Gotham Gazette http://www.gothamgazette.com/component/tags/tag/1017 Sat, 23 Mar 2019 00:42:38 +0000 Joomla! - Open Source Content Management en-gb webmaster@gothamgazette.com (Webmaster) Report: Under New Law, Small Donors Drove Public Advocate Special Election Campaigns http://www.gothamgazette.com/city/8348-report-under-new-law-small-donors-drove-public-advocate-special-election-campaigns http://www.gothamgazette.com/city/8348-report-under-new-law-small-donors-drove-public-advocate-special-election-campaigns  poolnytdebate 001

The first public advocate debate (photo: Holly Pickett for The New York Times (pool))


Small-dollar donors were behind 63 percent of the first wave of campaign contributions to candidates who ran in the February special election for public advocate, up from 26.3 percent in 2013 when there was an open race for the seat, according to an analysis by New York City Council Member Ben Kallos. The Manhattan Council member sponsored the law to implement in the public advocate special election the new campaign finance rules overwhelmingly approved by voters in a ballot referendum last year.

The public advocate special election, in which City Council Member Jumaane Williams emerged victorious, was the first citywide race under the new rules that lowered contribution limits for special elections for citywide offices from $2,550 to $1,000 (special election limits are half of the regular election limits, which changed from $5,100 to $2,000), increased the ratio of public matching funds given to candidates from 6-to-1 for the first $175 of a qualifying contribution to 8-to-1 for the first $250, and increased the limit for public funds payments from 55 percent of the spending limit for a race to 75 percent. Soon after the referendum was approved -- by just over 80 percent of voters -- the City Council and Mayor Bill de Blasio expedited legislation in order to apply the rules to elections before 2021, after which they were set to be mandatory. For the special election and those through 2021, the next citywide election year, candidates must choose the old or new system.

Of the 17 candidates on the public advocate ballot, all but one opted into the voluntary public matching funds program, which is administered by the New York City Campaign Finance Board. Only four decided to stick with the outgoing matching program while the rest chose lower contribution limits that came with higher public matching funds. In total, the 11 candidates who eventually qualified for public funds received $7,178,120 via the CFB.

According CFB’s own analysis released the day after the election, the most common contribution amount was $10, down from $100 in previous public advocate elections. “The matching funds give candidates the incentives to raise money the right way, by going to the New York City voters they want to represent in government, not to big-money donors or special interests,” said Amy Loprest, CFB executive director, in a statement on February 27. “If we want a government that is closer and more responsive to the people, it has to start with how candidates fund their campaigns.”

Kallos, the City Council’s resident good government wonk, has pushed improvements to the city’s campaign finance law for years and felt vindicated by seeing the campaign finance numbers behind the election. The ballot question, proposed by a charter revision commission created by Mayor Bill de Blasio, was largely similar to a bill Kallos had sponsored in the previous legislative session of the Council.

“One of the reasons I was so eager for this to apply in the public advocate’s race is I was worried about the time between the vote in November [2018] and 2021 and I wanted to prove to people that this could work,” he said. There will be another public advocate election this fall to decide who will hold the seat vacated by Attorney General letitia James for the final two years of her public advocate term. Kallos’ bill also lowered the thresholds for candidates to qualify for official debates sponsored by the CFB and for public funds payments.

His analysis, which covers the candidates’ pre-election campaign finance disclosures till February 11 (the most recent filing deadline - final numbers are due March 25), found that contributions of $1,000 and more accounted for 26 percent of the $2.2 million raised to that point in the election, compared with 60 percent throughout 2013. In total, all the candidates raised $2.6 million for the special election, which was “nonpartisan” and did not have party primaries. In 2013, candidates raised $4.9 million running for public advocate in the primary and general.

Kallos has long been critical of big money in elections, particularly donations from the real estate industry which have been a large force at the city and state level. “This is the first time a citywide elected official has been elected without real estate money,” said Kallos, who himself rejects real estate donations.   

Several candidates in the special election similarly refused real estate cash, which is of a piece with broader calls for candidates to rely on small donors. Public Advocate-elect Williams was among those who signed a pledge floated by New York Communities for Change, a housing justice advocacy organization, to refuse corporate and real estate money.

“New York City has changed forever: we will no longer be held hostage by big-money real estate developers and landlords who aim to profit through policies that incentivize the displacement and gouging of low-income tenants,” said Jonathan Westin, NYCC executive director, in a statement calling on other candidates to follow Williams’ lead.

Several candidates running for citywide office in 2021, or exploring a candidacy, have already said that they will rely on the new campaign finance system, including Comptroller Scott Stringer and City Council Speaker Corey Johnson.

Real estate donations are increasingly becoming a litmus test for progressive Democrats, some of whom were elected to the state Legislature last year and are also pushing to implement a public financing program for state elections similar to the city’s model. For advocates and labor leaders, the public advocate election was proof positive that small-dollar financing is effective and should be replicated by the state. “Jumaane Williams's victory, and the public participation in the process, is a glimpse of what we could accomplish if we pass campaign finance reform at the state level,” said Stanley Fritz, campaigns manager for Citizen Action. Hector Figueroa, president of 32BJ SEIU, said, “The major shift towards small donor financing in city wide elections shows that working people in our state want a more democratic system.

Kallos notes that candidates can spend fewer hours dialling for dollars from wealthy donors if they rely on small contributions from the tens of thousands of residents of their districts, or from millions in the case of citywide races. “My hypothesis was that if we increase the public match...that that would halve big money and it actually did that,” he said. “It wasn’t a modest success. It literally cut it almost in half.”

The expanded matching funds program has been widely praised for elevating the voices of everyday New Yorkers. “Normally, a special election for public advocate would probably be very much of an insider’s race. It would be funded by insiders and people who follow politics closely,” said Alex Camarda, senior policy advisor at Reinvent Albany, a good government advocacy group. “And I think that what putting this legislation into effect now did was incentivized candidates to reach out to ordinary New Yorkers to campaign.” Camarda also expects this momentum to carry forward and that candidates will feel “real pressure” to participate.

Many of the candidates who ran for public advocate were also first-time contenders, including Nomiki Konst and Dawn Smalls, who were among the ten candidates on stage at the first official debate in the race, and among the seven candidates at the second official debate.

There have been arguments levelled against the public funds system, of course, and it’s hard to predict exactly how it will work for a full-fledged citywide race rather than a truncated special election. Some candidates have said the regulators of the program are sometimes overly harsh and fine them for small, technical violations. Others criticize the cost to taxpayers -- the entire special election is estimated to cost the city around $20 million in administrative and public campaign financing while the annual budget of the public advocate was only about $3.6 million last year. Former City Council Speaker Melissa Mark-Viverito, who stuck with the old campaign finance rules and came in third in the special election, argued that the new system was being pushed through to prevent her from winning, apparently in part because she was transferring a significant sum of funds from her prior campaign account, an advantage more easily mitigated with the new system.

But there is otherwise broad agreement that the city’s program is a model to be emulated, as other jurisdictions have done across the country, and it is progressively being improved. “I’m still not done yet,” Kallos said.

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

Note - This article has been updated to clarify that total candidate fundraising was $2.6 million for the special election. It has also been updated to clarify the contribution limits for special elections. 

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Report: Under New Law, Small Donors Drove Public Advocate Special Election Campaigns Mon, 11 Mar 2019 04:00:00 +0000
7 Candidates Qualify for Second Public Advocate Special Election Debate http://www.gothamgazette.com/city/8290-7-candidates-qualify-for-second-public-advocate-special-election-debate http://www.gothamgazette.com/city/8290-7-candidates-qualify-for-second-public-advocate-special-election-debate Public Advocate debate 10 candidates

The first debate (photo: Holly Pickett for The New York Times (pool))


Seven candidates running in the special election for New York City Public Advocate have qualified for the second and final official televised debate, which will take place Wednesday night, just six days ahead of the February 26 election.

There will be 17 candidates on the ballot, 10 of whom qualified for the first televised debate. Now, for the “leading contenders” debate, seven candidates met the threshold set by city law, which includes raising and spending $170,813, according to a spokesperson for the city’s Campaign Finance Board. Candidates made their latest filings to the Campaign Finance Board by midnight Friday.

