Empower Small Donors,
Public Campaign Funding
Empower Small Donors,
Public Campaign Funding
States Take the Lead
While Washington is stuck in partisan crossfire on the issue of public financing, many states have moved ahead with their own programs. In all, 25 of the 50 states plus major cities like Los Angeles and New York have adopted some form of public financing for election campaigns, though the size and impact of this patchwork of different programs varies widely.
Success often depends on just how much public funding is offered, how realistic are local campaign spending limits, and whether there is a political culture at work in a state or locality that encourages political candidates to participate, or whether wealthy donors, ambitious candidates and outside forces simply overrun the system.
Four States with Robust Public Funding
Of the 25 states with some public funding, the most comprehensive and robust programs are the self-styled Clean Election systems in Arizona, Connecticut, and Maine – widely seen as models for other states. Their Clean Election systems provide public funding grants for virtually all statewide and legislative candidates. Once office-seekers have raised enough seed money to prove their viability, these systems fund the entire remaining cost of their campaigns.
Not only has there been bipartisan backing for such legislation in these three states, but a significant majority of candidates from both parties running for governor, the legislature and other important state offices have agreed to accept limits on their own campaign fund-raising and spending in return for receiving state subsidies.
Minnesota, too, has an across-the-board program of financing campaigns for major state offices and for the 201 seats in the state legislature. But Minnesota differs from the others, in that it provides only partial funding for roughly 20-25 percent of total campaign expenditures.
But like Arizona, Connecticut and Maine, Minnesota has attracted the large majority of candidates for state political offices to adopt public funding and accept spending limits. And that has helped to hold down the overall costs of campaigns and to mitigate the influence of large private donors.
Funding for Key State Offices
Another group of states, including Florida, Massachusetts, Michigan, New Jersey, and Rhode Island, have embarked on a more modest strategy. They provide partial public funding but for only a limited handful of candidates – those running for governor or other statewide offices. They offer no public funding for legislative candidates.
Over the past couple of decades, public financing systems in these states have been reasonably well used. But periodically, the system is overwhelmed when independently wealthy candidates, such as Gov. Rick Scott of Florida and Gov. Rick Snyder of Michigan, both Republicans and former corporate CEOs elected in 2010 and re-elected in 2014, have financially buried less well-heeled opponents who relied, in part, on public funding.
In addition, the Florida legislature has raised that state’s campaign spending limits so high, reaching nearly $25 million in 2010, that the League of Women Voters protested it had torpedoed one major purpose of public financing – to hold down campaign spending.
Other states, such as Hawaii, Maryland and Vermont, have similar limited programs, but they have been less well used in recent years, either because candidates see their public subsidies as too small or their state spending limits as unrealistically low, with the result that participation looks like political suicide.
Maryland: Publicly Funded Underdog Wins
In the 2014 election in Maryland, the victorious Republican gubernatorial candidate Larry Hogan chose to use the state’s public financing system. But he was the first major party candidate to do that in 20 years.
In Vermont, the last statewide candidate to qualify for state public funding was a third party candidate, the Progressive Party candidate for lieutenant governor, in 2004. Hawaii’s public financing program suffers from a similar lack of participants. It offers public funding for legislative races as well as for top state offices, but typically only a few candidates seek and receive public funding out of roughly 160 candidates running for 80 state offices.
Three other states, including New Mexico, North Carolina, and West Virginia, limit their public funding programs to candidates for judicial office or state regulatory bodies. Ten states make public funding available to political parties – Alabama, Arkansas, Iowa, Kentucky, Minnesota, New York, North Carolina, Ohio, Rhode Island and Utah.
Several states including Arkansas, Ohio and Oregon, provide tax credits for small donors to political candidates for major state offices.
How Do States Raise the Funds?
The most commonly used method to finance public funding of campaigns is the tax return check-off that lets voters decide whether to donate to public financing. In the 1970s, several states adopted plans to encourage voters to donate to political parties rather than directly to candidates by letting taxpayers designate from $1 to $10 on their tax returns for political donations.
This type of check-off system and similar tax rebate systems are still being used in Alabama, Arizona, Iowa, Kentucky, Minnesota, New Mexico, North Carolina, Ohio, Rhode Island and Utah. Arkansas grants residents a $50 tax credit for political donations.
