Local campaign finance reform

Have you noticed how many more slick campaign mailers you have been getting? There's a noticeable change in the last few election cycles. I know that elections generally get more expensive over time, but I'm concerned that the increased use of conventional political consultants is making our local campaigns more expensive and less grassroots. This can't be good for promoting civic engagement, and might even lead to less honesty in campaigns. I could go on, but I'll just say that I'm not happy about the impact of some of these paid consultants on our local races.

Anyway, CAN* is having their annual meeting, and you're invited! They have planned a debate on public financing of campaigns. Speaking for campaign finance reform is my friend Peter Walz, who works at Democracy North Carolina. Speaking against it is Thomas Mills of Old North State Strategies (can't find a website for them). He has professionally consulted for many of our local elected officials including Kevin Foy and Ellie Kinnaird. I guess he feels they need to send even more of those mailers to, um, 'connect' with their constituents. I know I sure feel empowered by all that junk mail, how about you?

Community Action Network Annual Meeting

Members and non-members welcome!

Sunday, November 7, 2004

1:30 – 3:30 PM

Chapel Hill Public Library Meeting Room

"Running for Local Office: Who Should Pay?"

Guest Speakers

Thomas Mills, Political Consultant
and
Peter Walz, Democracy North Carolina

will present their opposing views
on the controversial subject
of public financing for elections

There will be plenty of time for questions.
Bring your friends and neighbors!

* The Community Action Network (CAN) is an organization of civic leaders and community activists. I disagree with many of their opinions about local issues, but I believe they are usually trying to foster a healthy public discourse above all. But then again, they did endorse Dianne Bachman...

Issues: 

Total votes: 445

Comments

I would support public financing of local elections. But if the intent is to make these elections more "locally" based, then to my mind our local elections should also be non-partisan. The two are linked in my mind.

I oppose any further local finance restrictions, and I oppose any public financing of local campaigns.

Why? Two reasons (at least).

First, the value of print endorsements (CHN, Indy) is worth thousands of dollars in mailings, or more, per candidate. You OP people are more often than not supported by those papers, at least in the past 14 months. So it's easy and convenient for you to try to limit other ways of means of campaigning for people who don't get the free endorsements. First, part two, incumbency carries some value as well, so that restrictions would handicap challengers.

Second, any local campaign finance funding + restrictions, because they would be established by local incumbents, would most likely favor established candidates (people with established political networks). At least that's the case with the specific proposals I've seen so far.

It's hard enough to find qualified people to run for these part-time offices. We don't need restrictions that further disadvantage people with busy schedules in favor of those with fewer work and/or family obligations (and therefore more time for personal meet-and-greet occasions).

Jeff, how do you feel about accelerating reporting periods and making the last reporting period occur closer, say one week, before the election?

If I was candidate running, I would find it difficult running against the non-local UNC BOT/out-of-town developer supported candidate Bachmann. How do you suggest leveling the playing field so a local candidate receives local support?

Will,

In municipal races, at least, there is actually a reporting period that ends about a week before an election (Oct. 27 for Nov. 4, I think it was). I'll point out, though, that the penalties for being slightly late, or for being in error that you correct later, seem to be about zero. And if you're late enough, the first penalty is simply that the state publishes the fact of your tardiness in reporting.

It might make sense to introduce one more reporting date, about three weeks before the election, so that any related issues can come up in candidate fora and the like.

A better penalty for faulty reporting might be that if you are late in reporting an amount of X dollars, even if you corrected the misreporting later, you would be declared ineligible and your seat vacant in case of victory. That might have to be written in state law, though.

Bachmann's donation info was available before the election, from what I remember. This is where journalism (including blogging!) comes in, if they're doing their jobs, which they were. (They could go further and report summaries of all the candidates revenues on the Sunday before the election.) Bachmann lost, right? and she outspent some victors.

I'll add that the campaign finance reports are complicated things, and journalists are sometimes way off in interpreting the revenues and expenses of some campaigns. (I'm not confident enough of specific historical examples to cite any.) Furthermore, it might take some well informed reporting to identify the interests behind the donor name.

