Voter Owned Elections - More Choices & Different Voices for Portland

Voter Owned Election reform is a fair and sensible approach to return accountability and voter control to Portland politics. This reform system is proving itself as a viable alternative to 'business as usual' where it has been adopted in Maine and Arizona.

· Voters gain more choices as candidates can run based on leadership skills and community support rather than fundraising ability.

· Voters are the focus of campaigns - not contributors and fundraising.

· Community concerns can come first in city council decisions, diminishing the perception that big money contributors win over public interest.

2) What does analysis of campaign contributions tell us about Portland city elections?

Portland politics are out of balance. According to analysis by City Auditor Gary Blackmer, since 1970 the highest spending candidates also received the most votes in 99 out of 114 campaigns or 87 percent of the time. Since 1970 incumbents have spent four times the combined amount of all their challengers.

Analysis by the Money in Politics Research Action Project (MiPRAP) indicates that out of Portland's 43 zip codes over half of campaign contributions to council winners since 1992 come from only ten zip code areas. Contributions larger than $50 make up more 95 percent of all fundraising. Business interests dominate campaign contributions.

56.4 percent of campaign contributions to City Council winners since 1992 come from only 10 zip codes.
The remaining 43.6 percent of contributions breaks down as follows:

21.1 percent comes from the remaining Portland zip codes. This includes PO Box zips and border zip code areas that include both outer Portland and adjoining suburban communities neighborhoods
13.2 percent comes from Oregon outside of Portland and border zip codes
5.2 percent comes from outside Oregon
4 percent has no geographic attribution because addresses were missing or the dollars came in unitemized contributions of $50 or less.

The two zip codes with largest people of color populations comprised only 1.7 percent of total contributions to City Council winners. Zip area 97227 in north Portland has a people of color population of 48.5 percent but only contributed 0.4 percent of contributions. In northeast Portland 97211 the population is 44.6 percent people of color but contributions comprised 1.3 of total contributions to City Council winners.

Only 5 percent of contributions to City Council members came in small donations of $50 or less.

Once in office the size of the average itemized contribution increases from a city council member's first race to subsequent races.

Trends in Size of Average Itemized Contribution - 1992 through 2002 Elections

	Francesconi	Hales	Katz	Saltzman	Sten
1^st election year	$261	$240	$399	$600	$297
last election year	$423	$768	$815	$487	$745
% increase	62%	220%	104%	-19%	151%

Francesconi's 1^st and last elections were 1996 and 2000, Hales 1^st and last elections were 1992 and 2000, Katz 1^st and last elections were 1992 and 2000, Saltzman 1^st and last elections were 1998 and 2002, Sten 1^st and last elections were 1996 and 2002

The typical increase does not hold true for Commissioner Saltzman because his average itemized contribution figures are affected by a personal loan of $83,170 he made to his first campaign.

Asked to comment on this increase, the current council member with the most dramatic average contribution increase, Commissioner Erik Sten, said, "Fundraising got much easier after my initial campaigns. I was a long shot early in 1996 and my fundraising included more of those valued but hard-won $50 contributions. Once in office the money comes easier and in bigger checks."

The business sector, particularly the real estate industry, dominates fundraising. The top two contributing sectors for each recent council winner are noted below:

Council Member	Top contributing sector	% of total fundraising from top sector	2^nd highest contributing sector	% of total fundraising from 2^nd highest sector
Francesconi	Financial/ Insurance/Real Estate	25.2%	General Business	15.9%
Hales	Financial/ Insurance/Real Estate	30.9%	Construction	17.7%
Katz	General Business	23.4%	Financial/ Insurance/Real Estate	18.8%
Leonard	Labor	41.5%	Financial/ Insurance/Real Estate	15.1%
Saltzman	Financial/ Insurance/Real Estate	30.2%	General Business	12.5%
Sten	Financial/ Insurance/Real Estate	27.9%	General Business	17.1%

3) What is Voter Owned Election reform?

Voter Owned Elections are a sensible reform that is proving itself as a viable alternative to 'business as usual' in Maine and Arizona politics. Candidates have a new way to run for office without big money. Voter owned candidates agree to:

Collect a large number of $5 qualifying contributions to demonstrate community support
Reject private money contributions
Limit campaign spending
Agree to comply with strict administrative regulations

In return, participating candidates receive limited amounts of campaign dollars from a publicly financed fund. Even more important - Portlanders will have Voter Owned Elections.

4) What are other names for Voter Owned Elections?

Maine and Arizona adopted this reform under the name clean elections. Portland City Auditor Gary Blackmer developed the Portland proposal using clean campaign terminology. Other terms for this comprehensive reform strategy include fair and clean elections, public funding campaign reform, public financing campaign reform, political accountability act and Voter Owned Elections.

