................... 5
C. Representative Stark's Application for the Homestead
Tax Credit........................................... 6
D. MDAT's Action on Representative Stark's Application... 7
E. OCE's Interaction with Representative Stark........... 8
IV. DISCUSSION........................................................9
A. Overview.............................................. 9
B. Specific Legal Provisions or Standards of Conduct..... 10
1. Willfully Providing False Information or Answer
(Section 14-1004 of Maryland Code)............... 10
2. Evasion of Laws (Paragraph 2 of Code of Ethics for
Government Service).............................. 11
C. The Record Unequivocally Shows That Representative
Stark Did Not Break Any Laws or Engage in Any
Improper Conduct..................................... 11
1. The Record Shows That the Homestead Credit
Application Was Unclear.......................... 11
2. The Record Shows That Representative Stark
Provided Truthful Answers........................ 12
3. The Record Shows That Representative Stark Did Not
Receive A Tax Credit Based On His Application.... 14
V. CONCLUSIONS......................................................15
VI. STATEMENT UNDER RULE 13, CLAUSE 3(c) OF THE RULES OF THE HOUSE OF
REPRESENTATIVES..................................................15
APPENDIX A: DOCUMENTS COLLECTED BY THE COMMITTEE ON STANDARDS OF
OFFICIAL CONDUCT............................................... 16
APPENDIX B: REPORT AND FINDINGS OF THE OFFICE OF CONGRESSIONAL
ETHICS......................................................... 48
APPENDIX C: REPRESENTATIVE FORTNEY ``PETE'' STARK'S RESPONSE TO
THE REPORT AND FINDINGS OF THE OFFICE OF CONGRESSIONAL ETHICS.. 96
111th Congress Report
2d Session HOUSE OF REPRESENTATIVES 111-409 ======================================================================
COMMITTEE ON STANDARDS OF OFFICIAL CONDUCT
IN THE MATTER OF REPRESENTATIVE FORTNEY ``PETE'' STARK
_______
January 29, 2010
_______
Ms. Lofgren, from the Committee on Standards of Official Conduct,
submitted the following
R E P O R T
I. BACKGROUND
A. PROCEDURAL HISTORY
Sometime between the end of May and early June 2009, the
Office of Congressional Ethics (OCE) began preliminary reviews
into allegations regarding the conduct of Representative
Fortney ``Pete'' Stark and four other Members of Congress.\1\
OCE reviews alleged that these Members may have improperly
received a property tax credit on homes owned in Maryland in
violation of state law.\2\
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\1\OCE's records are conflicting regarding the exact date that OCE
authorized and initiated its preliminary review regarding
Representative Stark. In a letter to the Standards Committee on June 2,
2009, OCE stated that the Board had initiated a preliminary review
without specifying when OCE's Board authorized it. See COS. 0001
(Letter from David E. Skaggs (Chair of OCE's Board) and Porter J. Goss
(Co-Chair of OCE's Board), to Chair Zoe Lofgren and Ranking Republican
Member Jo Bonner of the Committee on Standards of Official Conduct,
June 2, 2009). However, in another letter from OCE to Rep. Stark on
June 5, 2009, OCE stated that that OCE's Board authorized a preliminary
review on May 29, 2009, and that it would initiate such review on June
5, 2009. See COS. 0002-0003 (Letter regarding request for information
from Leo Wise (Staff Director and Chief Counsel to OCE) to Rep. Pete
Stark, June 5, 2009). And, finally, OCE's Report and Findings in this
matter (OCE's Review No. 09-9030) states that OCE's Board authorized
and initiated a preliminary review on June 5, 2009. See OCE Findings
para.6. The documents designated with ``COS.'' numbers constitute the
documents collected by the Standards Committee in the course of its
investigation. Pertinent portions of the documents collected by the
Standards Committee can be found at Appendix A. The Standards Committee
notes that certain personal information, such as home addresses and
other private information, has been redacted from the documents
collected by the Standards Committee. The Standards Committee has
redacted this information based on privacy considerations and because
the information is irrelevant to any question at issue in this Report.
OCE's Report (Report) and Findings of Fact and Citations to Law
(Findings) in this matter can be found at Appendix B.
\2\Three of the Members represented a state other than Maryland and
one represented a district in Maryland.
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On June 26, 2009, four members of OCE's Board voted to
terminate all of the reviews except for the one regarding
Representative Stark. Representative Stark's situation was not
materially distinguishable from the terminated matters, yet in
contrast to the other matters, OCE's Board, on June 26, 2009,
voted to initiate a second-phase review with respect to the
matter involving Representative Stark.\3\
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\3\OCE Findings para.7.
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On August 5, 2009, OCE's Board voted to extend the second-
phase review concerning Representative Stark for an additional
14 days.\4\ It also forwarded to the Committee on Standards of
Official Conduct (Standards Committee) the reports and findings
for the terminated matters. OCE's cover letter to those
terminated matters highlighted that its reviews uncovered
several facts about the manner in which Maryland administers
the Homestead Tax Credit that, in its judgment, ``place Members
of Congress who own homes in Maryland at risk of being accused
of improperly receiving the credit at no fault of their
own.''\5\ No apparent explanation has been offered by OCE as to
why this fact did not protect Representative Stark.
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\4\Id. at para.8.
\5\See COS. 0004 (Letter from David E. Skaggs (Chair of OCE Board)
and Porter J. Goss (Co-Chair of OCE Board), to Chair Zoe Lofgren and
Ranking Republican Member Jo Bonner of the Standards Committee, et al.
August 5, 2009).
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By OCE's count, the second-phase review ended on August 28,
2009.\6\ OCE's Board adopted findings and voted to refer only
the matter involving Representative Stark to the Standards
Committee for further review on October 23, 2009.\7\ Three
weeks later, OCE transmitted to the Standards Committee a
report and findings (OCE Report and Findings) on November 12,
2009, which contained OCE's findings adopted earlier and
recommended further review of allegations involving
Representative Stark.\8\
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\6\OCE Findings para.9. Given the conflicting dates as to when the
preliminary review began, see supra n.1, this Committee expresses no
opinion on whether OCE's determination that its second-phase review
ended on August 28, 2009, is accurate because it has no bearing on the
Committee's ultimate conclusion in this matter.
\7\Id. at para.10.
