With only a few days left in the legislative session, Gov. Andrew Cuomo has released a long-promised proposal to overhaul how political campaigns are paid for in New York State, to a legislature already considering its own proposals and disinclined to reduce funding from campaign donors.
Gov. Andrew Cuomo unveils his campaign finance reform bill, with just days to go in the statehouse session. AP Photo/Mike Groll
The governor’s proposed bill would establish a public funding system that would match private donations to candidates, cap contributions at a much lower level than they are currently and close loopholes that allow donors to contribute virtually without limits.
He made a similar call for reform last year, promising to send the legislature a campaign finance reform bill during the 2012 session. But no reforms were ever enacted.
Cuomo’s new proposal comes after several scandals have rocked Albany, including the arrest of State Sen. Malcolm Smith, who is accused of trying to buy his way on to ballot in the race for mayor of New York City. The campaign finance bill is one of three reforms that he has proposed to clean up Albany; the others include toughened penalties and prosecution for public corruption, and reforms to modernize elections.
The public matching funds system envisioned in the governor’s bill would be similar to the one already in place in New York City, providing a 6-to-1 match for donations up to $175. As in the city, participation in the system would be optional. Supporters, including the Obama campaign spinoff group Organizing for Action, assert that matching funds help reduce the influence of deep-pocketed donors in campaigns by making it possible for less wealthy candidates to be competitive.
Senate Republicans have staunchly opposed a system of matching funds. GOP Senate leader Dean Skelos has repeatedly said that he does not want to spend taxpayer dollars on campaigns, a position that he reiterated yesterday. Republicans jointly control the Senate with the four-member Independent Democratic Conference (IDC), whose leader, Jeffrey Klein, proposed his own campaign finance bill. Klein’s bill also includes a matching funds proposal, and caps contributions to all candidates at $2,600.
In the mix too is a matching-funds bill from Democratic Assembly Speaker Sheldon Silver. That measure would create a $2,000 contribution limit for candidates who participate in the program, but those not opting in could continue to abide by the current campaign finance limits, which good government groups have called “sky high.”
Cuomo’s proposal also asks legislators to limit the donations that they can receive from individuals, although not as severely as Klein’s bill. Under the current system, a candidate running for statewide office can receive up to $19,700 during a primary from an individual, and up to $40,100 during a general election from the same individual.
The governor’s proposal would allow candidates for statewide office not opting into the public financing system to receive just $10,000 from any one individual during a primary election and $15,000 during a general election. Those opting into the public financing system will be limited to receiving $6,000 donations both in the primary and the general elections. The plan calls for lower contribution limits for Assembly and Senate candidates as well.
The Cuomo bill attacks some well-worn loopholes in the state’s campaign finance system. For example, donations to party housekeeping accounts would be capped at $25,000. Housekeeping accounts are supposed to be used for party operating expenses, but there’s little oversight for how the money is spent. Under the current rules, donations to these accounts are unlimited. The lack of limits has opened up the party accounts to big-money influence, as happened last year when New York City Mayor Michael Bloomberg donated $1 million to the Republican state Senate housekeeping account.
The governor’s plan will also severely limit the number of donations that can be funneled through limited liability companies, or LLCs. Under the plan, LLCs would be treated as corporations, and would not be able to donate more than $1,000 to candidates.
Under existing campaign finance rules, LLCs are considered individuals, each subject to the same contribution limits as a person. An analysis by The New York World found that one donor alone, real estate mogul Leonard Litwin, used multiple LLCs to contribute more than $900,00 to candidates running for state Senate in the 2012 election.
Klein’s bill bans donations from corporations, but does not address LLCs. Silver’s bill does not change the rules for LLCs either.
Cuomo himself has benefitted from the LLC loophole. A report released last year by the New York Public Interest Research Group found that he received multiple donations from LLCs, including a quarter-million dollars from companies associated with Litwin.
Several good government groups have voiced support for Cuomo’s proposal. “Common Cause/NY is encouraged by Governor Cuomo’s strong vision for campaign finance reform in New York State, centered around a comprehensive package to address public corruption,” said Susan Lerner, Executive Director of Common Cause/NY, in a written statement that accompanied a press release from the governor’s office. “However, voters need the full force of the legislature working with the Governor to deliver the democracy they deserve.”
Not all good-government groups are on board just yet. Bill Mahoney, research coordinator from the New York Public Interest Research Group, says that his organization is still reviewing the legislation. “Generally it does seem better than the status quo,” said Mahoney of the bill.
