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After Ballot Proposal Spending, Council Member Eyes Expansion of Independent Expenditure Disclosure


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One PBA IE on 2019 ballot question 2 (photo via Campaign Finance Board filing)


Just after an election where the issue became especially apparent, a New York City lawmaker is planning to introduce legislation to close a loophole that has allowed independent expenditure committees to shield donors when they spend money to sway voters on ballot proposals. The potential change in city law would bring certain donor disclosure rules in line with state regulations and extend other city regulations to what is already required for political spending on candidates by groups outside the candidate campaign.

The move by Brooklyn City Council Member Brad Lander comes five years after the city enacted disclosure regulations on independent expenditures for candidates and following two consecutive general elections where city charter revision referenda went before voters.

In the most recent election, just completed, three groups -- each with its own independent expenditure committee registered with the state -- spent over $1 million either in support of or in opposition to ballot proposals. None of those entities had to disclose their contributors to the city’s Campaign Finance Board (CFB), forcing members of the public to navigate a labyrinth of city and state databases in order to get the most complete picture of the influence of large political spenders. Nor did the independent expenditure committees have to follow a city law mandating such groups disclose their top three donors on communications with voters, a regulation in place for promoting or disparaging candidates.

“In 2014, we created a great law to provide disclosure for independent expenditures on behalf of candidates, and there is already evidence that it is working,” Lander, a Brooklyn Democrat, wrote in an email to Gotham Gazette. “This year, the first significant expenditure on behalf of a ballot measure revealed to us the need to expand our disclosure rules, already among the strongest in the nation for candidates, to cover spending for ballot measures as well.”

“I am working on introducing legislation to do just that, to ensure that the same level of transparency applies across the ballot,” he said. Lander was the lead sponsor on the 2014 legislation that created the new independent expenditure transparency requirements. It came just after the city’s raucous 2013 election cycle when IEs played a significant role in the first mayoral race following the Supreme Court’s Citizens United ruling, among other local elections where such spenders sought influence.

Lander’s stated plan comes days after the CFB issued a recommendation to the City Council suggesting lawmakers close gaps in the city’s campaign finance laws. Those gaps became more evident as spending around the ballot questions picked up in the days leading up to the general election this fall. Following the CFB recommendation, the Daily News Editorial Board endorsed the idea of closing the loophole.

In a press release issued Thursday, the CFB asked the Council to consider legislation that would amend the campaign finance laws in the City Charter to require independent expenditure committees to disclose their contributors to the CFB via its online portal; and publish “paid-for-by” notices on electioneering materials -- both of which are already required for spending on behalf of candidates under the 2014 law.

The City Charter also requires organizations making contributions of $50,000 or more to independent spenders on behalf of candidates to disclose all donors who gave more than $25,000 in the preceding 12 months.

Under the CFB recommendation, the paid-for-by notices would include a list of the independent spender’s top three donors as well as a weblink to the agency’s online portal, where the public can view detailed information on political spending. The aptly-titled “Follow the Money” portal presently contains details on how much was spent on political campaigns by independent expenditure committees, including what the spending went to and when it was spent, with images and videos of each ad posted or aired.

But that is the extent to which the public can follow the money through the CFB’s relatively user-friendly online resource. To find out who is bankrolling the independent expenditure committees, interested parties must visit the State Board of Elections’ cumbersome financial disclosure webpage where the information is largely decentralized.

“New York City has the country’s strongest disclosure requirements and resources for independent expenditures. Unfortunately, when it comes to ballot proposals, our law has a blind spot,” said CFB Executive Director Amy Loprest in the Thursday press release.

“Bringing the disclosure for ballot proposals in line with the requirements for independent expenditures about candidates will provide voters with important information that will help them cast informed votes, and we urge the Council to take action,” the statement reads.

For the past two general elections, New York City voters have had the opportunity to approve or reject City Charter amendments proposed by successive Charter Revision Commissions. Charter commissions can be empanelled by the mayor or through City Council legislation to examine the city’s central body of laws, take public testimony, and make recommendations for reform.

This year, the Charter Revision Commission was created by the City Council in conjunction with then-Public Advocate Letitia James and Manhattan Borough President Gale Brewer. The commission put five questions on the ballot, together containing 19 distinct amendments, dealing with a range of city election and governance issues.

In the weeks leading up to the start of the nine-day early voting period in late October, and Election Day on November 5, three independent expenditure committees together spent roughly $1.15 million urging voters to cast ballots either for or against one or more of the proposals. All five questions were overwhelmingly approved by voters citywide.

The vast majority of independent spending was around Question 1, which contained an amendment that would bring ranked-choice voting to certain New York City elections. The voting method, which allows voters to list candidates in order of preference rather than making a single all-or-nothing choice, was backed by a coalition of good government reformers and elected officials under an independent expenditure committee called “Committee for Ranked Choice Voting NYC.” The committee spent a total of $986,017 on digital, TV, and direct mail advertising between mid-September and Election Day, according to the CFB portal.

But, while the principals of the committee are required to be reported to the CFB, the committee’s funders are not. According to the Daily News editorial, which analyzed data from the State Board of Elections, the Committee for Ranked Choice Voting had received a total of $1,996,948.33, of which 90 percent is from just four large contributors.

Ballot Question 2, which dealt with police oversight, also saw significant spending, but to vote down the proposal. That campaign was waged by the city’s largest police officer union.

While there were independent expenditures made for and against ballot proposals in the 2018 general election, the total independent spending on those campaigns was a much smaller $125,659, according to the CFB portal.

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by Ethan Geringer-Sameth, reporter, Gotham Gazette
     

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