McGavick’s Safeco payout questioned

OLYMPIA – Washington Democrats on Wednesday asked the Federal Elections Commission to investigate U.S. Senate challenger Mike McGavick’s $17 million “golden parachute” from Safeco Insurance Co.

McGavick’s campaign said the complaint is bogus.

“Everything was by the book,” McGavick spokesman Elliott Bundy said.

The state Democrats filed a formal complaint with the watchdog agency asking for an investigation into the compensation that McGavick got when he resigned as president and CEO of the insurance company to run for the Senate.

“As a candidate for U.S. Senate, his $17 million windfall appears to be a special interest favor that illegally subsidizes his campaign,” state Democratic Chairman Dwight Pelz said in a statement.

“If McGavick’s lobbying career left any doubt he would fight for big insurance companies in Washington, D.C., this golden parachute clarifies the kinds of special interests he’ll represent in the U.S. Senate.”

McGavick is challenging incumbent U.S. Sen. Maria Cantwell, D-Wash.

The complaint said McGavick earned $9.8 million in additional stock options by staying on at Safeco until Feb. 28, though he was a full-time candidate, and that he was allowed to accelerate other stock options. The extra compensation may amount to an illegal unreported campaign donation, the Democrats suggested.

Bundy said the exit package was fully reported by Safeco last month and was entirely aboveboard. The report said some stock options were accelerated, a move worth about $3.3 million to McGavick; some 2005 compensation was reduced; and McGavick forfeited $7 million worth of stock that was not vested. His compensation package was $8.4 million last year, the report said.

Democrats are trying to smear McGavick as “the evil CEO who ran away with millions while he laid off employees,” Bundy said. The truth, however, is that McGavick “saved a Seattle company and thousands of jobs for Washingtonians,” and was paid less than the average CEO, he said.

State Republican Chairwoman Diane Tebelius called the Democrats’ complaint frivolous and said it reflects “panic within the Democratic ranks” as McGavick draws closer in the polls to Cantwell.

“The Democrats’ complaint against Mike McGavick has absolutely no credibility,” Tebelius said.

She said it’s also hypocritical because Cantwell herself was compensated more than $10 million by RealNetworks while running for the Senate six years ago.