\8\``Upon the completion'' of a second-phase review, OCE is
``authorized and directed'' to transmit a written report to this
Committee. See H. Res. 895, Section 1, clause (c)(2)(C). In
contravention of this directive, that did not occur here until more
than two months after the second-phase review ended, which OCE
determined was on August 28, 2009. Despite the Standards Committee's
continuing concerns with OCE's adherence to its authorizing resolution,
the Committee has nonetheless concluded, as it did recently in another
matter with similar flaws, that ``on balance, the public interest [is]
served by publication of OCE's Report and Findings in this case, and
thus the Standards Committee [has] declined to withhold publication of
OCE's Report and Findings.'' See House Comm. on Standards of Official
Conduct, In the Matter of Representative Sam Graves, H.R. Rep. No. 111-
320, at 23 (2009).
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In mid-November 2009, the Standards Committee sent OCE's
Report and Findings to Representative Stark to provide him with
an opportunity to respond to OCE's allegations. Representative
Stark's counsel submitted a response on December 1, 2009, which
Representative Stark formally adopted by oath or
affirmation.\9\
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\9\Representative Stark's response to the allegations in OCE's
Report and Findings can be found at Appendix C.
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On December 24, 2009, the Chair and Ranking Republican
Member of the Standards Committee issued a statement announcing
they had jointly decided to extend the Committee's
consideration of OCE's transmittal for a 45-day period.\10\
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\10\House Rule XI, clause 3(b)(8)(A), and Standards Committee Rules
17A(b)(1) and 17A(c)(1).
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B. SUMMARY OF OCE'S ALLEGATIONS
OCE's Report and Findings asserted that Representative
Stark may have violated Maryland state law and the Code of
Ethics for Government Service by intentionally misrepresenting
information on an application to establish his eligibility for
a property tax credit, the Homestead Tax Credit (Credit), for a
house that he owns in Maryland.\11\ Maryland provides the
Credit to homeowners who can establish that the home is their
``principal residence.'' ``Principal residence'' is defined as
the location where a homeowner is registered to vote, among
other criteria.\12\ OCE asserted that Representative Stark
misrepresented that he was registered to vote in Maryland on
his application for the Credit, even though he is registered to
vote in California.\13\ By doing so, OCE claimed that
Representative Stark received $3,769.79 in Homestead Tax
Credits in 2009.\14\
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\11\See OCE Report and Findings para.para.1-3, 15, 17.
\12\OCE Findings para.1.
\13\Id. at para.para.2-3, 15.
\14\Id. at para.para.1-3, 15, 20.
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C. SUMMARY OF REPRESENTATIVE STARK'S RESPONSE TO OCE'S ALLEGATIONS
In his response to OCE's Report and Findings,
Representative Stark asserted that he violated no laws or
applicable standards of conduct. Rather, he contended that
OCE's allegations were fundamentally flawed. Representative
Stark raised four main arguments to OCE's allegations.
First, Representative Stark claimed that he did not
indicate on his electronically-filed application that he was
registered to vote in Maryland to establish eligibility for the
Credit.\15\ Representative Stark responded to OCE's allegation
of ``intentional misrepresentation'' as ``nonsensical,'' given
that other responses on his application showed that he did not
fully meet the requirements to receive the Credit.\16\ Further,
Representative Stark asserted that Maryland may have made an
electronic data-entry error in compiling his on-line response,
or that he may have mistakenly indicated his voter registration
in his application.\17\ Because either of these scenarios is a
more plausible explanation of the mistake, OCE's conclusion
that Representative Stark committed an intentional
misrepresentation was in error, according to him.\18\
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\15\Rep. Stark Resp. to OCE Report and Findings at 2.
\16\Id.
\17\Id.
\18\Id.
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Second, Representative Stark asserted that OCE's
allegations were factually flawed because he did not, in fact,
receive a Homestead Tax Credit as a result of his
application.\19\ Rather, Maryland ultimately determined he was
not eligible.\20\
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\19\Id. at 3.
\20\Id.
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Third, despite Maryland's denial of his application,
Representative Stark maintained that he nonetheless may be
eligible for the Credit because his Maryland home is the only
home that he owns.\21\
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\21\Id. Representative Stark rents living accommodations in his
congressional district. See id. at 3, n.3.
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Fourth, Representative Stark raised procedural arguments
that OCE violated its obligation to complete its review in a
timely manner and refer this matter to the Standards Committee
within 89 days as is required by OCE's authorizing
resolution.\22\ As such, OCE transmitted its Report and
Findings after the matter terminated, rendering it legally
invalid.\23\
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\22\Id. at 3-4.
\23\Id.
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II. JURISDICTION OF THE STANDARDS COMMITTEE
House Rule XI, clause 3(a)(2) vests jurisdiction over the
matters addressed in this Report with the Standards Committee.
The Standards Committee may investigate any alleged violation
by a Member, officer, or employee of the House of
Representatives of the Code of Official Conduct or of any law,
rule, regulation, or other standard of conduct applicable to
the conduct of such Member, officer, or employee.\24\ Sole and
exclusive authority over the interpretation and enforcement of
the Code of Official Conduct lies with the Standards
Committee.\25\
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\24\House Rule XI, clauses 3(a)(2) and 3(b).
\25\House Rule X, clause 1(q), Standards Committee Rule 17A(a).
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The Standards Committee conducted its investigation in this
matter pursuant to Standards Committee Rule 18(a), which
authorizes the Standards Committee to consider any information
in its possession indicating that a Member, officer, or
employee may have committed a violation of the Code of Official
Conduct or any law, rule, regulation, or other standard of
conduct applicable to the conduct of such Member, officer, or
employee in the performance of the duties or the discharge of
the responsibilities of such individual. Standards Committee
Rule 18(a) authorizes the Chair and Ranking Minority Member to
jointly gather additional information concerning such an
alleged violation by a Member, officer, or employee.
The instant Report is authorized under House Rule XI,
clause 3(a)(2), which obligates the Standards Committee to
report to the House its findings of fact and recommendations,
if any, for the final disposition of any investigation and
action as the Standards Committee may consider appropriate
under the circumstances; and House Rule XI, clause 3(b)(8)(A),
which authorizes the Standards Committee to report on matters
forwarded to the Standards Committee by OCE.
III. FACTUAL FINDINGS
The Standards Committee reviewed the matter discussed in
OCE's Report and Findings without prejudice or presumptions as
to the merits of the allegations.\26\ As such, the Standards
Committee's findings and conclusions with regard to
Representative Stark were informed by, but made independent of,
OCE's Report and Findings.
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\26\Standards Committee Rule 17A(a).
