Sarah Holder is a staff writer at CityLab covering local policy, affordable housing, labor, and technology.
Big money is flooding into elections on the local level. Cities like Denver, Baltimore, and Portland, Oregon, are some of the ones pushing back.
It’s well known that a run for a big office needs big money backing it, but up and down the ballot, budgets have been swelling, and not only in the U.S.’s largest cities. Several localities—including Portland, Denver, and Baltimore—have initiatives in motion to overhaul the system either by driving down the dollar amounts each person can give or solicit, piloting public financing projects that make each donated dollar go further, or both. The overarching goal is to keep big money and its influence out of local politics, and to give all candidates a fair shot.
In Denver, voters will decide on an expansive reform package, including a contribution cap and a generous matching fund. Baltimore’s city council has unanimously passed a charter amendment that would create a similar small-dollar matching system, if Mayor Catherine Pugh approves it and passes it along to the fall ballot. And before Portland, Oregon, phases in its own public financing measure in 2020, voters will decide on a strict local contribution cap this November.
“The reason we’re doing this in the city of Portland right now is, one, we want to show political momentum—that this is something popular that different areas want to accomplish,” said Jason Kafoury, one of the leaders of the Honest Elections campaign, which is championing Portland’s “Fair Elections/Clean Governance” ballot initiative. “But beyond that we are interested in changing the local political culture, and forcing this to be a campaign issue that people have to address.”
Local political spending, he says, has gotten “out of control.”
And the factors behind its spiral are two-fold, says Ross Morales Rocketto, the co-founder of Run for Something, an organization that helps young progressive candidates run for office. He believes that it’s both that people are more willing to give, and that candidates are willing to ask for more.
Large political donors recognize that local races have national implications, and are willing to fund mayoral or city council candidates to build party power strategically. “At the state and local level, races historically have been far less expensive than federal races,” said Joanna Zdanys, counsel for the Brennan Center's Democracy Program. But that also means, she says, “given the low cost of state and local races, a big expenditure by a deep-pocketed, special-interest spender has the potential to really overwhelm a candidate.”
And potential city leaders, in turn, are hiring national media consultants who recommend large budgets and high spending. Local campaigns have become more professional, with sleek campaign mailers and digital or TV ad spots.
“I also think that there’s just the willingness to do more for a lot of these candidates,” said Rocketto. “They’re willing to go for broke.”
To most of the country, Portland, Oregon, isn’t exactly synonymous with lavish political spending. Mayors’ races there don’t make headlines for breaking donation records, like L.A.’s $33 million race did in 2013, or Michael Bloomberg’s jaw-dropping $109 million reelection campaign for mayor of New York City did in 2009.
But unlike most states, Oregon has no campaign contribution limits on individuals, nor corporations. And in cities like Portland, where they’re able, candidates have taken advantage of that fact: During Portland’s 2012 mayoral race, each of the three front-runners raised close to $1 million during the primary alone, amounting to a record-breaking $2.5 million between them. Portland’s current mayor Ted Wheeler also received over $1 million in combined donations in 2015 and 2016, including $15,000 from Nike and more than $30,000 from local unions after clinching victory in the primary.
The state got close to implementing campaign finance caps in 1994, after a state measure passed with the support of 72 percent of voters, but the Oregon Supreme Court struck down the reforms in 1997, ruling that the measure would have violated the free speech clause of Oregon’s constitution.
In 2016, Kafoury’s group, Honest Elections, tried again, this time putting a county-wide cap up for review. Voters in Multnomah County, which contains Portland, passed it with 89 percent of the vote. But after a challenge from local business interests and the Portland Realtor’s Association, a Multnomah County Circuit Court judge struck it down once more, using the same 1997 argument.
The U.S. Supreme Court has already ruled that while limiting campaign contributions does burden free speech to an extent, the risk of corruption—or the appearance of corruption—posed by not limiting campaign contributions is worse: Caps serve to limit “the real or imagined coercive influence of large financial contributions on candidates' positions and on their actions if elected to office.” (Campaign expenditures, meanwhile, cannot be limited according to the Supreme Court). Armed with that federal precedent, the county judge’s decision is being appealed to the Oregon Supreme Court.
But in the meantime, Honest Elections Portland is hoping that a local fix will tide the city over. If passed this November, the amendment to the city’s charter would, among other things, cap the amount of funding each candidate can receive from individuals and most political committees at $500; ban corporate donations; increase transparency around large donors’ identity; and “limit political committee independent expenditures to $10,000 per year,” according to the Portland Tribune.
“Traditional wisdom says that he who raises the most money wins,” said Jo Ann Hardesty, who is running for the Portland city council this November. “Usually in Portland that would be a white male, who has been invested in the community for years. That’s been the history in the city of Portland of who has had the privilege of running for public office.” Hardesty, who served as president of the Portland branch of the NAACP until stepping aside for the campaign, says the cap will increase access to non-traditional candidates mounting grassroots campaigns, like herself.