But because of the soaring costs of political campaigns, the impact of small taxpayer donations is literally dwarfed by the oceans of dark money from anonymous donors now flowing through independent groups into election campaigns.
With a dwindling percentage of taxpayers now using the tax check-off option, public funding advocates fear that existing public funding will wane for lack of sufficient funds – unless the explosion of Mega-Money donors triggers a backlash and a new grass roots push to revive public funding of campaigns.
Below are descriptions of public financing efforts in 15 different jurisdictions:
In 1998, Arizona enacted one of the most ambitious public funding programs in the nation, providing full public funding for candidates for all statewide offices as well as the state legislature. The Arizona program took effect with the election of 2000. To qualify for public funds, candidates must collect a defined number of $5 dollar donations (a total of $4,000 for gubernatorial candidates, $220 for legislative candidates). Once those thresholds are met, candidates receive an initial grant to finance their campaigns. From then on, they must stop raising funds on their own. In 2012, more than $3.2 million was distributed to participating candidates.
In 2002, Janet Napolitano, later Secretary of Homeland Security, became the nation’s first governor to be elected under a publicly financed Clean Elections system. A decade later, in 2012, five of Arizona’s top statewide elected officials ran campaigns based on the state’s Clean Elections system, including then-Governor Jan Brewer, Secretary of State Ken Bennett, two Arizona state Corporation Commissioners, and the Corporation Commission Superintendent.
Because of political objections against using taxpayer funds for public financing of elections, Arizona’s Clean Election system is largely financed by special surcharges on legal fines or penalties, such as parking tickets, speeding tickets and other civil law violations.
Participation in the Arizona Clean Elections was high in the 2008 and 2010 elections, but declined since 2011 after a Supreme Court decision that struck down a provision of the public funding program. The Court left standing public funding in principle, but banned one provisionthat offered an increase in matching funds to publicly funded candidates to offset large infusions of private donations to candidates operating outside the public funding system. In a 5-4 decision, the U.S. Supreme Court ruled that this second infusion of public funds unconstitutionally infringed the rights of large independent donors.
After that ruling, participation in Arizona’s Clean Elections system fell significantly in the 2012 and 2014 campaigns. Some candidates were fearful that public funding would not be sufficient to offset heavy private funding of their competitors. Even so, about 30% of the successful legislative candidates in 2014 used the public funding system, as did the state superintendent of public instruction and two of the five state corporation commissioners. But the system broke down in the governor’s race. The Republican candidate, former corporate CEO Doug Ducey, shunned public funding and spent $6 million, half of it his personal funds, in defeating Democrat Fred Duval, whose campaign spent about half as much as Ducey’s.
In April 2016, Arizonans for Clean and Accountable Elections moved to inject new life into the state’s public funding system by proposing a popular referendum on a major reform measure that would provide a 6-to-1 match of small campaign donations up to $160 for any legislative candidate. “It revitalizes Clean Elections by creating a small-dollar match,” said attorney Jim Barton. “It allows ordinary folks to contribute to elections in a way that you’ll (the candidate) be able to run competitive races.” To get on the ballot, the initiative campaign must collect 150,642 valid signatures by July 7, 2016. The new plan, estimated to cost $5 million, would cover only legislative races, not races for statewide offices, It would also force much broader disclosure of independent funding than previously.
In late June 2016, Arizonans for Clean and Accountable Elections called off their petition drive with roughly 100,000 signatures in hand because the firm hired to gather signatures for their ballot initiative was hired away by the Arizona Chamber of Commerce and Industry. Movement leader Samantha Pstross said that a non-compete clause blocked the Clean Elections group from hiring another firm in time to gather the 150,000 required signatures by the July 7 deadline. Chamber of Commerce spokesman Garrick Taylor did not deny the charge, saying the Chamber was prepared to use “all options available to us” to block the measure. Taylor said the chamber’s board “has made it clear that they want to consider all possible means to ensuring that what is essentially taxpayer-funded elections on steroids did not become the law in Arizona.”