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A. BACKGROUND INFORMATION ON REPRESENTATIVE STARK
Since January 1973, Representative Stark has represented
the 13th Congressional District of California. As would be
expected with this position, Representative Stark is registered
to vote in California.\27\ He pays California resident
taxes.\28\ He has a California driver's license.\29\ With
respect to living arrangements, Representative Stark rents
accommodations in his district, and has owned a home in
Harwood, Anne Arundel County, Maryland, since May 1987.\30\
Representative Stark does not occupy or own any other
residential properties.\31\
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\27\OCE Findings para.30.
\28\Id. at para.32.
\29\Id. at para.31.
\30\See Rep. Stark Resp. to OCE Report and Findings at 3, n.3; OCE
Findings para.19; and Maryland Department of Assessments and Taxation,
real property data regarding Rep. Stark's home, at Bates No. 09-
9030_0002, which is appended to OCE's Findings.
\31\See Rep. Stark Resp. to OCE Report and Findings at 3, n.3. The
Standards Committee further understands that Representative Stark uses
a home owned by his in-laws as his mailing address in order to ensure
that he receives mail when he is not in his congressional district.
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B. THE MARYLAND HOMESTEAD TAX CREDIT
Since 1977, Maryland's Homestead Tax Credit Program has
existed to help homeowners pay large state and county tax
assessment increases on properties that qualify as their
``principal residences.''\32\ The Credit limits taxable
assessment increases each year to 10 percent or less.\33\ A
``principal residence'' is defined as the ``one dwelling where
the homeowner regularly resides and is the location designated
by the owner for the legal purposes of voting, obtaining a
driver's license, and filing income tax returns.''\34\
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\32\Interview of Mr. Robert E. Young, Deputy Director, Maryland
Department of Assessments and Taxation, by Standards Committee Staff,
January 6, 2010 (hereinafter ``Int. of Robert Young by Standards
Committee Staff''). The Maryland homestead property tax credit
provisions, as amended, are codified in the Md. Code Ann., Tax-Prop.
Sec. 9-105 (West 2009), and implementing regulations issued by the
Maryland Department of Assessments and Taxation (MD Assess. & Tax.),
which are set forth in Title 18, Subtitle 7, Chapter 3 of the Code of
Maryland Regulations (Md. Code of Regs. (2009)).
\33\See COS. 0005 (providing overview of the Maryland Homestead Tax
Credit, June 2009, from the Maryland Department of Assessments and
Taxation's Web site).
\34\Md. Code of Regs., Md. Assess. & Tax. 18.07.03.01(B)(3).
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In October 2007, the Maryland General Assembly passed a new
law requiring all homeowners to submit a one-time application
to verify whether a homeowner should receive or continue to
receive the Credit.\35\ Through experience administering the
program over the years, the Maryland Department of Assessments
and Taxation (MDAT) learned that many homeowners who did not
meet the requirements for the Credit were nonetheless receiving
it, whether they knew it or not, particularly with respect to
rented or vacation properties.\36\ Indeed, in explaining the
basis for the new law, MDAT's Director noted that the Credit
was ``unique'' because ``it is the only tax credit in the
history of the state that you did not have to apply for * * *
so most people didn't even know they were getting the
credit.''\37\ Thus, the purpose of the new law was to ensure
that homeowners were properly receiving these tax credits and
to prevent substantial losses in tax revenue.\38\ The new law
directed MDAT to establish an application process to verify
that homeowners qualify for the Credit on their one ``principal
residence.''\39\
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\35\2007 Maryland Laws Ch. 564 (S.B. 522) and Ch. 565 (H.B. 436),
codified in Md. Code Ann., Tax-Prop. Sec. 9-105(d)(6), (l) and (m).
\36\Prior to 2007, for example, homeowners obtained the Credit
during settlement on new homes if the homeowner indicated that the
actual property address would be the location for receiving property
tax bills. In such cases, MDAT presumed that the property would be an
owner-occupied ``principal residence'' to qualify for the Credit. See
Int. of Robert Young by Standards Committee Staff.
\37\Janel Davis, Homeowners Now Must Apply for the State Property
Tax Credit, Gazette.net, Jan. 9, 2008, available at http://
www.gazette.net/stories/010908/montnew84501_32357.shtml (last visited
Jan. 27, 2010). (Gazette.Net is an online Maryland Community
Newspaper.)
\38\Int. of Robert Young by Standards Committee Staff.
\39\This directive requirement is codified in Md. Code Ann., Tax-
Prop. Sec. 9-105(d)(6).
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Robert E. Young is the Deputy Director of MDAT.\40\ Since
1978, Mr. Young has been an employee of MDAT and has overseen
the Homestead Tax Credit Program.\41\
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\40\Int. of Robert Young by Standards Committee Staff.
\41\Id.
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When interviewed by the Standards Committee, Mr. Young
explained that MDAT informed all homeowners of the affirmative
obligation to apply for the Credit by mailing applications to
all Maryland homeowners with updated assessment notices over a
three year period.\42\ Beginning on January 1, 2008, MDAT
mailed the first set of applications to one-third of Maryland
homeowners. On January 1, 2009, and January 1, 2010,
respectively, MDAT mailed applications to the remaining two-
thirds of Maryland homeowners.\43\ MDAT's cover letter to these
mailings informed homeowners that they could submit a completed
application through the mail or electronically on MDAT's Web
site.\44\
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\42\Int. of Robert Young by Standards Committee Staff; OCE Findings
para.24.
\43\Int. of Robert Young by Standards Committee Staff.
\44\Id.; COS. 0006 (MDAT's Web site welcome page to submit
application for the Credit on-line, which notes that the new law
requires all homeowners to submit the one-time application).
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To evaluate eligibility to receive the Credit, the
application requires that a homeowner answer ``yes'' or ``no''
to five questions that closely parallel the definition of
``principal residence.''\45\ Those questions ask, in relevant
part: (1) Will the real property address identified on the
application be used as the single, principal residence of the
homeowner for more than six months of the calendar year,
including July 1; (2) is the real property address identified
on the application the address where the homeowner expects to
file his or her next federal and Maryland income tax returns;
(3) is the real property identified on the application the
address from which the homeowner has received a driver's
license; (4) is the real property identified on the application
the address at which the homeowner is registered to vote; and
(5) is any portion of the principal residence rented?\46\ A
homeowner will automatically receive the Credit without further
inquiry if he or she answers ``yes'' to all of the first four
questions.\47\
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\45\See COS. 0007-0008 (blank copy of application for the Credit
from MDAT's Web site).
\46\COS. 0008.
