Pay Me Back

So City Attorney Mike Aguirre is getting into campaign mode. He’s holding a fundraiser April 18 “to help retire his 2004 campaign debt.” See his flier here.

There has been some confusion about this. You’ll remember Councilman Tony Young received a hefty fine from the Ethics Commission for not promptly retiring his debt from a campaign that ended only months after Aguirre’s. (Remember Young ran in a special election to replace his former boss, the late Councilman Charles Lewis.)

So why can Aguirre raise money two-and-a-half years after his election?

Let’s review. Aguirre is raising money to pay off loans that he made to his own campaign in 2004. He can collect money to pay off those loans for the next century if he wants to.

But the law was changed in 2005. Now, all the candidates for elections since then have only 180 days after the election to repay the loans they gave themselves.

In other words, until 2005 candidates could loan themselves as much money as they wanted as a type of gamble to get in office. If they won, people would help them pay back their bet. If they lost, well, the reality was you simply lost your money.

So, for example, that might be one reason why Phil Thalheimer, who ran for City Council in 2004 and lost, still has his campaign committee open. He loaned his campaign more than $1 million. As long as he keeps his committee open, he can hold out the hope that somebody will want to give him money to recoup some of that loan. And that hope would be buoyed by an election win in 2008 should Thalheimer run again.

But memo to those candidates who ran in 2006 and those who run in the next round: you loan your campaign money at a little higher risk. Not only might you lose, but you only have 180 days after the election to ask people to help you pay your loan back should you win.

Now Young would have been OK if he were raising money, like Aguirre, to pay off his own loans to his campaign. But Young owed his campaign staff bonuses. And even in the old rules, you only had a short time after an election to pay off debt like that. It was a deadline that Young missed by a long shot, hence a $10,000 fine.

So Aguirre can legally raise as much money as he loaned himself. He can hold these kinds of fundraisers until I’m a grandfather. But there was a reason the city changed and will not allow anyone else to do it. Here’s why the Ethics Commission and City Council decided to change the law in 2005:

With respect to restricting the time period after an election, the Commission believes that it is important to allow candidates a certain period of time to retire debt, but that it is equally important to prevent candidates from collecting contributions for an indefinite period while in office to repay personal loans to their respective committees. The Commission is concerned that the current practice of allowing the collection of contributions over multiple years to repay personal loans allows contributors to exert a potentially corrupting influence on officeholders. This is an undesirable practice because it allows contributors to give money that essentially goes directly to the officeholder.

— SCOTT LEWIS