To encourage small donors to political campaigns, Arkansas grants its residents a state tax credit of up to $50 per person ($100 on a joint tax return) for contributions to political candidates, parties, or political action committees. Arkansas has no pool of public funds available to candidates.
Both houses of the California state legislature passed a Clean Elections bill, the California Fair Elections Act, in 2008 and it was signed by Governor Arnold Schwarzenegger. For the law to take effect, it had to be approved by the voters in a ballot initiative, but on June 8, 2010, a majority of California voters supported the measure by 57% to 43%, but that fell short of the required super-majority.
Connecticut has the most broadly used public funding program for state elections in the country. The state legislature enacted the Citizens Election Program in 2005, providing for full funding of all statewide offices and the legislature for candidates who accept public funding. The program was signed into law by Governor Jodi Rell, took effect with the 2008 state elections.
Candidates qualify for state grants by collecting individual contributions from $5 to $100, and qualify by reaching a threshold amount that varies with the office – $250,000 for gubernatorial candidates, $5,000 for state representative. The qualifying thresholds are used to insure sufficient public support to justify public financing for candidates and to deter “fringe” office seekers from obtaining public funds.
November 2010 saw Connecticut’s second general election under its Citizens’ Election Program. All five statewide offices – Governor, Lieutenant Governor, Secretary of State, Attorney General and Comptroller – are now held by candidates who used the publicly financed Clean Elections system. Also, about 70 percent of those seeking office in Connecticut’s General Assembly and 77% of those finally elected took part in Connecticut’s publicly funded campaigns.
In the state’s 2012 legislative elections, participating candidates made up 65 percent of the total field and overall, 77 % of those ultimately elected used Citizens’ Election Program. Like Arizona, Connecticut’s Clean Elections program avoids using taxpayer funding by deriving its money from general state revenues generated by abandoned property and unclaimed financial accounts.
Once again in 2014, the public funding system was widely used. Both incumbent Governor Dan Malloy and his Republican challenger Tom Foley, a businessman and former Ambassador to Ireland, chose public financing of their campaigns over raising their own funds. Each received $6 million from state funds. More than 83% of the winning candidates for the state legislature also participated in the public funding program.
With a 64% majority vote, the Florida electorate approved an amendment to the state constitution in 1994 to provide partial public funding for candidates for Governor and other major statewide offices but not for the legislature. Florida’s system gives a dollar-for-dollar match for contributions up to $250 raised by candidates, provided the candidates accept campaign spending limits.
In the last six gubernatorial elections, 17 candidates have used the system, either in party primaries or in the general election. But the impact has been spotty because several wealthy candidates have bypassed public funding and financed their own campaigns, and in 2005, the Florida legislature tripled the spending limit, which the League of Women Voters said was “distorting the original purpose of public financing system to hold down the cost of campaigns.”
In 2010, Republican gubernatorial nominee Rick Scott brushed aside public financing and spent or loaned to campaign $75 million of the fortune he had made as CEO of the Columbia/HCA hospital chain. Scott won by a narrow 1.2% margin over Democratic nominee Alex Sink, who also bypassed public financing. In his 2014 run for re-election, Scott again declined public funding and his campaign spent close to $100 million while Democrat Charlie Crist accepted public matching funds and agreed to abide by the state’s $25 million spending cap.
Florida’s public funding system has come under fire but in 2010 it withstood a popular referendum seeking to eliminate it. One major reason that Florida’s public funding program does not have a deterrent effect on soaring campaign spending, experts say, is that state law does not limit spending by political parties and independent groups.
In the 2014 elections, Tallahassee voters passed by a 67% majority a political anti-corruption bill amending the city charter to set up an ethics commission to guard against conflict of interests, to limit campaign contributions to city candidates to $250 and to provide a $25 tax rebate to encourage small donors to political campaigns.
In late April 2016, Accountable Miami-Dade, an ethnically and politically diverse coalition of civic groups, business, labor and local political figures, launched a petition drive for a citizens initiative that would both lower limits on individual donations to candidates for county offices and offer a 6-1 public funding match for donations of up to $100 to qualified candidates who agree to the lower limits.