\47\Int. of Robert Young by Standards Committee Staff. Mr. Young
further explained to the Standards Committee Staff that when someone
does not answer ``yes'' to all of the first four questions, then MDAT
gets an ``exceptions report'' for further review of the application.
Id. Mr. Young added that a ``no'' response to Question 4 pertaining to
voter registration ``has the least probative value'' in MDAT's review
because there are many acceptable explanations why someone may not be
registered to vote at the particular address. Id. OCE's recitation of
MDAT's review process, as set forth in its interview memorandum, stated
that MDAT automatically grants applications if someone provides a
``yes'' response to Questions 1 and 2 regardless of other answers due
to resource constraints. See Bates Nos. 09-9030_0007-0008, para.para.7
and 10, which are appended to OCE's Findings. OCE's recitation of
MDAT's review process from notes taken during the interview is
inconsistent with Mr. Young's explanation to the Standards Committee
Staff in his transcribed interview.
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C. REPRESENTATIVE STARK'S APPLICATION FOR THE HOMESTEAD TAX CREDIT
On or about January 1, 2009, MDAT mailed to Representative
Stark's Maryland address an application for the Credit, along
with his assessment notice.\48\ MDAT's electronic business
records document that Representative Stark submitted a
completed application for the Credit through MDAT's on-line
submission process on February 6, 2009.\49\ A print-out of
Representative Stark's electronically-filed application from
MDAT's electronic business records indicated that he answered
``yes'' to Question 1 (principal residence for more than six
months during the year), Question 2 (location for filing income
tax returns), and Question 4 (voter registration).\50\ He
answered ``no'' to Question 3 (driver's license) and Question 5
(residence rented).\51\
---------------------------------------------------------------------------
\48\Int. of Robert Young by Standards Committee Staff. It is the
Standards Committee's understanding that Representative Stark did not
receive the Credit for his Harwood home between the time he purchased
it in May 1987 and July 1, 2006, because his property taxes did not
increase more than 10% in one year at any time during that period.
However, between July 1, 2006, and June 30, 2009 (i.e., tax bill years
2007-2009), his property taxes did increase more than 10% each year. As
a result, the Credit was automatically triggered and applied to
Representative Stark's tax bill for those tax years by Maryland tax
officials, even though he had taken no affirmative action to seek the
Credit. See also OCE Findings para.20 (stating that Representative
Stark did not receive the Credit before 2006).
\49\Int. of Robert Young by Standards Committee Staff; COS. 0009
(printed from MDAT electronic records regarding Rep. Stark on January
4, 2010).
\50\Int. of Robert Young by Standards Committee Staff; COS. 0010
(printed from MDAT electronic records regarding Rep. Stark on January
4, 2010).
\51\Id.
---------------------------------------------------------------------------
With respect to Question 2, Representative Stark filed his
California resident and Maryland non-resident income tax
returns for 2008 from his Maryland address.\52\ He did the same
for his Federal income tax return for 2008.\53\
---------------------------------------------------------------------------
\52\OCE Findings para.32; Bates Nos. 09-9030--0024 and 09-9030--
0026, which are appended to OCE's Findings.
\53\Int. of Robert Young by Standards Committee Staff.
---------------------------------------------------------------------------
With respect to Question 4, MDAT's electronic business
records apparently show that Representative Stark contacted
MDAT in mid-March 2009, and requested that his answer be
changed to a ``no'' response.\54\ The MDAT employee who
received this call and made this entry purportedly told her
supervisor.\55\ The supervisor, in turn, informed Mr. Young,
who is her boss.\56\ Mr. Young did not speak with
Representative Stark about this purported request.\57\ Nor did
he have any further discussion with any MDAT employee about
this purported telephone call.\58\
---------------------------------------------------------------------------
\54\See COS. 0011 (printed from MDAT electronic records regarding
Rep. Stark on January 4, 2010); OCE Findings para.28. Mr. Young told
the Standards Committee Staff that the notations in this document about
contacting him and not answering questions are solely meant to remind
MDAT employees that tax informative is sensitive personal data and that
only certain officials are authorized to respond to questions regarding
such information. Int. of Robert Young by Standards Committee Staff.
\55\Int. of Robert Young by Standards Committee.
\56\Id. Mr. Young stated further that he did not know whether that
information was accurate, but that is what he was told happened. Id.
This is a classic ``double hearsay'' issue with respect to veracity of
the conversations alone (and not including the underlying electronic
entry of the phone call). Additionally, Representative Stark does not
acknowledge such contact with MDAT in his response to the OCE Report or
in his interview with OCE. See Rep. Stark Resp. to OCE Report and
Findings at 2, n.1; OCE Findings para.35. Representative Stark's
initial answer to this question and whether he later called MDAT
regarding his response to this question are unclear. However, it is
unnecessary for the Standards Committee to untangle these issues
because whether Representative Stark did indeed make such a phone call
or not is immaterial in light of the totality of factual findings and
conclusions reached by the Committee in this matter. There would be
nothing discreditable, in any event, in Representative Stark making an
effort to correct an error.
\57\Int. of Robert Young by Standards Committee Staff.
\58\Id. Given the volume of issues that Mr. Young is responsible
for addressing, he added that this purported phone call was not
something that he would have taken any special interest in unless it
later became an issue. Id.
---------------------------------------------------------------------------
D. MDAT'S ACTION ON REPRESENTATIVE STARK'S APPLICATION
MDAT did not find Representative Stark eligible for the
Credit.\59\ MDAT likely found his application ineligible for
the Credit by the end of March 2009,\60\ although OCE's Staff
was told by MDAT that it removed the Credit associated with
Representative Stark's Maryland residence on May 1, 2009.\61\
In any event, MDAT unquestionably disapproved of his
eligibility before June 2009, when MDAT provided counties with
electronic updates to ensure that tax bills contained current
assessment and tax credit information.\62\ In Anne Arundel
County, Maryland, tax bills were issued on July 1, 2009.\63\
---------------------------------------------------------------------------
\59\Int. of Robert Young by Standards Committee Staff.
\60\Id. Mr. Young was unsure of the exact date because it is not a
required input in MDAT's records. Id.
\61\See Bates No. 09-9030--0009, para.12, which is appended to
OCE's Findings.
\62\Int. of Robert Young by Standards Committee Staff.
\63\Id. In Maryland, property tax bills are issued on a fiscal year
basis, which runs from July 1 through June 30 of the following calendar
year. Int. of Robert Young by Standards Committee Staff; see also COS.
