GO Item 1
September 15,2014
Worksession 2
MEMORANDUM
September 11, 2014
TO:
FROM:
Government Operations and Fiscal Policy
Commi~\"
Robert H. Drummer, Senior
Legi~f}ttomey
Josh Hamlin, Legislative Attometr'] _.
f1iuJ
SUBJECT:
Worksession: Bill 16-14, Elections - Public Campaign Financing
Expected attendees:
Jared DeMarinis, Director of Candidacy and Campaign Finance for the State Board of Elections
Robert Hagedoom, Finance
Aron Trombka, Office of Legislative Oversight
Bill 16-14, Elections
Public Campaign Financing, sponsored by Councilmembers
Andrews, EIrich, Berliner, Riemer, Council Vice President Leventhal, Council President Rice,
Councilmembers Navarro, Floreen, and Branson was introduced on February 4. A public
hearing was held on March 4 and a Government Operations and Fiscal Policy Committee
worksession was held on March 20.
Bill 16-14 would:
(1 )
(2)
(3)
(4)
establish a Public Election Fund to provide public campaign financing for a
candidate for a County elective office;
regulate campaign finance activity of a candidate for County elective office who
voluntarily accepts public campaign financing;
authorize the Maryland State Board of Elections to administer and enforce the
public campaign financing system; and
provide for penalties for violations of the public campaign financing system.
Background
One ofthe provisions in the Campaign Finance Reform Act of 2013 (Chapter 419 of the
2013 Laws of Maryland), enacted by the General Assembly
in
its 2013 Session, authorizes the
governing body of a county to establish, by law, a public campaign finance system for the
election of County Executive and County Council. A copy of this part of Chapter 419 is at © 13­
14.
Bill 16-14 would implement this authority by establishing a public campaign finance
system for the election of County Executive and County Council. The goal of this Bill is to
encourage greater voter participation in County elections, increase opportunities for more
residents to run for office, and reduce the influence of large contributions from businesses,
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political action groups, and other large organizations. Councilmember Andrews explained the
purpose of the Bill in his January 29 memorandum at ©15 and summarized the components of
the Bill at ©16.
The Bill would designate the Maryland State Board of Elections to certify candidates and
generally administer the public campaign financing system. The Director of Finance would be
responsible for establishing a Public Election Fund and distributing the public contributions to
certified candidates. The Council would have to appropriate funds for the Public Election Fund.
A candidate would need to obtain a specific number of small contributions from a County
resident of between $5 and $150 in order to qualify for public funding. Each of these qualifying
contributions must be received within 365 days before the primary election and at least 45 days
before the primary. A candidate for Executive would need
to
collect at least 500 qualifying
contributions and an aggregate total of at least $40,000 to qualify. A candidate for At-Large
Councilmember would need 250 qualifying contributions and an aggregate total of at least
$20,000. A candidate for District Councilmember must collect at least 125 qualifying
contributions and an aggregate total of at least $10,000.
A candidate for Executive certified to receive public funding would be eligible for a
matching contribution of $6 for each dollar of a qualifying contribution for the first $50 of the
contribution; $4 for each dollar of the second $50; and $2 for each dollar of the third $50. The
match for a candidate for Councilmember would be $4 for each dollar of the first $50, $3 for
each dollar of the second $50, and $2 for each dollar of the third $50. Therefore, a candidate for
Executive who collects 3 qualifying contributions of $50 would receive $900 in matching funds
and a candidate who collects 1 qualifying contribution of $150 would receive $600 in matching
funds. The maximum public contribution for a candidate for Executive would
be
$750,000 for
the primary and $750,000 for the general election. The maximum public contribution for each
election for At-Large Council member would be $250,000 and the maximum public contribution
for each election for District Councilmember would be $125,000.
A candidate who voluntarily accepts a public contribution must pay for all campaign
expenses with the qualifying contributions, the matching public contributions, and a personal
loan from the candidate and the candidate's spouse of no more than $6000 from each.
Public
Hearing
The Council's Government Operations and Fiscal Policy Committee held a public
hearing on March 4. Each of the speakers representing an organization supported the Bill.
Finance Director Joseph Beach, testifying on behalf of the Executive, (©24), Kate Waybright,
Progressive Maryland (©25), Jennifer Bevan-Dangel, Common Cause Maryland (©26), Toni
Holness, ACLU of Maryland (©27), William Roberts, Montgomery County Young Democrats
(©28-30), Ronald Levin, Sierra Club of Montgomery County (©31-32), Brian Doherty,
Progressive Neighbors (©33), and Shelley Sherman, US Action (©34), each supported the Bill.