In addition to dropping the maximum permissible campaign donation in local elections from $1,000 to $250 per election, the initiative would allow candidates for county commissioner to qualify for up to $1.1 million in public matching funds, and candidates for Mayor of Miami, for up to $2.2 million. The matching money would all be drawn from general county funds.To curb what reform activists call the long-time corruption of Miami politics from campaign funding by vendors, developers and lobbyists, the new measure prohibits large county contractors from making donations to candidates and closes loopholes that have allowed lobbyists to make gifts to candidates and office-holders.
Backers gathered 125,000 signatures to put the measure on the November ballot and presented them to the county commission for certification, but not enough county commissioners showed up at the commission’s August 9 meeting to qualify the measure. “We have 125,000 signatures waiting at the Election Headquarters,” said Christian Ulvert, chief organizer of the petition drive. “It was disappointing the process isn’t moving forward.”
With the November election fast approaching and the county commission refusing to certify the ballot initiative, proponents filed suit and won a favorable decision from Circuit Court Judge William Thomas. On Sept. 9, two months before Election Day, the judge ruled that commission exceeded its authority and ordered the initiative placed on the ballot. But the county commission immediately appealed, putting a stay on Judge Thomas’s order, and on Sept. 20, Florida’s Third District of Appeals overturned the lower court ruling, blocking the initiative from appearing on the ballot in 2016, but leaving the door open for a future challenge by reformers against the county commission.
In February 2015, a 79% super-majority of Chicago voters went on record in favor of a “Fair Elections” referendum calling on the Chicago city council and the Illinois legislature to take legislative action to “reduce the influence of special interest money in elections” by encouraging small donor contributions and by using “a limited amount of public money.”
In the run-up to the Chicago mayoralty election, incumbent Mayor Rahm Emanuel and his runoff rival, Cook County Commissioner Jesus “Chuy” Garcia, endorsed the proposal. After it passed, David Melton, executive director of the Illinois Campaign for Political Reform, called for a renewed push for legislation to reform the state’s campaign financing system.
In 2006, the Los Angeles City council enacted a system of public funding for municipal elections by establishing a 1-to-1 match on contributions of $5. But the program, which was financed from the general city budget, proved inadequate. So in 2013, the City Council increased the match to 4-to-1, starting in 2015.
Campaign reform advocates in LA were impressed with the success of New York City’s high-ratio match and urged Mayor Eric Garcetti and members of the city council explained that that LA should follow suit. The council agreed. As Trent Lange, President of the California Clean Money Campaign, put it: “We need to make major changes in the way we finance election campaigns. The new rules will enhance the voice of regular voters and make candidates engage more with the people they represent.”
The Maine Clean Elections program, an across-the-board system of public financing, was enacted by voter referendum in 1998 and took effect with the 2000 election cycle. It has reshaped the financing of Maine elections ever since.
To qualify for public funding, candidates in Maine must collect a defined number of $5 contributions from registered voters in their own district. The qualifying thresholds vary by office – $500 for uncontested House races to $600,000 for gubernatorial candidates. Once certified, candidates are eligible for a grant to fully fund their campaigns. But to receive it they must pledge not to accept any further private contributions. Funds for public financing are generated by a general state appropriation.
From the start, participation in the public funding program was strong from candidates in both parties, both for statewide offices and for both houses of the state legislature. It reached a high point in 2008, when 81% of of all legislative candidates took part.. But the Maine system was partially undercut by U. S. two Supreme Court decisions and participation fell off to 53% in 2014.
When the Clean Election law was first adopted, it not only gave candidates initial grants of public funds but allowed them later to collect “matching funds” if they were outspent by a privately funded opponent. In 2011, the Supreme Court struck down the matching funds provision as abridging the free speech rights of private donors. And after the high court’s Citizens United decision in 2010, private spending on legislative races jumped fivefold from 2008 to 2012.
Reform groups like Maine Citizens for Clean Elections and Mainers for Accountable Elections were determined to repair the state’s public funding system. They got a new reform law on the ballot for a popular vote. In November 2015, a 55% majority of Maine voters approved a law that authorizes a new way to give candidates a second funding grant if they keep on raising small $5 donations. To offset the rise in private campaign donations, the reform act increased public funding for the governor’s race from $1 million to $3.2 million and roughly tripled public funding for legislative candidates. Plus, it put more teeth into funding disclosure requirements and penalties for campaign law violations.
