A subsidiary of the Building Industry Association of Washington violated state campaign-finance laws, the state Public Disclosure Commission has ruled. The findings are a blow to the builders association, a major supporter of Republican candidate for governor Dino Rossi.

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A subsidiary of the Building Industry Association of Washington violated campaign-finance laws, the state Public Disclosure Commission has ruled.

The five-member commission will pass along its findings to the state Attorney General’s Office, which will decide this week whether to prosecute.

The subsidiary in question, BIAW Member Services, committed multiple violations by not registering as a political committee and by failing to report more than $500,000 in contributions, the PDC found.

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The decision is a blow to the builders association, which in recent months ran a controversial ad campaign aimed at derailing Democratic Gov. Christine Gregoire’s bid for re-election.

After a complaint from a citizens group led by two former state Supreme Court justices, the PDC, which oversees campaign-finance regulations, began an investigation into the building association’s political activity.

Monday’s 4-0 vote (one member did not vote) by commission members to forward the violations to the state Attorney General’s Office follows a similar recommendation by the commission’s staff last week.

The PDC also confirmed similar violations by the Master Builders Association of King and Snohomish Counties. The local builders group failed to register as a political committee despite raising more than $700,000 in contributions for industry-friendly candidates and causes since 1996.

Olympia-based BIAW has funneled millions of dollars during the past decade to Republican causes and candidates. The group is often at odds with labor unions, environmentalists and Democrats.

As it did in 2004, the BIAW and its allies are airing television and radio ads attacking Gregoire’s record. The BIAW is a major supporter of Gregoire’s opponent, Republican Dino Rossi.

“They were pretty much caught red-handed,” said Mike Withey, a lawyer for the group that filed the complaint against the BIAW. “It’s important to enforce these laws no matter how big and powerful the violators are.”

Withey said he was confident the Attorney General’s Office would prosecute, but if it did not, he said, the citizens group he represents would be willing to sue.

Representatives at the Attorney General’s Office declined to comment on whether they would prosecute but said a decision would be made by the end of the week.

Almost immediately after the PDC’s decision, the builders association released a news release calling the vote “unprecedented, convoluted and grossly unfair” and accusing the PDC of doing “Gregoire’s dirty work.”

BIAW Member Services is a voluntary workers’-compensation insurance program. Several local builders associations that work with the subsidiary were encouraged to route surplus insurance funds through BIAW Member Services to a political-action committee running many of the attack ads against Gregoire.

Robert Faturechi: 206-464-2393 or rfaturechi@seattletimes.com

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