5) Is Voter Owned Election reform making a difference in Maine and Arizona?

Whatever the name, in Maine and Arizona this new system is proving itself as a way to increase competition and voter choice, change campaigns so they focus on constituents rather than contributors and broaden policy debates beyond the interests of campaign donors.

Voter Owned Election reform in Maine and Arizona is changing policy decisions. Both states have passed important legislation to reduce prescription drug costs, a dramatic example of what can happen when legislators are free from the influence of pharmaceutical campaign contributions and lobbyists. For example, Arizona Governor Janet Napolitano kept her campaign promise to require bulk purchasing of prescription drugs by the states because she did not take contributions from pharmaceutical companies. While the issues are different in City Hall, the savings potential is far greater than the cost of reform.

In Arizona, there was a significant jump in contested races in 2002, increasing to 60 percent from only 40 percent in 2000 elections. In Arizona's 2004 general election, 46 candidates for state legislature and corporation commission were elected running under that state's Clean Elections system. Ten of Arizona's statewide elected officials, including its governor, attorney general, treasurer, and the entire Corporations Commission have been elected under Clean Elections. Fifty-eight percent of the state house and 23 percent of Arizona state senators ran as participating candidates. This is an increase from 2002, when the house was 45 percent and the senate 17 percent participating candidates.

In Maine's 2004 primaries, 71 percent of the candidates participated in that state's Clean Elections system. This is up from 50 percent in 2002 and 31 percent in 2000. Maine's Portland Press-Herald reported that the bumper crop of candidates resulted in the most contested party primaries in almost a decade. In the 2004 general election, nearly 80 percent of Maine's legislative general election candidates participated in the reform option. The Maine state senate is now composed of 83 percent members elected as participating candidates and their house of representatives has 77 percent of its members who ran under the reform system.

6) Is Voter Owned Election reform in place in other places besides Maine and Arizona?

Voter Owned Elections are in place in Vermont for statewide candidates. North Carolina adopted this reform strategy for judicial elections and candidates for Public Regulatory Commission in New Mexico have the option of running in voter owned election systems in 2006. Twelve municipalities have partial public funding systems.

7) What has the City Council been doing on this issue?

City Auditor Gary Blackmer and Commissioner Erik Sten have been exploring this issue since late 2002. Their research led them to the clean money campaign finance reform strategy. At an April 2004 hearing there was a critical Council vote for the Auditor to work with the City Attorney and Office of Management and Finance to develop a report and draft ordinance. These were released in July and discussed at a Council work session in August. City Council adoption of a reform ordinance has to occur in early 2005 for voter owned election reform to be in place for the 2006 elections. So… NOW is the time to get Voter Owned Elections "on the radar screen" and urge support by current City Council members and Council candidates.

Contact information

Sam Adams City Commissioner 1221 SW 4th, Room 220 Portland, Oregon 97204 503-823-3008 sadams@ci.portland.or.us	Randy Leonard City Commissioner 1221 SW 4th Ave. rm 210 Portland, OR 97204 503-823-4682 randy@ci.portland.or.us	Tom Potter Mayor 1221 SW 4th, Room 340 Portland, Oregon 97204 503-823-4120 mayorpotter@ci.portland.or.us
Dan Saltzman City Commissioner 1221 SW 4th Ave. rm 230 Portland, OR 97204 503-823-4151 dan@ci.portland.or.us	Erik Sten City Commissioner 1221 SW 4th Ave. rm 240 Portland, OR 97204 503-823-3589 erik@ci.portland.or.us	Gary Blackmer City Auditor 1221 SW 4th Ave. rm 140 Portland, OR 97204 503-823-4078 gblackmer@ci.portland.or.us

8) Why does campaign finance reform rarely show up on surveys as a major public concern?

It is true that when people are asked to identify issues of greatest importance that campaign finance reform rarely ranks very high. But when asked about the influence of money in politics, the story changes. Polling shows a widespread belief among Americans that contributions do influence votes. A Mellman Group poll taken in 2000 with a sample size of 800 potential voters and a margin of error of +/-3.5 percent included the following question.

When a member of Congress is elected with the help of special interest contributions, how much do you think it affects his or her votes on issues of concerns to those groups?

87% affects 9% doesn't affect 4% don't know

9) Do campaign contributions make a difference in Portland decisions?

A Portland story about the role of campaign contributions in policy decisions comes from a City Council vote made on October 30, 2003. A major landowner in NW Portland, the Singer family, benefited from a recent City Council decision about construction of parking facilities that overturned a proposal developed by the NW neighborhood association. Singer companies have made $15,000 in contributions to Portland elections over the years. That these contributions "paid off" are indicated by comments by Mayor Katz at the hearing:

"I maintain that today the special interests have won. I hope that we all realize that the message this sends to other neighborhoods is that they all are in peril."

