How tightly can Cuomo close campaign finance loopholes?

How tightly can Cuomo close campaign finance loopholes?

In his State of the State address yesterday, Gov. Andrew Cuomo declared that that the time has come for sweeping campaign finance reform in New York State. “In short,” he said, “the state’s campaign finance laws fail to prevent the dominance of wealthy contributors and special interests.” He promised to lower existing limits on the size of campaign contributions and to create a new enforcement unit in the State Board of Elections with the independence and authority to investigate alleged violations.

New York State has one of the least transparent and most corruptible campaign finance systems in the whole nation, according to reformers and analysts like the Brennan Center’s Michael Waldman. New York ranks 48th in the nation in voter turnout and a smaller percentage of New York residents contribute to candidates to state office than anywhere else in the nation.

Perhaps the biggest campaign finance loophole is “independent expenditures.” New York does not have any limits on independent expenditures, and allows more money from interest groups and corporations into the political system than is permitted at the federal level, with practically no disclosure of such spending. The state’s new ethics law calls on the state Board of Elections to impose rules, but the board has missed its Jan. 1 deadline for releasing its regulation.

We want to know: How tightly will Gov. Cuomo really be able to close campaign finance loopholes?

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What we found

Good-government groups are generally optimistic about Gov. Cuomo’s proposed campaign finance reforms.

Said Mark Ladov, counsel for the Brennan Center’s Democracy Program: “We have a lot of confidence in Governor Cuomo’s ability to enact public financing and comprehensive campaign finance reform.” He notes that campaign finance is an issue that tops voters’ complaints across the political spectrum, opening an opportunity to address it. “Gov. Cuomo promised to bring a bill to the legislature this year. If he introduces a bill, whether property tax reform or gay marriage, he’s going to work to make it happen.”

The bigger obstacle is the Board of Elections, asserts Bill Mahoney, legislative operations and research coordinator of the New York Public Interest Research Group (NYPIRG). “If a public financing system were to be managed by an unreformed Board of Elections, the program would be a complete disaster,” he said. “The existing structure creates a system in which our already weak laws are never enforced, and legal deadlines routinely ignored.”

Dick Dadey, executive director of Citizens Union, agreed that many violations occur unnoticed, with inadequate review of campaign disclosures and reports by the board. He suggests that if the governor’s proposed new enforcement unit within the Board of Elections is “free from political influence,” properly funded and adequately staffed, this could change.

Looming over the optimism, however, is the U.S. Supreme Court’s 2010 decision in Citizens United v. FEC, which allows for unlimited spending on independent advertising supporting or opposing candidates. Citizens United, acknowledges Mahoney, “does limit what can be done to change every aspect of the campaign finance system.” While it is impossible to identify the volume of undisclosed independent expenditures in New York State elections, NYPIRG estimates that independent expenditures have been increasing in recent election cycles, and predicts they will continue their upward growth this year. New York could choose to require disclosure of independent expenditures but could not place restrictions on their size.

Attorney Laurence Laufer, who specializes in corporate political activity law and was formerly general counsel of the New York City Campaign Finance Board, notes that New York has not seen had a significant change in campaign finance laws since 1974 – not least because any changes must be approved by the state legislature. “The governor has given himself a tall order,” said Laufer. “By definition, legislators have benefitted and have been elected under the system we have, and it’s a difficult case to persuade them that changes are needed. That has proven to be the case for close to 40 years.”

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