Maryland provides partial public funding but only for candidates for governor and lieutenant governor. It requires candidates who accept public funds to accept a limit on their campaign spending, based on the state’s population. In the 2014 election cycle, the limit was $2,586,124. Maryland law does not limit expenditures for statewide candidates by state, local and national parties or independent organizations.
Maryland’s program has attracted little use over the past two decades because the public funding it offers falls short of what major candidates can raise privately. But Larry Hogan, the Republican candidate for governor, was not well known and, seeing advantage in public funding, became the first major party candidate in 20 years to opt for public financing. His Democratic opponent, incumbent Lieutenant Governor Anthony Brown, spent more than $9 million to win the state’s Democratic primary. In the general election campaign, Hogan cast himself as fighting a “grass roots” battle against an “entrenched incumbent machine.”
The Bay State is a case study in how the interest of average voters in publicly funded campaigns can be thwarted by elected politicians who oppose public financing that increases the vulnerability of incumbents to challengers.
In 1975, Massachusetts instituted a program of partial public funding for candidates for the state’s six highest elective offices, requiring them to qualify by raising their own initial funds and agreeing to campaign spending limits. This program was funded by hundreds of thousands of taxpayers designating a $1 per person donation on their tax returns.
In 1998, Massachusetts Voters for Clean Elections pushed to expand this program dramatically by offering full public funding for candidates for all constitutional and legislative offices. They got the issue on the ballot and won a 58% voter majority. But in the Bay State, all enacted referendums are “subject to appropriation,” meaning that voters can create programs in principle but only the legislature can appropriate funds. In this case, the state legislature led by House Speaker Tom Finneran blocked the new program by refusing to fund it.
Massachusetts Voters for Clean Elections sued the legislature and won a court order providing for the sale of more than $4 million in surplus state property to fund candidate campaigns in 2002. But not to be outdone, Speaker Finneran engineered a counter-referendum in 2003, asking voters if they supported “taxpayer funded elections,” and 75% voted no. The legislature used that vote as justification to repeal the clean election program.
The political donnybrook has taken its toll on public financing of campaigns in Massachusetts. The state has been thrown back on its original taxpayer-donation scheme, with funds limited and participation declining.
As in Maryland, Massachusetts spending limits are so low ($1.5 million for a gubernatorial general election campaign in 2014) and the public funding offered is so modest that major candidates often bypass the system. They fear being financially outgunned. In 2010, for example, while seven candidates for statewide office received more than $1.4 million in public funds, such major candidates as Deval Patrick, the victorious gubernatorial candidate, his running mate and two other top state officials declined public funding.
Since 1978, the Michigan Campaign Finance Act, passed in the wake of Watergate, has provided partial public financing for gubernatorial candidates. Its system is financed by a voluntary income tax return check-off or donation of $3 per person ($6 per couple). In primary campaigns, public financing provides a 2-for-1 match for contributions of up to $100 raised by candidates. In the general election, a flat grant of $1,125,000 is made to candidates who accept state spending limits.
In 2010, all five defeated gubernatorial candidates – four Republicans and one Democrat – took public funding and agreed to a spending limit of $2 million. But the ultimate winner, Governor Rick Snyder, a wealthy venture capitalist, spent more than $6 million of his own money, and his campaign overall spent $11 million, more than a 4-1 advantage over his Democratic opponent Lansing Mayor Virg Bernero.
In 2014, the public funding system was overwhelmed by a $47 million advertising blitz in the gubernatorial race, 75% of that money spent by SuperPACs claiming independence from Governor Snyder and his Democratic challenger, former Congressman Mark Schauer, even those groups were open in backing the two opposing candidates made no secret of their candidate and their message. Snyder again bypassed public funding and amassed a much larger war chest than his Democratic rival, former Congressman Mark Schauer who took public funds.