0012-0015 (MDAT's ``A Homeowner's Guide To Property Taxes and
Assessments,'' last revised July 27, 2009, noting in Section I that tax
bills are issued in July/August of each year in Maryland, and rendered
for the upcoming fiscal year, which is effective as of July 1); and
COS. 0016 (``Property Tax Information,'' Anne Arundel County, Maryland,
noting that taxes are due on July 1, and may be paid without interest
on or before September 30 of the tax year).
---------------------------------------------------------------------------
Representative Stark's property tax bill, which was issued
on July 1, 2009, did not contain a Credit.\64\ Indeed, it
contained no tax credit whatsoever.\65\ The notation of ``NOT A
PRINCIPAL RESIDENCE'' on Representative Stark's tax bill
highlighted that he did not receive any homestead tax benefit
for the period July 1, 2009, through June 30, 2010.\66\
Representative Stark, therefore, ``never received a homestead
tax credit for the application which he submitted on-
line.''\67\
---------------------------------------------------------------------------
\64\COS. 0017 (Rep. Stark's property tax bill from July 1, 2009,
issued by Anne Arundel County, Maryland).
\65\Id.
\66\Int. of Robert Young by Standards Committee Staff; COS. 0017.
\67\Int. of Robert Young by Standards Committee Staff.
---------------------------------------------------------------------------
Furthermore, if Representative Stark had not responded to
Maryland's requirement to submit an application, he would have
continued to receive the Credit until December 2012.\68\
---------------------------------------------------------------------------
\68\See Bates No. 09-9030--0008, para.6, which is appended to OCE's
Findings.
---------------------------------------------------------------------------
E. OCE'S INTERACTION WITH REPRESENTATIVE STARK
In June 2009, OCE requested information from Representative
Stark regarding his application for the Credit.\69\
Representative Stark could not locate a copy of his
electronically-filed application.\70\ In lieu of an exact copy,
Representative Stark, in mid-June 2009, provided OCE with the
application filled out by hand, which represented his best
recollection of how he filled out the on-line form.\71\
---------------------------------------------------------------------------
\69\See OCE Findings para.25.
\70\Id.
\71\See OCE Findings para.25; Bates Nos. 09-9030_0014-0015, which
are appended to OCE's Findings (containing a copy of Representative
Stark's hand-written recollection of his application provided to OCE).
---------------------------------------------------------------------------
On July 29, 2009, Representative Stark voluntarily agreed
to an interview with OCE's Staff.\72\ The interview did not go
smoothly. OCE's Staff claimed that Representative Stark was
``belligerent'' and ``frequently insulted them.''\73\ They also
indicated that Representative Stark was videotaping the
interview and demanded a copy of the tape.\74\
---------------------------------------------------------------------------
\72\OCE's Findings erroneously stated that OCE Staff interviewed
Rep. Stark on May 29, 2009, see OCE Findings para.34. OCE Staff's
interview memorandum of Rep. Stark contains the correct date of the
interview on July 29, 2009. See Bates Nos. 09-9030_0028-0029, which are
appended to OCE's Findings.
\73\See Bates No. 09-9030_0029, para.8, which is appended to OCE's
Findings.
\74\See OCE Findings para.36; Bates No. 09-9030_0029, para.8; Bates
No. 09-9030_0031-0033, which are appended to OCE's Findings. While
Representative Stark appears to have acknowledged receipt of OCE's
request, he did not substantively respond to it. See Bates No. 09-
9030_0035, which is appended to OCE's Findings.
---------------------------------------------------------------------------
During the interview with OCE's Staff, Representative Stark
was shown a copy of a print-out of his electronically-filed
application, which OCE obtained from MDAT.\75\ Representative
Stark could not explain why his response in the on-line version
pertaining to voter registration differed from his recollection
of his response, but acknowledged that these responses
differed, according to OCE's interview memorandum.\76\
Representative Stark did not concede during the OCE interview
that he contacted MDAT to change his response to the voter
registration question.\77\
---------------------------------------------------------------------------
\75\See OCE Findings para.35; Bates No. 09-9030_0029, para.7, which
is appended to OCE's Findings.
\76\See id.
\77\See OCE Findings para.35; Bates No. 09-9030_0029, para.5, which
is appended to OCE's Findings.
---------------------------------------------------------------------------
During the interview with OCE's Staff, Representative Stark
stated that he did not receive a Credit after filing the
application on-line.\78\
---------------------------------------------------------------------------
\78\See OCE Findings para.34; Bates No. 09-9030_0028, para.3, which
is appended to OCE's Findings.
---------------------------------------------------------------------------
IV. DISCUSSION
A. OVERVIEW
The Standards Committee finds that Representative Stark did
not intentionally misrepresent information on his application,
or attempt to evade the payment of Maryland property taxes by
misrepresenting such information, in violation of Maryland law.
Based upon the facts gathered during the Standards Committee's
independent investigation as fully discussed below, the
Standards Committee found that Representative Stark did not
receive a Maryland Homestead Tax Credit as a result of the
application that he was required to file. His responses, taken
as a whole, did not establish his eligibility for the Credit or
evince an intent to lie or evade payment of Maryland property
taxes, and MDAT did not, in fact, grant him any tax credit,
including the Homestead Tax Credit.
As a result, the Standards Committee finds that
Representative Fortney ``Pete'' Stark did not violate any laws
or other applicable standards of conduct in connection with his
application for a Maryland Homestead Tax Credit, and that no
further action is warranted in this matter.
The Standards Committee further finds that OCE's
determination that there is a ``substantial reason to believe''
the allegations that Representative Stark, by his conduct
relating to his Credit application, may have violated Maryland
law, House Rules, or other applicable standards of conduct was
in error and not supported by the ``information then known to
the Board.''\79\ Accordingly, the Standards Committee finds
that no further action against Representative Stark is
warranted and that the matter should be dismissed.
---------------------------------------------------------------------------
\79\OCE Rule 9A.
---------------------------------------------------------------------------
B. SPECIFIC LEGAL PROVISIONS OR STANDARDS OF CONDUCT
OCE's Report and Findings stated that Representative Stark
may have violated the following legal provisions or standards
of conduct.
1. Willfully Providing False Information or Answer (Section 14-1004 of
Maryland Code)
Section 14-1004(a) of the Maryland Code provides:
A person who willfully or with intent to evade
payment of a tax under this article or to prevent the
collection of a tax under this article provides false
information or a false answer to a tax interrogation
under this article is guilty of a misdemeanor and on
conviction is subject to a fine not exceeding $5,000 or
imprisonment not exceeding 18 months or both.\80\
---------------------------------------------------------------------------
\80\Md. Code Ann., Tax-Prop. Sec. 14-1004(a) (West 2009).