10) Is there always a "smoking gun" connection between campaign contributions and City Council decisions?

We can be glad that in Portland the answer is no. But that doesn't mean that reform isn't needed. Indeed, the point is that under a Voter Owned Election system campaign contributions can be removed from the equation when policy decisions are made in City Hall. Taking money out of politics diminishes the perception of undue influence.

11) What do business people think about money in politics?
A national poll of 300 corporate executives was done by The Tarrance Group for the Committee for Economic Development. This survey was done from mid-September to mid-October of 2000 and has a margin of error of + 5.8 percent. Key findings from this surveyinclude:

74 percent say pressure is placed on business leaders to make large political donations.
79 percent agree that the current campaign finance system has spawned an arms race for cash that continues to get more-and-more out of control
51 percent agree that many business executives fear adverse legislative consequences to themselves or their industry if they turn down requests for campaign contributions from high-ranking political leaders and/or political operatives

12) Why do some business people give campaign contributions to both candidates in a race?

"Double giving" is when a contributor, typically business people, give to both candidates in the same race. This pattern of campaign contributions appears to be a business investment to ensure access regardless of the election results.

One example in Portland politics is business leader Dr. Robert Pamplin. In the 1998 race between Dan Saltzman and Tanya Collier, RB Pamplin Corp. gave a total of $4,000 to Saltzman and $2,000 to Collier during the primary and general elections. During the special election in 2002, RB Pamplin gave $2,500 each to the three major Council candidates, Nick Fish, Randy Leonard, and Serena Cruz. Cruz and Leonard advanced to the general election. Pamplin then focused his contributions on Leonard, giving another $5,000. Mr. Pamplin hedged his bets during the 2004 City Council primary with his company giving $2,000 first to Sam Adams, and then another $5,000 to Adams and $2,000 to Fish. During the general election RB Pamplin gave $3,000 to Nick Fish and an additional $1,000 to Adams. RB Pamplin gave $37,500 to Jim Francesconi in his run for mayor starting with $10,000 given in the summer of 2003. On October 12, 2004, the RB Pamplin Corp. gave $100--the maximum allowed under the candidate's self-imposed limits--to Tom Potter. Two weeks after the election, Potter received $100 each from RB Pamplin Corp. and Dr. Pamplin.

Other Portland businesses follow this "double giving" pattern so we don't mean to be picking on Dr. Pamplin. It is also important to realize that "double giving" contributors are probably asked for money by both candidates. As noted in answer #11, 74% of national executive polled say that pressure is placed on business leaders to make large political donations. We can free both candidates and contributors from this vicious cycle by adopting Voter Owned Elections for Portland.

13) Why can't candidates just self-impose a limit on their contributions like Tom Potter?

Tom's success as a financial underdog is the exception since the highest spending candidate for city office has won 87 percent of the time since 1970. In addition, self-imposed contribution limits worked for Tom Potter because of name recognition from many years of public service. In addition, his opponent, Jim Francesconi, raised so much money that his fundraising became the story rather than his record.

Indeed, Jim Francesconi is a good example of why Portland needs Voter Owned Elections. The current system makes it hard for a candidate like Francesconi to remain true to his community activist background and the perception, if not the reality, that Francesconi was changing his political "stripes" to garner financial support from big money contributors. We can't fault candidates like Jim Francesconi for doing what it typically takes to win - we need to provide a new campaign finance option.

14) How do candidates qualify for Voter Owned Elections and what about hobby candidates?

Candidates who wish to participate must collect a large number of $5 qualifying contributions to demonstrate community support and weed out hobby candidates. The required numbers are as follows and were developed with input from local candidates, community organizers, and campaign experts.

Mayoral candidates - 1,500

City Commission candidates - 1,000

Auditor candidates - 1,000

Candidates file a declaration of intent with the Elections Officer within the Auditor's office and during the qualifying period agrees to accept only $5 qualifying contributions and seed money contributions.

15) What are seed money contributions?

Interested candidates can raise start up or seed money to assist in their efforts to collect qualifying contributions. For example, seed money could be used to print a flyer about the prospective candidate. Seed money contributions are limited to $100 from any person or political committee. There is also an overall cap on seed money fundraising set at five percent of the spending limit for the applicable race. Seed money contributions are deducted from the voter owned election allocation. This provides an incentive for prospective voter owned election candidates to focus on grassroots methods of collecting qualifying contributions.

16) Who can give qualifying contributions?

