Oh, I don't know about that. That's a matter of election law, what district you live in and what timing is of the residency. I don't know what the period of time is that you have to have lived there, I just don't know the answer to that question.
You must live in your district in order to be a representative from that direct, yes.
You might want to take back as a message to New York that maybe they ought to reconsider the question of having only district council members. I want you to notice that of the five Councilmembers currently in the room, each one is a Councilperson-at-large.
Except for 75 /00 LAW & GOV'T - BILL 2 Councilman Nutter, who came in to save the District Councilmembers, and he is one of the ten District Councilmembers. We're five of the seven Council-at-large. That's just an aside.
That's certainly a very interesting observation. I will bring it back to New York. I wanted to return to the disclosure for just a minute, another item in which I was a little bit confused about the local law that you are proposing. I don't know what the candidates are already required to disclose to the Board of Elections, but there are some elements that are important to include.
Well, for example, when a contribution is reported to the Board of Elections, must it include things like employer information or occupation? We consider those to be very important pieces of information.
Yes, except that we have basically no auditing aspect at all. People file their complaints and the only way a return 76 /00 LAW & GOV'T - BILL 2 gets examined at all is if a competitor files a demand for it, and there are very, very few demands ever filed.
Right. Well, I would couple my earlier suggestion that you look into the audit powers of this board with a concern about what kind of disclosure will be made. In New York, we have a board of elections that, I think, similarly does not do a lot of audit and does not have as stringent requirements. But for the voluntary part of our program, we require additional information from the candidates that the Board of Elections does not require, such as occupation and employer information, and we also audit every single candidate who joins our program.
That would be an 77 /00 LAW & GOV'T - BILL 2 addition and one I think we ought to consider.
We're not required to audit every single candidate by law but as a matter of practice that's what we do, but we do have explicit audit powers in our law for the Board. And we also have Internet disclosure. We provide candidates -- software to the candidate, and we have virtually instantaneous disclosure to the public of the candidates' filings.
How does that work? The candidate files to the Board, and then you instantaneously put it on the Internet?
We give them campaign finance software. They enter the data directly onto the software, and when it's a filing date, they hand us a disk and we stick it in a computer, it gets up loaded instantaneously, and it goes into the --
Well, you have provided, I noticed, for software, the Internet was not 78 /00 LAW & GOV'T - BILL 2 mentioned, but it's time for that too, yes. And we would be pleased to give you a copy of our software package, if that would be helpful to you.
Right, we'll be happy to do that. Our board is also mandated to publish the nonpartisan voter guide that I just handed up. It provides information about candidates, ballot proposals, and voting in elections, and it is sent to all registered voters in New York City. It also includes candidates regardless whether they choose to opt into our voluntary program. And I think what's important about it, especially for the small council races, is that it is a free -- for the candidate, it is free, it is targeted to the audience that pertains to the candidate, and it also allows the voters the opportunity to get information about candidates in a nonpartisan format.
If I may, because one of the preoccupations that have been expressed to me is that Philadelphia is still one of the 79 /00 LAW & GOV'T - BILL 2 last big cities with, I would say, a party machine.
Can I suggest that this be the last question. And if you could stay, it might be helpful because there may be questions that come up, but there are a great many witnesses that have to be heard yet.
So many concerns that they have expressed to me has been that Philadelphia is one of the last big cities with a party machine. I know that New York has, like, five different party machines -- the Bronx machine, the Manhattan Democratic machine, the Brooklyn Democratic machine, the Staten Island, and so on. And that this type of bill would inhibit or prevent or would hamper, hamper independent candidacies challenging the candidates that would be endorsed by the machine and this would be preventing individual candidacies from coming forward and being successful. Has that -- how's that experience happened in New York?
I don't -- I think that a good system of public financing adds more 80 /00 LAW & GOV'T - BILL 2 candidates. I don't see that it takes them away. I don't see what that argument would really be. I think other problems --
Well, I'll tell you what the argument is. In Philadelphia, for example, the Democratic party is one of the strongest organized Democratic parties. Most of us sitting at the table welcome that fact, but the other side of it is that that organization can put out on Election Day an army of committee people who work, say, on behalf of the endorsed candidates, and an independent candidate who is not endorsed has to find some means, if they want to run seriously, to combat that, and it means they have to raise far more money to produce their own army.
In New York City, we attribute to the candidate the party spending on that candidate's behalf. In other words, if the party puts out a card that has your name and says "Vote for John Doe," we would expect, unless the candidate can show us differently, and no one ever has, that that will be charged to John Doe's campaign as a contribution by the party to that 81 /00 LAW & GOV'T - BILL 2 campaign and as an expenditure by that campaign. So that controls the behavior -- so far has controlled that behavior.
I'd like to summarize. I know you have a lot of witnesses, but I do want to make a few points that I think are very important.
One is that in New York City, we have a provision that protects the Board against lengthy vacancies, and that provision is that after a certain period of time, if the appointing authority does not make an appointment, the Board can make a new appointment. I would urge that only because sometimes the elected officials, for whatever reason, may not want to fill a vacancy or they're not paying attention to it, and it's very important that this board always have a full complement of members. Another thing is that the budget should have some special protections. In New York City, 82 /00 LAW & GOV'T - BILL 2 we have -- and I think we've built in certain things and I don't know enough about how your system here works. But in New York, for example, our operating budget, as well as the public fund, we estimate that number, our mayor must include our estimate in the executive budget that he could -- it could be she, but it's always been he -- submits to the Council, and even though the Council and Mayor may negotiate something out later, our number is where they start, and that's a very important budget protection.
We may want to adopt it as a general procedure, not limit it only to campaign reform.
Another concern is that meaningful penalties have to be available for violations of the law. In New York City, penalties are up to $10,000 per violation. There are possibly criminal penalties, but for the most part, that $10,000 figure has been -- per violation has been sufficient to be a very strong check. And I questioned whether the current draft 83 /00 LAW & GOV'T - BILL 2 really addresses the notion of penalties to a degree that will safeguard the public fund. I'd also just on a few last points, I'll mention that I do believe expenditure limits must be high enough to allow people to opt into the system. People can use a low expenditure limit as an excuse not to opt into the system. And in addition, a low spending limit can have, whether intentionally or otherwise, the effect of prevent lesser known candidates from spending enough money in order to get their name out. A well-known person or an incumbent has many other avenues to communicate with the public, but a lesser known person or an insurgent needs to have sufficient money to make the case. On public the funds, I think you have to be very cautious about how much money is going out to candidates and at what stage. As an administrator, I am very concerned that we have the time to look at candidates' filings to assure ourselves that these people are in compliance with the law because once that money goes out, just try and collect it. It's not easy, and especially when you have formulas that are very generous, 84 /00 LAW & GOV'T - BILL 2 that's something you have to be prepared to deal with. On independent expenditures, I had a question about your draft. It read to me as though any independent expenditure, no matter how small, would suddenly trigger a 10-to-1 match, and I don't know if that was the intent, but I thought that might be.
Oh, all right. Well, the way I read it, it seemed that way to me. Another thing. On filings. In New York City, we have a filing schedule. It's intended to go at the same pace as the Board of Elections filing schedule. The Philadelphia proposal could mandate that the candidates file on as much as a monthly basis, and I would just mention that even the frequency of our filings, which is not as frequent as what you're calling for, has been said by some candidates to be burdensome. It can also be burdensome for an administrative agency. And then the last couple of points I 85 /00 LAW & GOV'T - BILL 2 would make. On the add-on provision, the sort of self-taxing arrangement, I'm not aware of any tax checkoff system, whether it is an add-on or even an allocation of what's already being. I've taxed never seen one in the country that has worked. And I would urge you to delete that. That's my personal opinion, I'm not necessarily representing my board, but I think that's an invitation to have a referendum every year and to lose it, that people are checking it off and, therefore, this is not worthy. There is no other government expenditure, generally speaking, that asks people to check it off. And I think one of the important psychological facts about having a campaign finance program is, it has to be treated as an important integral aspect of democracy. It's not something separate, it's not a luxury. We spend millions of dollars in New York City, 30 million a year on our board of elections, just to get the machinery out, the physical machinery out so that we have votes. Our program, to date, after a decade, has never cumulatively cost that much money to 86 /00 LAW & GOV'T - BILL 2 operate, or even in terms of the money that's been given to candidates. And I believe it should be thought of as money that makes democracy meaningful, not some luxury. So I, just as an ideological matter as well as practical one, I don't think that the tax deductions -- the tax checkoffs are very meaningful. And then my last point that I want to leave you with, we have in New York a new provision that applies the same rules as the campaign finance program has to transition in inaugural expenses. There has been some experience in New York State and in New York City where candidates were able to raise money after they were elected in order to pay for transition in inaugural expenses that were never scrutinized, nobody knew who the contributor were, etc., and in many ways, that money is even more influential than campaign contributions. So I want to say again, I applaud you for looking into this subject. I know it's a very difficult one but I think it's a very worthy one. And I do caution, however that the devil is very often in the details, and it's important to get 87 /00 LAW & GOV'T - BILL 2 the details right when you ultimately pass this law.
Well, we thank you very, very much. Obviously, you've had an enormous amount.
I saw in the New York Times not too ago some punitive measures that the Board took, and a friend of mine was involved in that, Guillermo Leonares (ph.) and some other -- the borough president, or whatever it is. And what were the fines levied at that time?
I believe the fine that you are describing was $60,000, and it was a very large amount of money. I should mention two things, however. I want to say first about Councilmember Leonares, he has been a very staunch supporter of campaign finance reform.
And he also is, I believe, the very first Dominican representative in our 88 /00 LAW & GOV'T - BILL 2 city council and maybe across a lot of other offices, and he gave very moving testimony before our board how he really could not have run except for this program. He's now in his second, in his term last term, and in the last election, our board found that his campaign had failed to report many, many expenditures and had gone way over the expenditure limit. Under our law, if you go over the expenditure limit, the maximum fine is three times the amount of money by which you went over the limit. And I think he had the second highest, in terms of percentage, the second highest overage that the Board had ever seen. But that was the subject. It was over-the-limit expenditures, and I believe it was a 2- or 3-to-1 calculation of the amount by which he went over the limit, that his campaign went over the limit, I should say.
No, he's a good friend, and I served on like three boards with him, and he was talking to me about it, but it is part of the process that we need, perhaps, to institute here.
And he still 89 /00 LAW & GOV'T - BILL 2 supports campaign finance reform.
We're going to go over all of those items very much in the preparation of a report that will be following this meeting.
Now a local panel consisting of Kathy Miller, President of the National Organization for Women, Philadelphia Chapter; Liberty City Gay and Lesbian Democratic Club, and I understand Denise Kulp, the Co-Chair, will be testifying. Also as part of the panel will be Mary Goldman, for the Americans for Democratic Action; and Ed Schwartz, President of the Institute for the Study of Civic Values, and a former Councilman. And I understand Mary Goldman 90 /00 LAW & GOV'T - BILL 2 is going to speak first for the panel. (Witness comes forward.)
Well, Angus Love, of the National Lawyers Guild, why don't you come forward also and join the panel. Mary Goldman, why don't you exercise the rights of seniority and start.
