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:
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.
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.
Increase the cap on public funds as a percentage of a campaign’s total spending limit from 55 percent to 65 percent.
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.
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.
Note: Gotham Gazette is an independent publication of Citizens Union Foundation, sister organization of Citizens Union.>