The $5 qualifying contributions can only be made by Portland residents. A voter registration requirement was considered but not anticipated to be in the final ordinance because of the delay and cost involved in verifying voter registration, a process that is done for a fee by the Multnomah County Elections office.

17) What does the participating candidate and community get?

A participating candidate receives two significant benefits. One is that freedom from the time demands of conventional campaign fundraising. The second is enough money to run a viable campaign. Community benefits are candidates and campaigns whose focus can be constituents rather than campaign contributors as well as policy making by elected officials who are "voter owned" rather than the recipients of private, special interest contributions.

18) How much money is provided to participating candidates?

Candidate	Primary election	General election
Mayor	$200,000	$250,000
City Commissioner	$150,000	$200,000
City Auditor	$150,000	$200,000

No money is given to participating candidates who are unopposed.

19) What can this money be used for & why should public money go to candidates I don't support?

Current state law mandates that campaign contributions can only be used for legitimate campaign expenses. For example, regardless of the source, campaign funds can't be used for personal use like vacations. Additional regulations govern the use of voter owned election funds. Voter Owned Election funds cannot be transferred or spent on any other candidate's race, initiative or ballot measure committees, or for independent expenditure or issue ads. Voter Owned Election funds will also not be available for purchase of large fixed assets or for any personal use by the participating candidate. Legal defense fees may also not be paid for from Voter Owned Election funds.

Voter Owned Elections is a systemic rather than piecemeal reform. Public dollars are being used to create a new system that has been proven in Maine and Arizona to be fair and sensible. This may mean that public dollars support candidates that you don't support but right now tax dollars are used for a diverse set of policies that often aren't approved by all voters. It should also be noted that an Arizona analysis by University of Wisconsin political scientists indicates that concerns that money would be used by fringe candidates are unfounded.

20) How were these Voter Owned Election allocations chosen?

City Auditor Gary Blackmer recommends these allocations based on review of historical campaign spending levels and consultation with campaign experts. These dollar figures represent a balance between the need to provide enough money to run a viable campaign and recognition that participating candidates will not have to spend time or money on fundraising.

21) When does a candidate receive the Voter Owned Elections funds?

After a candidate has been certified as meeting all qualifying requirements, twenty percent of the primary election voter owned election fund allocation for the applicable office is distributed. The remaining eighty percent of the primary election voter owned election allocation is distributed within five business days after the 90^th day before the primary. There is discussion of shifting this to 120 days because often "the race" is the primary.

For participating candidates that advance to the general election, 20 percent of general election Voter Owned Election fund allocation for the applicable race is distributed within 30 days after the primary. The remaining 80 percent of the general election Voter Owned Election funds are distributed within five business days after the 120^th day before the general election.

The Voter Owned Election system applies to the entire election cycle, both the primary and general elections. This election cycle approach prevents a candidate from opting into the Voter Owned Election system in the primary when he or she finds it advantageous but opting out in the general election and running as a private money candidate after receiving the benefit of public dollars. This approach also addresses problems seen in the presidential public funding system where candidates can raise private money in the primary and then use public dollars in the general election.

22) Are candidates required to participate?

No. Participation is voluntary. Candidates who choose not to participate will raise funds privately, as occurs now. A key reason for the constitutionality of Voter Owned Election reform is that is a voluntary option. A critical element of Voter Owned Election reform is that it limits spending. Since expenditure limits have typically been found unconstitutional, candidates need to voluntarily opt into the new system.

23) May incumbents run under the new system?

Yes. Incumbents who run under the new system will not need to spend time fundraising. Instead, incumbents will be free to spend their time in office responding to constituent concerns and on campaign activities that focus on constituent and community concerns rather than talking with contributors.

24) What happens if participating candidate is outspent?

If a participating candidate faces a privately financed, non-participating opponent and is outspent, the participating candidate will receive additional matching or equalizing funds.

For example, if a participating mayoral candidate faces a non-participating candidate in the general election who raises $500,000, the participating candidate is eligible to request an additional $250,000 over his or her initial voter owned election allocation of $250,000. If the non-participating candidate raises $800,000 a total of $500,000 in matching funds can be requested. In this situation, the participating candidate is still outspent ($750,000 to $800,000) but enough funds are provided to get out a campaign message. It isn't fiscally prudent to provide unlimited matching funds. The participating candidate also has no fundraising expenses and should be able to gain a public relations advantage by opting into the new system and out of the private money fundraising "arms race."