I understand that, David. I'm with you, baby. Thank you all, Councilmembers, for having these hearings, and especially for taking up this important issue. Over time, as campaign spending has escalated out of control, there seems to have been a deterioration in people voting and being involved, and I know this particularly because I live near students, and it is terribly depressing to see how they're not voting these days at the University of Pennsylvania. As many of you know, ADA has been 91 /00 LAW & GOV'T - BILL 2 involved in virtually every municipal election since our founding, in 1949. So we agree that campaign reform, finance reform is vital, necessary, and overdue in Philadelphia, and we support the adoption of limits on individual and PAC contributions. However, we think that this bill does not adequately address the many nuances and intricacies of campaign finance reform and shouldn't be passed at this time. And I think we've heard recently from New York a lot of the reasons why not, and our overlap some of that. Instead, we'd like to spend several months working with Council to develop legislation that comprehensively addresses the needs of the City of Philadelphia with all peculiarities. So we're going to urge all of you to hold this bill and work with us in order to pass a really comprehensive bill after the summer recess. Some of the concerns we have: The voluntary expenditure limits are so low that they would discourage people from challenging incumbents, which is the opposite of what the bill is designed to do, and I think you 92 /00 LAW & GOV'T - BILL 2 may have raised them between the bill I saw today, and I haven't seen that. If the purpose of this effort is to create more level playing field, then the overall limits must be increased; otherwise, citizens will view this bill as an effort to protect incumbents. The bill does not give voluntary expenditure limits for the Row Offices, just for Mayor and City Council, and that should be spelled out as well. The bill does not address what happens to any campaign funds that candidates have in the bank prior to the day of the enactment of this law. The topic of independent campaign expenditures is extremely complex, and we're not sure that this bill addresses all of these issues. The bill calls for a 10-to-1 public financing for a candidate whose opponent has an independent campaign contribution, and do we really want to discourage all independent organizations such as ours from getting involved in campaigns? Is this provision legal? Is it desirable? And how do other cities address it? And what are the 93 /00 LAW & GOV'T - BILL 2 ramifications that this brings up? The makeup of the campaign finance board seems peculiar and subject to political influence. How can we ensure that it does not give advisory opinions that are pro-incumbent or otherwise subject to political influence. I don't know in Philadelphia if we can do this. We should have a try at it. How do we make sure that this system does not simply encourage campaigns to go underground as the federal finance reform system has done with soft money. For example, can we figure out a way to make sure that ward leaders are covered? No other city in America has a stronger ward system as Philadelphia. And as a former ward leader, I know that the ward system is susceptible to abuse and a serious lack of oversight. In addition, how do we ensure that candidates do not shift their campaign expenditures to state campaign accounts, which are not regulated? The additional limits on people who do business with the City are probably unnecessary if 94 /00 LAW & GOV'T - BILL 2 we have a $1,000 limit on individual contributions. Also, this provision would be a nightmare to administer, and the cost would outweigh whatever small benefit it would add to the bill. The limits on off-year fund-raising may not be practical and should probably be either increased or done away with.
How can we improve upon the enforcement mechanisms of the bill? As many of you know, the current reporting requirements are not currently regulated by the District Attorney or any other City officials. What's make us think that this system will work any better? And it sounds like it does in New York, so we, it seems to me, need to study that much more carefully. Finally, what will all of this cost us as taxpayers? As you know, the City has many serious needs right now, and we must have a good estimate of the cost. And what it cost in other cities? Although I personally think that we have to do it -- we need to have campaign finance reform, whatever it costs, again, based on some of the past testimony. I think they're absolutely 95 /00 LAW & GOV'T - BILL 2 right. We understand that these are complicated issues that can't be resolved in a few hours or even a few days, but it would be a serious mistake to try to rush this bill to passage. This bill may be our only attempt to achieve true finance reform in this generation of Philadelphia politics. With that in mind, we urge members of Council to hold this bill at this time, and we stand ready to work with you to develop the legislation that we all can support. We should not rush to reform, as Congress did in the post-Watergate era. We in Philadelphia need to engage in a thoughtful process so that we can make a more perfect campaign finance reform bill. Thank you.
Thank you. I'm going to suggest to all members of Council, those at the table, those in other seats, that we hold questions until the panel all has an opportunity -- each member of the panel has an opportunity to make their statement, then questions can be 96 /00 LAW & GOV'T - BILL 2 directed at any member of the panel. The next one is going to be Councilman Schwartz.
Thanks, Councilman Cohen, and I appreciate the opportunity to share some thoughts on this today. I guess it's a question of half-empty, half-full in this instance. I certainly came at this with the notion, this bill, that this is in effect the next step in a conversation about what a final bill will look like. These are complicated matters, and I agree completely with the ADA and Mary Goldman that we need to try to do it right, or it will be done wrong; but on the other hand, there's a tendency, when you do move toward a new system, to see all the potential faults of it. And I guess the first thing I want to do mostly here is to weigh in on behalf of at least the bill and what it's attempting to do, and as the framework for this conversation, to urge that we really make a strong effort to move forward in producing a system that will work. And I do they think that we benefit from the fact that 97 /00 LAW & GOV'T - BILL 2 two major cities, and perhaps some others, but New York and Los Angeles, which are hardly small towns, have adopted systems of this kind that seem to be working fairly well. And they have offered us valuable advice. And, therefore, we can benefit from their experience. I would like to address at least some reactions in general and issues that I think we have to raise and bring to the attention of the committee some of the work that we have been doing on the role that the media and spending on the media plays this in this process, which, I think, really has to be taken into account as what we're trying to do deal with as we deal with the question of money.
Well, let me just say I don't think you ought to take -- any people here ought to take the point of view that because this matter's before Council that it's a sure shot for passage; it isn't. Councilmembers are basically becoming familiar with the issue for the first time. There are lots of questions by the whole Council body. One of the considerations is 98 /00 LAW & GOV'T - BILL 2 that the thought behind pushing it onto a vote to get on the ballot in November was that in the presidential election, more voters seem to be attuned, more are interested, that Senator McCain campaign, whether you regard him as an independent, a right-wing conservative or a right-wing radical, whichever way, but he has heightened the interest of everybody. And there was concern expressed that this may be the best time. So I just suggest that you think about that. That's one of the factors that maybe we won't get a perfectly bill, but at least if we can get some bill that makes sense, this may be the best time for passage. You all raise good points about, you know, how the bill can obviously be worked on and approved, but will it be worthwhile doing it and maybe using four years of possible momentum. So I'm just suggesting that don't assume that this bill is ready for passage. There would have to be a lot of work done in City Council. We think this hearing will be very helpful in the process, but I'm just suggesting 99 /00 LAW & GOV'T - BILL 2 you might want to think of those concerns. That's what we're going to be thinking of in evaluating whether we move forward or take more time to prepare a better bill. And we'll be interested in your reactions, you know, in the next few weeks, when that decision has to be made. To get it on the November ballot, Council has to complete its action by no later than June 22nd, which is when we are scheduled to recess. If don't complete it by then, it means there's no chance of making the November ballot. So just keep that in mind and, you know, you have your own evaluations, and we'll appreciate them. Councilman Kenney?
Thank you, Councilman. I may have been wrong on counting the dates, but I had a discussion with Councilman Ortiz, and he had mentioned something about the final passage of the bill by the 13th of September would get us still on the ballot for November.
September 13th. 100 /00 LAW & GOV'T - BILL 2 I'm not sure whether or not that's accurate. Yeah, September 13th would be our drop-dead date for the November election.
-- in a position to be voted by the first day we come back.
Right. But we'd have to vote it finally by that date in order to make the November election, I think. Well, I'll tell you what, why don't we have the tech staff figure that out but I think that's the situation.
Go ahead. I just wanted to get that on your radar screen. 101 /00 LAW & GOV'T - BILL 2
No, no, I understand. I just want to make it clear that my coming here -- I'm coming here with the attitude that I think you have a Herculean task, really in getting this bill 6 together for passage -- no offense to the bill. We have had all the public support in the world at the federal level for finance reform, and it doesn't pass because the devil does lie in the details, and when people start getting down to individual provisions, they can't agree on them. And from my understanding, even the major citizen groups in the field out here who are fighting for this don't agree. So, yes, everybody's for it until you start getting down to the specifics, and it doesn't pass along. And you throw that into the equation along with the obvious question that taxpayers will ask about an additional expenditure of public money for something at a time when the City's finances are now being propelled again at risk. I think we have our work cut out for us, but I do -- that's why, in a way, I come here saying I support this. With all the things that we have to do, the first thing we have to say is, We support this, 102 /00 LAW & GOV'T - BILL 2 this an public objective that we need to achieve. And now is the time to achieve it. We did finish the last year of a mayor's race which recast entirely the framework of local politics in this city. When I ran for City Council years ago, I was proud, and still am, to say that I spent no more than about $60,000 to win a Council-at-large seat, and at that time, I guess it was close to the fourth largest city in the United States. 2 million just to win a state legislative seat because they don't have a grassroots system of organizing, and they do have to rely entirely on the media, which is what raises the cost to the astronomical levels. Well, last year, we virtually threw out the remnants of the grassroots system until Election Day and fought the whole thing out on television, and that's what jacked the price up. And I have some evidence here that might be useful to you in your deliberations. But we do have work cut out for us. I think that, in fact, just to take 103 /00 LAW & GOV'T - BILL 2 turns of two of the basic framework here, leaving aside the question of how much public money ought to go into this and how. I think the limits on contributions from individuals and businesses with contracts with the City are especially justified. That really galls people to see that in the paper. And the limits, I would say, on off-year elections, if it's impractical to do it -- maybe we can't, but it seems to me this endless round of fund-raising that goes on is something that is really offensive to the candidate themselves, as well as the public. And, frankly, these things could go into effect even if there were no limits on spending because what they would require, then, of people is that they broaden base of people from whom they have to raise money. And that in itself democratizes the process. Now, of course, the problem we have is that given court decisions, that doesn't rule out the millionaire spending, as you point out with Corzine trying to be senator, his own money or her own money to win a seat. I believe the courts have ruled that it's unconstitutional to prevent 104 /00 LAW & GOV'T - BILL 2 that. So this is where the expenditure limits become almost essential. And the caveat I would emphasize here is a comment that was made earlier, and that is that you really do have to look carefully at what it costs an insurgent to win a race against an incumbent as a as basis for your spending limitations. I recall that there was one year -- and I don't one which one it was -- in the federal where the limits that Congress proposed, or some people proposed, to set were in fact lower than it cost any insurgent to beat any incumbent in the previous election anywhere in any district in the United States. That's not campaign finance reform; that's an incumbent racket, and it didn't go through.
So you have to look at that. I say that, as we, Councilmen, all three of us have been insurgents at one point or another, we know what we needed to do. And if the die was cast in a way that you couldn't spend the amount to meet your basic needs, but an incumbent could get himself or herself in the press every day, that's not going 105 /00 LAW & GOV'T - BILL 2 to work. So that's got to be examined, what did it cost for insurgents to win. Finally, I would say that if the spending is to be reduced significantly, we do have to, in fact, address an aggressive effort to broaden the coverage of these races by the conventional media, and here I'm not waiting for a bill. In part, as a result of what was happening last year, the Institute connected with Paul Taylor, who, you may recall, was the political reporter here in Philadelphia for a number of years for the Inquirer, went on to become the political reporter for the Washington Post and then quit his job, out of his own outrage at what was developing in American democracy. And Paul created an organization called "The Alliance for Better Campaigns," and they have been leading the fight to expand not free air time, but news coverage -- issue-oriented, like debates, news coverage of campaigns a month before the primary and the general election, and they have piggybacked in this year on a proposal that came out on a presidential commission on this subject, 106 /00 LAW & GOV'T - BILL 2 which has called for every station to devote at least five minutes over the course of the period of time from to 11:30 at night the month before 5 primary and general election campaigns for issue-oriented coverage of the candidates. And we're not talking about a particular candidate; we're talking about all the candidates. So it's a very reasonable kind of request. But I can tell you, having pursued this spring, and we will now go more aggressively in the fall, with our local stations. There's been a lot of resistance to this. But here are the stakes. I have given to you two spreadsheets, which we, in fact, developed for the Alliance for Better Campaigns because the biggest campaign last year in the country was our mayor's race. And so they were using our mayor's race as an object lesson, in a sense, for what goes on. They had us go to all the stations and get the public file on campaign contributions. ), who does this work at Penn, did a careful analysis of the news coverage. 5. That's $5 million of the amount that they raised that was put into the four stations in this area during that two-month period of time. That's where the money goes. And, meanwhile, there was nothing like that kind of coverage on the news stations night after night of their efforts or others, as much coverage as there appeared to be. We are witnessing now this barrage of ads back and forth between Corzine and now Florio. Do we have comparable news coverage for the South Jersey of that senate campaign, issue-oriented coverage? I don't think so. So if we're going to be able to significantly reduce the amount that candidates have to spend, particularly at the mayor's level, we're going to have to simultaneously address that, and I would suggest to you that that we are doing that this year now, and I will be calling upon your assistance in dealing with some of our local media this fall. This spring, the primary turned out to be, let's say, less interesting that it might have been, although the senate race was 108 /00 LAW & GOV'T - BILL 2 there for people to cover if they wanted to. There will no excuses like this in the fall and there will be no excuses like this in the future for a mayor's race. Obviously, for some of the other races like Council-at-large or District Council, some of our races -- I've come back now as a candidate -- you can't get media, there are too many candidates and they can't choose, so we have to go out and dig. And I'll end with this: it is a good point of comparison in a way.