A leader in campaign finance reform long before the Watergate scandal moved Congress to enact spending laws and limits in 1974, Minnesota has long had a robust program of public financing for statewide offices such as Governor and attorney general as well as for legislative candidates. By the 2012 election cycle, the state’s Campaign Finance and Public Disclosure Board reported that 87% of state legislative candidates accepted public funding that totaled $1,948,951. With public funding so much, the political culture in Minnesota has helped hold down the overall cost of Minnesota elections.
In years when elections are held for Governor, Lieutenant Governor, and other statewide offices as well as the state legislature, the public financing program roughly doubles. In 2010, the state paid out $4,467,177 to campaigns. Most major statewide candidates typically seek public funding and accept spending limits. But in 2000, wealthy retail magnate Mark Dayton spent $12 million of his own money in an unsuccessful bid for the U.S. Senate and then spent another $3 million of his own money in 2010 in winning his race for governor. But in 2014, Dayton switched. Like his Republican challenge, Jeff Johnson, Dayton applied for public campaign financing and accepted the state spending limit of $3.6 million.
For years, Minnesota offered residents a tax credit for small donations to candidates. But in 1987, that was repealed and converted in 1990 to a cash rebate from the state for donations up to $50 for individuals and $100 for married couples. Funding for that program was suspended in 2009 under former Republican Gov. Tim Pawlenty, but reinstated in 2013, under Governor Dayton. Minnesota pays for the public funding rebates to campaign donors through general appropriations made by the state legislature, and contributors apply to the state department of revenue for tax refunds.
Since 1977, New Jersey has provided public financing for candidates for governor, to give candidates with limited financial means a way to seek the state’s highest office and to persuade candidates to accept limits on their own fund-raising and spending. The state provides a 2-1 match for qualified funds raised by the candidates. New Jersey has also tried a pilot program for limited number of legislative seats, but its full-fledged public funding has remained narrowly targeted on the governor’s race.
Since the program was instituted, all but two general election candidates — Democrat Jon Corzine in 2005 and 2009, and Republican Douglas Forrester in 2005 — have accepted public money and agreed to curtail their own spending. But high spending ceilings have benefitted incumbents and well-known candidates. In 2013, Republican Gov. Chris Christie received the maximum of $8.2 million in matching public funds, while his Democratic opponent, Barbara Buono, received roughly $1.8 million. Both agreed to an overall limit of $12.2 million on campaign expenditures.
New York City:
In 1998, the New York City Council enacted a system of public funding for city elections, providing a 6-to-1 match for individual contributions up to $175. Most of New York City’s current 63 City Councilors have been elected with public funding. The system is financed by general city budget appropriation.
After a close comparison of funding for different campaigns in New York City, New York University’s Brennan Center for Justice issued a report concluding that with the incentive of public funding and a high match ratio, candidates for city council had, in fact, reached out to a much broader spectrum of small donors from minority groups and local residents than candidates for the state assembly, running in the same districts but without the incentives of public funding. “In so doing,” the Brennan Center stated, “the city’s public financing system appears to have achieved one of its key goals – strengthening the connections between public officials and their constituents.”
New York State – in contention:
Public funding of state elections was a major issue for the New York state legislature in 2013 and 2014. Legislative proposals to establish a small donor matching system based on the New York City model were vigorously debated during three consecutive legislative sessions in Albany. Responding to a broad statewide coalition of traditional reform advocates and a growing group of business leaders, Governor Andrew Cuomo has called for fundamental campaign finance reforms including a statewide system of small donor “citizen-funded elections.”
Several times, public funding bills have passed the Assembly but have fallen short in the state Senate by a handful of votes, most recently in March 2014. With campaign finance reform a key issue in New York State’s 2014 elections, a renewed push to pass a public funding law in the 2015 legislative session is likely. Given New York’s size and influence among state governments, success would carry national significance.
In the mid-1990s, the Ohio legislature authorized a $50 per person tax credit to residents who donate to campaigns for major state offices, such as governor, lieutenant governor and attorney general.
Under the Oregon Campaign Contributions, Finance and Spending Act, adopted by a 72% majority of Oregon voters on Nov. 8, 1994, individuals may receive a $50 individual tax credit ( $100 tax per couple) for contributions to political candidates and parties. The act also set limits on contributions by individual, certain groups and political action committees to candidates and established some spending limits.