In a primary election matching funds are allocated between participating candidates. For example, if there are three participating candidates and a non-participating commissioner candidate raises $180,000, matching funds of $30,000 (the difference between $180,000 and the $150,000 voter owned election allocation) are distributed equally ($10,000 each) between the participating candidates. The rationale for this shared match is that in Portland's nonpartisan elections, only two candidates advance to the general election unless one candidate wins 50 percent plus one votes. The intent of the matching funds in the primary is to provide enough money for participating candidates to at least ensure a run-off in the general election.

25) Do independent expenditures and issue ads trigger matching funds?

First of all what are these categories of spending? Independent expenditures are dollars spent by a third party independent of the candidate that include so-called "magic words" of express advocacy such as "vote for" or "defeat". Third party spending is also behind issue ads that do not expressly advocate for or against a candidate but by any common sense analysis are campaign ads.

In Oregon determination of what constitutes spending for or against a candidate is outlined in State ex rel Crumpton v. Keisling, 160 OR App 406 (1999). This court decision outlines the following criteria: 1) the message, in its context, clearly and unambiguously urges the election or defeat or one or more identifiable candidates, 2) the message, as a whole, seeks action rather than simply giving information, and 3) it is clear what action the message advocates. Disclosure of financial donors behind independent expenditures and issue ads is required under the Crumpton decision regardless of when during the election this spending occurs.

The Bipartisan Reform Campaign Act (BCRA), also known as McCain-Feingold, defines independent expenditures and issue ads as "electioneering communications" and limits the source of money that can be spent on this kind of advertising in the 30 days before the primary and 60 days before the general election. Given the focus of federal campaigns on TV advertising, the BCRA regulations only apply to broadcast ads.

Matching funds for participating candidates are allowed in response to either independent expenditures or issue ads ad as defined by the Crumpton case with additional provisions based on BCRA provisions on this topic.

26) What about matching funds in response to a combination of third party spending and being outspent by a non-participating candidates?

Matching funds to participating candidates can also be triggered by a combination of private money fundraising and independent spending that go over the Voter Owned Election allocation for that office and election.

27) What about campaign finance reports and electronic reporting?

To ensure timely release of matching funds, independent spending of $1,000 or more must be reported within one business day to the Elections Officer in the Auditor's office. This information will be posted on the Auditor's website and distributed to all candidate's in the race.

Once a non-participating candidate has reached a fundraising level (either alone or in combination with independent expenditures) equivalent to the voter owned election allocation for that office and election, additional reports in $2,000 increments for Auditor and Commissioner candidates and $3,000 increments for Mayoral candidates will be required. These reports are due to the Elections Officer within either one or two business days depending on proximity to the election. The Elections Officer will post this information on the internet and distribute to other candidates in the race. The Elections Officer has one business day to distribute matching funds after a request has been received by a participating candidate.

All candidates must file expenditure reports, regardless of the source of their campaign funds. Non-participating candidates must file contribution reports on timelines specified by the Secretary of State and as noted above. Participating candidates must file disclosure reports documenting qualifying and seed money contributions.

Electronic filing of campaign finance disclosure reports is a public policy goal that is complementary to Voter Owned Election campaign reform. A campaign finance disclosure panel convened by Secretary of State Bradbury recommended a system of electronic campaign contribution and expenditure reporting with the information going into an on-line searchable database. This recommendation applies not only to state campaigns but to all local elections, resulting in one reporting system to be used by all of Oregon's political jurisdictions. The goal is to have this up and running for the 2006 election cycle. Even if this state goal is not realized, City Auditor Blackmer is assessing interim electronic reporting options.

If implementation of electronic reporting is delayed, however, the reporting required to ensure efficient allocation of matching funds can be done with a fax machine. Electronic reporting is helpful, but its delay should not be a barrier to adoption of a Voter Owned Election system.

28) What about in-kind contributions?

A minimal level of in-kind contributions are allowed to prevent a prospective or participating candidate to not be penalized if services are provided to his or her campaign with notification only coming after the fact. The cap on the allowed level of in-kind contributions is 5 percent of either the primary or general election spending limit or public funding allocation for that candidate.

29) Timely distribution of matching funds?

In Maine and Arizona different systems have been developed to ensure timely distribution of matching funds. One option under review in Portland is use of Trustee Accounts. The Elections Officer will be required to evaluate a participating candidate's request for matching funds within one business day. The participating candidate is then authorized to receive a Trustee Account check that can be written immediately.

30) When will the system be in place?

If enacted by the City Council by mid-February 2005, the Voter Owned Elections system can be in place for the 2006 elections and available to candidates for Auditor and the two City Council positions that come up for election in that cycle. If enacted later, then the new system would be in place for the 2008 elections.

31) What about administration and oversight?