Because we could not, in fact, get media, then we had to rely on the system of grassroots politics to carry us forward. This forced all of us to go night after night to ward meetings, to community meetings, to use our contacts with various kinds of organizations to get other contacts, to pyramid our support from the bottom up to the point where, on Election Day, we might end up on a ballot that actually did benefit from some spending. And the result is that even now, even last year, I heard numbers of 100,000, $120,000 that people had to spend to run at large. In other cities, those kinds of candidates, our kinds 109 /00 LAW & GOV'T - BILL 2 of candidates, could not do that, because they, too, would have had to figure out a way to buy enough media time to get attention. So we have a very good point of contrast in this system, between a system that depends upon the media and a system that depends upon people. And the closer we can get through both media reform and finance reform to moving politicians back to the people, the better democracy we will have. Thank you. )
Thank you very much. Angus Love, of the National Lawyers Guild.
Thank you, Councilman Cohen. And I thank Chairman Ortiz and the Law and Government Committee for the opportunity to testify today. Angus Love, on behalf of the Philadelphia Chapter of the National Lawyers Guild. The Guild was founded in 1937 as the first racially-integrated national bar association. Through the years, Guild members have been active 110 /00 LAW & GOV'T - BILL 2 in the development and implementation of the New Deal, fought against the McCarthy-era scare tactics, provided organizational and legal skills to the civil rights movement, assisted draft resistance during the Vietnam War, and most recently, fighting for economic rights and corporate responsibility. We have over 5,000 members and 200 chapters. The preamble to the National Lawyers Guild Convention states we hold human rights more sacred than property rights. Thus, we are here today to speak on behalf of campaign finance reform. In the political arena, it is obvious that property interests in the form of campaign contributions are overwhelming human rights. Campaign spending is clearly out of control. Each new election cycle breaks records from the previous cycle. The recent mayoralty election that's been well documented here is just another example. Spending in Councilmatic races has reached the half a million dollars. On the national level, as Councilman Cohen pointed out, George Bush has rejected public financing. As he 111 /00 LAW & GOV'T - BILL 2 also pointed out, Jon Corzine is breaking all spending levels in his senatorial campaign against Jim Florio. As the need for money increases, the amount of time spent tending to the people's business decreases. Governor Ridge started fund-raising for his reelection campaign a few short weeks after winning his first term. As many of the large contributors expect access, the voice of the people, or the vox populi, is greatly diminished. Community organizations and lobbyists with which the Guild often works with are armed only with ideas quickly forgotten when political action committees and lobbyists show up with envelopes stuffed with campaign contributions. If we are to strengthen the democratic traditions, campaign reform must take place. Many of the causes that I and fellow Guild members are committed to hinge upon campaign finance reform. Only when a candidate has the sufficient time to tend to the people's people's business and has not mortgaged their positions on important issues of the day can a real debate take 112 /00 LAW & GOV'T - BILL 2 place on the important social issues of our time. True campaign financing reform can keep the democratic principles that we hold so dear from eroding into a kleptocracy. While we stand steadfastly behind the idea of campaign finance reform, we do not naively assume that every and any scheme put forth will bring about the desired result. We know the long march begins with one step. We are here today to urge the City Council to take the first step by scrutinizing Bills 356, 357, and 380 in the included Charter change and come up with a comprehensive campaign finance reform proposal. Philadelphia has been in the forefront of many great social movements. This Council adoption of the death penalty moratorium was another historic step in our city in the tradition of our forefathers. Emerging issues such as campaign finance reform often begin at the local, or grassroots levels. We ask you once again to take the lead in our Commonwealth in the area of campaign finance reform. We ask you to follow the lead of other municipalities, as we've heard today, such as New York and Los Angeles. We are 113 /00 LAW & GOV'T - BILL 2 well aware that many of the proposals are flawed and often lead to countermeasures by those comfortable with the status quo. Thus, we do not want to rush into this area. Indeed, certain aspects of the current proposals may inhibit participation of certain grassroots candidates.
We also welcome the amendments that have been offered and think they take a step in the right direction in curing the problems. In 1976, the Supreme Court decided the Buckley case. , matching funds. And I know we have someone from the Brennan Center here today to speak to their recent study regarding the Buckley decision and how it's really failed to address the issue and allow the proliferation of soft money to thwart any kind of meaningful reform. S. District Court 114 /00 LAW & GOV'T - BILL 2 for the Eastern District to advance to a vote in the Senate, I believe, was cut by allowing an individual who opposes campaign financing reform to be elected to the Federal Elections Commission. This will only make matters worse. We are aware that for every move, there is a countermove. Despite this knowledge, we must move forward if we are truly interested in a participatory democracy. Those who term these bills "anti-incumbency" should come up with reasonable alternatives. This issue is too important to be left twisting in the political winds. We urge everyone to take a long hard, look at the proposed legislation and come up with a workable solution to this festering wound in our democratic process. We commend you for taking this important first step.
Good afternoon. My testimony deals, I think, more specifically with, I believe, the effects that complain finance 115 /00 LAW & GOV'T - BILL 2 reform will have on grassroots organizations. I've been the co-chair of Liberty City Lesbian and Gay Democratic Club since 1996. We have over 400 members locally, a mailing list of over 5,000. And in 1999, we were part of an effort to register and identify lesbian and gay voters in the City. We were successful in identifying over 18,000 lesbians and gay voters in Philadelphia, over 15,000 of whom are Democrats. Since 1998, I've been the co-chair of the National Stonewall Democrat Federation, a national organization of gay, lesbian, bisexual, and transgender Democrats and Democratic clubs across the country. National Stonewall has over 50 affiliate organizations throughout the U.S. and over 20,000 members. Just over a year ago, the City of Philadelphia came through a Democratic primary in which we had five viable candidates for mayor, and it's no secret that the candidate that was supported by all of the major lesbian and gay political organizations in the City did not win. It was the most expensive Democratic primary in the City's history and one of the most expensive 116 /00 LAW & GOV'T - BILL 2 in the country. And it was the amount of money contributed during the primary that determined who the winner would be. Seeing that two candidates had far and away the most money raised, the media decided that the race was between these two financial front-runners. A lot of people, deciding that the person wanted to vote for had no chance to win, ended up voting for one of the two with the most money. A lot of people, having been told that the person they wanted to vote for had no chance the winning, decided that they wouldn't vote. And this is how campaign finance reform positive effect in Philadelphia. As was made clear by last spring's Democratic primary, the people who have the effect on the outcome of the race here in the City are the people with money. The lack of a cap on campaign fund-raising takes away the decision of who will win from the people and awards it to those who have the money to make substantial contributions to a politician's campaign. It takes power away from the people and grassroots organizations like the ones I represent and puts it in the hands of people who often don't 117 /00 LAW & GOV'T - BILL 2 even live in the City but have financial interests here. And I really encourage members of Council to look at the article about the economic development in Philadelphia that was in the New Yorker this week, by Nicholas Lemon, that talks about that. Grassroots organizations may not have much money, but we are rich in votes, and we have worked hard to get our constituencies out to vote on Election Day, but it's hard to counteract the belief that an individual's vote will have little effect in the face of millions of dollars and the coffers of the predetermined winners. Everyone bemoans the fact of low voter turnout, but we must have the courage to take the steps needed that would erase some of the causes of low turnout. And one of the causes is the idea that the outcome of an election has already been determined by money. Campaign finance reform will help to democratize the democratic process and allow the people who are registered to vote once again to determine the results of Philadelphia elections. Liberty City Lesbians and Gay Democrat 118 /00 LAW & GOV'T - BILL 2 Chub wholeheartedly endorses campaign finance reform in Philadelphia, and we're very willing to work with Council and the committee on whatever bills -- on how the bills are final written in the City thank you. Thank you.
Thank you. I'm Kathy Miller, the President of Philadelphia NOW, and I appreciate very much that City Council is holding these hearings, and I appreciate Law and Government Committee and Councilman Cohen for doing this. I'm delighted that the issue of campaign finance reform is being given some serious consideration. I'm probably the least technical witness on this. And my major concern here is the effect that campaign finance reform has on the potential of women taking a more active voice in governing ourselves. It took women 72 years to get the right to vote, we've had it for 80 years, and we still have a very small percentage of women in the governing bodies.
But not in this 119 /00 LAW & GOV'T - BILL 2 Council. We have a lot of good women in this Council.
We have a lot of good women, well but out of is not even half. 6
We're not half there. 9 We're not doing bad but we're not half there. 10
But a few years ago, 11 there were none -- well, a couple. 12
And things are moving and 13 I think things have been moving, and I would be 14 interested in term of, like, Los Angeles and New 15 York whether they can tell whether the impact has 16 been on having more women, in fact, run for office 17 or not, but that we're still one of the major difficulties for women --
I know one in New York who ran an insurgent campaign against a very well-financed individual. Margarita Lopez, Margarita ran an insurgent -- am I right? -- an insurgent campaign, a really grassroots campaign. And the only way that Margarita Lopez was successful was because New York City had public 120 /00 LAW & GOV'T - BILL 2 financing, and she ran against an individual or two individuals. She ran against -- I know one individual that really out-raced her tremendously, and she was able to -- this is to me the proof of independent candidacies being able to overcome the party machinery, because Margarita was not only Puerto Rican, she was a lesbian Puerto Rican, and she was running on a ticket that really was a progressive agenda that she was pushing, and she has become one of the more vocal City Councilmembers, one of the thorns on Giuliani's side.
Yeah. This is exactly what we're hoping will happen with the finance reform, that if we change the way local elections are financed, then more women will be able to actively take part. One of the biggest barriers for women has been how elections are financed, and women historically have had the lack of access of control of money. I know some people have raised concerns that finance reform will hamper women, or that just as women are starting to learn to play by the rules, they're changing the rules. Most groups of 121 /00 LAW & GOV'T - BILL 2 women who I know who are politically active feel like campaign finance reform is essential to women getting in there, that we're quite aware of the fact that campaign finance reform will change -- can actually help level the playing field. I don't think it will make it even; I think women will still have an uphill battle, but it lessens the difference and makes it a more even playing field. And I was here when we honored Granny D for her long and valiant walk across the United States to call attention to the campaign finance reform issue. I sincerely hope that we will not just honor her.
I hope that we will honor her by passing a meaningful campaign finance reform bill.
Darlene Cradle, because she's a part a community panel, and I know that she has a short statement. Stay, please. (Witness comes forward.) 122 /00 LAW & GOV'T - BILL 2
Just bring in a chair in there. Identify yourself for the record and proceed with your testimony.
Okay. Good afternoon. My name is Darlene Cradle. I am a board member with Philadelphia ACORN. ACORN has 5,000 members strong. It's a very strong organization for low- and moderate- income people. Too often, low- and moderate-income neighborhoods are denied access to democracy because one of the simple facts: money. We can't make large contributions, and often people running for elected office listen to their contributors. We need to take big money out of politics and pass strong campaign finance reform legislation here in Philadelphia. It should be about one person/one vote instead of one dollar/ one vote. On behalf ACORN, we support Councilperson Kenney and Ortiz and request for campaign finance reform. Take money out of politics and put democracy back in. Thank you. 123 /00 LAW & GOV'T - BILL 2
Thank you. Mary said something when she testified, and we're not rushing. I mean, today Nicole Gordon's and Rebecca Avila's testimony were -- and the facts and the issues that they brought in are some things that we want to bring integrating into the bill, putting it into the bill, but we have to begin at one point, and I want to be able, from all of testimony that we have and we are getting, to be able to come out with the most comprehensive bill possible. And if individuals such as Marguerita Lopez can succeed in the machine-hard, nitty-gritty politics of New York City -- I know some of the Bronx boys. Freddie Ferrell (ph.) is a friend of mine, Jose Rivera is a friend. Roberto Ramirez, I spoke -- I spoke to him because we're involved with the Vieques issue and are doing a lot of stuff. And they play hard politics. They play, I would say, even harder politics than we do here, if that can be possible. And -- but you still see people. I mean, you have an iconoclast like Jose Rivera, who is a Puerto Rican in the South Bronx, who takes 124 /00 LAW & GOV'T - BILL 2 the most outlandish progressive, really progressive positions. You have people like Margarita Lopez succeeding against big-money interests and big-machine interests. So -- and the only way -- and Guillermo Leonares, Guillermo Leonares succeeded again against machine interests, against the Manhattan Democratic machine in there, and he was able to succeed and run for a Democratic district that because of his politics -- not only that he was Dominican and the first Dominican running for a council seat in New York City, but he was under-financed, and his politics -- his politics are very similar to mine, in terms of progressive outlook, in terms of the issues that he takes on and advocates for. And he was easy able to overcome those odds and win, and win. So I think that one of the issues that that proves to me is that if you have it done well, if it is established well and the limits are set in such a way that they're realistic and people are able to organize and get out their message, independent politics, I think, will not only survive, but I think will thrive under this 125 /00 LAW & GOV'T - BILL 2 system. Yes, Ed?