---------------------------------------------------------------------------
(a) Elements and Standard of Proof to Establish a Violation
To prove a criminal violation of Section 14-1004(a) of the
Maryland Code in connection with an application for a Homestead
Tax Credit, it must be shown, beyond a reasonable doubt, that
an accused: ``willfully'' or with intent to evade payment of or
prevent the collection of a tax provided false information or
answers on his or her Credit application. Under Maryland
criminal law, the term ``willful'' is accorded the meaning
provided by federal courts interpreting this term in federal
criminal tax provisions.\81\ Therefore, ``willfulness'' may be
established through proof of a ``voluntary, intentional
violation of a known legal duty, not the result of accident or
mistake or other innocent cause.''\82\
---------------------------------------------------------------------------
\81\See Johnson v. State, 451 A.2d 330, 332 (Md. 1982).
\82\Id; see also Cheek v. United States, 498 U.S. 192, 201 (1991)
(declaring that Supreme Court precedent conclusively establishes that
the standard to meet the statutory ``willfulness'' requirement in
criminal tax offenses is the ``voluntary, intentional violation of a
known legal duty'') (citing United States v. Pomponio, 429 U.S. 10, 23
(1976); United States v. Bishop, 412 U.S. 346, 360 (1973)).
---------------------------------------------------------------------------
(b) Applicable Elements and Standards of Proof to Establish
Alleged Criminal Violations in Standards Committee
Proceedings
Liability for a violation of Section 14-1004(a) of the
Maryland Code requires proof, beyond a reasonable doubt, that
the accused acted with the requisite intent to commit the act
and knowledge that the act is a violation of the law. However,
it has been long established that this Committee need not
adhere strictly to general criminal law standards that require
proof of the requisite intent to establish a violation to
appropriately execute its responsibilities in the non-criminal
disciplinary context.\83\ Rather, the Code of Official Conduct
and Code of Ethics for Government Service make clear that
``Members of Congress are expected to adhere to standards of
conduct far more demanding than the bare minimum standards
established by our criminal laws.''\84\
---------------------------------------------------------------------------
\83\See House Comm. on Standards of Official Conduct, Manual of
Offenses and Procedures Korean Influence Investigation, pursuant to
H.R. Res. 252, 95th Cong., at 35 (1977).
\84\Id.
---------------------------------------------------------------------------
2. Evasion of Laws (Paragraph 2 of Code of Ethics for Government
Service)
Paragraph 2 of Code of Ethics for Government Service
provides:
Any person in Government Service should: * * *
Paragraph 2: Uphold the Constitution, laws, and legal
regulations of the United States and of all governments
therein and never be a party to their evasion.\85\
---------------------------------------------------------------------------
\85\Code of Ethics for Government Service, Paragraph 2.
---------------------------------------------------------------------------
(a) Elements and Standard of Proof to Establish a Violation
A Member who violates a state criminal statute or seeks to
evade the requirements of a state's tax law may be found to
have violated standards of conduct applicable to Members of
Congress under Paragraph 2 of the Code of Ethics for Government
Service.\86\
---------------------------------------------------------------------------
\86\See, e.g., See House Comm. on Standards of Official Conduct, In
the Matter of Representative James A. Traficant, Jr., H.R. Rep. No.
107-594, at 4-12, 105-114 (2002).
---------------------------------------------------------------------------
As fully shown below, Representative Stark's conduct did
not violate Maryland law under traditional criminal standards
or under the more lenient standards applicable to the Standards
Committee's review of alleged criminal misconduct. Nor does the
evidence suggest that Representative Stark intended or
attempted to evade payment of Maryland property taxes by
providing false information.
C. THE RECORD UNEQUIVOCALLY SHOWS THAT REPRESENTATIVE STARK DID NOT
BREAK ANY LAWS OR ENGAGE IN ANY IMPROPER CONDUCT
1. The Record Shows That the Homestead Credit Application Was Unclear
From its reviews of other Members who had been given the
Credit, OCE determined that the Credit application was unclear.
In its review of this matter, OCE also noted that the wording
of Question 2 is vague because it allows a homeowner to answer
``yes'' if he or she files a non-resident tax return from the
Maryland property address, as Representative Stark did, despite
MDAT's intent that this question only apply to a Maryland
resident tax return.\87\ Moreover, in its reviews of other
Members, OCE's Staff expressed that the application was
confusing in more direct terms.\88\
---------------------------------------------------------------------------
\87\OCE Findings para.32.
\88\Specifically, its interview memoranda of the MDAT officials
used in its findings for other Members stated that:
---------------------------------------------------------------------------
The Homestead Tax Credit Application asks whether the
applicant's ``real property address'' is ``the location
where the homeowner(s) will file the federal and Maryland
income tax return,'' ``the location from which the
homeowner(s) have received a driver's license,'' and ``the
location from which the homeowner(s) are registered to
vote, if registered.'' The OCE staff pointed out that these
questions do not specify that the applicant must file a
Maryland resident tax return, receive a Maryland driver's
license, and be registered to vote in Maryland. [Emphasis
in original]. Representative 1 stated that despite the
application's ambiguity, it was [MDAT's] intent to grant
the Homestead Tax Credit only to principal residences of
property owners who were registered to vote in Maryland,
possessed Maryland driver's licenses, and filed Maryland
resident income tax returns. Representative 1 stated that
[MDAT] will consider changing the language of the
application to clarify this ambiguity. See, e.g., COS.
0018-0019, para.2.
OCE's observations regarding the ambiguity on the
application were omitted from the interview memorandum of MDAT
officials only in Representative Stark's matter, despite the
fact that the interview was of the same witnesses, and occurred
on the same date and time.\89\ OCE's Report and Findings
offered no statement identifying or explaining the omission of
this paragraph in this matter, but the paragraph was included
in all other interview memoranda of the MDAT officials in the
matters that OCE terminated.
---------------------------------------------------------------------------
\89\Compare Bates Nos. 09-9030_0028-0029, para.2, appended to OCE's
Findings (OCE Staff's interview memorandum of MDAT officials pertaining
to Representative Stark) with COS. 0018-0030, para.2, (OCE Staff's
interview memoranda of MDAT officials pertaining to other Members).
Except for Representative Stark, OCE's interview memoranda pertaining
to other Members contained identical text in Paragraphs 1 through
Paragraph 11, and then noted fact-specific issues for each Member.