The seven candidates who will debate Wednesday night on NY1 television are former City Council Speaker Melissa Mark-Viverito, attorney Dawn Smalls, activist Nomiki Konst, City Council Members Jumaane Williams and Rafael Espinal, and state Assemblymembers Michael Blake and Ron Kim.

Of the ten candidates who made the first debate, City Council Members Ydanis Rodriguez and Eric Ulrich and Assemblymember Daniel O’Donnell did not meet the threshold for the second debate.

To make it into the “leading contenders” debate, the candidates then had till February 11 to raise and spend $170,813 and needed to be endorsed by an elected official representing New York City at the local, state or federal level, or by a membership organization with at least 250 members in the city (a labor union or political club, for instance).

Ulrich, the only Republican at the first debate, Rodriguez, and O’Donnell did not meet the financial threshold for the second debate.

At the first debate on February 6, the ten candidates made their pitches to city voters and weighed in on everything from funding for the MTA and NYCHA to the then-happening Amazon deal, and their disagreements with Mayor Bill de Blasio. To qualify for that debate, the candidates were required to show $56,938 in campaign fundraising and expenditure by the filing due just before the debate.

[Read: In First Debate, Public Advocate Candidates Take on De Blasio, Amazon & Each Other]

The debate at 7 p.m. on Wednesday (February 20) will broadcast by Spectrum News NY1 and will be publicly accessible on NY1’s website and Facebook page. It will also be simulcast by NYC Life, the city’s media channel. The hour-and-a-half debate will again be moderated by Errol Louis of NY1, with questions also coming from Laura Nahmias of Politico New York and Bobby Cuza of NY1.

The public advocate special election was triggered after the former office-holder Letitia James was elected New York State Attorney General. James filled a vacancy created by the resignation of former Attorney General Eric Schneiderman in the wake of allegations of physical abuse by several intimate partners.

The public advocate is a watchdog over city government and an ombudsperson, with the power to introduce legislation to the City Council. The public advocate is also first in line to the mayor if the mayor is unable to serve out his or her full term. The position helped launch James to become attorney general, and her predeccessor, Bill de Blasio, to become mayor.

The sponsors of the debate include Politico New York, Citizens Union, the League of Women Voters, the Latino Leadership Institute, Borough of Manhattan Community College, NAACP New York State Conference Metropolitan Council, and Delta Sigma Theta Sorority, Inc., East Kings County Alumnae Chapter.

Beyond the ten candidates who made the first debate, the other candidates on the February 26 ballot will be Benjamin Yee, Manny Alicandro, David Eisenbach, Jared Rich, Tony Herbert, Helal Sheikh, and Latrice Walker, an Assembly member who has dropped out of the race but was unable to have her name removed from the ballot.

The election, open to all registered voters across the city, is expected to be low turnout. The winner will hold the seat at least through the end of this year -- there will be a primary election this June and a general election this November to determine who holds the seat for 2020 and 2021.

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

Ben Max contributed to this story.

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7 Candidates Qualify for Second Public Advocate Special Election Debate Sat, 16 Feb 2019 05:00:00 +0000
City Council Passes Legislation Authorizing Electeds to Create Legal Defense Funds http://www.gothamgazette.com/city/8224-city-council-set-to-pass-legislation-authorizing-legal-defense-funds http://www.gothamgazette.com/city/8224-city-council-set-to-pass-legislation-authorizing-legal-defense-funds mayorcouncilfisacl

(Photo: Benjamin Kanter/Mayoral Photo Office)


Update: This article was published on Wednesday and the City Council passed this legislation on Thursday afternoon with a 42-5 vote. Council Members Joe Borelli,  Chaim Deutsch, Steven Matteo, Carlos Menchaca and Eric ulrich voted against the bill. Council Member Jumaane Williams abstained from the vote. 

A bill that would allow elected officials to set up trusts to raise money from private sources to cover legal fees is set to be approved by the New York City Council on Thursday.

The legislation, sponsored by City Council Member Stephen Levin, would allow city officials to raise as much as $5,000 from individual donors through trusts, to pay for legal fees arising from criminal or civil investigations that are unrelated to their governmental duties, such as those involving campaign activity (legal fees related to government duties can be covered by public funds).

The trusts would have to file detailed quarterly reports on fundraising and spending with the city Conflicts of Interest Board (COIB), and would be prohibited from taking donations from lobbyists, corporations, LLCs, and people doing business with the city. The reports will be posted publicly online.

Levin’s bill is meant to fill a gap in the city’s legal framework that allows elected officials to use taxpayer funds to cover their defense in investigations arising from their official duties, but not in the case of non-governmental activity. Mayor Bill de Blasio found that out the hard way after facing dual state and federal probes into his fundraising activities through outside nonprofit groups and, in one, related government actions, which eventually led to no charges being filed but left the mayor with hefty legal fees running into the hundreds of thousands, even after he reversed course to utilize public funds to cover the bulk of over $2 million in fees related to the federal inquiry of whether he directed government favors based on campaign donations.

The mayor initially sought to use a legal defense fund to cover the costs but the COIB issued an advisory opinion limiting any donations to a mere $50, viewing them as gifts to an elected official which are severely limited by law. The mayor then used public funds to pay for the costs related to his government duties -- about $2.6 million -- but said he could not cover a separate bill that related to his non-governmental activity. De Blasio is not the only elected official who has had significant legal bills to deal with related to their official or non-governmental activity, he and others have pointed out.

The legislation is scheduled for a vote at a hearing of the City Council’s Governmental Operations Committee on Thursday morning, in what seems to be a rushed vote -- the bill was introduced on January 9 and the committee held an initial hearing on it last Monday, at which several questions were raised by COIB representatives and Council members. Spokespeople for Levin and for Council Speaker Corey Johnson said the bill is expected to pass through the committee and to be approved at a meeting of the full Council in the afternoon. It is very rare for any legislation at the City Council to move so quickly from introduction to passage.

The government reform community is split in its opinion on the legislation. Groups like Common Cause New York and Reinvent Albany have supported the effort to create a framework around legal defense funds, while another reform group, Citizens Union, disagrees with the very concept. In a letter of opposition sent to the Council on Wednesday, Citizens Union argued that the bill “creates the risk or appearance of corruption and undue influence, and will necessitate a complex regulatory scheme to mitigate.” The group urged the Council to, at minimum, tweak the legislation to bring donation limits in line with the lower limits that apply to campaign contributions.

The Campaign Finance Board, which monitors campaign fundraising and expenditure in municipal elections, also raised concerns about the bill. Executive Director Amy Loprest noted in her testimony before the governmental operations committee on January 14 that the legislation seems to allow officials to use trusts to pay for fines incurred from campaign finance violations. Officials can already cover those costs from their campaign accounts, which are subject to stricter fundraising limits.

“By providing certain candidates, i.e. those who are elected officials or public servants, with an additional vehicle to raise funds, Int. No. 1325 creates a path for those candidates to solicit and accept contributions from individuals that aggregate well over the existing contribution limits,” Loprest said in her testimony, urging that the bill be amended. “A clear majority of voters in last November’s Charter referendum voted to reduce these limits by more than half, with reducing the risk of corruption as the main rationale.”

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

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City Council Passes Legislation Authorizing Electeds to Create Legal Defense Funds Wed, 23 Jan 2019 05:00:00 +0000
With De Blasio in Debt, City Council Considers Bill to Allow ‘Legal Defense Trusts’ http://www.gothamgazette.com/city/8218-with-de-blasio-in-debt-city-council-considers-bill-to-allow-legal-defense-trusts http://www.gothamgazette.com/city/8218-with-de-blasio-in-debt-city-council-considers-bill-to-allow-legal-defense-trusts nycczerohearingsl

City Council Member Stephen Levin (photo via New York City Council)


Mayor Bill de Blasio owes hundreds of thousands of dollars to lawyers who helped him during legal investigations that ultimately resulted in no criminal charges against the mayor, but left him with bills to pay even after he reversed course and decided to use public funds to cover the portion of his legal expenses related to his government work. The remaining balance, for work related to campaign activity de Blasio was involved with that was the subject of part of the inquiries, has left de Blasio looking for a new way to pay off his debts: a legal defense fund whereby he raises money from donors willing to help him.

But, there’s been a key catch: the city does not have a legal framework for allowing public officials to create such accounts, and the advice the mayor got from the city’s Conflict of Interest Board limited him to receiving very small gifts from prospective benefactors.