The Elections Officer within the Auditor's Office is currently the city employee responsible for monitoring campaign finance disclosure reports and dealing with other election issues. The Elections Officer will be responsible for Voter Owned Election system administration. As with current election responsibilities, the City Auditor will be responsible for administration of the Voter Owned Election system.

A Citizens Voter Owned Election Commission will be created to provide assistance to the Elections Officer, Auditor, and City Council in administrative rule making and policy improvements. The Commission will consist of seven members and be recommended by the Auditor for City Council appointment. Commission members will serve staggered four-year terms. The Citizens Voter Owned Election Commission will make decisions pertaining to any incumbent Auditor with regard to matching funds or other matters regarding implementation of this reform in that Auditor's race.

32) What are penalties for violating the Voter Owned Elections ordinance?

If a participating candidate is found to have accepted private money as well as public dollars, they will be subject to a civil penalty of up to $10,000. In addition, the candidate will be removed as a participating candidate and must return any Voter Owned Election funds plus interest at a 12 percent interest rate. Stringent penalties for other Voter Owned Election system violations, including personal use of funds are also applicable. In general, the Voter Owned Election allocation is considered a loan and must first be repaid, with interest, if a candidate withdraws from the system and wants to continue the election as a non-participating candidate.

33) What about inflation?

The Citizen Voter Owned Election Commission will periodically review the dollar amounts and number of qualifying contributions. The Commission shall recommend any necessary adjustments to reflect inflation or population change to the Auditor for approval by the City Council.

34) What can organizations or individuals do to be involved in the campaigns of participating candidates?

Participation in campaigns has not changed except in terms of contribution limits. Portland residents may give $5 qualifying contributions. Seed money contributions of $100 may be made by any entity authorized under state law to make campaign contributions.

During the qualifying period, individuals may assist participating candidates in gathering qualifying contributions. Individuals and organizations may arrange gatherings at which individuals can make qualifying contributions.

After the qualifying period, gatherings for the purpose of soliciting campaign contributions for participating candidates will not be required or allowed. Instead the focus of gatherings can be discussion of issues.

Volunteers may "door-knock" urging constituents to vote for particular candidates, register voters, determine concerns and needs of constituents, impart information, distribute literature and answer questions. Volunteers may staff campaign offices, answer phones, assist visits with information and voter registration, and make phone calls on behalf of candidates, etc. Volunteers may speak to groups on behalf of candidates, erect signs and distribute handbills. Volunteers may assist with research and other information gathering to provide candidates with facts to support positions on issues.

In summary, essentially all "grass roots" campaign activities remain available to individuals and organizations.

35) Can a participating candidate use public funds to retire debt from a previous campaign?

Voter Owned Election funds cannot be used to repay debt from a previous campaign. A participating candidate must be allowed the option to raise funds to repay outstanding campaign debts, but must set up a separate bank account and keep those dollars separate from voter owned election funds.

36) What may candidates do with surplus funds from a previous election cycle?

Participaiting candidates may not use surplus or left over funds from any previous campaign once they declare an intent to opt into the Voter Owned Election system. They may return surplus funds to their contributors, retire a previous campaign debt, contribute the surplus to the city clean elections fund, or keep the dollars in a separate account.

37) If a participating candidate doesn't use all of the Voter Owned Election allocation, what happens?

All unspent Voter Owned Election fund dollars must be returned. No Voter Owned Election funds are retained by the candidate after the conclusion of the campaign.

38) Couldn't candidates participating in the Voter Owned Election system pool their funds or transfer public dollars between or among their campaigns?

No. Current Oregon elections law contains a principal campaign committee designation, so use of campaign funds are to focus on a candidate's own race. The Portland Voter Owned Elections ordinance also includes additional protections forbidding the transfer of funds from a participating candidate to another political committee. This prevents a voter owned candidate from giving from his or her campaign dollars to another candidate, to a ballot measure, or spending campaign funds on an independent expenditure or issue ad.

39) What about reducing the cost of media in campaigns?

The cost of TV advertising is a piece of the campaign finance reform puzzle, particularly for statewide candidates and candidates running in relatively large geographic areas like Portland. Providing free air time for candidates and strengthening lowest unit charge regulations to ensure that candidates are charged fair rates are two important reform strategies to address this issue.

Action on these reform steps, however, can only occur at the federal level, as regulation of the broadcast industry is the sole purview of the Federal Communications Commission and Congress. Action steps could include:

Contact Senators Wyden and Smith and suggest that they co-sponsor the Our Democracy, Our Airwaves bill. Current co-sponsors are Senators John McCain (R-AZ), Russ Feingold (D-WI), and Richard Durbin (D-IL.) This legislation closes the lowest unit charge loopholes, provides free air time for qualifying candidates, and requires improvements in public affairs news coverage concerning elections.
Contact the Federal Communications Commission and urge that they use the following public interest guidelines when reviewing broadcast license renewals:

Require a minimum of 3 hours per week of local civic and electoral affairs programming.
Require independently produced programming for at least 25 percent of prime time scheduling.
Require more frequent and accessible reporting of public file records.
Limit excessive commercialization.