I think it's a procedure in terms of looking at this. The starting point -- what seems to fly most is the spending limits on individual contributions. I mean, we all kind of accept that in other races. And so there's a lot of precedent there, you can't give more. That doesn't solve the problem if the individuals have a lot of money themselves, but it certainly does a lot to broaden the base of, as I said, people who contribute. I think the second issue you need to look at rather quickly really revolves around the fiscal implications of this. I don't think you should treat this lightly. I've just finished reading the PICA report on the City's financing. They're raising all these risks, you have a projected budget that doesn't include pay increases for employees and the rest of it. What does this realistically look like it's going to cost in order to achieve any meaningful result?
I agree, Ed. You 126 /00 LAW & GOV'T - BILL 2 know, when this thing was approved in New York, New York was going through some sort of fiscal situations itself at that point. And, again, I go back to one thing that impressed me at the end there when Miss Gordon says that the fund has to be considered important, and I wrote it here on this paper, as an integral aspect of democracy.
And the thing is that we spend a lot of money very foolishly in this city, millions of dollars. I think we are not the size of New York, we're not "8 million stories in the Naked City." You know, we are 1.2 million; by the time the census comes out, maybe 1.1 million, who knows? And so we want to make it very rational. And I do not believe -- Rebecca Avila said that in the last election, the expenditures from the fund were in the hundreds of thousands of dollars. Is that right, Rebecca? You know, in a city of 3 million people. And so what we have to go by is the experience of other cities and what they have gone 127 /00 LAW & GOV'T - BILL 2 through. It's like when they were talking to us about domestic partnership here. One of the issues that they kept saying to me in arguing against the domestic partnership bills was the same phrase you used -- you got to consider the fiscal implications of this on the budget. It is going to put a huge hole in the City budget. Well, we have approved it, people. It's functioning, and it has not. Either at one point in time, we're going to have to have the courage to invest -- as Nicole Gordon said, invest in democracy. And as Mr. Pedro said when he came in and said to invest in it and, you know, let the citizens of Philadelphia be the judge of whether they want to do this or not. And I believe that, just like in New York, the people of New York voted it in and the people of L.A. voted it in, and I think the people of Philadelphia will fool us. I think they will approve it.
I'm merely saying -- I'm not disagreeing with you and, in fact, again, we do have the experience of these other cities, which may be very assuring, and I certainly think 128 /00 LAW & GOV'T - BILL 2 that, you know, I'm inclined to support it. I mean, we seem on a stadium or whatever you think of the project, $200 million, oh, yeah, that's nice. So when you really want to do something --
Yeah. Well, I'm just saying that we're spending $200 million more, etc.. Whatever the number is, it's a lot, right? And people accept it. Again, I'm merely saying, as a procedure for dealing with this, coming up with -- you may end up with a number that's so reasonable based on what we're trying to accomplish here that it will reassure people, and then that becomes the basis in part on working backwards toward the spending limits that are appropriate, keeping in mind these concerns about insurgency that I raised.
First of all, let me say, I think you drove away from me when we were talking, and I didn't hang up on you.
No, I just ran out 129 /00 LAW & GOV'T - BILL 2 -- the cell phone.
You went someplace, but I figured, oh, okay, I just want to make sure I didn't --
Okay. You know, I think Ed is right, and that's why we brought up the amount, because of all of this. And so we have to make sure that there is proper oversight, that the audits are in place because we all need to be pulling on the same (unintelligible). We absolutely want campaign finance reform, we are totally 100 percent with you on that. We just want to have it so that it's the easiest sell because of, I think, some of the reasons we said. You know, it's going to be a hard thing, and if people are saying, but you're not going to keep track of where it's going and who's doing what to whom, in this town, it's, you know, it won't work.
No, the audit idea, those ideas we want to integrate that into the bill. The people have to have confidence, as 130 /00 LAW & GOV'T - BILL 2 Nicole Gordon said. The people have to have confidence that the money that is being taken out of the fund is going to be spent responsibly, that it is going to be spent in what we're talking about, that it's going to be spent in good government, in helping government become more responsible and much more responsive.
And they have been able, evidently, to amend it in New York, and I'm not saying that we're rushing -- well, we feel a little rushed, for whatever reason, it's two weeks and here's the hearing, and we only have a couple weeks, and all of these things have been left out, and we want to have a full discussion so we can get everything in as fast as possible.
Well, Mary, remember, we tried to do this last term and it never came up to a hearing. Now --
And now we're at the hearing level and we're moving along.
Robert Wingert, Larry Frankel and Glenn Moramarco of the Brennan Center. (Witnesses come forward.)
I really appreciate you guys listen to all of this because I know that some of you -- I know that Mr. Moramarco and I have discussed this issue for a long time now, and I know that you must have heard this testimony many times before, so I appreciate it. Whoever is going to go first, please grab the microphone and identify yourself for the record.
My name is Larry Frankel, the Executive Director of the American Civil Liberties Union of Pennsylvania. And I'll wait till the two Councilmen are actually pretending to pay attention.
I want to thank you for inviting me to testify today on the campaign finance reform bills. I compliment you for initiating this discussion and especially commend 132 /00 LAW & GOV'T - BILL 2 you for considering the idea of public financing for candidates in Philadelphia elections. I want to first state that I cannot present you an official position of the ACLU of Philadelphia. The Board of Directors is meeting next week and we'll have the bills on the agenda. I think they will also have my testimony to consider. I have tried to highlight in my testimony what I think are the issues that I expect to at least -- if I don't bring them to the Board, the Board will probably want to consider them if they, you know, continue to formulate their position on these bills, and I hope that my review of those issues will add to your perspective and consideration on the legislation. Of course, we'll address the issue the constitutionality. S. Supreme Court has upheld federal and state laws limiting the amount that individuals and Political Action Committees can contribute. That's the Buckley case and Nixon v. Shrink Missouri Government PAC upheld state limitations. On the other hand, the Supreme Court, starting in Buckley, has been much more skeptical 133 /00 LAW & GOV'T - BILL 2 about legislation of limits on expenditures, and particularly in the area of independent expenditures, whether they're by political parties, incorporated political associations, or Political Action Committees. If they're independent, not coordinated with the campaigns, it's going to difficult to regulate them. In Buckley, the Supreme Court also held that Congress could engage in public financing of elections and may conditions acceptance of public funds on agreements by candidates to abide by specific expenditure limitations such as you guys have set forth in your bill. However, to withstand constitutional scrutiny, the public funding system must be truly voluntary and not coercive. With those principles in mind, let me discuss several specific aspects of the legislation. Certainly, the contribution limits for all candidates, the mandatory limits on all candidates, would probably survive a constitutional challenge. I do not think that the same can be said with regard to limits on how much any candidate can raise in an off-year. I don't 134 /00 LAW & GOV'T - BILL 2 know of any particular precedent that would support this kind of temporal restriction, both on the raising and giving of money, 'cause it also affects those who give money. You're saying I can't give to candidate in X-year if he's already hit the limit, so it's not just affecting the candidate's ability to raise money, it affects the person who might want to give money. In light of the Supreme Court's holding in Buckley about expenditures and, of course, skeptical views on a variety of restrictions on defended expenditures, I am doubtful this kind of regulation would be looked upon with favor, although there be some cases that indicate it could. I also think -- and I will get later into my testimony -- that there may be practical reasons that it may not be a good idea. I'm going to shift my focus now to the public financing aspects of the bill. Nationally, the ACLU has been very supportive of public financing as the most sensible campaign finance reform and one that runs into the least constitutional problems. We believe that the public would be well-served if government provides 135 /00 LAW & GOV'T - BILL 2 the means for candidates to deliver their message, give them the floor, give them the ability to get out into what is the media market for their candidacies and get their message out. As long as the system is truly voluntary and not coercive, the ACLU supports this means of reform. I would anticipate that my board and others would focus on a couple aspects that appear problematic. First, the amounts provided to candidates seem insufficient.
I can't imagine any credible candidate for mayor of the City of Philadelphia thinking he or she can wage a competitive campaign and deliver his her message for $750,000. While many may think that the amounts spent in the last election were extremely large and offensive, it still takes money to be on TV, on the radio, put out print material, and maintain a campaign. So 750,000 probably won't do it. The amounts aren't necessarily coercive, but they may be virtually unattractive. Now, I see your amendments, and I'm going to get to amendments before I finish my testimony, Councilman. I've had a chance to look at the amendments. 136 /00 LAW & GOV'T - BILL 2 The other issue I want to address is a more complicated issue, and that's the impact of independent expenditures. First of all -- and this isn't in my testimony -- I don't know if your definition may need some tweaking. I was looking at one of the cases which I'll discuss and in Minnesota. Although the law was invalidated, they at least made it clear that independent expenditures did not involve newsletters sent out by organizations that may indicate, you know, ratings of candidates. You know, there's all sorts of organizations in the City that yearly, you know, like to let their members know how they feel about that, and I don't know that we want to make independent expenditures, and the definition isn't clear in the bill. But more problematic is the section 19 that says that if it's determined that a candidate who participates in the public funding system is the subject of an independent expenditure campaign, then that participating candidate shall receive public funds at a rate of $10 for each $1 of eligible contributions made. I'm not completely certain of what this really means. 137 /00 LAW & GOV'T - BILL 2 Does it mean a campaign against you? which is what it logically sounds like. But what about an independent expenditure campaigns on behalf of a candidate? That is not really described in the legislation. I mean, if the candidate has a campaign on behalf of them, should the opponents of that candidate get money? While I'm not completely certain of what the provision really means, it does sound like you could have a massive infusion of public funds to a candidate as a result of that kind of independent expenditure campaign. And we believe that this impacts on first-amendment rights. And I'll give you an example. Suppose the labor unions get together and decide to target, let's say, a District Council race, and they want to spend considerable sums on an independent campaign against a candidate who they think is hostile to their interests. Well, according to the bill, that would trigger off public funds being distributed to the candidate they're opposing because they've chosen to get involved in a race that they care about, and then they affect their members and the 138 /00 LAW & GOV'T - BILL 2 livelihood of their members. Now, there's conflicting court decisions about whether this indeed does impinge on first-amendment rights. The most recent case is from the First Circuit, and I know that my -- I think I can call him "a colleague" here, because we've been on a debate at least together, and he's come and spoken to my board. They were involved in successfully defending law in Maine, which had a provision, although not a 10-to-1 provision. But there's another case from the Eighth Circuit which invalidated a Maine law which had a matching-fund provision when they were running independent expenditure campaigns.
You know, just to get a flavor, the court there went the other way, and they described a system in these words: "Thus, by advocating a candidate's defeat or her opponent's victory by an independent expenditure, the individual committee or fund working for the candidate's defeat instead has increased the maximum amount she may spend and given her the wherewithal to increase that spending merely by exercising a first-amendment 139 /00 LAW & GOV'T - BILL 2 right to make expenditures opposing her or supporting her opponent. " Now, I understand that independent expenditure campaigns are an issue that's going to have to be dealt with if you're going to have public financing, but I think it does become problematic, and I used labor unions as an example. I could use a race involving a pro-choice candidate or a pro-life or a pro-gun safety candidate or a whole range of issues. I mean, we're not even talking about people who've got a financial interest per se in government but who care about an issue deeply. And I think we have to really grapple with what the consequences of giving a candidate matching funds because that group has decided to exercise its right to be involved in the election. I don't have an easy answer to it. I know it's a problem that has to be addressed, and it is a first-amendment issue. And I think that although the courts are split, I think that we 140 /00 LAW & GOV'T - BILL 2 have to look at that.
I don't we want to infringe on the first amendment in any way.