Spotlighting this perceived gap in the city’s legal and campaign finance framework, de Blasio’s situation, as well as others before him, has spurred action, and the City Council has begun to consider a new law to create “legal defense trusts.”

On Monday, January 14, the Council’s Committee on Government Operations held a hearing on a bill proposed by Council Member Stephen Levin, a Brooklyn Democrat, that would allow city officials to establish such trusts for fees incurred during an investigation or trial. The bill sets a donation limit at $5,000 per donor, which is more than double the $2,000 limit for campaign contributions, with no limit on how much an official can raise in such a fund. As written, the bill bans lobbyists, persons doing business with the city, corporations, and LLCs from contributing to legal defense trusts. Additionally, any legal defense trusts would be required to make quarterly reports to the Conflict of Interest Board on their donations, which would then be made public and posted online, in a manner similar to the Campaign Finance Board’s reporting of political donations. No campaign funds could be used for a legal defense trust or vice versa and each trust will be overseen by an independent trustee.

Levin said that his bill “would bring transparency and regulation to a system that is in need of improvement.” Under the current law, city officials in civil and some criminal cases are entitled to a legal defense paid for by the city, as long as the cases relate to their public duties. However, offenses unrelated to an official’s public duties (such as political campaigns, issue advocacy, and certain administrative issues) are not paid for by the city.

Council Member Fernando Cabrera, a Bronx Democrat and the chair of the Government Operations Committee, explained it as a problem because “public officials are not highly paid and rarely independently wealthy,” and “defending against allegations and investigations for alleged wrongdoing can be financially devastating for someone of average means.”

While there have been past instances to raise the issue, the bill and committee hearing were spurred by a March 2017 advisory opinion from the city’s Conflict of Interest Board, which stated that because there was no law specifically addressing the issue, donations to a public official’s legal defense fund are considered gifts under current law and therefore limited to $50 per person. The advisory opinion came after Mayor de Blasio planned to create a legal defense fund to cover fees from state and federal investigations into his fundraising activities.

De Blasio, a second-term Democrat, was never mentioned by name during the hearing, but was frequently referred to as a “public official in the headlines,” when the advisory opinion was brought up during testimony provided by representatives of the Conflict of Interest Board.

At a press conference on January 8, de Blasio reiterated his assertion that a new legal framework was necessary. “I believe there is a need in a democratic society for this kind of mechanism, a legal defense fund is a very well established idea,” he said. He added the caveat that the bill had not gone through the legislative process, so he didn’t know the final wording. When asked if he would disclose his donors if the bill passed, he replied “absolutely” (it may be required).

While de Blasio has been earning the salaries afforded to elected officials for many years, he also owns two houses in Park Slope, Brooklyn, making him fairly wealthy. He has indicated he does not have the means to pay his legal bills, not acknowledging the possibility of leveraging his property, or at least its value. He has pointed to the larger case for legal defense funds that goes beyond his situation, something it appears City Council members and others are in agreement about. De Blasio has claimed that law enforcement investigations are part of being in political office.

At the hearing, the bill appeared to have the support of the Council members who spoke, although some had suggestions for improving it. The Conflict of Interest Board, represented at the hearing by its executive director, Carolyn Lisa Miller, and general counsel, Ethan Carrier, also expressed general support. However, Miller said there are some reservations about a section of the proposed bill that would ban the use of a defense fund from paying legal fines, but allows a fund to pay civil and administrative fines, such as Campaign Finance Board fines. Council Member Keith Powers, a Manhattan Democrat who expressed support for the concept of the bill but is undecided about its current form, asked about this section, but it was unclear if the provision would be changed.

Miller stated the COIB already does not have enough resources to do its mandated work and would require additional funds to fulfill the requirements of the bill. She estimated that an online reporting portal would cost $40,000 to set up and a few thousand each year afterwards for licensing. The bill requires quarterly reporting for defense funds and each audit would cost between $5,000 and $10,000, according to Miller’s estimate based on information from other city agencies. When asked about the number of defense funds that would be registered, she said she did not know. If the section allowing defense funds to pay campaign finance violation fines were to be included in a final bill, she estimated that as many as 50 defense funds could be established. Without that provision, she said there were only be a few, if any, per year. Many candidates for office wind up incurring some amount of fines from the Campaign Finance Board, often ranging from a few hundred dollars to a few thousand.

Council Member Kalman Yeger, a Brooklyn Democrat, said he supports the concept behind the bill, but thinks that the specifics could be improved. He questioned why the Campaign Finance Board would not allow COIB to use its reporting portal or certified auditors, which he said would save taxpayers money. According to Miller, the CFB’s portal is proprietary to that agency and cannot be used by COIB. Near the end of the hearing, Cabrera proposed that the CFB could administer the bill’s requirements instead of the COIB. Both Levin and Treyger were against this proposal, but Yeger reaffirmed that he would like a mandate included in the bill for the CFB and COIB to share resources.

While not at the hearing, watchdog group Common Cause supports the bill. In a July 2017 statement in support of legal defense trusts, Susan Lerner, the executive director of Common Cause/NY,  said that “there must and should be a process for public officials to raise funds to pay for legal bills” and “we need a policy in place to give public officials a workable solution and avoid ad hoc improvisation.” Common Cause commissioned a study of legal defense fund laws across the country and made recommendations to cover New York City’s perceived “policy gap.” Levin’s bill includes many of Common Cause’s recommendations.

The Council committee hearing on the bill only included a statement from Council Member Levin, its lead sponsor, and the representatives from COIB. The Council now has to decide whether to amend Levin’s bill and if more hearings are required to address the issues raised at the January 14 hearing. The Council will also have to decide to vote on the bill or put it on indefinite hold. If it passes committee, it will go to the full 51-member Council. Meanwhile, it is unclear when exactly Mayor de Blasio’s legal bills are due, the debt has been outstanding for quite some time now.

In response to a tweet about the bill from Politico reporter Sally Goldenberg, former City Council Member Sal Albanese, a 2013 and 2017 Democratic primary opponent of de Blasio, said that Levin and the bill’s other sponsors “should be held accountable for introducing this self serving corruption hazard” and called them “Bill de Blasio sycophants.” Levin replied to Albanese, stating that “I never spoke to [the Mayor’s Office] before introing this bill” and that “the bill itself is specifically designed to eliminate a corruption hazard.”

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by Andrew Millman, Gotham Gazette

Read more by this writer.

Ben Max contributed to this article.

Note: after initially mistaking Council Member Yeger for Treyger, this article has been corrected. It has also been updated to clarify Council Member Powers' stance on the bill.

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With De Blasio in Debt, City Council Considers Bill to Allow ‘Legal Defense Trusts’ Mon, 21 Jan 2019 05:00:00 +0000
Next Steps for 3 City Charter Revisions Passed Election Day http://www.gothamgazette.com/city/8073-next-steps-for-3-city-charter-revisions-passed-election-day http://www.gothamgazette.com/city/8073-next-steps-for-3-city-charter-revisions-passed-election-day schools chancellor reg

(photo: Michael Appleton/Mayoral Photography Office)


This is part of AGENDA 2019, a joint Gotham Gazette-City Limits project
Find the rest of the series here

Voters approved three ballot proposals on Election Day to amend the New York City charter, the city’s foundational governing document -- the local constitution. The proposals related to the city’s campaign finance system, civic engagement, and community boards. Mayor Bill de Blasio, who empaneled a charter revision commission last year that put the proposals on the ballot, argued that the proposals would strengthen democracy in the city.

“The question in front of voters was simple: Are we going to be a city that works for everyone,” de Blasio tweeted after the measures passed. “New Yorkers answered with a resounding ‘YES, YES, YES!’”

Now that all three proposals are to be added to the charter, they will have to be implemented within the next few years. At the same time, another charter revision commission created through City Council legislation is also holding public hearings and is expected issue its own recommendations for the 2019 general election ballot.

Each of the three proposals approved this year included language around implementation, though some aspects will be left to certain individual and group decision-makers.

Proposal 1 - campaign finance reform
Proposal 1, which lowers campaign contribution limits in city elections and enhances the city’s public-matching campaign finance program, passed with 80.3 percent approval.

