A complaint filed with the state Board of Elections Wednesday morning alleges that Senate leader Phil Berger is using campaign contributions to pay the mortgage on his $250,000 Raleigh townhome.

Does that count as a legitimate campaign expense?

Bob Hall, the former executive director of Democracy NC, doesn’t think so.

Hall’s complaint says Berger has been paying $1,500 a month toward his mortgage on a fourteen-hundred-square-foot townhome at 1535 Yarborough Drive that he purchased for $250,000 in 2016. (Such a monthly rent payment would just about cover the mortgage payment, depending on Berger’s down payment and interest rate.)

Berger’s campaign finance disclosures list $55,000 in payments toward YPD Properties LLC for “rent” as a campaign operating expense. Berger is the manager of YPD Properties LLC, according to the secretary of state website.

In other words, Berger’s campaign is “renting” Berger’s townhome and calling it an operating expense. 

No one answered the door of the townhome, located on a private cul-de-sac near Mordecai, when Hall knocked Wednesday morning before dropping off the complaint at the state BOE office.

State law allows elected officials to use campaign funds for “expenditures resulting from holding public office,” but also notes that contributions “do not become part of the personal estate of the individual candidate.”

Paying off a mortgage, Hall says, enriches the owner of the property and is no different than “using their campaign money like a piggy bank.”

“He’s accumulating an asset, essentially,” Hall told the INDY. “It’s not an expense. It’s actually an investment, and he’s going to be able to walk away with a piece of property that’s worth a quarter of a million dollars and have his campaign pay a big chunk of that. “If he can do this, then other legislators can do it, and we can have dozens of them claiming that they are just paying rent, but it’s actually paying off a mortgage and they are going to get a substantial personal gain.” 

Berger did not respond to the INDY‘s inquiry into the matter but told The News & Observer that the Board of Elections approved the expense. BOE spokesman Patrick Gannon confirmed that the office had received the complaint but said he could not go into detail about the allegations. 

Hall says Berger has already paid his law firm more than $109,800 from campaign funds for his office in Eden. In addition, Hall says, “the [office expense] payment is especially questionable when Berger collects per diem expenses for claiming he is in Raleigh on legislative business, often for well over two hundred days a year.”

Berger has led the Republican Party in the Senate since 2011.  

Contact Raleigh news editor Leigh Tauss at ltauss@indyweek.com. 

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