I don't think you are either, and I think we want to be careful. And I know there's going to be further work on the bill, but I think we need to look at what some of other cities and states that have public financing and see how we solve that problem. I would also like to address another constitutional point, and that is the ineligibility of individuals or businesses to enter into a contract for goods or services, city financial services if they donate to political campaigns. And I know eliminating pay-to-play sounds like good political rhetoric, but in reality, it means many individuals could lose their rights to give money to candidates of their choosing. I mean, I think if you read this broadly enough, you've got a law firm, and that means every lawyer in that law firm cannot donate any money or that law firm cannot apply to do any work for the City, and that, I think, is 141 /00 LAW & GOV'T - BILL 2 inhibiting a tremendous amount of first-amendment activity. And if you've got maximum contribution levels already, I'm not sure that you need to also have that kind of provision in here. One final constitutional question -- maybe it's not constitutional, but it fits in here, which I'm not about to address, but I think some lawyers who understand Home Rule Charter and the interaction with State law really need to take a look at is whether the City even has the authority to do this. As you know, Councilman, I do lobbying up in Harrisburg, and I'm sure you know the State House has passed a bill with an amendment that is sitting over in the State Senate, which would make it clear that the City has the authority to do it. One would ask, why do they think they have to pass such a bill if the City already has the authority? I think it's a question I'm not prepared to even try to answer, but given the history of some attempts by this body to enact legislation to only see either the State legislature or overrule it or the courts throw it out, I think it ought to be looked at carefully. 142 /00 LAW & GOV'T - BILL 2 And one thing I would certainly suggest -- at least with regard to the legislature -- if this bill comes out as a Democratic-only bill, without bringing some Republicans on board, you probably are guaranteeing a bill in Harrisburg passing rather quickly with the Governor's signature trying to overturn it. I mean, I think you really need to make this bipartisan and yet they not see it in any way as a Democratic attempt to make it harder for Republicans to participate. That's not an ACLU position; that's just, I think, you know, a gratuitous advice. But having seen enough things this Council's done interfered up in Harrisburg, I don't think it, you know, can be lightly dismissed, and that may change if the majority in the House changes, but I don't know that we can anticipate that. Moving beyond some of the constitutional issues, I just want to point out when I view campaign finance reform proposals, and I've had an opportunity to do so, I think one of the questions that we really have to ask is whether the proposal -- how much the proposals really favor incumbents, because oftentimes, I 143 /00 LAW & GOV'T - BILL 2 think if you look at it closely, and maybe, you know, this makes people vote in favor of them some more and probably sometimes some proposals don't pass, you have provisions that do help incumbents. I think the public has a right to expect that if you change the system, it's going to be more competitive, not less competitive. And I think you have to be careful at looking at some provisions to make sure that you don't inadvertently make it less competitive. I think limiting challengers to how much they can raise -- not just incumbents but challengers, to how much they can raise in off-years, particularly when you have a primary that's in May, can create a lot of problems for the non-incumbent. I mean, can you imagine -- what if Sam Katz could only have raised $100,000 a year each year before the general election?
He would have started off much further behind than he already was. Can you imagine somebody running against an incumbent Councilperson and not being able to try and build up a war chest prior to the election year and then even be taken seriously? 144 /00 LAW & GOV'T - BILL 2 You know, incumbents maybe can't raise more than that either, but they already have a whole lot of built-in advantages. They, you know, have newsletters they can send out, they can do all sorts of community events, they get all sorts of press. I mean, the challengers really need to be able to raise money sometimes to run an effective campaign, and this would limit them. I think the limits on expenditures on candidates for -- the public financing also inhibits the challengers, and I see that the amendment that you've got proposed would increase those amounts. And I think that is important because you want to make it so it's attractive enough for a challenger to say, Yeah, I'll go with public financing because that that will really give me enough money to be credible and out there. One risk that I see, and if you'll let me play off this scenario, I think a savvy incumbent would realize, you know, I've got enough name recognition, I've got the ability to deliver my message through my office, I'll go with public financing. If my opponent doesn't go with public financing but raises enough money, I'll get even 145 /00 LAW & GOV'T - BILL 2 more public financing money, so if they're successful in raising money, I'll benefit also. So I think you just want to take some time to make sure you are not -- I mean, you are incumbent, but I think your motives are well and good, and we don't want to --
In Wisconsin, and he squeaked through but he made it against the challenger, who spent huge amounts of money.
Mm-hmm, mm-hmm. But I would want to note some practical issues that I noticed in reading the bill. It's silent on the status of campaign funds already accumulated before the law goes into effect. What is going to happen if, you know, somebody's got half a million in the bank already? You know, they're going to have an advantage, I don't think you can take it away from them and say they can't use it, and I would be interested -- and I haven't had the time -- to like learn from the experience of New York 146 /00 LAW & GOV'T - BILL 2 and Los Angeles, what they did. I mean, how did they, time-wise, implement this to this deal with that issue? Are the enforcement tools sufficient to really discourage political operatives from trying to skirt the various prohibitions contained in the bill, or is this a regulatory system that is so full of potential loopholes as to be nearly unenforceable like the federal law? You need strong tools and strong teeth. I mean, we've seen what's gone on at the federal level. There was even a story in the Wall Street Journal today about even some of the Republicans were questioning some of Congressman's DeLay's tactics. I mean, you've got people who spend a lot of time scheming and thinking about where's the loophole and how do I get around it? They know they can because the enforcement mechanism isn't --
I think that's been the advice we got both from L.A. and New York in terms of being very strong along those lines. And I think that's something that we would hope to integrate into the -- I mean, the hearing has been very instructive, because it has shown where it is 147 /00 LAW & GOV'T - BILL 2 that we need to go to make it a stronger bill and a much more relevant and meaningful bill.
Yeah. I think the hearing's been very good in that regard. I also have a series of questions about Council-at-large elections. First let's go to what's the debate going to look like? If you have to participating candidates, only the most 10 diehard are going to listen to 20 to 25 11 candidates, believe me. I know that someone 12 mentioned the Senate race. In the primary here, 13 we had six candidates up on a debate. I mean, how 14 many people watched one full one, much less four 15 or five, you know, especially when everybody 16 recognizes -- except those candidates who aren't 17 extremely competitive -- that maybe you're down to 18 7 or 8 but you still have to listen to the other 19 15 because of the way the debate structure is. 20 It's just something pragmatically that has to be 21 thought out. 22
No -- eventually, 25 yes, I have a couple questions. 148 /00 LAW & GOV'T - BILL 2
Another question I have is, how do you deal with an independent expenditure campaign in the Council-at-large elections? What if, say, there's ten candidates who are participating candidates and there's an expenditure campaign in favor of one? Do you give matching funds to the other nine? Do you figure out which one is actually the target of the campaign and give that one -- I mean, I don't know what the answer to any of that is. I don't know that anybody does yet, and while we can learn some things, I think, from New York City and possibly Los Angeles since they don't have at-large elections, those issues are a little different. And the last point I'd like to make is, we also need to consider the impact of the lack of State regulation and the lack of State law in this area. I don't know -- again, I think it's useful to look at what's going on in other cities and what kind of laws those states may have. But Pennsylvania is pretty notorious for having virtually no State regulation of campaign finance, certainly the amounts that given. And can we successfully regulate -- can 149 /00 LAW & GOV'T - BILL 2 one successfully regulate their activities so that they are not becoming the vehicles for what, you know, generically we might call "soft money," that then is used to influence elections in the City? I think that has to be seriously looked at. I don't know what the experience has been in other places, but there's a whole range of other entities interested in what occurs in Philadelphia that are not necessarily, you know, any candidate's campaign committee in this city. And I think you have to consider the interaction between the two in making sure you have a strong bill. My final comment is the one point -- and I don't know how you build it into the legislation, but the woman from New York said you got to constantly be vigilant and probably modify the system as you see the problems that arise and address, you know, things that nobody's even thought of here today that you'll see once you implement a system. But in closing, I want to commend you for initiating this discussion. It's the beginning of what I think is an important process 150 /00 LAW & GOV'T - BILL 2 here. I hope that the focus will be on a public financing system. And to the extent we have time and some expertise to provide, we'll be happy to assist.
Yeah, thank you. There's two general issues that get raised from most of the testimony that comes from people with legal expertise and legal background, and that is one on constitutionality. And I'm wondering how you view the continuing success and existence of both New York and Los Angeles and some other major cities that they have not been either struck down or challenged for their constitutionality and can be more restrictive, or as restrictive, as what's being proposed here.
I'm not completely familiar with all of the provisions in those bills. Let me tell you what I think is unquestionably sound here: restrictions on the amount that people can give. The Supreme Court decision this year made it clear that as long as you've got some rational basis for setting those amounts and the amounts I see are chosen are 151 /00 LAW & GOV'T - BILL 2 pretty much the federal amounts, those are going to be upheld. A voluntary system of public financing with an agreement that you will not spend beyond those amounts, that's going to be constitutional. Some of others, you know, I don't even know if those other cities have some of the kind of provisions here with regard to the time --
Los Angeles does. And I don't know whether anybody's ever challenged it on that basis as well and whether it poses any kind of problems. I don't know what the term limits there may be, and that may affect some of that to a certain degree. I just caution that it struck me in terms of reading it and, you know, no criticism of it. You know, we had less than two weeks. And, frankly, there's been some other business on the table, and I'm glad to hear there will be further time to take a look and do some further research. In the independent expenditures, there's a split in the courts, and I think there's 152 /00 LAW & GOV'T - BILL 2 still a lot of work that needs to be done. So I think the general framework is there and in place. There may be some particular issues. I don't see, you know, a court striking down the whole thing. There may be certain details that may be --
Do you believe that the State -- that the Commonwealth's lack of oversights provision law on -- statute on this particular issue is maybe, in the long run, good for us? Because they're not prohibiting us from doing anything. If they're silent on the issue, would it indicate some leeway for us to monitor ourselves because they are silent on a specific issues? Is that's how courts have ruled or have they ruled alternatively on those kinds of issues?
I'm going to say I need to look at that a little more closely. You know, maybe it's a gut reaction, but obviously, some people in the state legislature think you don't have that authority.
Well, we do have an opinion from the City Solicitor that says we can 153 /00 LAW & GOV'T - BILL 2 do it and it is defendable. I understand a lot of folks in the legislature will always say that we don't have the authority to do anything.
They also thought you had the authority some gun-control legislation.
I was actually surprised that it got out of the House, frankly, and-- well, it got out of the House and it is in the Senate, and I think some of the conversations, informal conversations, that I've had and others have had with senators in trying to explain what it is we're trying to accomplish, I think there's been somewhat a softening of what you would expect them to be against it. I mean, some prominent who have people raised a lot of money themselves say, Well, yeah, if you explain it that way, I understand it, and if you guys want to police yourselves, that's fine. As long as you're not imposing upon our ability to raise money, we don't really care. So I think there's a possibility it may even get out of the Senate.
If I may. I think there's a possibility. I think to aid that -- I 154 /00 LAW & GOV'T - BILL 2 mean, I think you would be on much better grounds if the bill was passed in the Senate and signed by the Governor, and no one could then come in and say they didn't give you the authority. You know, you take that away. But I will go back to the -- I think it's much more likely to pass the Senate if it appears there is significant bipartisan support for the legislation because, frankly, the House -- it was easy. They know, we pass it, we can say we voted for campaign finance reform, and let the Senate be the bad guys. I mean, you know, that happens all the time, as you know well. Let the other guy be the bad guy. It's different when you have a unicameral legislature like City Council, you can't play that game.
And I guess as a matter of comment, I find it difficult, although I understand the concept of the first-amendment issue as it relates to television advertising, but I guess you would at least acknowledge the fact that from, I guess, maybe a truth in advertising situation, it's difficult to defend the amounts of money that are spent to spin a person's image in 155 /00 LAW & GOV'T - BILL 2 ways that maybe really don't relate to issues but more relate to trying to portray a person in a particular way. I mean, Neil Oxman's favorite comment that I've read in a story in the Washington Post was that he viewed his job as keeping people from going to the polls, which I thought -- I called him up about it and had a discussion with him about it, which I think is kind of crazy in the long run if you're looking at it that way. So money, in some ways, large amounts of money, are being raised to put stuff on television that really make people not want to go out and vote. And I'm wondering if in the end analysis, maybe from a legal standpoint it may be accurate, but from a moral or practical standpoint, it really isn't even promoting the first amendment; it's stifling in some ways people's desire to participate in their democracy. And I don't know a legal way around it, but just from a comment, an observation standpoint, I mean, you look at some of the commercials that you see in the last election, 156 /00 LAW & GOV'T - BILL 2 that you see in the presidential election and you see in the mayoral elections, I mean, we all know these people, and we're saying, Who is this person on television spending 10, $15 million, creating an image that we know may not even be true? But all that aside, the fact that campaigns have become so electronic and so televised so product-slick, I think, in many ways, has detracted from people's desire to participate anymore. And if we could rachet down the amounts and change the ballfields from major-league ballparks and go into a minor-league ballpark price-wise, it may get more people wanting to at listen to what we have to say as opposed to flipping the dial as we show up in their homes unsolicited.