New York City’s voluntary public matching funds program, often seen as a model for the country, currently matches the first $175 of each campaign contribution at a ratio of 6-to-1. Proposal 1 raises the public match to 8-to-1 for the first $250 of a donation, thus increasing the impact of smaller donations, and will lower individual contribution limits to citywide candidates from $5,100 to $2,000, with lower offices like borough presidents and City Council members also seeing public match increases and lower contribution limits.

The goal is to empower small-dollar donors, giving their contributions a greater impact and disincentivizing candidates from depending on larger, wealthier donors and PACs. In theory, it allows first-time candidates not backed by deep-pocketed donors to run more competitive races.

The percentage of a candidate’s overall spending limit that can be received in public funds will be increased from 55 percent to 75 percent, and candidates will be allowed to receive public funds earlier in their races -- a change that could help insurgent candidates or candidates without deep-pocketed allies, but also could help incumbents rack up higher totals earlier.

Under the text of the amendment, the new campaign finance regulations will take effect on January 12, 2019. But, candidates who choose to participate in the public funds program and run for office in the 2021 primary elections can choose to opt out of the new rules, thus sticking with the current limits and system. Candidates must declare their intentions by July 15, 2019.

For non-participating candidates, meaning those who opt not to participate in the matching program, the limits and thresholds remain the same as they were before January 12.

All candidates participating in the public matching program will be brought under the new regulations starting in 2022.

The language of the amendment also includes a clawback provision should any of the changes to contribution limits and matching fund ratios be struck down in court. In such an instance, all the changes would be nullified except for the expansion of the public matching funds cap from 55 percent to 75 percent.

In all, the charter commission estimated that the new system would increase the amount of public funds disbursed to candidates by roughly 47 percent relative to the very busy 2013 city election cycle, which will in many ways be mirrored for 2021. In the 2013 cycle, the Campaign Finance Board doled out $38 million in public funds. Under the new rules, disbursements would have been an additional $18 million, for a total of $56 million, according to the charter commission’s staff research.

In last year’s elections, when there were fewer competitive races, the CFB gave out about $18 million in public funds, which would have seen an additional $8.5 million in public funds under the amended charter.

City Council Member Ben Kallos, who unsuccessfully attempted to increase the public funds cap to 85 percent through legislation, was glad to see voters pass the improvements to the system. In a phone interview, he implied that concerns about the cost of the new system were overblown, and said that enhancing the system is key to eliminating real and perceived conflicts of interest.

“It’s far less than the city lost on Rivington, and whether it was a case of actual corruption or just appeared improper, it had significant cost to our city,” Kallos said, referring to the scandal around the city’s sale of Rivington House and related allegations of pay-to-play involving the mayor. “Just the defense of our city cost about $6 million,” he added in reference to the mayor’s legal bills accrued during law enforcement investigations of his fundraising that saw no charges filed. “So whether it is to save $100 million around Rivington or the $6 million in legal fees, it pays for itself.”

He continued, “When the next mayor’s going to have a budget in excess of $90 billion, [$18 million] to make sure that that elected official would only be accountable to the voters without the influence of big money is worth every penny.”

Gotham Gazette: Proposal 2 - civic engagement commission
Proposal 2, which creates a civic engagement commission tasked with implementing a citywide participatory budgeting program and other initiatives, passed with 65.5 percent approval.

The new citywide participatory budgeting program, expanding efforts undertaken annually in City Council districts (currently in 31 of the 51 CDs), would have to be implemented by the commission by July 1, 2020. Participatory budgeting allows residents to vote on projects to spend a certain amount of funds in their Council districts.

The commission will also be tasked with improving translation services at voting sites and providing resources to community boards, as well as more generalized partnerships with community organizations to increase civic engagement.

The commission would remain a fixture after implementing its designated programs, and would be required to report annually on its programs, many of which can be by its own design.

The commission will consist of 15 members: 8 appointed by the Mayor, 2 by the City Council Speaker, and 1 by each Borough President. The mayor’s majority of board picks worried some that it would be a power-grab of sorts, given the wide latitude afforded to the commission with its mission of “enhancing civic engagement and strengthening democracy.” But in that respect, it is actually something of an improvement from the proposed Office of Civic Engagement, which would be completely under the mayor, per a bill introduced by City Council Member Brad Lander, who supported proposal 2 and celebrated its passage.

The commission will be empaneled on April 1, 2019.

Proposal 3 - community board reform
Proposal 3, which establishes term limits for community board members and institutes a set of new requirements around the community board application process and more, passed with 72.3 percent approval.

Community board members, who are appointed by Borough Presidents and currently allowed to serve an unlimited number of two-year terms, will now be allowed only to serve four consecutive two-year terms. At that point, members will be term-limited out, but they will be allowed to be reappointed after a two-year interregnum. Current community board members will be allowed to serve an additional four terms no matter how long they have served as of 2019. Thus, no current member will be term-limited off their board until 2027.

To prevent heavy turnover that year and the following year, appointees commencing their term in 2020 will be allowed to serve five terms.

Borough Presidents will also be required to seek out diverse candidates for community board appointments, ensuring that different geographic areas are adequately represented. The proposal mandates that borough president reach out to community organizations active in the district and also allows civic groups and neighborhood organization to submit nominees to the Borough President. Community boards as constituted today are often criticized for being older and whiter than the communities they serve. Younger and more diverse voices on community boards could lead to very different outcomes. Borough presidents will also be required to make applications for community board member positions available on their websites with detailed requests for information about members, including work and community experience, demographic information (which would be optional) and conflicts of interest disclosures, among other things.

While community boards do not have a binding vote on land use and development matters, local City Council members often strongly consider and align with their home community boards. Four of the city's five current Borough Presidents expressed strong opposition to proposals 2 and 3 (Brooklyn's Eric Adams was the lone exception) and worked unsuccessfully to defeat them.

The civic engagement commission approved in proposal 2 will also be required to provide additional resources to community boards, such as “urban planning professionals and language access resources.”

Though it received a higher vote share than proposal 2, proposal 3 was widely seen as the most controversial of the three during the election season. While proponents noted that community boards are often older and whiter than the communities they represent, opponents said the measure would lead to a brain drain to the benefit of real estate developers. The worry was that an influx of new members without land use knowledge would allow developers to run roughshod over community interests. In the end, voters took the side of the proponents.

This is part of AGENDA 2019, a joint Gotham Gazette-City Limits project
Find the rest of the series here

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

Ben Brachfeld contributed to this piece.

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Next Steps for 3 City Charter Revisions Passed Election Day Sun, 02 Dec 2018 05:00:00 +0000
Council Member Uses Campaign Funds to Sue City, Raising Questions http://www.gothamgazette.com/city/8018-council-member-uses-campaign-funds-to-sue-city-raising-questions http://www.gothamgazette.com/city/8018-council-member-uses-campaign-funds-to-sue-city-raising-questions city cm mark gjonal 5 emil cohen

City Council Member Mark Gjonaj (photo: Emil Cohen/City Council)


Bronx City Council Member Mark Gjonaj is using two campaign accounts to fund a lawsuit against New York City, raising questions about how candidates can spend their campaign money.

Over $17,000 from Gjonaj’s 2017 and 2021 City Council campaign accounts have gone to pay Dunnington, Bartholow, & Miller, a law firm representing then candidate Gjonaj in a suit where he is listed as the lead plaintiff against the City of New York, according to campaign finance records through July 2018.

Then a state Assembly member, Gjonaj initiated the suit during his campaign for City Council two weeks before the Democratic primary, alleging that the Bronx was overburdened with more homeless shelter and mental health patient beds, more so than any other borough. Specifically, the complaint argued that the Bronx pays more than its “fair share,” which is a provision in the city Charter providing for shared responsibility across the five boroughs for some of the most burdensome facilities.

The case has lasted for more than a year, and state court records show that Gjonaj switched attorneys in February to the firm of Edmond Pryor, his senior government advisor, according to LinkedIn. Gjonaj’s 2021 campaign account closed Dunnington, Bartholow, & Miller’s tab with a $9,372 payment in the latest filing over the summer.

City and state election law holds that campaign expenditures should be campaign-related. City elections are overseen by the Campaign Finance Board (CFB), where most of its regulations exist for candidates who opt-in to the board’s highly-praised matching funds program. Candidates who opt in get subjected to higher scrutiny and tighter rules as part of the deal for accepting public money.