Portlanders, however, should not wait for federal regulators and Congress to take action. Voter Owned Elections will work now to give candidates the resources they need to run an effective campaign and spend more time talking with constituents, not contributors.

40) What about district representation as a way to level the playing field?

A shift to district representation in Portland is integrally linked to restructuring the city's commission style of government. These changes would require significant changes to Portland's charter and merit careful study. Regardless of future decisions on the structure of Portland government, the need for campaign finance reform remains.

Voter Owned Election reform opens up the political process and levels the playing field, improvements that are necessary regardless of the size of council districts. Indeed, a cynical interpretation of district representation is that it will only lower the costs to special interests to buy access and leverage over a city council member. An optimistic view is that it will enable grassroots candidates to beat better-funded opponents because "shoe leather" campaigning is more feasible in smaller districts. This latter scenario will only be strengthened with Voter Owned Election campaign reform.

Trends in legislative races indicate that smaller districts don't reduce campaign fundraising. Typical Senate districts include 114,000 residents; House districts have 57,000. With 530,000 residents, Portland contains slightly more than nine House districts and about 4.5 Senate districts. The 2002 general election fundraising record in a House district with an open seat was $529,523. This represents $9.29 raised per resident. The fundraising record in an open seat Senate district in the 2002 general election was $891,641. In this race $7.82 was raised per resident. Presumably a comparable race in Portland would involve more money. But in hotly contested 2002 general election race for an open Commissioner seat, the two candidates raised $499,324. This represents $0.94 raised per resident.

Review of legislative elections indicates that financial underdogs don't do very well even though the district size is less than for Portland's citywide races. According to Auditor Gary Blackmer, the highest spending candidate won in 87 percent of city elections since 1970 (99 out of 114 campaigns). In both 2002 and 2004, the top fundraiser won 91 percent of Oregon legislative races. Even in smaller legislative districts with increased opportunity for "shoe leather" campaigns, financial underdogs lose 9 out of 10 times.

41) Don't we just need to shorten campaigns?

The legal reality is that it is unconstitutional to require that candidates limit campaigning to certain periods of time before primary and general elections. Also, much of the concern about length of campaigns can be attributed to the protracted presidential primary schedule and doesn't actually apply to most city races.

42) Isn't Voter Owned Election campaign finance reform really incumbent protection?

The Cato Institute and other conservative voices have criticized campaign finance reform as primarily benefiting incumbents. A recent report, Do Public Funding Programs Enhance Electoral Competition, by Kenneth R. Mayer and two colleagues at the University of Wisconsin-Madison, reaches four conclusions that indicate that Voter Owned Election reform in Maine and Arizona does not unduly benefit incumbents. These conclusions are:

1) Public funding programs have increased the pool of candidates willing and able to run for state legislative office.

2) Public funding appears to have increased the likelihood that an incumbent will have a competitive race.

3) The reelection rate for incumbents in Maine and Arizona dropped significantly in 2002, even after controlling for the effects of redistricting.

4) Inadequately funded voter owned election programs are ineffective. If the public grants are not large enough to permit candidates a reasonable chance to run a competitive campaign, the programs will have no appreciable effect on election outcomes, competitiveness, or candidate behavior.

43) Don't we also need to amend the Oregon constitution and impose contribution limits?

Contribution limits and Voter Owned Elections address the problem of money in politics from different angles and are not mutually exclusive. That contribution limits are not an effective stand-alone reform strategy, however, is revealed by seeing how little difference there is between Oregon politics compared to most other states and federal elections that occur under contribution limits. Indeed, the Voter Owned Elections systems in Maine and Arizona overlay an existing regime of contribution limits. Imposing contribution limits in Oregon requires an amendment to our state constitution, which is beyond the purview of Portland city council action.

The question, then, becomes, "Is it worth adopting Voter Owned Election reform without contribution limits?" We believe that the answer is yes, especially in Portland where establishing a political culture that expects candidates to run as "voter owned" candidates seems quite feasible. The power of this new social norm under which the public expects candidates to run under the voter owned election system is evident in Tucson partial system. "Every candidate elected to Tucson office from 1991 through the present has participated in the city's public financing program."

44) Will Voter Owned Election reform be found constitutional?