I believe that election laws require pre-payment for most or all expenses. So any donation received during the last week or even more is probably not going to affect what a candidate does (although it might help the candidate spend less money out of pocket). I had to make my final strategic financial decisions about 2-3 weeks before the election, based on the money I did and did not have.

I don't think the main question is whether the money is local. Rather, it's what interest is or is not behind the money. Wealthier candidates might spend a lot of their own money. That's local. Less affluent candidates might get a few checks from family or friends out of town. That's not local, but it's disinterested money. You could get into spending limits from that, and I laid out my thoughts on those above.

It's easier to beat a well-funded lone-interest candidate such as Bachmann, than it is to beat an incumbent in a strong coalition with newspaper endorsements. A lot of that, though, does depend on the media, in our case newspapers. Besides putting a lot of time in door-to-door campaigning, there are very good ways to leverage one's lesser financial resources.

It's not a perfect system we currently have. But making it more restrictive would make it both more elitist and incumbent-oriented.

Seems like there are two goals in this discussion so far. First, ensure the feasibility of any citizen running for elected office, unrestricted by funding. Two, ensure that those who do run are not buying the office through funding by special interests. In some ways those two goals seem oppositional.

If we had public financing, where would the finances come from? What if there was a cap on discretionary spending and each candidate was given a 'media' budget?

Will--the How to Run a Campaign idea is part of e-democracy discussions elsewhere.

In an earlier article, I looked at the pattern of donations for both Ms. Bachmann and Mr. Swain.

First, the last reporting period anyone could look at ended roughly three weeks prior to the election. In local elections, there is no practical reason to not wedge in another reporting period ending 10/31. Of course, public financing could make this moot.

Second, if you're wealthy, you're free to loan yourself funds (like Ms. Bachmann did to the tune of $5000 in the last month of the election) and 'count' on later receipts to make up the loan. Thus, wedging in a later reporting period isn't a total panacea. For instance, I could loan my campaign $5000 and 'count' on 'hidden' donors to make up the deficit. Imagine this conversation from one or more donors, "Hey, I know I represent a development interest with business before the council, so, in order to maintain your appearance of independence, we'll just donate after the election. Go ahead, load your campaign that money, we'll take care of you later." Considering that an elected official might come to depend on that payback, the potential for abuse (because of the financial leverage) is even greater.

Third, I still wonder about the kind of problem that Mr. McSwain's donations illuminated. Mr. McSwain received %65 of his funds after 10/17, over $2300 from just 12 donors between 11/26-12/11. Mr. McSwain indicated that the vast majority of the money he raised was unspent during the campaign and that he planned to use it to fund some type of political action movement involving downtown (I'm not aware of what became of the money, maybe he'll read this and update us).

That said, imagine a scenario where a 'spoiler' candidate was created by some particular interest group. This 'spoiler' would never intend to win, just to stir the pot and create problems for those candidates the interest group oppose. Further, these candidates could be enticed with promises of post-election funds that could be used at their discretion. To be clear, the scenario I'm proposing does not apply to Mr. McSwain, who ran to win, but involves a possible strategy by any disreputable group. How are we to tease out the difference between a candidate with integrity, like Mr. McSwain, and one that is up to hank-panky?

None of these real-world scenarios could happen with public financing.

The first problem, the limited transparency for end-of-election donations goes away.

The second problem, candidate loans backed by a 'wink-wink,nudge-nudge' agreement to indemnify any deficit goes away.

The third problem, a potential to reward real and 'spoiler' candidates with post-election contributions goes away.
Of course, nothing stops some kind of other payment, but, hopefully, the threat of criminal prosecution will limit that as a problem.

Public financing doesn't have to stop with funds being made available to candidates. Imagine if all the candidates last time could've used their bulk buying power to purchase signs - the savings could've been incredible ;-)!

Seriously, public financing coupled with resources to promote candidacies ("How to Run a Local Campaign for Dummies"), seminars on getting your message out, etc. (activities once performed by political parties) would really open up field to our citizens.