Glenn Moramarco and then we'll follow with Common Cause. And, you know, you cannot read this thing, but just give me the stuff and this will be included in the record because it's a good analysis of the New York bill 23 here.
Sure let me just make sure that everyone in Council is clear about the 157 /00 LAW & GOV'T - BILL 2 Brennan Center or at least what we've been doing recently.
Sure. Glenn Moramarco from the Brennan Center for Justice at NYU School of Law. The Brennan Center was founded about five years ago by former law clerks and friends of Justice Brennan to work on issues that were of concern to the justice. A premier one is democracy. In that line, we've been involved in campaign finance reform for some time now and have really been very active in litigating these issues on a day-to-day basis. We represented parties in the Shrink Missouri case that has been discussed today. We got Senator McCain on the ballot in New York. I'm representing Ralph Nader now to get him on the ballot in North Carolina. I successfully the Maine Clean Elections Act case, which was the first full public funding statewide initiative in the country. And I think people have read in the Philadelphia Inquirer on Monday about our landmark 158 /00 LAW & GOV'T - BILL 2 study of issue advocacy that just came out, analyzing all of the ads from the 1998 election. But in terms of litigation, we bring some expertise to the field here, and I would like to discuss then a case that Larry brought up, because, actually, I would go farther. I'm not in fundamental disagreement with Larry on some of these issues. I think the worse thing that could happen would be if you pass a law that then gets struck down, because a lot of effort is obviously going into this, and I see from all the testimony that there really is a ground swell of support in this city for good and effective public financing campaign reform system. So it would be silly to lose it then in some details that may not be necessary. And while I don't think a court would strike down the whole bill, I think you ought to know going in which are the potentially problematic areas here. A. and New York, you're fine. Mandatory contribution limits, public funding, voluntary spending limits those are all sound and reasonable, and you're not 159 /00 LAW & GOV'T - BILL 2 going to have any problem, but there are some aspects to this bill that are a little unique that you need to need to give a little bit more thought to, perhaps. The lower contribution limits, for example, for those seeking government contracts or benefits, I actually think that that would survive. I think the case law on that is pretty good. C. Circuit, basically based on the Securities and Exchange Commission rules on pay-to-play. What the federal rule now is that you can only give $250, which is very close to your $200 limit. And I think the court there was satisfied that by allowing some de minimis contribution, you weren't cutting off a person's first-amendment right, but you were attacking an area in which there really is more pervasive opportunity for corruption. There are a number of states with similar provisions to this; it is not 160 /00 LAW & GOV'T - BILL 2 unique to the Philadelphia bill. And so I think that that is something that you could pretty strongly defend if you decide politically you want to keep it. On the other hand, the 10-to-1 match for independent expenditures, I think, really is questionable both in terms of policy and constitutional validity. There are two cases on that, and I defended the successful one in Maine, which is the only positive precedent in this area. But that was a 1-to-1 match, and the Court there was persuaded that with a 1-to-1 match, you can say that it's furthering first-amendment values because when somebody speaks, there's a right to reply. And there really is, you know, a furtherance of a debate here is like giving equal time. Here, this 10-to-1 match seems to be to just be punitive. It's saying to people, If you have an independent expenditure, the person you're against is really going to be helped tremendously. There are other ways to do this. You could do this the way Maine does.
You can say if 161 /00 LAW & GOV'T - BILL 2 somebody's the target of an independent expenditure, the City will match the amount of that expenditure, or you can raise their otherwise their voluntary spending limit by the amount of the independent expenditure. There are lots of ways to do that, but I think a court would see 10-to-1 as punitive. A closer call is the total contribution limits for off-year fund-raising. There's not a lot of case law on it, it's mostly at the State level. There aren't federal decisions on it, I don't think the State Court decisions are that well-reasoned, they go both ways. I mean, I think you just should know that that's a gamble. You may not want to invite the problem unless, for political reasons, you think it's very important. A. very well at all. But it's a problem area. The other thing I would suggest is, it seems to me the penalty section here really needs beefing up. Under the federal system, what you have is, you tie the potential penalties to the 162 /00 LAW & GOV'T - BILL 2 magnitude of the violation, so that if it involves contributions or expenditures of $50,000 -- there are basically two tiers in the federal system. For regular civil violations, it can be $5,000 or the amount involved in the nondisclosure or non-reporting. And if it's willful, it can be $10,000 or twice the amount. It seems to me, you want to tie whatever the penalty is to the magnitude of the offense. I know that Common Cause also raises an issue about independent expenditures, which I did not address in my testimony, but just want to say for the record that I think their recommendation is really quite good, and you should look at the definition of "independent expenditures" more closely and go with the bill that they recommended. This is the most -- this is one of the most contested areas in public finance today. It's very, very difficult to predict what the courts will approve in this area, but I think the bill that is put forth in Common Cause's recommendation is really quite a good one.
My name is Robert 163 /00 LAW & GOV'T - BILL 2 Wingert. I'm a Philadelphia resident and business person and a former member of the Pennsylvania Common Cause Government Board. With me today is Barry Kauffman, who is the Executive Director of the State Governing Board of Common Cause. I'm going to be very brief because much of what I had to say would be redundant, and in light of the honor, it would waste everyone's time. We applaud what you're trying to do here. We appreciate what it would do to open the doors for people who otherwise wouldn't have a shot at public office, and we appreciate also the concept of limiting campaign contributions to a level that would force potential candidates to get out and play the field a little more in terms of fund-raising. Obviously, they wouldn't spend a lot of time lobbying big-ticket contributors and avoiding the small gain. We know that these reforms can work because where they've been implemented in other locales, they've worked. And we know that -- we have some information that we can elaborate on that issue if you would like. 164 /00 LAW & GOV'T - BILL 2 We have several recommendations for changes to the proposed legislation, and we are submitting those along with my written testimony for your review. I'll turn this over now to Barry.
Thank you for conducting this hearing today. I think it's very important. I think it will add some momentum to your efforts. I just have a few brief comments. Common Cause, you will notice in our written comments -- and we're not going into that at this time does -- does share almost all of the concerns that the Brennan Center has raised as well as the ACLU, and we have some suggested ways of remedying those problems. Four points which we did not put in written testimony, which I would -- I think it's important to reinforce form prior speakers. And that's: I think New York suggested that you have audit and subpoena power. I think it's really important if we're going to protect the public purse. Public finance is important, it's worthwhile, but I do think we need to protect it. I think we need to apply party 165 /00 LAW & GOV'T - BILL 2 expenditures on behalf of a candidate to the overall expenditure limits of that candidate. I think that was suggested by one other person. One of the bills -- again, this is a technical amendment now. I think we have to make it absolutely clear that the expenditure limits are in the aggregate, that you cannot give $1,000 once, $1,000 twice, $1,000 three times, but 333, and 333 and 333 make the 1,000. So that all those limits are in the other aggregate. And every other municipality I've talked to -- and I did get a chance to talk to several yesterday -- made it absolutely clear that you must have a nonpartisan tough-minded enforcement agency to keep the public's confidence in this. And the one issue which has come up quite a few times -- and I think it's an issue we're all going to have to deal with as we promote this, and that is the cost. It's a legitimate issue, but I think we can win on that issue, because in the several municipalities I talked to, they noted the pay-to-play does seem to diminish, that there is less incentive to have to reward 166 /00 LAW & GOV'T - BILL 2 political contributors. And to some degree, this system may pay for itself because there isn't this reward system built in that we have in the current system. But even putting that aside, I think we can defend this on its own because there's no more important task or duty of a government, especially a representative democracy, than in protecting its own integrity and the people's confidence in that integrity. And I cannot think of any more justifiable expense than protecting the integrity of elections because, let's face it, elections are the only way that the average citizens have in holding power accountable. So protecting the honesty, the openness, and the competitive elections, I think, is absolutely essential and is justifiable on its own merits. Thank you.
You know, what bothers me more than any single issue in this area is the feeling I have that decisions at the government level may not be made on the issue of merit. It's very distressing to learn, for example, that a campaign contributor pays for the 167 /00 LAW & GOV'T - BILL 2 cost of a trip to a foreign country by a candidate and then shortly thereafter, the candidate, who has the power of decision-making, shortly thereafter, a very big contract involving millions of dollars is issued to that candidate. It may very well be that the decision was made totally on merit, but everybody -- you know, everybody says they hope so, but there is a note of question in most people's mind, and in many people's minds, there is a conviction that the choice had nothing to do with merit. That happens constantly in this city. The excuse given is that, Well, we have to pick among contributors because everyone's contributing large sums of money to our campaign. Therefore, we're not being influenced by the contribution. In other words, I guess if you get enough corruption, then the honest person is guilty of something for not participating in the system of corruption. It's just a very uncomfortable feeling. We citizens ought to be able to feel that public monies and public decisions as to money are based on merit. And I find that a more important issue 168 /00 LAW & GOV'T - BILL 2 in my mind than the question of the election. In Philadelphia, we have had independents win elections. After they win elections, independents don't always remain independent. Generally, they move in the other direction. Ed Rendell, the Mayor, was -- you know, was a strong independent when he first ran for office. And that's been true of many people. So I think whatever we can do to bring in elements of integrity in the decision-making progress is important -- maybe more important than the question of candidates who are independent winning. In Philadelphia, we've had a pretty good history of independent candidates being able to win elections. Of course, maybe things have changed now. We never had an election before in which I think $9 million was spent by one candidate in the Democratic primary for mayor, and I think maybe the second candidate raised $5 million. Now, it would be tough for an independent, particularly a newcomer in the race, to raise that kind of money. So we thank you all for your interest. Somehow we've got to make this subject a little 169 /00 LAW & GOV'T - BILL 2 more interesting, though. I would like to say that we were discussing the no-smoking issue in restaurants and bars last week, and we had -- the room was packed here. Some people were standing up. It created so much interest because we were dealing with something basic to the owners of restaurants and bars. And, by, God they packed it, and there was a lot of people interested in the issue of dealing with smoke and preventing it for health reasons, preventing it from occurring in restaurants and bars that they wanted to go to. But looking in the room today, we have people, you know, who are leaders in community groups and the public-interest groups, but we haven't reached the community yet. And I think maybe the reason we haven't reached the community yet is that people have begun to accept it as a necessity -- that's the lack of integrity. They think that, you know, kind of everything is for sale, and there's no use fighting it. But with your help, I think we're going to be leading the community. Yes, go right ahead.
I've testified at a 170 /00 LAW & GOV'T - BILL 2 number of hearings on campaign finance reform, and I was going to refrain from making my soapbox speech but, Councilman Cohen, you're motivating me. I think one of the damaging things that can happen at these hearings sometimes is to reinforce unnecessarily to some degree people's cynicism. I lobby in Harrisburg. We make absolutely no political campaign contributions, none. It doesn't stop people from sending me invitations, unfortunately, but we don't make any. There is nobody's office that is off-limits to me because of that. I understand that money has influence, but when you bring some information. Some expertise, or when you can organize people to contact their legislators -- an elected official will not do something for a contributor if they think it's going to cost them their job. And there's not press here so I'm not so worried today. But I think sometimes these hearings add to the problem, if that's the message that continually sent out. There are numerous occasions that I can point to in Harrisburg, of all places, where the 171 /00 LAW & GOV'T - BILL 2 money interests wanted something and they didn't get it because the legislature were more scared of the voters. And some of us. Including myself, need to spend more time re-educating people about how to contact their legislator and making them responsive to things besides money. And, you know, I understand that -- there's no doubt about it, the agenda is set by who gives money, and sometimes bills merely move one stage in the process to shake the money tree. But there is a rule for those without the money. It's, they organize -- that's what labor was all about, that's what labor unions get in business for, because they could bring together numbers of people. Max Weiner had an incredible impact in this city and he didn't have money to do it. So it just-- you know, I'm speaking to people who knew, but it just is a soapbox get on. I also have to communicate to the public that they can have an impact, if they actually care and if they actually organize. And those of us who are in the business of having to kind of communicate that message need to keep doing it. Otherwise it, is just going to get worse. 172 /00 LAW & GOV'T - BILL 2
Councilman Cohen, I'll just be very brief. Larry's right that we shouldn't help to fuel cynicism, but I think we're starting to see the pendulum swing a little bit, and I think that's good news for us, because we saw some groups here, I guess, some of the gay-rights groups and some of the other City groups, and across the nation, environmental groups, they're finally starting to get it, that this is not just some boring insider's game; this is the power game that underlies every issue that rank-and-file people care about, and they're finally starting to get it and they're understanding why and that's why they're backing organizations like ours and campaign finance reform, because it impacts their success in the long run. And we're even starting to see hints of this in the U.S. Supreme Court, which up to this year, was always very careful to exclude expenditure limits from their view of what -- mandatory expenditure limits from their view of 173 /00 LAW & GOV'T - BILL 2 what was constitutional. And I think -- I'm not sure, but I think it was Justice Stevens' concurring opinion which began hint that the Court now understands -- they didn't make any decision on this, but their opinions began to hint that the court now understands the impact that big money not only has on candidates corrupting candidates, which was there was low contribution limits, but they began to hint that they now understand the impact that it has on corrupting the electoral system and the legislative process as a whole. They haven't quite gotten to the point where they're doing anything about it yet, but their opinions are beginning to hint at their understanding of this.