Like neighboring Massachusetts, Rhode Island offers partial campaign funding for candidates for the state’s top elective offices along with tight spending limits for their campaigns. That combination tends to attract underdog candidates but is less attractive to favorites. In the 2014 gubernatorial race, for example, the victorious Democratic candidate, State Treasurer Gina Raimondo, turned down public funding and raised her own funds, breaking state spending records with 65% of her funds coming from out of state. Her Republican rival, Cranston Mayor Alan Fung, chose to accept public financing and received a subsidy of $1.1 million . In the end, Fung was outspent by Raimondo, $5.4 million to $2.2 million.
Nov 8, 2016 – South Dakota became the first state in a decade to pass public funding for the state’s political campaigns in a surprise grass roots victory against the South Dakota’s Republican Party establishment and a well-financed opposition led by Americans for Prosperity, flagship of the Koch political network, organized by the oil and energy billionaires Charles and David Koch of Wichita, Kansas. Two other reform measures, for a non-partisan primary system and for gerrymander reform, were defeated.
But a 51.6% majority of South Dakota voters approved one of the most sweeping campaign finance reform laws in the nation. Initiated Measure 22, or IM-22, imposes tighter limits on campaign contributions, requires wider and more detailed disclosure about campaign donors, establishes a state ethics commission to combat corruption, and will provide each voter with $100 in “democracy credits” to donate to any candidate for state – provided that candidates qualify by agreeing voluntarily to strict limits on funding their own campaigns and not to seek outside funding. IM-22 calls for up to $12 million in public funds for “democracy credits”in each election cycle, to be financed by general state funds of $9 per registered voter.
The reform drive was sparked by TakeItBack.org founded by Rick Weiland, a businessman Democrat who lost a race for the U.S. Senate in this heavily Republican state 2014, and Drey Samuelson, for 28 years chief of staff for retired Democratic Senator Tim Johnson. With support from the South Dakota Farmers Union, League of Women Voters, state chapter of AARP and national campaign reform organizations such as Represent.Us and Open Primaries, ballot committees gathered roughly 100,000 signatures and won certification in September 2015 to put the reform measures on the ballot in November 2016.
They built a coalition of Democrats, independents and Republicans including such prominent former Republicans including such prominent former Republicans as former Senate Majority Leader Dave Knudson, former State Treasurer David Volk, former State Senator Don Frankenfeld and Rick Knobe, former Republican Mayor of Sioux City, now a political independent.
In July 2016, the Koch brothers political network opened a media barrage to defeat a IM-22, focusing its attacks against the $100 per voter public funding. According to Ben Lee, leader of Americans for Prosperity in South Dakota, his patrons saw South Dakota as “a testing ground” in the battle over campaign finance reforms. Americans for Prosperity took the lead in organizing, financing and anchoring an opposition coalition called “Defeat 22” that included the South Dakota Chamber of Commerce and the South Dakota Farm Bureau.
For four months leading up to the 2016 election, the Defeat 22 coalition blanketed the state with waves of radio ads and hundreds of thousands of mailers attacking state IM-22 as taxpayer welfare for politicians. Its website warned South Dakotans that “scheming politicians want to use our tax dollars to pay for their political campaigns….Political attack ads paid for by you.”
Reform leader Rick Weiland countered that “This is about opening up our democracy and letting people have a voice again. Getting people to believe that it matters again.” The democracy credits, he said, give average voters some tool to offset the dominating influence of MegaDonors. “You actually get to take your tax dollars back and invest them in candidates that you think are going to do your bidding in the state capital,” Weiland said in an interview. “The intended consequences of that is it makes the person running for office less dependent on the thousand-dollar check-writer…It levels the playing field. “
In addition, IM 22 bars unlimited campaign donations from PACs and political parties to candidates and reduces the amounts of money candidates can receive. It lowers the ceiling on PAC donations from $10,000 to $2,000. Funding disclosure requirements are demanding. For any campaign contribution of $500 or more to any campaign, PAC, or political party, the recipient must disclose the donor, the donor’s occupation and current employer in a timely manner. The ballot measure passed with a 52% majority on November 8, 2016. Two other measures failed – one for gerrymander reform and the other, for a nonpartisan primary.