It is unclear if the lawsuit constitutes campaign activity, with Gjonaj apparently pushing the boundaries by using campaign funds for a lawsuit that does not appear directly related to the act of running for office.

“I can’t see any way that funding a lawsuit with no relevance to a campaign can be a legal use of campaign funds, whether the candidate is participating in the matching funds program or not,” said election attorney Sarah Steiner. “The NYC Campaign Finance law is clear that campaign funds may be used only to defend matters related to campaign activity, and not at all to bring lawsuits.”

The CFB offers little guidance on these specific circumstances. For candidates who do not opt in to the matching funds program, there are fewer restrictions because they are not using public funds.

Council Member Gjonaj, a Democrat, did not opt in to the matching funds program, self-funding much of his past campaign, during which his campaign spent roughly $1.3 million, a record sum for a City Council campaign. The CFB rules document a wide variety of legal and illegal expenditures, but only if the candidate is using public funds. Nonparticipants are still subject to CFB jurisdiction and certain rules, and campaigns are audited by the CFB.

Two-thirds of all citywide candidates opted into the program in 2017, with 89 candidates, including Gjonaj, not participating. Many nonparticipants were incumbents facing limited or no competition who preferred to spend campaign funds by looser rules, at times to support government activity like participatory budgeting, though one Council member paid to air his own weekly radio show.

In 2016, the CFB changes were made, loosening some spending rules and adding one specific measure of oversight to police expenditures beyond those relating to matching funds. The rule states that the board monitors a non-exhaustive list of factors to check if campaigns are acting in bad faith, including “whether the campaign has demonstrated a pattern of making other expenditures not in furtherance of the campaign or impermissible post-election expenditures.”

A representative from the CFB told Gotham Gazette that it has not completed its cycle of audits of city campaigns where specific incidents can be investigated.

“Per CFB policy, we will not provide comment on issues associated with any candidate’s regular post-election campaign audit until after it has been completed,” said Eric Friedman, Assistant Executive Director for Public Affairs for the CFB, in a statement.

Gjonaj’s suit itself had a lot to do with the planks of his campaign, and he was glad to use those raised funds to pursue his agenda, according to his office.

“From public safety to recreational funding, Councilman Gjonaj made the case throughout the 2017 campaign that the Bronx wasn’t getting its fair share. It was a message that Bronxites inherently understood and rallied behind on Election Day. He’s a fierce advocate for the Bronx, and if he has to go to court to protect our community from City Hall’s unfair policies, he will, as he did,” said Reginald Johnson, Chief of Staff to Gjonaj, in a statement.

The Bronx Council member’s lawsuit, where several other Bronx community and business leaders are also listed as plaintiffs, calls for the city to halt further construction of homeless shelters in the Bronx and to release indexes to measure “beds to population.”

“The disproportionate number of Residential Facilities sited in the Bronx interferes with and causes damage to Bronx community residents; interferes with the community's use of public resources; and has subjected and will continue to subject the community, including plaintiffs, to significant hazards and risks to health, safety and property,” reads the complaint.

The city has sought to dismiss the suit, arguing that the plaintiffs do not cite a specific enough harm beyond the community at large.

Because Gjonaj filed his suit as a candidate and as a private individual, he is not subject to regulations handed down by a State Supreme Court judge in February. That ruling found that City Council members cannot sue the city in their official capacities because members are supposed to be represented by the city’s Law Department, which is already representing the city.

The CFB allows for suits from candidates to be paid for with public funds when the campaign’s eligibility for public funds is challenged in court. While Gjonaj’s suit relates to policies of his campaign, he is not subject to the same rules as those using matching funds and there are no specific city rules pertaining to his situation.

“It sounds like the lawsuit relates to governmental policy but was not brought in connection with his holding of office or campaigning for office,” said Jerry Goldfeder, a special counsel with Stroock & Stroock & Lavan LLP, specializing in campaign finance law. “As such, it is not proper to use campaign funds for such legal representation.”

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by Jake Shore for Gotham Gazette
  

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Council Member Uses Campaign Funds to Sue City, Raising Questions Thu, 25 Oct 2018 04:00:00 +0000
Campaign Finance Board Report Shows Small Donors with Large 2017 Footprint http://www.gothamgazette.com/city/7904-campaign-finance-board-report-shows-small-donors-with-large-2017-footprint http://www.gothamgazette.com/city/7904-campaign-finance-board-report-shows-small-donors-with-large-2017-footprint  cfb chart


As a mayoral charter revision commission readies to release proposals that would, if approved by voters in November, reduce the impact of large donors in municipal elections, a report released Thursday by the New York City Campaign Finance Board highlights how small donors are increasingly playing a larger role in city elections.

The CFB’s 2017 post-election report examined last year’s citywide election, in which the three citywide positions, five borough presidents, and all 51 City Council seats were on the ballot. The CFB administers the city’s campaign finance law and its public matching funds program, which currently matches the first $175 of every qualifying donation at a 6-to-1 ratio, incentivizing candidates, especially those who lack deep pockets or access to moneyed donors, to run for election on grassroots campaigning and fundraising. The program is considered a national model and has been emulated in municipal elections in other states.

In 2017, the eighth citywide election under the program, small donors played a bigger role than they ever have before, the report found. About 73 percent of contributors to mayoral candidates were small donors, giving $175 or less. That number was 43 percent in the 2013 election cycle and 70 percent in 2009.

Mayor Bill de Blasio and his Republican general election opponent, state Assembly member Nicole Malliotakis, both participated in the public funds program last year. De Blasio made a concerted effort to court small donors for his reelection after having faced allegations -- which also prompted official investigations that closed with no charges filed -- that his administration took favorable actions for donors with city business who gave large contributions to his campaign and two extra-governmental nonprofits he created to promote his agenda.

Notably, though the number of small dollar contributions were overwhelming -- 13,767 out of 18,796 contributions to mayoral candidates -- they only accounted for $783,699 or 11 percent of the total value of fundraising by all mayoral candidates. For comparison, there were only 656 contributions of the maximum-allowed value -- $4,950 for the last cycle -- which accounted for $3.24 million or 45 percent of the total fundraising by mayoral candidates.

Participation in the public funds program was also widespread, with 84 percent of candidates opting in for the September primary and 64 percent participating in the general election. In 2013, 91 percent of primary candidates and 62 percent of general election candidates were participants, with the larger primary percentage than 2017 likely due to the greater number of open seats in that cycle. In 2017, for instance, five out of 41 City Council incumbents did not face a challenger in the primary or general election.

In total, the CFB doled out $17.7 million in public funds, $5.9 million of which went to de Blasio and Malliotakis. The report also found that City Council candidates got more than 50 percent of their funds from the public matching program.

“For 30 years, New York City’s Campaign Finance Program has shaped the landscape of city elections and strengthened New Yorkers’ relationship to their government," said Amy Loprest, CFB executive director, in a statement. “Our 2017 Post-Election Report highlights why our program continues to be a model for citizens across the country who want to reduce the impact of big money in politics.”

The report also includes several proposals to improve the campaign finance program through legislation. The board recommends lowering contribution limits, increasing the matching fund ratio and the cap on public funds, lowering both the threshold for citywide candidates to qualify for public funds and the lowest matchable contribution.

The CFB issued these same recommendations to the mayor’s charter revision commission in June, and the commission has taken some of them into consideration as it creates its final proposals, which will be released in the coming weeks and put before voters on Election Day in November. Among other suggestions, the commission will recommend lowering contribution limits for citywide candidates to $2,000 for those who participate in the public funds program and $3,500 for those who do not. The current limit is $5,100. The commission is also proposing increasing the ratio of matching funds to 8-to-1 and matching the first $250 of every contribution for citywide candidates. Under another proposal, the public funds cap would increase from 55 percent of the spending limit for a position to 75 percent.

The charter commission is set to meet on Tuesday to vote on the final language of questions that will be placed on the ballot for voters. Should any of the CFB’s recommendations fail to make the grade, they will likely be taken up by the City Council in the form of legislation or by a separate Council-convened charter commission that will start to hold public hearings in mid-September and is planning to put recommendations before voters in 2019.