Just a couple quick ideas to get you thinking Jeff.

The original voter-owned elections petition, which I assume is behind this topic, can be found on the Chapel Hill website at:

http://townhall.townofchapelhill.org/archives/agendas/ca030324/10-attach...

Will,

We are both concerned to create conditions that, as you put it, “would really open up [the] field to our citizens.”

You lay out a host of potential conspiracy problems.

On the other side, I maintain that any added regulation on campaign financing would further restrict citizen entry into the field of politics.

(Note: I spent upwards of $3000 as a write-in to get 41%, which is about half as much as Nelson spent the previous election against an opponent on the ballot. [His 2003 end-of-year report was late, and I haven't checked again to see what he spent.] I could not have managed that result with the added time requirements for public finance eligibility.)

You imply that the last pre-election report (Oct. 27 in 2003) is not open to public scrutiny before the election. I'm not sure about that, but you might be right. So just open it up immediately.

Now I'll turn this spoiler issue on its head for you. In Carrboro in 2003, there were originally 5 Alderman candidates, including 2 incumbents, for 3 slots. Only one of them, Steve Rose, was clearly distinguishing himself from the incumbents. If the pro-status quo votes had been split evenly among the other four candidates, then Rose might well have won. What happened? Zaffron & Broun were the incumbents; Chilton was allying himself strongly with the incumbents (or at least he gave that impression when it was to his advantage). So someone went to talk to the fourth guy (whose name I forget) and convinced him to drop out for the sake of the incumbents' agenda (tall buildings downtown, etc.). And drop out he did, especially benefitting third-place finisher Zaffron, who is the one who told me about this.

I am not at all condemning that sort of politicking; it even makes sense, and it's part of coalition-building. But it demonstrates how hard it is to crack into local government around here. Regular citizen interest created a potential spoiler effect for the incumbents, in favor of the challenger. An incumbent squelched it.

There is no way we could have public finance without giving equally to all candidates (or all qualified candidates, whatever that would mean). And since incumbents have a huge advantage of name recognition and established support bases, not to mention traditionally the support of local print endorsements, a public finance system would be very imbalanced.

One extra security measure against the sorts of conspiracies you lay out, would be to make sure that our governing bodies have at least seven individuals. (The Chatham County Commissioners could benefit from that.) What if Bachmann had been elected? That's one seat out of nine, and I don't think you're complaining about the financial supporters of the other 8/9 (or are you?).

Jeff, the word 'conspiracy' is a little harsh. The only scenario I posited that didn't actually happen last time was the 'spoiler'. You may now remove your tin foil beany ;-)!

I was concerned about the other 9 of 10 candidates funding, but, those candidates (except Ward) clearly answered my (and others) questions about their contributions.

Ms. Bachmann was unusual in that she was claiming that she wasn't aligned with UNC or developers, but, in fact, she was at the same time receiving large donations from those same interests (BOT, East-West, etc..). The problem with her raising $18,300 for a local race wasn't the size of the pot as much as her 'coyness' in refusing to explain the pattern of donations and the obvious disconnect between what she claimed and what was happening. Of course, one could easily argue the amount was excessive for a local race. In addition, no one except Mr. McSwain (and Mr. Ward to a minor extent) had so many out-of-town, large contributors with business before the council. A great contrast to this concentration of contributions was Ms. Greene's and Mr. Hill's contributions.

Surmounting incumbency could definitely a problem in local elections, but incumbency is also a double-edged sword. Jeff, you can run for office claiming what you would do, while a candidate, let's say Councilwomen. Verkerk, will have to defend her public statements and actions. Incumbency will be her major problem for the '05 election as her actions with ACS and her condescending statements in council meetings comeback to haunt her.

Given the leverage the 'net provides ( like OP.org), you could start campaigning now for office Jeff (if you're not already doing so) at a low entry cost. But when it comes time to compete in a traditional sense, doesn't the current state of financing work against your candidacy? Wouldn't the VOE be a good, first, step to helping a candidate like yourself?