But one month after the election South Dakota Circuit Judge Mark Barnett put implementation of IM-22 on hold by issuing a preliminary injunction at the request of a group of two dozen Republican lawmakers and others who filed a lawsuit against the state. Foes of the measure contend that provisions of the law including an ethics commission, public campaign funding and limitations on lobbyist gifts to lawmakers violate either the South Dakota constitution or the federal constitution or both. Attorneys representing the state and sponsors of the ballot measure argued against the court ruling, asserting that IM-22 is constitutional.
In January 2017, with lawmakers fearing arrest or fines if they continue previous contacts with lobbyists, the Republican-dominated state legislature declared a ‘state of emergency’ to give itself power to repeal IM-22 and simultaneously bar voters from nullifying legislature’s action through another popular referendum. Represent South Dakota, a pro-reform group, charged that the repeal measure (HB 1069) was so poorly worded that it “may actually legalize bribery.” Spokesman Doug Kronaizl asserted: “By invoking a fake emergency and overturning the election result, the Rushmore State more closely resembles anti-democratic regimes in Ukraine and third-world countries.”
On February 1, the South Dakota Senate voted 27-8 to pass HB 1069, sending the legislature’s repeal of voter-backed campaign finance reform to Gov. Dennis Daugaard for signature. During debate, Republican Sen. Lance Russell asserted that the GOP majority’s action may be the most “repugnant display of raw partisan political power” he’s ever seen. Republican proponents of repeal claimed they were acting not out of opposition to campaign and ethics reforms, but out of concern that IM-22 might violate state and federal constitutions. But at a senate committee hearing, they were accused of running roughshod over voters. “You have usurped the right of the people to make a decision that’s fully within their power,” asserted Roxanne Weber, a software engineer from Pierre. “Allow the people to have their voice. Allow them to be part of the process.”
In November, 2015, Seattle voters adopt an ”Honest Elections” initiative that provides for taxpayer-funded “democracy vouchers” for average voters, voluntary spending limits by candidates, and a bar against candidates’ receiving donations from any person or company with at least $250,000 in city contracts or $5,000 in lobbying expenses.
Under the plan, which passes by a 63% majority, the Seattle Ethics and Elections Commission (SEEC) will mail four $25 vouchers in each election cycle to all voters, who can then donate the vouchers to their choice of local candidates for mayor, city council and city attorney. Voters approve a $30 million increase in property taxes over ten years to finance the program. Candidate participation is voluntary, but participating candidates must agree to contribution and spending limits and to participate in three debates.
In the spring of 2016, a broad left-to-right, cross-partisan political coalition joins forces to form Integrity Washington and push for a popular referendum on the Washington Government Accountability Act that would apply some of the concepts in the Seattle Honest Elections law statewide. Their proposal (I-1464 )would empower average voters with democracy vouchers, deter influence peddling in election campaigns by lobbyists and state contractors, and to expose dark money donations with tighter campaign disclosure rules. National organizations such as Every Voice, the League of Women Voters and Represent.Us are backing the drive along with conservative groups such as Take Back Our Republic and Seattle Tea Party Patriots, and Washington State organizations such as Fix Democracy First, the Progress Alliance of Washington and Wash PIRG.
The petition drive, which began March 21, 2016, met the deadline to qualify this initiative for the November 2016 ballot by turning in 328,125 signatures on July 8. Washington State law requires a minimum of 246,000 valid signatures for an initiative to qualify. On August 3, the petitions were validated by the Secretary of State’s office, qualifying I-1464 for the November ballot.
If the people approve, the new law would provide each voter with three $50 democracy credits to contribute to candidates of his/her choice, funded by closing a loophole in state sales taxes for certain out-of-state shoppers. Participating candidates would need to agree to significantly lower limits on accepting private donations and on using their personal funds. The new measure expands on current disclosure requirements by mandating that electioneering communications identify the root sources of the five main contributions, whether corporations, unions or individuals, thus blocking the current practice of naming anodyne intermediary funding conduits. The Act would bar lobbyists and public contractors from contributing more than $100 to candidates for any office they lobby or that has control over public contracts.