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

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Campaign Finance Board Report Shows Small Donors with Large 2017 Footprint Thu, 30 Aug 2018 04:00:00 +0000
Former and Current Elected Officials Discuss Potential Changes to City Campaign Finance System http://www.gothamgazette.com/city/7854-former-and-current-elected-officials-discuss-potential-changes-to-city-campaign-finance-system http://www.gothamgazette.com/city/7854-former-and-current-elected-officials-discuss-potential-changes-to-city-campaign-finance-system nyccfb twitter

Schaffer, Ulrich, Torres, Quinn, Gotbaum, Cho (l-r) (photo: @NYCCFB)


Former and current New York City elected officials broadly praised the city’s campaign finance system at a panel at New York Law School on Wednesday, while acknowledging that it could be improved to incentivize more reliance on small donors and streamlined to encourage first-time candidates to run for office.

The panel was hosted by the New York City Campaign Finance Board (CFB) and moderated by Daniel Cho, assistant executive director for candidate guidance and policy at the CFB. The panellists included sitting City Council Members Ritchie Torres and Eric Ulrich, former City Council Speaker Christine Quinn, and former Public Advocate Betsy Gotbaum, who shared their divergent experiences in running for elected office, raising campaign money, and navigating the city’s campaign finance program.

The CFB administers the system and its widely lauded public matching funds program, which intends to level the playing field in elections by matching the first $175 of every qualifying contribution at a 6-to-1 ratio. The rationale is simple: It motivates candidates for local and citywide office to cast a wider net and seek smaller individual donors rather than depend on wealthy contributors giving larger donations.

But, even as other jurisdictions have begun to model programs after New York City’s, the CFB is hoping to strengthen its system, further limit the size of maximum donations, and encourage pursuit of small donors, recommending a slew of reforms for consideration by Mayor Bill de Blasio’s charter revision commission, which will soon announce the proposals it will put before voters on November’s Election Day. CFB Chair Rick Schaffer gave opening remarks before the panel, during which he outlined the history of the campaign finance program and the CFB's new recommendations.

Those reforms include drastically lowering contribution limits, increasing the matching fund ratio to 8-to-1 and the value of matchable donations to $250, changing the thresholds for qualifying for matching funds -- including the addition of a geographic requirement where a citywide candidate would have to get at least 50 donations from each borough -- and lowering the minimum qualifying contribution from $10 to $5. In the coming weeks, the charter commission will issue its final report, and the proposals it lands on will be presented to voters on the November general election ballot.

[Read: Campaign Finance Board Proposes Reforms at Charter Commission Hearing]

Council Member Ulrich, a Republican from Queens, said the matching fund system was instrumental in his special election campaign in 2009, which he ran without help from labor unions or the local party establishment. “The critical factor in me deciding to move forward and to run was in fact the campaign finance program,” he said.

Torres, a Bronx Democrat, similarly said the program gave him “sufficient resources” to run his City Council campaign in 2013, but with one caveat. “The cost of running a campaign seems to vary widely from Council district to Council district.You could win a district like mine on the sheer strength of door-to-door campaigning,” he said.

Quinn -- who is the only mayoral candidate to ever max out on public matching funds, Cho later said -- subsequently noted that rent for campaign offices in particular is one cost that can be drastically different depending on the district.

Gotbaum, who is now executive director of government reform group Citizens Union, said that when she ran for public advocate in 2001, she raised large numbers of maximum donations -- currently $5,100 for citywide candidates -- because of a crowded field and because the CFB’s matching funds tend to be doled out late in the campaign. The program does appear to serve its intended purpose better for City Council candidates as citywide candidates continue to raise a majority of their funds from large donors.

Gotbaum supports the public funds program but worries about the public reaction to the cost of public financing if the matching amounts are raised, though she also acknowledged that not enough New Yorkers even know the program exists. “I think if you put the match up terribly high, those few people that participate may start to complain...I’m just throwing that out there as a point of discussion,” she said.

The CFB gives out public funds twice in an election in most cases, for the primary and then for the general. But Ulrich pointed out that for Republicans, who tend to be involved in far fewer primaries owing to Democrats’ heavy voter enrollment advantage in the city, matching funds are usually only disbursed once. In some cases, Ulrich argued, this gives Democratic candidates advantages in terms of getting their message out to voters and attacking their Republican opponent. “So I think the board should probably look at that,” he said. “It doesn’t affect most participants but...certainly in my part of the city, it does.”

All the panellists agreed that a big challenge to ensuring ordinary voices are reflected in elections is that voter participation and engagement is far too anaemic in New York City. They not only stressed the need for more voter education but also the dire necessity of reforming the state’s antiquated voting and election laws which are widely held responsible for low voter turnout.

“The reliance at the state level is on these big donors, corporate donors in fact,” said Ulrich, who ran for state Senate in 2012 and said he received dozens of large, unsolicited donations. “I would much rather if there was any way possible for state, federal, and city candidates for public office to be participating in a matching funds program. It’s a much more transparent, fairer, and I think ethical approach to running for political office.”

Ulrich’s Republican colleagues who control the state Senate have not had the same opinion, however, as the chamber has opposed most campaign finance reforms supported by the Democratic Assembly and Governor Andrew Cuomo, as well as most voting and election reforms.

Quinn took particular issue with state election law’s LLC loophole, which allows hidden donors to legally circumvent the already high state contribution limits through multiple limited liability companies. As Council speaker, Quinn ushered in campaign finance reforms which included a prohibition against LLC donations in city elections. She also said the practice of intermediaries “bundling” donations from several contributors for a single candidate tend to be more corrupting than a single, maxed-out donation.

“That’s really where the amplification of corporate interests comes into place,” she said, urging the CFB to go beyond simply lowering contribution limits.

Torres also wanted to see “bolder” reforms. “Some of these improvements do feel incremental,” he said, pointing out the heavy reliance on large donors, particularly in the mayoral race. He wants to see a drastic reduction in the contribution limits. “I think it would create a system that is purely powered by small donations,” he said.

The Council member also noted that the recent victory of Alexandria Ocasio-Cortez -- who ran on a platform opposed to corporate donors -- over Democratic Rep. Joe Crowley in the June congressional primary shows a “millennial outcry” against excessive money in politics. “If the mayor’s charter commission were to radically reduce contribution limits in response to the national zeitgeist that’s taking hold, I think it would be a legacy achievement for the mayor,” he said.

The panellists also agreed that perception matters in politics, and that constituents need to be reassured that government is not for sale, with some discussion around the “doing-business” limits on donations from entities seeking or holding city contracts.

“For me, the standard is whether you contribute to the appearance of corruption,” Torres said, noting that Council members can raise substantial sums of money from industries that they regulate and that individual members also hold an almost “veto power” over land use matters that could be worth tens if not hundreds of millions of dollars. “I’m not suggesting that this happens but the fact that it’s even a theoretical possibility is problematic,” he said. “A member could leverage the power you have over the [Uniform Land use Review Procedure] to extract sizable contributions. So why not foreclose that possibility.”

Ulrich blamed the negative perceptions that the public holds of New York politicians on the long and constant stream of state-level elected officials, mostly in the state Legislature, who have been convicted of corruption. “I think until Albany gets their act together and enacts some form of real and robust ethics reform and campaign finance reform,” he said, “that is going to overshadow...all the wonderful and great work that the CFB is doing.”

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

Note: Gotham Gazette is an independent publication of Citizens Union Foundation, sister organization of Citizens Union. ]]>
Former and Current Elected Officials Discuss Potential Changes to City Campaign Finance System Wed, 08 Aug 2018 04:00:00 +0000
Mayoral Charter Revision Commission Hears Expert Testimony on Campaign Finance Reform http://www.gothamgazette.com/city/7744-mayor-charter-revision-commission-hears-expert-testimony-on-campaign-finance-reform http://www.gothamgazette.com/city/7744-mayor-charter-revision-commission-hears-expert-testimony-on-campaign-finance-reform charter comm rev2

The Charter Revision Commission


The Charter Revision Commission empaneled by Mayor Bill de Blasio met on Thursday at NYU for the second of four expert advisory issue forums, discussing what could be the marquee issue for this year’s commission: changing the city’s campaign finance system. The first meeting, held Tuesday, focused on voting and election reform.

Like the first hearing, Thursday’s saw the commission hear from invited experts on the topic at hand, and was broken into two sections. For campaign finance, the first panel discussed context and perspective of the city’s system from politicians and experts, and the second provided recommendations.