Will,

Thanks for the offer, but I prefer to manage with less regulation (i.e., current), not more. I might now be established enough to do fine under public financing, but that wouldn't be fair to the next neophyte (signatures requirements, etc.).

What about the taxpayers? I'm certain that many of them would prefer a visit to their door rather than an extra dollar in taxes for each candidate mailing they receive.

You're talking about a de facto petition requirement to become a viable candidate under finance regulations. I oppose petition requirements for local or even state offices.

Any way you cut it, additional regulation is going to increase the time required to campaign successfully, which is going to further dissuade people from running.

Jeff, I hadn't thought of this from the regulatory angle - good point.

Any ideas on what to do when we get 'Briar Chapelled' with a candidate with $30-40k of backing?

Thanks, Will.

I don't remember how close it was, but I don't imagine Bachmann could have won with twice as much funding as she had. There are dizzyingly diminishing returns in off-year local elections when you just throw more money into mailings and ads (pace Pavao-Foy).

So my answer: Do the same thing as in Chapel Hill in 2003, expose her as much as possible, and vote her down.

Jeff says I told him WHAT?!

After an otherwise pleasant afternoon, I was trolling this string to find an assertion by Jeff Vanke that I told him of an effort to strong-arm a candidate for Carrboro Board of Aldermen into withdrawing from the race. I
said no such thing.

Moreover, this assertion contains the implication that, either directly or by proxy I was involved in such an effort to gain political advantage.

Any implication to that effect, or that I was was even aware of, and hence, countenanced such an enterprise is insulting, offensive, and false. Under no circumstances would I participate in such a tactic--And, should I be made aware of this sort of activity, I would urge anyone involved, in the strongest terms, to cease and desist forthwith.

What I do know for a fact, however, is that it never happened. How do know this?
After reading this surprising post I simply called said candidate--A pleasant and thoughtful gentleman by the name of Norm Miller, and asked him. Norm said that at no time was he approached by anyone urging him to leave the race. Rather, he said, events were exactly as described in media reports:

Norm ran to advance the implementation of the Vision2020 and New Vision for Downtown Carrboro plans. His initial examination of the issues led him to feel that the Town was not sufficiently aggressive in pursuing the goals and plans outlined in those documents. A conscientious candidate, Mr. Miller continued to ask questions and investigate the level of activity associated with these efforts. Based on his own further inquiries, Mr. Miller became satisfied that the Town was, in fact moving forward aggressively in these areas, decided that a new candidacy was unnecessary, and left the race. That's it.

How did this rumour get started? My only guess is that the concept of such a rational approach to a candidacy was simply too much of a stretch for the pneumatic egos and machiavellian ambitions that seem to populate this business to grasp.

Really, Jeff, where do you get this stuff? Oh, yeah, maybe the same guy who told you that Carrboro's firefighting equipment consists of a horse-drawn pumper, two stepladders and a dalmation...Okay, I'll stop before I say something even more intemperate and unsuitable for a family publication, except to say this:

For the moment, I'll assume no deliberate malice on Jeff's part, and that he merely got his sources confused. I would recommend, however, that if people insist on posting twaddle gleaned from Rumour Control, that they have the decency to label it as such.

I have some thoughts on the topic at hand, but will wait for my temperature to moderate before continuing.

Cheers,
Alex

Alex,

Note that I actually said that I thought such behavior was fine. Nobody forced anyone to do anything. Not even close.

I actually got this story from you yourself, in a friendly conversation we had either before or after a candidate forum during the 2003 campaign, out on the steps of Town Hall. I asked you if you knew what had happened to the drop-out candidate. You responded, "we" talked with him and ascertained that "we" share the same goals for the Downtown vision. And since there were already three candidates running in favor of that (you didn't name them, but since it wasn't Rose, it was clearly you, Joal, and Mark Chilton), he decided to drop out, assured that the Downtown vision was fully represented among the three candidates.

