Proposition O - Campaign Finance Reform (Public Funding, Soft Money Restrictions)

Voter Guide
November 1, 2000
This measure appeared on the November 2000 San Francisco ballot.
 

What it does

This measure would amend the city’s existing Campaign Finance Reform Ordinance to establish new limits on campaign contributions, including to non-candidate and independent committees; provide for partial public matching funding for candidates for the Board of Supervisors; and impose additional reporting and disclosure requirements on candidates and political committees.

Why it is on the ballot

This proposed ordinance was placed directly on the November 2000 ballot by a 4-0 vote of the city’s Ethics Commission. The Commission developed the measure through public hearings, staff research, and expert testimony. Most of the provisions are based on campaign regulations in other US cities. The measure attempts to address the public’s growing cynicism about the role of money in the political process, in particular the ability of self-interested economic organizations (businesses and unions) to buy elections. It is in direct response to two court decisions which invalidated portions of the city’s existing campaign finance law—one which invalidated allowing contributions in higher amounts to those who agreed to limit their spending; another invalidating limits on independent expenditures. The Ethics Commission took on the task of trying to find ways to strengthen campaign finance reform on a local level that would meet the legal tests.

Pros

Those who support this measure state:

  • If you believe that there is a direct correlation between the amount of money raised for political campaigns and political influence, then this ordinance furthers democracy by limiting the amount of money that can be contributed to a local campaign and by providing for partial public funding of Board of Supervisors’ campaigns so that candidates aren’t completely beholden to their contributors.
  • This proposed ordinance addresses fundraising and expenditures by independent committees, which are mechanisms to skirt individual campaign contribution restrictions and to allow for private aggregations of funding either to support or oppose candidates.
  • The common sense understanding that “the money will find an outlet” refers to the fact that there is no absolute way to prevent those with money from spending it to elect people (or themselves). For this reason, most serious advocates of campaign finance reform believe that public financing of elections must be a component of a successful reform: it is a way to at least begin to give less-monied candidates the resources to get their message out when competing with wealthier candidates.
  • This is an ideal example of how a proposed ordinance should be placed on the ballot: a city commission uses a deputy city attorney to craft a proposal that it believes is in the public interest, based on that commission’s stated mission under the city charter. The proposed ordinance even has a provision for future amendment, so that another ballot measure isn’t required to make changes that improve on the intent of the original ordinance.
  • It requires that independent expenditure committees disclose contributors before the election.
  • How could anyone be against better disclosure?

Cons

Those who oppose this measure state:

  • The city has no business subsidizing candidates for the Board of Supervisors, given other pressing needs for public funds and especially given the change to district elections which was intended to make it easier and cheaper for candidates to run for the Board.
  • If you believe in the court doctrine that spending money to influence politics is a form of “freedom of expression,” then campaign contribution restrictions are contrary to the First Amendment of the Constitution.
  • More disclosure is fine, but this ordinance goes too far in other areas, is overly long and complex, and mixes too many kinds of provisions in its catch-all nature.

SPUR's analysis

There are three main elements to this proposed ordinance: contribution limits, public financing and reporting/disclosure requirements.

  • Contribution Limits: The law which was invalidated restricted per-candidate contributions to $500 in the general election and $250 in the run-off for candidates who adopted a voluntary expenditure ceilings for their respective offices. This proposed ordinance would make the voluntary limits mandatory—$500 in the general election and $250 and in the runoff. It would also set an overall limit on the aggregated amount an individual can give to all candidates: $500 multiplied by the number of city elective offices to be voted on at the general election and $250 multiplied by the number of offices in the runoff. Also, for the first time, limits would be applied to contributions to any committees making so-called “independent expenditures” to support or oppose a candidate. No person could contribute more than $300 in one calendar year to all such committees. In addition, Prop. O would require obtaining employer information before a committee could cash a check—an important enforcement mechanism. Finally, no candidate for the Board of Supervisors would be allowed to loan personal funds to his or her campaign committee in excess of $15,000 at any time. This is to stop the practice of candidates loaning themselves money to scare off challengers, then using their leverage as office holders to extract contributions to repay the loans.
  • Public Financing: Current law does not provide for public financing of local election campaigns. This proposed ordinance would allow a candidate for the Board of Supervisors to receive partial public matching funds if he or she: (1) is seeking election to the Board and is eligible to hold that office; (2) raises $7,500 from at least 75 individual San Francisco residents in the amounts of $10-100; (3) is opposed by a candidate who is participating in this public financing program or who has received contributions or made expenditures equal to or exceeding $7,500; (4) agrees to limit campaign spending to $75,000 in the general election and $20,000 in a run-off; and (5) agrees to participate in a debate. Public funds could be used only to pay for qualified campaign expenses, which does not include payment of administrative, civil or criminal fines or payment for inaugural activities or officeholder expenses. The maximum amount of public funds that a candidate could receive for general election expenses would be $43,750; for run-off expenses the maximum would be $17,000. The total annual cost of the public financing program, including program administration, could not exceed $2 per San Francisco resident (total maximum annual cost of $1,602,754 as of 1/1/00, according to State Department of Finance population figures).
  • Reporting/Disclosure: Any candidate not receiving public funds would be required to notify the Ethics Commission of contributions received, expenditures made or campaign trust account balances that equal or exceed $7,500. For contributions received, expenditures made or account balances that equal or exceed 75% of the applicable expenditure ceiling, the candidate must file a statement with the Ethics Commission. Thereafter, the candidate must notify the Ethics Commission within 24 hours of receiving contributions, making expenditures or having fund balances exceeding 100% of the applicable expenditure ceiling. Certain committees would be required to report independent expenditures made to support or oppose candidates for local office if those expenditures exceed the amount of the applicable expenditure ceiling. Certain committees making contributions or independent expenditures totaling $500 or more in a calendar month during the six months immediately preceding an election to support or oppose a candidate for city elective office at that election would be required to disclose, prior to the election, all contributions and loans received and all expenditures made. Additionally, the proposed ordinance would authorize a private right-of-action to enforce the ordinance. Amendment of the ordinance would be allowed by the Board of Supervisors by a two-thirds vote, if the amendments further the purpose of the act, are approved first by at least a four-fifths vote of the Ethics Commission, and are available for public review at least 30 days prior to action by the Board.

In order to take a position, SPUR must obtain the support of 60% of the Board of Directors. The Board was so divided on this measure that it was not possible to obtain 60% either “pro” or “con.” This stalemate is perhaps an indication of the troublesome nature of campaign finance reform and the lack of any widely accepted answers. Various individuals feel strongly pro and con on individual parts of the ordinance. While this measure appears to be well crafted, a more focused measure would help to narrow the debate. SPUR suggests separating public finance requirements from contribution limits and reporting/disclosure provisions in a future ballot measure.

SPUR takes "No position" on Proposition O.