Well, they are very hopeful signs. We thank you for that note of optimism, too. Thank you for being patient with us today and for your testimony. Lauren Townsend, the Executive Director of Citizens for Consumer Justice. And I'm going to suggest Inja Coates come up, of the Philadelphia Cable Access Coalition. And David 174 /00 LAW & GOV'T - BILL 2 Masur, Director of Pennsylvania PIRG, and Phyllis Gilbert of the Sierra Club. (Witnesses come forward.).
And you have to hold the microphone very close to you, right.
Good evening. My name is Inja Coates, and I'm here to speak on behalf of the Philadelphia Community Access Coalition to express our support for this bill, though it sounds like there are some details that still need to be ironed out. In 1997, our group has picked up where previous groups left off and has been working for the last several years on the 16-year-old struggle to get the City to implement its own legislation for citizen access television. Among our members and supporters are many of Philadelphia's notable arts and cultural institutions, science and technology agencies, community groups, educators, and ordinary citizens. Perhaps it not be immediately obvious 175 /00 LAW & GOV'T - BILL 2 what our issue has to do with campaign finance reform, but allow me to explain what our experience has been. We have been a group of concerned citizens without a lot of political savvy, weren't really sure why the City was ignoring its own ordinance for public access. We thought that if we brought the situation to the attention of City Councilmembers, they would understand and correct this situation. We naively believed in a political system where elected officials represent their constituents' needs and interests in establishing public policy. Well, the past few years have been a real education for us in the way politics really works. Despite the fact that we have shown significant community support, our issues have been continually marginalized or ignored. I've been amazed to attend Council hearings, somewhat like this, where there are virtually no 21 Councilpeople in the room to hear the citizens speak, and many Councilpeople will not make themselves available to meet with citizens during a significant part of their term because they're busy fund-raising and campaigning for their next 176 /00 LAW & GOV'T - BILL 2 election. We have had difficulty gaining access to many of our elected officials because we are not perceived as important, and then several of the ones who did meet with us said they weren't opposed to public access but wouldn't support us against the powers that be. One Councilman put it -- as one Councilman put it, we didn't stand a chance going up the power of the cable industry, which he referred to as an 800-pound gorilla. We have been given lame excuses to justify the City's giveaway of the public resources to a powerful industry that is growing at an astonishing rate. With recent technology advances, the cable industry stands to make billions through its consolidated cable TV and cable Internet services. At the same time, they have worked very hard to see that a minor thing like the public interest does not impede their profit-making progress. A public access system in Philadelphia could do wonders for our city by providing free technology access and training to our citizens and organizations. Not only would this help in 177 /00 LAW & GOV'T - BILL 2 bridging the digital divide, but programs could be established that would assist after-school programs after-school programs, teach teens about the Web, televise Town Meetings, link block captains and community groups, assist social service agencies, and even provide free air time to local officials and candidates running for office. However, we have been taught not to rely on the merits of our issue, that being well-intentioned citizens is not enough. This is that cynicism that was being talked about earlier. Sadly, I am sure that we are not unique in this situation, and many groups have had similar experiences. The majority of politicians won't move unless you can help or hurt them financially or politically, and group that don't have a lot of money must build a political power base, negotiate influence, and demonstrate intimidating numbers of potential votes.
Perhaps those same rules of politics will apply even if we do have campaign finance reform, but hopefully, you can help to empower our 178 /00 LAW & GOV'T - BILL 2 elected officials to act on behalf of citizens by ending their enslavement to big money, and perhaps the influence of the local cable industry can be reduced to where they can be described as only a 200-pound gorilla if not a monkey. Access, whether to information, the media, or to the government, access means power. If ordinary citizens don't have a voice in politics or cannot access their representatives, then we do not have a true democracy. It is our hope that the campaign finance reform measures proposed in this bill, or one similar to it, will go a long way towards returning the government to the people.
Thank you. I would suggest to Councilman Ortiz and myself that we refrain from asking questions until each of the panelists have been heard. And then we may have questions for each of you. Who is next? Phyllis Gilbert.
Good evening. My name is Phyllis Gilbert, and as Chair of the Global Warming Committee of the local Sierra Club. I'm offering this testimony in support of campaign 179 /00 LAW & GOV'T - BILL 2 finance reform and public financing for the City of Philadelphia elections. The Sierra Club has 9,400 members in the Delaware Valley and 2,500 in Philadelphia, and we vote and we talk to our elected officials. We greatly appreciate this opportunity to publicly support these issues which are crucial to reviving our democracy, to protect its integrity and openness and, hopefully, its honesty. I was going to give -- you know, mention a whole bunch of issues that have plagued cities where we've paid polluters to pollute and plagued our government historically and to the present, but in view of the time constraints, I thought I'd just mention some of the kinds of issues that I've been involved in and others of us locally in the pay-to-play scenarios. And like Inja, we have come to City Councilpeople to try to educate and try to help to gain understanding of the importance of these issues for the sake of the public's environment and their health, but we've been kind of cast aside, even in public hearings. We came and testified at the public 180 /00 LAW & GOV'T - BILL 2 access cable TV hearings, we worked to force toxic waste contractors to obey environmental laws in southwest Philadelphia, we've protested against allowing many hospitals to continue burning hazardous waste, and we've testified against allowing privileged developers to let once- productive buildings to rot, and this little technique is now called "demolition by neglect." So, you know, we've known from our personal experience how important this law can be. As an activist, when we participated in these issues, we've really been discouraged by the lack of attention to our concerns. This bill has a good chance to improve our air and water quality and, therefore, our public health, for environmental issues are basically health issues. Where the polluters of the public have given the privilege to the public to pay for their health care, there are diseases that have been caused by a bad environment. So let me reiterate that the pattern of pay-to-play at all levels of government is destroying our environment and turning many away from their voting responsibilities. So we're 181 /00 LAW & GOV'T - BILL 2 looking forward to helping implement this bill to educating the public to encouraging people to take heart. We will work diligently with this coalition to take the next steps necessary for implementation. Thank you.
Thank you for letting me speak here today. My name is Lauren Townsend, and I'm the Director of Citizens for Consumer justice. Thank you again for allowing me to speak. It's a very grim problem that we're confronted with, our campaign finance system. A little bit CCJ is that we've become the state's largest consumer organization and coalition working on preserving and strengthening Social Security and Medicare, lowering prescription drug prices for consumers, passing a strong patient's bill of rights, preserving access to our civil justice system, and winning clean- money elections, as well as other issues. And working on these issues forces us to regularly battle the influence of 182 /00 LAW & GOV'T - BILL 2 special-interests dollars on the political process. Case in point was last week's Philadelphia Inquirer when the pharmaceutical lobbyists had a full-page ad urging consumers to keep the status quo and keep the government out of their medicine cabinet. So the problem is grim. In 1998 -- well, you know the problem. We've got very expensive elections. Congress spent more than a billion running for office in 1998, the Mayor's race astronomically priced, over twice that of New York City. And citizens and politicians agree that the system is broken. But a small, but growing, number of states across the country and cities, as you've heard earlier, are taking initiatives and moving forward with alternative campaign finance systems, like clean-money elections. Now, CCJ does prefer clean-money elections, with full public financing of elections, where candidate run their campaigns entirely with money from the public fund to qualified candidates that first meet ballot-access requirements and demonstrate community support by collecting a threshold number of small donations 183 /00 LAW & GOV'T - BILL 2 and signatures and then agree to abide by spending limits and reject private contributions. And because such a system is voluntary, it would be constitutional and stand up in court. But we applaud Councilman, Ortiz, Kenney and Cohen for introducing a proposal which, for Philadelphia, is a real step toward leveling the playing field and giving more Philadelphians equal opportunity, regardless of their economic status, gender, or the color of their skin. I mention economics, gender and race because when the vast majority of Americans stand outside the process altogether, with roughly 95 percent of the adult population making no 16 political contributions, it's kind of no-brainer to look at what's going on and see the situation what it is. Money, rather than democracy, is the name of the game. There was a study done by the Center for Responsive Politics called "Sex, Money and Politics: The Gender Gap in Campaign Contributions," where the Center states that although the gender gap in apportioning money between parties has generally widened in the 184 /00 LAW & GOV'T - BILL 2 1990s, the male/female breakdown in overall political contributions has not significantly changed. Women may vote in larger numbers than men, but women are responsible for only about one quarter of the large individual hard-money contributions; that's itemized donations of at least $200 to candidates, parties, and Political Action Committees. And that figure has remained fairly constant for over the past four election cycles. And we wonder whether this disparity could have something to do with why public schools and day care centers have to have plant sales, bake sales, and walkathons to raise money for public schools and day care center. But the plot thickens, adding insult to injury. The national group Public Campaign did a study called "The Color of Money," which examines campaign contributions and race. In it, they say that people of color are largely absent from what has become one of the most crucial elements in the election process, namely campaign financing.
The study quotes civil rights leader Nelson Rivers, III, Director of the Southeast Region of the NAACP, explaining the effect of money and politics 185 /00 LAW & GOV'T - BILL 2 on his community: "We're impacted in a negatively disproportionate way. Since African-Americans have decidedly less income, less disposable money than other people in this country, we're at a disadvantage when money is the deciding factor and whether you can participate. While other folk have the luxury of picking between two people who still might represent them in some way. " I've included sheets from the Color of Money Study, which show the greater Philadelphia metropolitan area contributions in the 1995-1996 election cycle by zip code. When you look at the numbers, you'll realize just how racist and imbalanced our campaign system is. Could it be that this imbalance has something to do where a new sports stadium is placed in our city, or why we don't have public access cable, which City Council voted to into law years ago? Today's system of financing political campaigns rewards large contributors by amplifying 186 /00 LAW & GOV'T - BILL 2 their voice at the expense of ordinary citizens. It is special-interests campaign contributions that effectively determine which candidates will have the resources to run serious election campaigns. This leaves out good candidates without money or connections to contributors. What's more, under our present campaign finance system, politicians are forced to spend too much time raising money, as Inja mentioned earlier, instead of devoting their full energies to the duties public office. With this in mind, while we do support full public financing, I urge you to move forward in your efforts to level the playing field because a truly vibrant democracy is one in which average Americans and grassroots organizations are shaping public policy, not large contributors and corporations. Thanks.