Denver’s cap goes even farther. It would lower maximum donations to local candidates to about a third of current levels—mayors, for example could receive a maximum of $1,000 from each individual—and prohibit them from accepting direct donations from businesses or unions, according to 5280 magazine.
State-level caps exist in 39 states, but even within them, many localities have long implemented their own, more stringent spending restrictions. And where caps have been pushed aside, spending has snapped back up. The Illinois campaign contribution restrictions will be lifted for Chicago’s 2019 mayoral election, according to the Chicago Tribune, because of an exemption for races in which “candidates donate $100,000 or more to their own campaign within a year of the election.” In April, the local businessman Willie Wilson self-financed that amount, thus dissolving the caps.
In the months since, Mayor Rahm Emanuel took advantage of the relaxed regulations to mount an aggressive fundraising campaign for reelection—before making an unexpected announcement that he would not seek reelection after all. “This has been the job of a lifetime, but it is not a job for a lifetime,” he said. As of August, though, he had already raised $10.1 million—almost $2 million of it in one day.
Contribution limits are just one piece of the puzzle in campaign finance reform, says Zdanys. Caps lower the barrier to entry for local candidates—but matching funds ensure that those smaller contributions carry water. In 2020, Portland will introduce such a program: every $50 donated to eligible candidates will be matched at a 1:6 ratio by the city. “For community members, that changes the dynamic of who can run and win,” said Hardesty.
Portland’s program is modeled after New York City’s Matching Funds Program, which has sextupled eligible small-dollar donations in most local races for years. But Denver’s program, again, raises the stakes: Donations of $50 or less will be matched at a 1:9 ratio by the city—turning $50 into $500.
Baltimore’s public financing plan is less fleshed out. The charter amendment, which was unanimously passed this month by the city council, calls for the creation of a fair elections fund commission, and a matching program that would be implemented in 2024—inspired by record-breaking spending in Baltimore’s 2016 election, in which $9 million total was spent between the mayoral candidates. More than $2 million of it was spent by the winner, Mayor Pugh.
“We want to make it as easy as possible for folks to run competitive races,” Baltimore councilman Kristerfer Burnett, the bill’s lead sponsor, told the Baltimore Sun. “You don’t want money to be the barrier keeping people with good ideas out of a race.”
Baltimore and Denver’s consideration of these reform measures is indicative of the momentum around public financing in other cities and counties, says Zdanys. Already, Montgomery County, Maryland, near Baltimore, has implemented its own small donor public financing measure (which had a mixed effect in the July race).
Other cities are experimenting with “democracy vouchers,” which give eligible voters money to back a contender of their choice. Seattle rolled out $100 vouchers in 2017, and cities like Albuquerque and Austin have proposed similar initiatives, CityLab reported, in an effort to get more people engaged with local elections and their local leaders.
“It encourages politicians to engage with their constituents, instead of staying in their office dialing for dollars,” said Zdanys. “It’s empowering small donors, and allowing their voices to be heard; and it has helped lower barriers to entry both for candidates and for donors who have otherwise historically not been active in politics.”
An uncertain impact
Caps or restrictions on fundraising can be one way to level the playing field, ensuring that candidates woo the everyman, not just the rich; and that they’re not beholden to the dollars that put them over the finish line. But they can also disadvantage first-time candidates, especially those who don’t have personal finances to fall back on, says Lindsay Crete, who works on local campaigns with the pro-choice women-candidate advocacy organization, Emily’s List. “It depends on where the cap is, and who it’s really affecting,” she said. “Well-established incumbents who don’t need to raise a lot of money won’t be as impacted by the cap as someone who’s trying to get the name recognition.”
In Chicago, Wilson told the Chicago Tribune that he chose to negate campaign finance restrictions not to open Emanuel’s fundraising floodgates, but to “level the playing field for some of the other candidates who may not be able to get as much money.”
“This lets them get $50,000 or $100,000 at a time if they can.” Wilson said. “Rahm is going to get all the money he is going to get.” With Emanuel now out of the race, the playing field has changed.
And when politicians can’t earn enough from small-dollar donations, some of the fundraising is punted to third-party groups that support but aren’t technically affiliated with candidates, called independent expenditure groups. (Emily’s List, for example, has an independent expenditure arm in addition to a political action committee.)
Some of these groups are notorious for running attack ads without the public knowing who finances them, said Zdanys. “Without accountability or disclosures behind the interests of a major spending campaign, it’s easy for spenders to hide behind unaccountable messages.”
Still, candidates—especially those running for the first time, against incumbents—are hopeful that the measures will level the playing field. Portland’s cap, coupled with the 2020 public finance matching measure, would be “a game changer,” said candidate Hardesty, who’s facing a runoff in November with an opponent who has already raised double Hardesty’s total. Despite this, Hardesty still topped her competitor, with twice as many votes in the May primary. But Hardesty said that the reforms would help her and others focus on running, not campaigning: “It will force me not to spend so much time on the phone trying to raise money. And it means that regular people can run and serve.”