Cities tackle reforming local campaign finance

By RACHEL GRAVES
Houston Chronicle

A Houston city councilman recently had a gripe about a city contract. Before answering a reporter's questions, though, he scanned his list of campaign donations to ensure he hadn't gotten money from the contractor.

Bert Keller, one of the council's strongest supporters of campaign finance reform, later said he was joking.

Not funny, say those who worry that developers, law firms and consultants are buying clout at City Hall by bankrolling political campaigns.

Although Enron's stunning financial collapse has spurred interest in campaign finance reform at the national level, some say the real battle over money and political influence should happen in city government. As a result, more cities across the country are trying everything from using tax money to match campaign contributions to publicly shaming candidates into complying with voluntary spending limits.

"Major reform begins at the local level," said Carl Castillo, director of the New Politics Program at the National Civic League, a Denver-based nonprofit group. "It eventually affects change at the national level."

New York City and Los Angeles have two of the most ambitious finance reform programs, matching money that candidates raise from individuals with public financing.

For every $250 donation from a New Yorker, the city's Campaign Finance Board gives the candidate $1,000 in public money. The intent is to give residents' contributions more impact against larger donations from political action committees.

Los Angeles has a similar system, although the matches are less generous.

Both systems are voluntary, and candidates must agree to contribution and spending caps in exchange for public money.

Some candidates do not participate, though, and New York Mayor Michael Bloomberg set a record last year by spending $72 million on his campaign.

Since the New York City Council approved its public finance system in 1989, officials say the city is seeing a broader range of candidates.

"We saw a large group of neighborhood community activist type people mounting serious campaigns," said Molly Watkins, a spokeswoman for New York's finance board

Other cities have taken different approaches.

In Westminster, Colo., the city's elected officials cannot vote on contracts concerning people who have given $100 or more to their campaigns. Since the law passed, the number of $99.99 contributions has soared.

Ballots in San Jose, Calif., show which candidates have abided by voluntary spending limits, letting voters decide whether the issue is important enough to affect their decisions.

Albuquerque, N.M., has mandatory spending limits, which are being challenged in court on the grounds that they violate the constitutional right to free speech.

The number of cities with campaign finance regulations more stringent than just contribution disclosure has nearly doubled in the past four years, from 75 in 1998 to 134 this year, according to the National Civic League.

Many other cities, though, have virtually no regulations.

Bob Stein, a political science professor at Rice University, said he believes campaign finance reform is more crucial at the local level than the national level because of the different services city and federal governments provide.

A large portion of federal campaign contributions come from philosophically motivated groups such as the National Rifle Association or Planned Parenthood. Those groups usually give money to candidates who share their philosophies - trying to influence who is in office rather than changing how individuals vote.

But the bulk of city government's work involves doling out contracts, and Stein worries that the best company might not be hired to pave a street because it did not contribute to the right campaigns.

"My right and freedom is to have the best government, the most efficient government that can be had," he said. "Contracts for city business do not reflect fundamental differences in partisan or ideological tastes and preferences. They should be awarded on the basis of who can do the best job for the least amount of money, not who gave money to elected officials."

Many elected officials, even those who support finance reform, argue that contracts are not determined by political contributions.

"If somebody doesn't know the difference between a bribe and a contribution, they need to find a new line of work," said former Houston City Councilman Chris Bell, who is running for Congress.

But Bell agrees the system needs repair. While on City Council last year, he pushed through a law seeking to regulate the use of soft money in city campaigns.

Bell said recently that the law - which prohibits special interest groups like political parties from spending their unregulated money on behalf of candidates - does not work because there is seldom a way to prove whether groups coordinate their campaign assistance with the candidates. Cracking down on uncoordinated spending is constitutionally questionable, again because the Supreme Court has linked the issue with free speech rights.

"We're on the right path," Bell said. 'With the elections becoming more and more partisan, you really have to address the issue of soft money."

The city of Houston, which officially has nonpartisan elections, prohibits candidates from taking contributions of more than $5,000 per election from individuals and $10,000 from political action committees. Candidates can raise money only in election years.

Contractors are barred under city law from giving to candidates for city office while their contracts are being considered and for 30 days after a decision is made.

But critics scoff at the notion that the blackout period can limit the influence of campaign contributors.

Those who do business with the city are dependable in their support of a winning candidate, so much so that there is a term for the post-election fund-raiser at which contractors backing the wrong candidate can atone by contributing to the winner. They are called "late train fundraisers."

Councilwoman Annise Parker, a gay activist who was seen as "anti-downtown" when she first ran for council in 1997, said downtown supporters quickly embraced her after her win and donated as much money in one night as she had been able to raise in one month before the election.

Parker believes the key to improving Houston's campaign finance system lies in requiring greater disclosure.

Candidates are required to file reports listing each contribution, but it is impossible to find specific contributors or otherwise analyze the reports without going through them line by line.

"It's not designed to give you the right information. It's designed to give you the minimal information," Parker said. "It should all be, out there for, everybody to see."

But others are skeptical about more regulations.

"It's like legislating morality," Councilman Bruce Tatro said. "Can you legislate ethics? Inevitably the answer is no."

Campaign donation laws

Highlights of Houston's campaign finance laws:

• Contribution limits of $5,000 per election from individuals and $10,000 from political action committees. State law prohibits corporations from making campaign contributions.
• A prohibition on raising money in non-election years.
• A blackout period that prevents contractors from giving campaign contributions while their contracts are being considered by the city and for 30 days after a decision is made.
• A soft money regulation that bars special interest groups such as political parties from spending their unregulated money on behalf of candidates, if the effort is coordinated with the candidate.