Thank you. I'm David Masur. I'm the Director for the Pennsylvania Public Interest Research Group. Penn PIRG is a 187 /00 LAW & GOV'T - BILL 2 statewide nonprofit and nonpartisan public-interest advocacy organization. With nearly 12,000 citizen members throughout Pennsylvania, Penn PIRG promotes greater access to the democratic process and campaign finance reform, environmental and public health protection, and safeguarding consumers from dangerous products, as well as consumer scams and rip-offs. Penn PIRG is part of a network of state PIRGs that have a long, rich history of working campaign finance reform issues. In recent years, the state PIRGs have had numerous campaign finance reform victories. In Montana, Mont. PIRG helped pass I-121, a ballot initiative to ban corporate contributions from ballot campaigns. Vermont PIRG helped support efforts to pass public financing for gubernatorial races and set mandatory spending limits and low contribution limits for legislative races. And state PIRGs in Massachusetts, California, Colorado, Missouri, and Oregon have helped put campaign finance reform initiatives on their respective state ballots. Penn PIRG supports political reform to 188 /00 LAW & GOV'T - BILL 2 make government accountable to ordinary citizens. Government of the people and by the people, while not flawless, is inherently better than rule by enlightened elite and is not only more likely to yield a political process that serves the public interest, but is essential to the ideals of freedom and democratic self government. I'd like to start off by congratulating the members of City Council for taking up such an important public-interest battle. It has become apparent to many Americans that our political process has become corrupted by the effects of big money and special-interest fat cats. As special interests spend hundreds of millions of dollars building their access to politicians, the scales have fallen out of balance, removing the ability of common citizens to have their voices heard in our political process. In turn, Americans become disillusioned about the political process, believing that it is no longer one person/one vote but $1/one vote. Because citizens feel they can no longer have their voices heard, they no longer participate in the political process, causing the democratic process to stagnate. 189 /00 LAW & GOV'T - BILL 2 Since money overwhelming influences who can run for office, who can wins elections and what issues dominate public discourse, elections can only truly represent the will of the people if campaign financing comes from ordinary citizens. There are many aspect of City Council's campaign finance reform legislation that Penn PIRG strongly supports. First, this legislation takes a strong stance to eliminate the pay-to-play scenario by prohibiting all elected officials and candidates for City offices from receiving contributions in excess of $200 from any individual or business which has a City contract for goods or services or City financial assistance, we were to level the playing field and promote a system of financial equality that promotes citizen involvement in the process. Secondly, the public financing system proposed in this legislation is quite beneficial in promoting greater constituent involvement. By guaranteeing that candidates get a broader base of financial support from a broader base of local supporters will undoubtedly mandate that candidates will not put special-interests dollars 190 /00 LAW & GOV'T - BILL 2 ahead of public-interest needs. For a candidate to choose to rely primarily on small contributions from ordinary citizens, this is a critical chance to run for office. While this is a step in the right, direction it still leaves grassroots candidates vulnerable to attack from candidates backed by wealthy interests or independent expenditures. Still, this legislation could take much stronger steps to protect the public interests in the democratic process.
First, the mandatory contribution limits are set too high to reduce wholesale corrupting influence of large contributors. By setting contribution levels at $1,000 this legislation will continue to allow wealthy interests to disproportionately influence elections. For most residents of Philadelphia, these contribution levels are well beyond their reach and will only continue to promote status quo. Penn PIRG recommends setting contribution at $100 for all candidates and all races in Philadelphia. This sets a limit that is within striking distance of what ordinary citizens can 191 /00 LAW & GOV'T - BILL 2 afford. Furthermore, we believe that by setting this mandatory contribution limit to a level of $100, it is on track with the spirit of this legislation and it will accomplish the worthy goals set out by the sponsors of this legislation. By eliminating the pay-to-play system, the language of this legislation sets strong limits of $200 for contributors who hold contracts with the City of Philadelphia. The goal is obvious: controlling undue influence by these specific special interests. Why would we not take equally strong steps to control special-interest influence from other sources as well and set similar strong contribution limits? Also this legislation clearly states that it hopes to achieve spending levels of $750,000 for mayoral candidates and $100 for at-large City Council candidates through the voluntary spending limits set forth in the bill. Again, lower contribution limits only will help promote these spending levels. A contribution limit of $100 would mandate that mayoral candidates need only $7,500 contributions at the 192 /00 LAW & GOV'T - BILL 2 maximum limit, and candidates for City Council would need only 1,000 contributions. 1 million residents, these levels of contributions are easily attainable for candidates who genuinely have a broad base of support. If public financing is added in, they become even easier to reach. The greatest step that can be taken to truly promote greater public involvement in protection of the democratic process comes from the methods that drive this legislation. This legislation is driven by spending limits instead of contributions. Penn PIRG, along with many organizations that work on campaign finance reform issues, believes that this has proven to be the less effective of the two options for controlling special-interest power over the political process while promoting public involvement and investment in our current political system. In order to meet the honorable goals set forth by the sponsors of this legislation, Penn PIRG recommends changes that can only promote access to the democratic process for Philadelphia's residents. 193 /00 LAW & GOV'T - BILL 2 First, set limits that are attainable for all of our City's residents. Contribution limits must be lower and Penn PIRG recommends contribution limits of $100 for all races. Secondly, just as the contribution limits in this legislation are mandatory, City Council should make spending limits mandatory as well. There are many reasons why spending limits must be made mandatory. In the political arena, we see far too many candidates who can out-spend their opponent with personal wealth and then turn their back on spending limits. This has been the case with many visible federal campaigns, including presidential candidate Steve Forbes, Ross Perot, as well as numerous Congressional candidates such as Mr. Corzine in neighboring New Jersey. Furthermore, spending limits should be made mandatory, as we've seen an era where candidates are able to raise so many large contributions that they no longer feel the need to opt into the spending limit plan. George W. Bush recently proved the power of the $1,000 donors in his decision to ignore voluntary spending limits 194 /00 LAW & GOV'T - BILL 2 for the presidential primaries. We must guarantee that we avoid this type of scenario in Philadelphia's elections.
These voluntary spending limits are unlikely to work in the obscene levels that some candidates will spend to outbid those candidates who comply. The spending cap will wind up being lifted in almost all instances and, therefore, will not achieve their purpose as currently drafted. S. Supreme Court struck down mandatory spending limits in 1976 in the infamous Buckley v. Valeo decision. However, over 200 constitutional scholars have denounced that decision as misguided several, and members of the current Supreme Court indicate willingness to reconsider that decision as ever early as this past January Pennsylvania's own senator Arlen Specter has cosponsored many times a constitutional amendment that would overturn the Buckley decision and specifically authorize mandatory spending limits. Philadelphia, the birthplace of democracy, should lead the country forward in establishing the common-sense need for mandatory spending limits in 195 /00 LAW & GOV'T - BILL 2 political campaigns. By taking these two critical steps, I believe that City Council will be able to meet the goals of this legislation and take a critical step in promoting greater citizen involvement in the democratic process. This will make Philadelphia a city with a rich history of being in the forefront of the fight for democracy to continue the tradition of being the leader in the fight for the cornerstone of our democratic process -- liberty equality, and justice. Thank you for giving me the opportunity to speak today.
I'd like to make a statement. When this passes, the fight for the Charter change, the fight for -- because I believe that this is going to draw a lot of monied folks to throw an opposition campaign against approving a Charter change of this sort. So we are going to need a real grassroots organization that we'll mobilize citywide and get the voters to really create a consciousness about what we're trying to do and get the voters to come out and defeat the 196 /00 LAW & GOV'T - BILL 2 money interest, because I believe the money interest, if they come out and do a campaign -- they did it in New York, they do it everywhere where this type of situation has been put forward, so we're in for a struggle.
One of the speakers mentioned the stadium, that maybe the site of the stadium is being picked --
You're the one that did? Well, just for those that are concerned about that issue, let me mention that on June 20th, beginning at 2 o'clock -- that's a Tuesday afternoon and running into the evening to enable those who can't come until after their work ends at 5 o'clock or thereabouts, Council will be holding a hearing on campaign financing for the purpose of hearing how people feel about whether there should be, and if so, how much should there be of public financing.
Not campaign financing -- public financing of stadiums.
That's the public 197 /00 LAW & GOV'T - BILL 2 financing of stadiums, so remember that. But Lauren Townsend mentioned that issue. Now, before that, we hope to be able to have this issue on the ballot. And as Councilman Ortiz pointed out, it's extremely important, if we're successful in City Council getting it on the ballot, it's very, very important that there be a tremendous amount of support, or the thing may very well be defeated in an election. It's not defeated because people don't support it; it gets defeated because of the power of money in influencing the media to campaign against it, but that will be the second step for us to deal with after this is over. We thank you all for coming being so patient. Next is Charles Juntikka, who's going to speak to us, representing the New York City Bar Association's Committee on Government Reforms. (Witness comes forward.)
You know, I only have about five minutes of information to give you. I'd like to talk about the -- I'd like 198 /00 LAW & GOV'T - BILL 2 to talk about the history of the New York City finance program, public financing program, and I'd like to tell you about our new law that is working really well in special elections. And then I'd like to make a constructive criticism, if I could.
I'm happy to do it. The history of the New York City system -- I'm not sure everyone knows about it, but in the mid-'80s, we had a Parking Violation Bureau scandal, where the Democratic county leader of Queens actually committed suicide as the police were coming to arrest him. And the Bronx County Democratic leader was arrested and convicted of a felony. And this caused enough of an uproar that we adopted our first public financing system, which was a one-to-one match for only percent 20 of the spending limit. But even that amount of money had a tremendous impact because it elected Mayor Dinkins over Mayor Koch. That election was so close -- it was 40,000 votes out of 2 million votes cast. And, of course, Koch got a lot of money because he was the incumbent, but Mayor 199 /00 LAW & GOV'T - BILL 2 Dinkins got $400,000 in public financing. And without that $400,000 in public financing, there is no Mayor Dinkins. And the real-estate industry continues to control New York for those four years. And areas of New York that never got public resources the way they should have got public financing. Because public financing got Mayor Dinkins elected. It's a very powerful tool, even a small amount of public financing. Now, we ran into a problem about ten years after our first law became antiquated. We started to spend -- one candidate would spend 9, $10 million on a mayoral race in a city of 8 million, and that created a kind of a scandal in New York. When I found out what was happening here, I was flabbergasted. You've got a scandal here too, for sure. Now, that caused our law to be improved. We had increased public financing to 55 percent, and we've had special elections where that money has really helped. We had a City Councilperson retire in lower Manhattan, and there were two candidate. We had a real estate 200 /00 LAW & GOV'T - BILL 2 candidate that got a lot of real estate money, landlord money; and a grassroots candidate. And, of course, the landlord candidate out-raised the grassroots candidate by, like $30,000, and that's a lot money in a special election. But the grassroots candidate went out there, got small contributions, with a 4-to-1 match, and got $75,000 in public financing. Now, the landlord candidate is no 11 dummy. He got 70,000 in public financing, and he still out-spent the grassroots candidate by 30 grand. But the grassroots candidate had enough money to get her message out, and she crushed the landlord candidate. Now, I think she would have won anyway, 'cause I'm that kind of guy, but it made a difference. And, again, that's not 80 percent public financing, that's not 100 percent public financing. You know, all people need is enough money to get their message out. And with our coming election in two years, we have people running for office who always wanted to run for office but never thought about it because they knew they couldn't have the money. We've tripled 201 /00 LAW & GOV'T - BILL 2 the candidates that we used to have. Now my constructive criticism. I think you guys are almost too generous with the public financing and too small on the spending limit. You know what's going to happen if you make the spending limit so low and the public financing system so generous? What you're essential trying to do is trying to almost completely get rid of the big-money contributions. It's smarter to keep a place for them to go. You know, like our spending limit now is going to be about 5 million, okay. And we allow -- we allow big-money contributions to be 45 percent of the spending limit. See, that money's going to go somewhere. And under your system, you know what will happen? It will go to independent expenditures, these crazy outfit that they set up. You know, in 16 years in New York City, we have never had a problem with independent expenditures. They are minuscule. And, you know, New York City is bigger than 40 states, because we allow a place for the big money to go.
If you don't allow a place for it to go within your system, it's going to go outside the system, which 202 /00 LAW & GOV'T - BILL 2 will defeat the purpose, especially at the mayoral level. City Council's different, it might work under your system. But I wish you would increase the spending limit because people will just -- you know, you'll have problems with that, people will go outside of it. And, you know, I don't think it really needs to be 80 percent public financing. I think our system is fine at 55 percent but, you know, anything you do will be better than the current system because you clearly have problems. One last thing I'd like to say -- not as a member of the Bar Association, but as a member of a consortium of other good government groups. We are using some very innovative tactics in getting campaign finance reform in Albany. And we've handed out a New York Times article about that with the Web site. The Web site has gotten 40,000 hits in the last 18 days or so. com. It was featured in a New York Times article with 1100 words, a big picture. And I got to stop talking 'cause I'm 203 /00 LAW & GOV'T - BILL 2 supposed to meet Nicole Gordon to catch a Metroliner. So do you have a question. Can it be a "yes" or "no"?
Don't worry about it, we'll be calling you on the phone.
Very good, thank you. Is there anyone who wishes to be heard who has not yet had opportunity, anyone? (No response.)
The committee will stand in recess until Thursday, June 8th, at 9 a.m. We hope at that time to have a bill.