"Contrary to some misconceptions, voluntary public financing schemes have been repeatedly upheld against First Amendment challenges." This is the key finding in a memo from the National Voting Rights Institute. In addition, all legal challenges to the Voter Owned Elections systems in Maine and Arizona have upheld the legality of public funding.

Indications of the likely positive response by the Oregon Supreme Court to a challenge on the basis of the state Constitution can be gleaned from two previous decisions. The first case pertains to 1973 legislation that included expenditure limits. Key points of that case are summarized as follows in the Portland City Club's study of ballot measure 6.

In 1975, the Oregon Supreme Court overturned these expenditure limits (Deras v. Myers). The court found that the limits violated rights of free expression and free assembly guaranteed by the Oregon Constitution. The Court noted that the evils that that the expenditure limit sought to prevent "could be treated by providing some form of public subsidy for campaign expenditures." The Court added that this "should not be taken as an expression as to the effectiveness of public subsidy or its desirability, but only that it is likely to be at least as effective as direct restrictions and is less clearly subject to Constitutional attack." (535 P2d 541)

In the 1997 Vanatta v. Keisling ruling, which overturned contribution limits adopted by the voters in 1994's ballot measure 9 two points shed some light on legal thinking about inappropriate coercion of candidates. Such coercion is a critical element in evaluating the constitutionality of a voluntary reform strategy like public funding.

"Petitioners single out parts of sections 13 and 19, asserting that they provide 'penalties' for failure to agree to limit expenditures under section 6. Petitioners argue that those provisions, when considered together with section 6, impermissibly coerce candidates to agree to self-imposed campaign contribution limits. Assuming without deciding that a statute that impermissibly coerces a candidate to agree to self-imposed expenditure limits would amount to an unconstitutional violation of Article I, section 8, we conclude that these sections do not impermissibly coerce candidates." (Italics in the original.)

Section 6 of measure 9 refers to voluntary expenditure limits. Section 13 required the Secretary of State to publish in the Voters' Pamphlet a statement as to whether a candidate has agreed to limit his or her expenditures. The Court held that this provision is non-coercive.

Section 19 provides that campaign contributors who give to candidates who have not agreed to abide by the campaign expenditure limitations under section 6 may not receive a tax credit for campaign contributions to that candidate, whereas contributions to limited-spending candidates are eligible for the tax credit. Petitioners argued that this disparity indirectly punished a candidate for not agreeing to the limitations. The Court's conclusion is that, "The legislative choice to allow such a credit, but only under limited circumstances, does not appear to us to implicate Article I, section 8."

To summarize, no one should be surprised if a Portland Voter Owned Election reform ordinance is challenged in court, but all indications are that legal hurdles will be successfully overcome.

45) How much will it cost?

City Auditor Gary Blackmer and the Office of Management and Finance (OMF) have developed cost estimates based on a computer model assessing Portland election competition history and projections of increased competition based on information available from Maine and Arizona. The cost estimate recommended by the Office of Management and Finance is $1.3 million a year. This is $2.45 a year per Portland resident.

46) Can't the money for this just come from voluntary check offs?

Providing enough funding is essential to ensure the success of Voter Owned Elections. Various forms of voluntary tax check offs have been part of the funding package in other states but as a "stand alone" funding mechanism, check off systems are not effective. In addition, a Portland reform can't amend Oregon state tax policies and forms so this is not an option for city level efforts.

47) Where will the money come from?

The Office of Management and Finance also recommends distributing Voter Owned Election costs citywide using an approach similar to the general fund overhead model. This approach treats Voter Owned Election dollars as another cost of government to be shared equally among city bureaus.

48) What do these dollar figures really mean?

The OMF uses a 2003-04 net adjusted budget figure of $907 million ($907,782,938) to make its estimates of how many city dollars would go to the Voter Owned Election system. Voter Owned Election costs of $1.3 million ($1,296,000) are 0.143 percent of $907 million. To visualize this, check out this pie chart.

49) Can spending on this new system get out of control?

Total spending on the Voter Owned Election system is capped at 0.2 percent of annual city spending to ensure that costs can't spiral upward without limit.

50) How can we not afford this option?

The potential savings that can result from removing City Hall policy decisions from the influence of campaign contributions will likely offset the cost of Voter Owned Elections. We can be glad that Portland policy making isn't dominated by quid pro quo decisions, but we'd be naïve to think that there aren't hidden costs of the current system of electing our city officials. Cost savings, particularly with regard to prescription drug costs are being realized in Maine and Arizona due to policy decisions made by voter owned elected officials. A final comment is from Marc Spitzer, a fiscal conservative elected as a Republican under Arizona's voter owned election system for that state's corporations commission, says, "The question shouldn't be how can you afford to do this, but how can you afford not to."