Money in Politics in New York, Feb. 22 Edition

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Albany Can Learn a Lesson from Ed Koch’s Legacy
After former New York City Mayor Ed Koch sadly passed away this month, Frederick Schwarz, chief counsel at the Brennan Center, explained in a New York Daily News op-ed how we can honor Koch’s legacy. In 1986, when Ed Koch was Mayor, some of his top political allies had been caught using their office for personal gain in a scandal that rocked the city. Koch seized the opportunity to reform New York City’s campaign finance system. Along with the City Council, he instituted a small donor matching program with low contribution limits. In 1989, in the first election that followed, all three mayoral candidates—Koch and David Dinkins, both Democrats, and Rudy Giuliani, a Republican—praised the new system and participated in it. Today, the benefits of the system are even clearer: the number of small donors to political candidates has grown, and elections field more competitive races. Although New Yorkers are now more confident in City Hall, they lack the same faith in Albany. In state elections, contribution limits are too high and big money donors reign supreme. New York State would do well to take a lesson from Ed Koch’s legacy and enact public financing.

New Disclosure Bills Proposed in New York Legislature 
Secret money spent by outside organizations has become increasingly common in American elections, including New York State and federal contests. In response, Assembly Speaker Sheldon Silver has sponsored a bill that would increase the disclosure requirements imposed on outside spenders. And State Senator Rubén Díaz has proposed a bill that would mandate elected officials to post their campaign contributions on their websites, including the source and amount of each major donation. In the Huffington Post, Ian Vandewalker, counsel at the Brennan Center, argues that it is important for the public to know who is behind the political ads they are bombarded with every election cycle. Voters should be able to make an informed decision on Election Day.

George McDonald Challenges NYC Contribution Limits in Court 
A Republican candidate for mayor, George McDonald, has accepted 10 campaign contributions in excess of New York City’s $4,950 legal limit, including one for $40,000. His campaign has also obtained a $120,000 loan in violation of the City’s election laws. McDonald filed a lawsuit earlier this year to invalidate the City’s contribution limits, which he argues run afoul of state law. The case is ongoing, and McDonald and the New York City Campaign Finance Board are set to appear in court on March 12. McDonald would face a $57,050 fine from the New York City Campaign Finance Board if he doesn’t return the excess contributions. If his legal challenge prevails, McDonald will likely face no penalty.  The City is defending the contribution limits. Campaign Finance Board spokesman Matthew Sollars said it “reduces the influence of deep-pocketed special interests and keeps corporate money out of our elections.”

Corporations Donate $670,000 to New York State Candidates, Save $2.4 Billion in Taxes
A December report from the US Public Interest Research Group showed that America loses nearly $150 billion to corporate tax havens each year. Regional assessment of the data by the Fair Elections Coalition for New York campaign demonstrates that offshore tax havens cost New York State $2.4 billion in annual tax revenues. Seventeen multinational corporations, including Bank of America, Citigroup, PepsiCo and Pfizer, sheltered billions of dollars in these accounts. At the same time, these 17 corporations also contributed over $670,000 to New York State politicians, including individual legislators, the Republican Senate Campaign Committee and the Democratic Assembly Campaign Committee. As Karen Scharff of Citizen Action explains, “You can never tie a specific policy to a specific to campaign contribution. But you can tie the overwhelming preponderance of behavior.” At a time of dire fiscal shortages, and suggested cuts to education and healthcare, it is critical to reform the system which creates the perverse incentives for politicians to pass such inequitable tax policies. Citizen-funded elections are critically needed in New York State. The estimated cost of $25-$42 million is well worth it.