The Morning Report
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Tuesday, Oct. 7, 2008 | San Diego City Council’s decision to increase the individual contribution limit to candidates for city office is a significant change to local campaign finance law. But just as significant is the disagreement over what it means to the relationship of money and politics in San Diego.
The San Diego Ethics Commission, which proposed the increase, and other supporters say it will create more transparency in campaign finance, lesson the influence of special interests in elections and provide a more level playing field for a candidate challenging an incumbent.
The cost of admission for a run at a local office is well into six figures. So the more money a candidate can raise from individuals, the argument goes, the less reliant they are on money from interest groups, and the less influence these special interests will have on politics.
Opponents, most notably the San Diego-Imperial Counties Labor Council, say it will give monied interests even more influence than they already have. Wealthy individuals and businesses, they say, can give even more and will still continue to fund through special interest groups no matter how high the limits go.
City Council voted Monday to increase the limit on individual contributions to candidates per election from a maximum of $270 for City Council races and $320 for mayoral and city attorney races, to $500 for all races, half the amount that the Ethics Commission had proposed. The change, which will take effect in January, marks the first time since 1973 that the city has raised its contribution limit.
Also, council voted to require candidates to file an additional disclosure statement the Friday before the election. And when pollsters call potential voters they will have to disclose the candidate behind the call, an effort to bring transparency to the so-called “push polls” that feature questions meant to persuade voters rather than gauge them.
San Diego’s campaign finance law is considered among the toughest in the nation. Beyond its contribution limits, San Diego forbids political action committees and any direct contributions from organizations or businesses.
After years of resisting calls to increase the limits, the Ethics Commission chose to propose the change this year largely because of the exploitation of loopholes in the law that allow organizations and political parties to support or oppose candidates through independent expenditures and so-called “member communications” by political parties.
These avenues allow parties, groups and individuals to collect money far beyond the city’s individual contribution limits and pour them into candidate and initiative campaigns, as long as certain rules are followed. In recent years the parties and organizations such as the Labor Council and the Republican-friendly Lincoln Club have spent millions on local campaigns.
It is extremely difficult for a candidate who is not self-funded to pay the ever-growing expenses of a campaign through small individual donations. So candidates have come to rely heavily on expenditures from unions and business organizations.
“One of the unintended consequences of the low limits is a situation in which candidates feel obligated to align themselves with special interests or the parties to receive the benefit of independent expenditures or member communications,” said Stacey Fulhorst, the Ethics Commission’s executive director.
Raising the limits, Fulhorst said, will allow candidates to control their message to voters and untether themselves from special interests. And, she said, it will give challengers a chance to keep up with incumbents who can raise money from a large number of people because of their name recognition.
Tom Shepard, a political consultant who ran Mayor Jerry Sanders’ re-election campaign, said higher limits will both cut into the influence of outside groups, and make it easier for citizens to keep track of who is giving money to whom in an election year.
“I deal with these people,” Shepard said of the large-scale donors. “Their preference is not to give money to some third party — they give money to third parties because they have no other option.”
Opponents of the increase say organizations will still pour millions into the campaigns regardless of what the limit is, especially in competitive races.
“All this does is invite more money into the process,” said Evan McLaughlin, the Labor Council’s political director.
The increased limit is a definite blow to the unions. Unions can compete with business groups through independent expenditures, but their members will not give individually at the same level as members of the Lincoln Club and other business groups.
Tony Krvaric, chairman of the San Diego Republican Party, supports increasing the contribution limits, calling the current level “un-American.” But he did not say the party would reduce its member communication spending when the limits are increased.
“The party will be here regardless to support its candidates,” he said.
And, said Bob Stern, president of the Los Angeles-based Center for Governmental Studies, there will be the same amount of independent expenditures, regardless. “The effect will be none, zero,” he said.
Stern doesn’t agree that higher limits will benefit challengers. Incumbents can pile up money in non-election years before they even have a challenger, and the increases simply allow them to pile up more, he said, adding that it would be more fair to challengers to limit fundraising to just the election year.