The commission, consisting of 15 members appointed by de Blasio, including Chair Cesar Perales, will finalize a list of proposed changes to the city Charter by early September that will then appear on the general election ballot in November for voters to approve or disapprove.

Representatives from the city’s nonpartisan Campaign Finance Board provided five recommendations to the commission for improving the city’s public campaign finance system and its centerpiece, the public matching funds program. The board recommends:

  1. Lowering individual contribution limits from $5,100 to $2,250 for citywide offices, from $3,950 to $1,750 for boroughwide offices, and from $2,850 to $1,250 for City Council seats.

  2. Increase the matching funds rate from 6-to-1 (for every dollar under $175 raised via an individual contribution, the city disburses $6) to 8-to-1. This would be coupled with an increase of the maximum matchable amount, from $175 to $250.

  3. Increase the cap on public funds as a percentage of a campaign’s total spending limit from 55 percent to 65 percent.

  4. Lower the threshold to qualify for matching funds for citywide races, from $250,000 from 1,000 eligible contributors for mayor and $125,000 from 500 contributors for public advocate and comptroller, to $125,000 and $75,000 respectively with the same number of contributors.

  5. Lower the minimum individual contribution counted toward the public match threshold, from $10 to $5.

Others, including advocates, elected officials, and academics, also provided recommendations to the commission, with some differing from the CFB and others in line with it.

The city’s public election financing system, whereby donations to candidates of up to $175 are matched by public dollars at a rate of 6 to 1, has been cited as a model nationwide for placing more power in elections in the hands of the average voter. City Council Member Carlos Menchaca testified to the committee that he never would have been able to mount an insurgent campaign without the system, and that it also allowed him to spend more time with voters rather than donors from out of the district.

“What the system allowed me to do was to have a conversation with donors at $5, $10, and my branded experience of $38 for the 38th District, about the campaign finance,” Menchaca said. “That was my beginning part of my conversation with everyone, that their dollars would multiply by six. That allowed folks to feel empowered in a challenger, and for people that were not entrenched in the system, which is where I had to go build my political support, became possible.” Menchaca said his average contribution amount for his 2013 campaign, in which he pulled off the rare feat of unseating an incumbent, was “around $100.”

The public matching program came into being in 1989, after a wave of corruption scandals in city, state, and federal government led to the passage of Local Law 8, which established a 1:1 match. The match was increased to 4:1 through the 1998 Charter Revision Commission, and was increased again to the current 6:1 in 2007.

The system has significantly lowered candidate reliance on political action committee (PAC) money and other “big money” donations found at other levels of elected government, including state-level elections in New York. The CFB presented data comparing an unnamed City Council member’s finances with that of a member of Congress and of the state Senate. The member of Congress raised 77 percent of their money from PACs and 0.6 percent from small contributions of $200 or less. The state senator raised 89 percent from PACs and 7 percent from small contributions. The City Council member, on the other hand, raised 25 percent from PACs, and 62 percent from small contributions when matching fund allocations were taken into account.

However, for citywide offices, the contribution percentages can be a red herring. In 2017, while 73 percent of contributions to mayoral candidates participating in the public match program came from donors who contributed under $175, 45 percent of the actual dollar value of the total contributions came from 650 individuals who donated the maximum for the 2017 election, which was $4,950 (it has since risen automatically, per law, to $5,100). For the City Council, the distribution is more equal, and in fact, Council candidates as a whole received more money in 2017 from small donors than from contributors of the maximum amount allowed by the program.

Non-participants in the program can take the form of a rich self-funder like Michael Bloomberg, but can also take the form of an incumbent without serious competition not wanting to use taxpayer funds for a formality election or interested in looser restrictions on their spending. Non-participation in competitive races is fairly rare, though. According to the CFB’s Assistant Executive Director for Public Affairs, Eric Friedman, 28 out of 64 non-participants in the public finance system in 2017 reported raising $0.

Others who testified were largely in line with the CFB on raising the match rate and reducing the maximum allowable contribution by about half. Advocates broke with the CFB on the issue of the match cap: while the CFB recommended that the cap be lifted to 65 percent, Alex Camarda of Reinvent Albany and Michael Malbin of SUNY Albany’s Campaign Finance Institute recommended that the cap be eliminated entirely, which would have the city provide more public funds relative to the spending limit.

“I don’t see what purpose that serves,” Malbin said of the matching cap. Camarda and Malbin both endorsed raising the rate of matching funds rate above 6-to-1, but did not recommend a specific rate.

For the 2021 election, the spending limit for a City Council candidate is set at $190,000, and the maximum public funds disbursement is $104,500, or 55 percent of the spending limit. Eliminating the cap would mean that a candidate could spend up to 85 percent of the spending limit using public funds. City Council Member Ben Kallos recently re-introduced a bill that would eliminate the matching funds cap.

CFB representatives were asked by Commissioner Wendy Weiser, director of the Democracy Program at NYU’s Brennan Center, why the board is endorsing a 65 percent cap instead of elimination. CFB Executive Director Amy Loprest said that raising it to 85 percent would be impractical.

“We make public funds payments to candidates who are on the ballot and who are opposed on the ballot, therefore we can only make those payments once the ballot has been set,” said Loprest. She noted that according to state election law, ballots could only be set after the end of petitioning. “The ballot is set roughly at the end of July, beginning of August. Which means that we make our first public funds payments at the beginning of August, which leaves about five weeks before the primary.” She noted that this would cause campaigns to be constrained to spending most of their money in the five weeks before the primary.

Camarda agreed in part.

“I think that in citywide races, 65 percent is plenty because citywide candidates don’t often hit the cap,” he said. “Our concern would be for City Council, because as I mentioned, 30 percent of the candidates in 2013 actually hit the cap.” The CFB stated that it wouldn’t oppose eliminating the cap, but that it was not its first preference.

The commissioners, including Chair Perales, a former Secretary of State under Governor Andrew Cuomo, appeared receptive to the changes proposed by the CFB and the other testifiers, for the most part. Most lines of questioning were of an inquisitive rather than adversarial tone. The commissioner who was most skeptical and critical of the proposed changes was John Siegal, an attorney and a de Blasio appointee to the Civilian Complaint Review Board.

“The reason, clearly, that mayoral candidates rely more on big contributions is because it takes a lot of money to run an effective mayoral campaign,” said Siegal, who donated $4,500 to de Blasio’s 2013 mayoral campaign. “And while it sounds good and feels good to say ‘let’s lower the contribution limit,’ that is going to have consequences. Candidates are going to have to work way harder to raise money. They’re going to have to spend a lot more time raising money.” He noted that there is an “efficiency to getting on the phone and getting 500 people to give $4,500 or $5,100 that is going to be lost here.”

The CFB’s Chair, Frederick Schaffer, said that he would agree with Siegal if the only recommendation made by the Board was to lower the contribution limit.

“That’s why we want to increase the match for citywide officials from 6-to-1 to 8-to-1, and increase the actual amount from $175 to $250,” Schaffer said. “We crunched those numbers precisely with this problem in mind, and we think that the overall effect of those three things together meets the concern that you have just expressed.”

Siegal was also critical of a proposed “geographical requirement” for citywide candidates, which would force them to fundraise around the city. Malbin’s presentation to the commission noted that most money raised for citywide contests comes from only five City Council districts, representing Manhattan around Central Park and Brownstone Brooklyn. For citywide candidates, Malbin recommended that they must show a minimum number of contributors in 20 of 51 Council districts to qualify for public matching funds. The CFB suggested that citywide candidates raise 50 contributions from each borough.

Siegal called this a “fundamentally different requirement than we’ve ever had in the system,” saying that previous campaign finance law was limiting the money candidates can raise rather than explicitly saying who it must be raised from, which he said would set a bad precedent, “engineering campaign fundraising.”

“Have you actually looked at how many Republicans raise 50 matching contributions in [the] Bronx? Or how many Democrats actually raise 50 contributions in Staten Island? And do we really want to tell candidates that they have to go out and introduce themselves to communities where they have no background and no ties, and the first thing they have to do is go ask for money. That doesn’t seem to me that it’s getting money out of politics, it seems to me like it’s pushing the fundraising race into places for other reasons,” he added.