Perhaps I was wrong to use the description "someone went to talk to the fourth guy." Perhaps he initiated the conversation. But he clearly had enough conversation with enough of your campaigns (being satisfied with all three of them) for me to describe his drop-out decision as coordination, whoever initiated it. And I do not doubt that it helped, and perhaps was essential to, your own reelection by 203 votes (of 1,551).

I don't know what you meant by "we"; if you yourself didn't talk with him during 2003, you were telling me then that your coalition had, and that you were aware of it. And I'll reiterate that I don't think this was wrong. My point was that this was a case of the strength of incumbents forming strong coalitions.

Jeff, you are mistaken. "We" didn't talk to anybody, and I told you no such thing. Many conversations take place on that porch--often rife with rumours. Methinks you have me confused with someone else.

The first time I, --or anybody on my campaign team--talked to Norm Miller was yesterday, when I called him to ask if any such activity occurred. As I said above, He stated categorically that nothing of the kind occurred. While he may have talked to folks who supported my positions in the course of his inquiry, no one directly associated with my campaign had any conversations with him. Ever. Ask him yourself--He's in the book.

Further, while you may have issued a 'but that's okay' disclaimer, it seems inconsistent with your assertion that such activity has a chilling effect on participation and your oft-stated concerns about measures that you believe would have such an effect--such as campaign finance reform. On the former, I agree. Consequently, I don't think such a tactic is 'okay'--particularly if, as you seemed to imply, it involves the use of pressure.

Cheers,
Alex

So did anyone go to this? What happened?

I wanted to go, but my twins had their birthday party scheduled at the same time. I asked Peter a while back to list recommendations for local PACs with regards to limits and disclosure reporting and I emailed him again yesterday to remind him. Did this get discussed?

Thanks,
Mark

Yeah, I attended the forum. It was a lively discussion, and while the issue of PACs--More specifically, 527's and their ilk, came up, there wasn't any specific discussion of how these activities might be better regulated. I've spent entirely too much time blogging today, so I've gotta get back to work. I'll add some more skinny later.

Cheers,
Alex

Alex, You are simply mistaken. The conversation took place between you and me, in a fairly casual manner, in the way that I presented it. It's understandable if you don't remember it, especially since there's nothing shocking about it.

I'm not going to argue with you about this any more..Now open the pod bay doors!...I don't think we have any option but disconnection, do you, Dave?(Apologies to Stanley Kubrick).

(Anyone who isn't thoroughly bored by this exchange, read the posts above and draw your own conclusions, or call Norm Miller and ask him yourself. He's in the book.)

Now, back to the subject at hand...

Despite the appearance given by the panel makeup of the CAN forum, Thomas Mills(for those not familiar with Thomas, he's a highly successful campaign consultant who works primarily with progressive candidates)did not argue against the basic principle of public financing, but raised some interesting questions about implementation under the Voter-Owned Elections structure that has been proposed.

Before digging into the details, however, it should be emphasized that the program as proposed (and utilized elsewhere) is entirely voluntary. As such, one contemplating participation must make a judgement that it is worth complying with some additional standards in order to recieve public financing. Those who opt out would be subject to no additional regulation.

This important distinction would seem to render Jeff's earlier argument about the chilling effect of 'additional regulation' moot.

The way it works, in summary, is this:
Candidates choosing to participate in the program:

1. Declare candidacy, and intent to participate in the program.

2.Raise a specified amount--say,$500 in small donations of no more than a certain amount-- say,$5-10, from registered voters in the jurisdiction in which s/he is running, to qualify.
(The theory is that this shows a base level of support to demonstrate some level of viability to the candidacy.

3. Upon acceptance of the public financing(limited to acertain amount), agree to the 'strings'--basically, reporting rules and a spending cap.

4. Run like hell. During the course of the campaign, if you are outspent by a non-participating candidate, you may receive additional 'rescue' funds, up to a certain amount, to catch up.
(This is a simplified version--For more detail, see the link in Dan's post above.)