Compare Bates Nos. 09-9030_0028-0029, appended to OCE's Findings with
COS. 0018-0030.
---------------------------------------------------------------------------
It is a fundamental axiom of our jurisprudence that the due
process clause requires that ``all are entitled to be informed
as to what the State commands or forbids.''\90\ Laws must
``give the person of ordinary intelligence a reasonable
opportunity to know what is prohibited, so that he may act
accordingly. Vague laws may trap the innocent by not providing
fair warning.''\91\
---------------------------------------------------------------------------
\90\Lanzetta v. New Jersey, 306 U.S. 451, 453 (1939).
\91\Grayned v. City of Rockford, 408 U.S. 104, 108 (1972).
---------------------------------------------------------------------------
The determination that the underlying requirement at issue
(i.e., the Homestead Tax Credit application) is vague would
make it difficult to draw the conclusion that a ``willful''
violation subject to criminal sanctions had been committed.
Under such circumstances, the requisite intent to commit the
act with knowledge that it is a violation cannot be
present.\92\
---------------------------------------------------------------------------
\92\If the application is vague or unclear, then one cannot have
``fair warning'' to willfully run afoul of what is prohibited. See City
of Rockford, 408 U.S. at 108; see also Satellite Broadcasting Co. v.
FCC, 824 F.2d 1, 3 (D.C. Cir. 1987) (holding that traditional concepts
of due process and fair warning apply to administrative applications
required by agencies).
---------------------------------------------------------------------------
Moreover, OCE's conclusion that there is a substantial
reason to believe that a ``willful'' violation was committed is
at odds with its overall conclusion reached in its reviews of
other Members. From those reviews, it reached the overall
judgment that the manner in which Maryland administers the
Homestead Tax Credit places ``Members of Congress who own homes
in Maryland at risk of being accused of improperly receiving
the credit at no fault of their own.''\93\ Such a
characterization is the antithesis of the standard required to
demonstrate a ``willful'' violation under Maryland laws.''\94\
---------------------------------------------------------------------------
\93\See COS. 0004.
\94\See Johnson, 451 A.2d at 332 (``willfulness'' is the voluntary,
intentional violation of a known legal duty, not the result of accident
or mistake or other innocent cause).
---------------------------------------------------------------------------
2. The Record Shows That Representative Stark Provided Truthful Answers
The record demonstrates that Representative Stark provided
overall truthful answers and, at most, made an inadvertent
mistake regarding his voter registration response, which was
soon corrected. His answers, when viewed in total and in
context, evince no intent to lie or evade payment of a tax.
Correcting an error is not misconduct.
First, the facts show that Representative Stark truthfully
answered Question 1 on his application regarding his Maryland
home being his primary home. Representative Stark owns only one
home, which is in Maryland, and rents accommodations in his
congressional district.\95\ Under these circumstances, the
record plainly shows that Representative Stark's Maryland home
could be viewed as his single principal residence as this term
is commonly understood.
---------------------------------------------------------------------------
\95\See Rep. Stark Resp. to OCE Report and Findings at 3, n.3; OCE
Findings para.19.
---------------------------------------------------------------------------
Second, the facts demonstrate that Representative Stark
truthfully answered Question 2 on his application, as that
question is worded, regarding the filing of income tax returns
from his Maryland property address. Representative Stark filed
his Federal income tax returns for 2008, and his California
resident and Maryland non-resident income tax returns for 2008
from his Maryland address.\96\
---------------------------------------------------------------------------
\96\See Int. of Robert Young by Standards Committee Staff; OCE
Findings para.32; Bates Nos. 09-9030_0024 and 09-9030_0026, which are
appended to OCE's Findings.
---------------------------------------------------------------------------
Third, the facts further show that Representative Stark
truthfully answered Question 3 on his application relating to
his California driver's license.\97\
---------------------------------------------------------------------------
\97\OCE Findings para.33.
---------------------------------------------------------------------------
At its core, OCE's conclusion rests solely upon the claim
that Representative Stark ``falsely'' certified his response to
Question 4 on the application to receive the Credit.\98\ This
claim is not borne out by the facts. First, Representative
Stark did not recall initially providing an affirmative
response in his on-line application to this question, but
acknowledged that such a response would be a mistake.\99\
Second, Representative Stark's on-line response to this
question was changed to a ``no'' response before MDAT formally
found his application ineligible for the Credit.\100\
Nonetheless, OCE appears to infer an intent to lie or evade tax
payments from the fact that MDAT changed Representative Stark's
response to this question two days after an article was
published in the New York Times on March 14, 2009, regarding
Representative Eliot Engel, who allegedly received the
Credit.\101\ Even if true, there are no facts to show that this
action was not the product of a mistake being discovered.
Moreover, OCE did not draw similar inferences regarding other
Members, after learning during its other reviews that some
Members contacted MDAT contemporaneously with the publication
of the article in the New York Times to allegedly remove the
Credit associated with their homes. Yet in this matter, which
merely involved a change to one response before any official
determination was made, OCE did draw such an inference. Third,
if both Maryland voting status and a Maryland driver's license
were absolute legal requirements for the tax credit, as OCE
described in its Findings, it would be nonsensical for
Representative Stark to claim one but not the other if his true
intent was to purposefully provide false answers to evade tax
payments.\102\ Any reading of the above facts leads to the
conclusion that, at most, Representative Stark made a mistake
when answering this question, which has the ``least probative
value'' in MDAT review.\103\ This mistake or inadvertent error
was soon corrected after he submitted his on-line application
and well before MDAT officially made its determination on his
application.\104\
---------------------------------------------------------------------------
\98\See OCE Findings para.para.1-3. 27-30.
\99\See OCE Findings para.35; Bates Nos. 09-9030_0029, para.7,
appended to OCE Findings.
\100\See COS. 0011 (printed from MDAT electronic records regarding
Rep. Stark on January 4, 2010). While Representative Stark does not
acknowledge he contacted MDAT, his response in MDAT's electronic
records was nonetheless changed to the correct response.
\101\See OCE Findings para.29; Bates Nos. 09-9030_0021-0022,
appended to OCE Findings.
\102\See Rep. Stark Resp. to OCE Report and Findings at 2.
\103\See Int. of Robert Young by Standards Committee Staff (stating
that Question 4 pertaining to voter registration ``has the least
probative value'' in MDAT's review because there are many acceptable
explanations why someone may not be registered to vote at the
particular address).