Schaffer dismissed the notion that 50 contributions per borough was unattainable for a seeker of citywide office.

“We’re trying to identify people who are reasonably likely to be real candidates, and so we thought the number 50 was really quite minimal, even for a Democrat in Staten Island or a Republican in the Bronx,” Schaffer said. There are currently three citywide elected offices: Mayor, Public Advocate, and Comptroller.

Other commissioners also had questions and concerns. Dale Ho, of the ACLU’s Voting Rights Project, questioned whether it was appropriate to put such specific numbers, limits, and thresholds into the city charter, which he characterized as difficult to change and rarely brought up for debate, versus the easier-to-change city code.

“As you can see from all this machinery here, [the charter] is quite difficult to amend,” Ho said. “If it turns out that the number should change over time, maybe the limits need to be reduced even more, maybe the match numbers need to go up even higher, maybe we miscalibrate something and we need to adjust something. If these changes are in the city charter, that kind of ties the hands of the city in a way that if they’re in the code, maybe they’re a little easier to adjust.”

Schaffer, a former top appointee in the office of the city’s Corporation Counsel, its top lawyer, said he believed that the City Council can amend the charter “just like ordinary legislation,” which Perales agreed with.

Other issues beyond those encompassed by the CFB’s recommendations also arose.

Government reform group Citizens Union remained neutral on increasing public funds disbursement to candidates, but gave suggestions for transparency measures if the commission decided to increase the disbursement. Rachel Bloom, Citizens Union’s director of public policy, called on the commission to prohibit public funds disbursed to candidates to be used to pay consultants that also lobby the city, subject candidate coordination with union members to campaign finance regulations, tighten Local Law 181, which regulates the nonprofits of elected officials, restrict the transfer of campaign funds running for one office to another office, and to transfer lobbying reporting and enforcement to the CFB.

When asked by Siegal if the CFB was interested in regulating lobbying, Loprest was ambivalent on whether the organization’s independence lent itself to being a watchdog on lobbying.

Meanwhile, Brooklyn Borough President Eric Adams advocated for eliminating money from politics entirely and moving to a 100 percent publicly funded system. Adams said that candidacies receiving public funding could be gauged by petition signatures, or by reaching a threshold through $1 donations that would end up in the public finance system. He also suggested that the members of the commission, none of whom have held elected office, were not fully equipped to know what raising money as a politician is like, and that they should hold a “mock election” to gain fuller experience.

“I think a good mock exercise is for everyone at CFB, everyone who’s making these decisions, to run a mock election,” Adams said. “Those who have never felt what what you go through to run an election can never really understand. I think to run a mock election, give them the task of calling people and giving them $500, if ever you want people to lose your number, try to raise that $500.”

Adams has already made his own appointee to the charter revision commission empaneled through City Council legislation, which will begin its business soon and put forth recommendations next year. Adams has chosen former City Council Member Sal Albanese, who has been a proponent for campaign finance reform, organizing much of his 2017 mayoral run around the “democracy vouchers” program that has been implemented in Seattle.

“Money is the enemy,” Adams said. “It is always going to be the enemy. We are always going to have a problem with corruption until we get money out of campaigns.”

The mayoral charter revision commission will meet twice more next week, on Tuesday and Thursday, to hear expert testimony on community boards and land use, then civic engagement and independent redistricting.

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by Ben Brachfeld, Gotham Gazette

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Note: Gotham Gazette is an independent publication of Citizens Union Foundation, sister organization of Citizens Union. ]]>
Mayoral Charter Revision Commission Hears Expert Testimony on Campaign Finance Reform Fri, 15 Jun 2018 04:00:00 +0000
Campaign Finance Board to Propose Reforms at Charter Commission Hearing http://www.gothamgazette.com/city/7735-campaign-finance-board-to-propose-reforms-at-charter-commission-hearing http://www.gothamgazette.com/city/7735-campaign-finance-board-to-propose-reforms-at-charter-commission-hearing mayor cityhall march

(photo: Benjamin Kanter/Mayoral Photo Office)


New York City’s modern campaign finance system is undoubtedly a model program -- it’s being emulated in other municipalities -- that has diversified and democratized the city’s quadrennial local elections since it was created 30 years ago. Among its strengths is that the public-matching program is consistently tweaked and updated with the times, and the Campaign Finance Board is taking the opportunity afforded by a mayoral charter revision commission to propose further reforms to the system.

CFB officials are set to present five proposals to the charter revision commission, empaneled in April by Mayor Bill de Blasio, on Thursday afternoon, at an issue forum at NYU focused on campaign finance reform, which was one of the mayor’s stated goals in creating the commission. The commission has been holding public hearings for the last few months and is now digging deeper into a few core subject areas including election administration, voter access and participation, land use, community boards, civic engagement, and independent redistricting.

The CFB’s proposals are meant to enhance its voluntary public matching funds system, which encourages candidates to seek small-dollar donations that are matched at a 6-to-1 ratio for contributions up to $175, or the first $175 of larger donations. The program aids those seeking public office without the help of wealthy donors or support from political party machinery, and gives everyday New Yorkers a greater voice by boosting the impact of their contributions.

Perhaps the CFB’s most significant proposal involves significantly lowering contribution limits for all offices. Currently, individual donors can give candidates for citywide office up to $5,100; candidates for borough president can receive up to $3,950, and City Council candidates can get $2,850 at maximum. The CFB proposes reducing those limits by more than half to $2,250, $1,750, and $1,250 respectively.   

There’s a clear rationale for these changes. In the 2017 election, the CFB noted, contributions to mayoral candidates larger than $2,250 accounted for only 5 percent of all contributions but 59 percent of the total funds raised by those candidates. Similarly, donations of $1,250 and more made up only 2 percent of contributions to City Council candidates but 32 percent of the money raised.

A few of the proposals are directly targeted at citywide positions -- mayor, comptroller and public advocate -- where large donors tend to play a greater role. The CFB suggests increasing the matching fund ratio for citywides from 6-to-1 to 8-to-1 and increasing the matchable donations from $175 to $250. In essence, candidates would be further incentivized to seek small-dollar donations, which would carry a bigger reward. For instance, a donation of $175 to a participating candidate would currently get them another $1,050 in public funds. The changed formula would mean that a $250 donation would net candidates an additional $2,000 in public funds.

Reforms along the lines of the CFB’s proposals have been advanced in the City Council but members have waited to act as the charter commission carries out its work. The CFB, an independently-operating body whose members are chosen by the mayor and the City Council speaker, releases a mandated post-election report every four years with a series of recommendations that typically leads to City Council legislation and at least some tweaks to the system that are passed into law. Such a report is expected by September, and is likely to include proposals similar to those being presented to the mayor’s charter revision commission. When de Blasio announced his charter revision commission and said he intended it to focus in part on campaign finance reform, some questioned why he wouldn’t allow the usual process to unfold.

The mayoral charter revision commission’s proposals will be announced in early September and placed on the ballot in the November general election, with city voters approving or rejecting them.

A second charter revision commission is being formed after legislation passed the City Council earlier this year. Its work will culminate with ballot proposals in 2019.

One bill currently at the City Council, proposed by Council Member Ben Kallos, would increase the cap on public campaign matching funds from the current 55 percent of the spending limit for a particular seat to 85 percent. The CFB is now proposing a more moderate increase to 65 percent of the spending limit, reasoning that it nonetheless boosts small donations while giving candidates the flexibility to raise and spend funds from private sources since public funds payments are usually doled out in the closing stretches of each election cycle.

Two other new CFB proposals would alter the thresholds for candidates to qualify for public funds. As it stands now, citywide candidates have to raise a minimum amount from a minimum number of donations. As an example, mayoral candidates have to raise at least $250,000 from at least 1,000 donors who gave a minimum of $10, while comptroller and public advocate candidates have to raise $125,000 from 500 donors giving at least $10. The CFB is proposing reducing these thresholds to $125,000 for mayor and $75,000 for the other citywide seats, while also pitching a new “geographic requirement” that each candidate receive at least 50 contributions from each of the five boroughs. They are also proposing lowering the minimum qualifying contribution to $5 for all elected positions.

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by Samar Khurshid, senior reporter, Gotham Gazette
     

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Campaign Finance Board to Propose Reforms at Charter Commission Hearing Wed, 13 Jun 2018 04:00:00 +0000