Some of the issues raised by Thomas were as follows:

1. Concerns that the device may work as an 'incumbent protection' device, in that incumbents would naturally have greater name recognition--not only making it easier to raise the qualifying amounts,--but that advantage would carry through the campaign, and put other program participants--subject to the same spending limits--at a disadvantage.

2. That without a 'rescue' clause, participating candidates could be easily rolled over (Thomas was apparently unaware of this aspect of the Chapel Hill proposal).

3. The difficulty of setting a reasonable base amount alloted per candidate due to the instability of fixed costs necessary to run a viable campaign, as well as the potentially inflationary dynamic of setting, if you will, a 'base amount' to run a campaign.

4. The budgetary quandary in a jurisdiction with at-large elections in which the number of candidates who would a);File, and b);qualify is unknown. For example: Let's say there are three seats up, and typically 2 file per seat, so that's what the town budgeted. What happens if twelve show up, and--just go with me here--actually qualify. That could turn into an expensive enterprise, and put the sitting board in a very difficult position: As an incumbent, when the issue of a budget amendment to cover the additional candidates comes up, do you vote to break the bank, or to deny some of your competitors funding? Ouch.

So, the question arises: Who'd take this deal? Apparently lots of folks.

Peter Walz, of Democracy North Carolina, cited the substantial success of similar programs that have been implemented statewide in Arizona and Maine. Among his examples were:

1.In Maine, nearly 80% of the candidates are running under the program

2.In Arizona, around 60% for House, and 40% for Senate.

3.In Maine--and for me, this is a particularly telling number--the number of contested primaries rose from 25% in 2000 (the first cycle of the program) to 39% in 2004.

There were more, but you get the idea.

Some unanswered questions were: How many of these were incumbents, and what proportion of participating candidates were successful, or could be considered competitive? While Peter did not have those numbers it's questionable that they would be meaningful in that it would be hard to do a useful trend analysis after only two cycles (this is the third for the program in Maine and Arizona).

All this tells me a few things: It seems clear that in terms of participation, and providing new competition for otherwise uncontested seats, that the program is demonstrably successful. Obviously, the jury's out on the actual level of competitiveness of those participating in the program (maybe somebody can find those numbers--I'm too busy now).

Clearly, Thomas has raised some operational issues to be dealt with, but here are a few ideas:

I would argue that the advantage to a participating incumbent operating on strong local good will may be offset by a non-participating challenger's ability to raise money from sources outside the jurisdiction, interest groups and unlimited spending. One would hope, however, that that the good will on the part of any candidate would be amplified by the willingness to limit their spending, and intake--and hence perceived influence--to local sources.

Obviously, considerable thought would need to be given to periodic review of the reasonable costs of campaigns, and alloting a reasonable amount--Thomas cited some generally accepted fixed costs in terms of the number of contacts per voter needed to be effective. This might be a useful benchmarking tool in this aspect.

The budgeting tool is a tougher nut to crack, but obviously, there needs to be some limiting mechanism. One approach may be to limit the number of slots eligible--Say, 2 per seat. One might then say the first folks in the door to fill those slots get guaranteed financing if they can qualify. The rest can either choose to go on a waiting list, and continue raising qualifying funds or (obviously) opt out. If one of the candidates in the front of the line fails to qualify, then you get in. As well, any candidate on the 'waiting list' should have the option to 'bail' at any time prior to accepting public financing.

By no means do I suggest that these are definitive solutions, but in the mean, I think that the broadening aspects of such a proposal, combined with the emphasis on maximizing local influence, and minimizing the impact of special-interest and PAC money are appealing. As such, it seems worth it to put thought into sorting out some of these operational details and give the mechanism a trial run. Its success will be judged on the level of participation, and the success of it's participants. If nobody bites--or if everybody who does, gets creamed, then it's back to the drawing board. But we'll never know unless it's given a chance.

All of this, is moot, however, unless the jurisdictions can get enabling legislation. As most folks know, in the last session, it got through the senate but got hung up in the house. The session's coming up, so it's time to get busy.

Thanks Alex. Your notes and analysis are very helpful.

 

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