\104\Int. of Robert Young by Standards Committee Staff.
---------------------------------------------------------------------------
Mere mistakes or negligence fall far short of the
requirement to prove a ``willful'' violation.\105\
Representative Stark's answers overall also demonstrate that he
did not violate the more demanding standards of conduct applied
in Standards Committee proceedings. However, the record further
shows that the totality of Representative Stark's responses
were truthful and, when viewed properly in context, show no
intent to lie or evade tax payments.
---------------------------------------------------------------------------
\105\See Johnson, 451 A.2d at 332 (``willfulness'' is the
voluntary, intentional violation of a known legal duty, not the result
of accident or mistake or other innocent cause).
---------------------------------------------------------------------------
On this basis alone, OCE's allegations are not sustained.
However, as discussed below, the record shows that OCE
erroneously concluded that Representative Stark received tax
benefits as a result of his Credit application. He did not.
3. The Record Shows That Representative Stark Did Not Receive a Tax
Credit Based on His Application
The Standards Committee's independent investigation
conclusively established that Representative Stark received no
tax benefits as a result of his electronically-filed
application for the Credit in February 2009. MDAT did not grant
Representative Stark's application and his ``application never
resulted in his actually receiving a homestead tax credit for
any tax year after its submission.''\106\ MDAT unquestionably
disapproved of his eligibility before June 2009, when MDAT
provided counties with electronic updates to ensure that tax
bills contained current assessment and tax credit
information.\107\ Indeed, Representative Stark's property tax
bill, issued on July 1, 2009, evidences that he received no
Credit or tax benefit of any kind as a result of his
application.\108\ OCE's allegations are thus unfounded.
Moreover, the record shows that OCE had evidence in its
possession to prove this fact.
---------------------------------------------------------------------------
\106\Int. of Robert Young by Standards Committee Staff.
\107\Id.
\108\COS. 0017.
---------------------------------------------------------------------------
OCE was in error when it asserted that, ``in calendar year
2009, the year directly affected by his answers on the 2008
application, Representative Stark received $3,769.79 in state
and county tax [homestead] credits,'' based on a document
printed on May 5, 2009.''\109\
---------------------------------------------------------------------------
\109\OCE Findings para.20; Bates No. 09-9030_0005, which is
appended to OCE's Findings. See also OCE Findings para.1.
---------------------------------------------------------------------------
The May 5 document that OCE relied upon for this assertion
is for bill year 2009, not calendar year 2009.\110\ Maryland
issues its tax bills on a fiscal basis, which runs in Maryland
from July 1 to the following June 30.\111\ Therefore, bill year
2009 in the document relied upon by OCE corresponded to fiscal
year 2009, which began on July 1, 2008. In other words, the
bill was issued to Representative Stark on July 1, 2008, before
MDAT even mailed an application to Representative Stark for the
Credit on January 1, 2009.\112\ As noted earlier, the Credit
was automatically triggered and applied to Representative
Stark's tax bill in bill years 2007-2009 by Maryland tax
officials because his assessments increased by more than 10%
per year, even though he had taken no affirmative action to
seek the Credit during that time.\113\
---------------------------------------------------------------------------
\110\See Bates No. 09-9030_0005, which is appended to OCE's
Findings.
\111\Int. of Robert Young by Standards Committee Staff; see also
COS. 0012-0015.
\112\See COS. 0031 (Rep. Stark's tax bill issued for fiscal year
2009, which runs from July 1, 2008-June 30, 2009, containing homestead
tax credits of $3,769.79).
\113\See supra n.47.
---------------------------------------------------------------------------
Additionally, OCE's allegations are inconsistent with the
available evidence. First, MDAT had removed any Credit
associated with Representative Stark's Maryland residence by
May 1, 2009, as documented in OCE's interview memorandum.\114\
OCE omitted this fact from the body of its Findings.\115\
Second, the very first page of the exhibit that OCE relied upon
for its erroneous conclusion shows that MDAT had highlighted
that Representative Stark's Harwood, Maryland, home was not his
``principal residence'' as of May 6, 2009.\116\ This means that
Representative Stark would not and did not receive any Credit
in July 2009. Last, Representative Stark reiterated to OCE that
MDAT found he was not eligible for the Credit approximately one
month after MDAT told OCE the same thing.\117\ These consistent
statements from MDAT and Representative Stark regarding the
disposition of Representative Stark's application should have
made clear that, as MDAT told the Standards Committee,
Representative Stark's ``application never resulted in his
actually receiving a homestead tax credit for any tax year
after its submission.''\118\
---------------------------------------------------------------------------
\114\See Bates No. 09-9030_0009, para.12, which is appended to
OCE's Findings.
\115\Instead, OCE included this significant fact in the last
sentence that begins with the New York Times article discussed above.
See id.
\116\See Bates No. 09-9030_0002, which is appended to OCE's
Findings.
\117\See OCE Findings para.34; Bates No. 09-9030_0028, para.3,
which is appended to OCE Findings.
\118\Int. of Robert Young by Standards Committee Staff.
---------------------------------------------------------------------------
V. CONCLUSIONS
In view of the Standards Committee's findings of fact in
Section III, and conclusions reached applying those findings in
Section IV, the Committee finds that no further action is
warranted. The matter is dismissed and the Standards Committee
considers it closed.
The Chair is directed upon providing the required notice to
Representative Stark and OCE, pursuant to House Rule XI, Clause
3(b)(8)(A), and Committee Rule 17A(a)(2), to file the instant
Report with the House, together with Representative Stark's
response and a copy of OCE's Report and Findings in this
matter, both of which are made a part of this Report and
appended hereto.\119\ The filing of the instant Report, along
with its publication on the Standards Committee's Web site,
shall serve as publication of OCE's Report and Findings,
pursuant to House Rule XI, Clause 3(b)(8)(A), and Committee
Rule 17A(b)(3) and 17A(c)(2). No other version of OCE's Report
and Findings is authorized and any publication of OCE's Report
and Findings independent of the instant Report is not
authorized.\120\
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\119\House Rule XI, clauses 3(a)(2) and 3(b).
\120\See House Rule XI, clause 3(b)(8)(A); Standard Committee Rule
17A; and H. Res. 895, Section 1, clause 1(f).
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VI. STATEMENT UNDER RULE 13, CLAUSE 3(c) OF THE RULES OF THE HOUSE OF
REPRESENTATIVES
The Standards Committee made no special oversight findings
in this report. No budget statement is submitted. No funding is
authorized by any measure in this report.
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