Tom Moore (©35-36), Marc Korman (©37-38), Evan Glass (©39), Dan Furmansky (©40-41),
Natali Fani-Gonzalez (©42), Armin Behr (©43), Beth Allen (©44), and Alan Hyman (©45-46)
also supported the Bill as individuals. Ralph Watkins (©47) opposed the Bill as an ineffective
use of taxpayer money.
Mr.
Watkins suggested public money be used for voter services to
2
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explain candidates' positions on important issues, such as sending out a sample ballot with
position statements written by each candidate.
March 20 GO Committee Worksession
Councilmember Andrews attended the worksession. Council President Rice and Council
Vice President Leventhal attended part of the worksession. Robert Hagedoorn, Finance,
represented the Executive Branch. Jared DeMarinis, Director of Candidacy and Campaign
Finance for the State Board of Elections answered questions from the Committee.
The Committee discussed the Bill and how the public campaign finance system would
work. The Committee asked the Council staff to work with Finance and the SBOE to answer the
Committee's questions concerning expenditures by independent political committees, slates,
funding, and how to limit matching dollars when funding is insufficient.
Issues
1.
What is the fiscal and economic impact of the Bill?
The Bill contains 2 different cost generators. First, OMB estimated that administering
and reconciling the Public Election Fund would require
~
of the time of a contractual
Accountant/Auditor in the Department of Finance at a recurring cost of $33,700. See (©18-19).
The other cost generator would be the funds necessary to properly fund the Public Election Fund.
The actual cost of the public contributions distributed to candidates depends upon the number of
candidates participating and the success of those candidates in collecting qualifying
contributions. OMB estimated that if each candidate for County office in 2010 had participated
in public funding under this Bill and received the maximum publicly funded match for both the
primary and the general election, the Fund would have paid out $9,625,000. See (©23). The
maximum cost for the 2006 election cycle would have been $13 million.
It
is unlikely that an election cycle would reach the maximum cost estimated by OMB.
Also, public contributions, absent a special election, would only be distributed every
4th
year.
Finally, a candidate must return any unspent money in the candidate's publicly funded campaign
account to the Fund after the person is no longer a candidate. Despite these mitigating factors,
the public contributions distributed to candidates in an election cycle could be substantial.
Although this cost could be reduced by reducing the matching dollars in the Bill, the system
must provide enough matching funds to run a creditable campaign or candidates will be
discouraged from using
it.
Maryland Common Cause prepared an estimate of the matching
dollars that would have been paid to candidates in the June
2014
primary election for Executive
and Council if the Bill had been in effect and each candidate who qualified accepted a public
contribution. Common Cause estimated that the County would have paid approximately $2.5
million in matching funds in this primary election. See ©62-65.
The most responsible method of paying for these costs would be to appropriate money for
the Fund annually, beginning with the first year after the Bill is enacted.
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2. Should the Bill prohibit loans from people or organizations other than the candidate or
the candidate's spouse?
The Bill does not permit or prohibit a candidate from accepting a loan from someone else
that is greater than $150. The State Election Law permits a candidate to accept a loan from
anyone in any amount with certain restrictions. The creditor must charge interest at the prime
rate or the lack of interest is considered a separate contribution. The loan must also have a
repayment schedule. If the candidate does not pay back the loan, it is considered a contribution.
See the SBOE Guidelines for Loans at ©48-49.
The purpose of Bill 16-14 is to restrict participating candidates to accepting only small
contributions from individuals and matching those contributions received from a County
resident. The candidate can only use money deposited in the candidate's publicly funded
campaign account for campaign expenses and must return any unspent money at the end of the
election. A candidate would also be prohibited from using the public contribution received to
pay back the loan. Since failure to repay the loan makes it a contribution under State Election
Law, the result is likely to be the receipt of a contribution greater than $150.
In
order to protect
the integrity of the publicly funded system, the Bill should prohibit a loan to the candidate from
anyone other than the candidate or the candidate's spouse.
Council staff recommendation:
amend lines 103-107 as follows:
ill
Other than
~
contribution from an applicant candidate or the candidate's spouse,
an applicant candidate must not accept
individual greater than $150.
~
Qualifying contribution from an
An
applicant candidate must not accept a loan from
An
applicant
~
anvone other than the candidate or the candidate's spouse,
candidate or the candidate's spouse must not contribute or lend
combined total
of more than $6000 each to the candidate's publicly funded campaign account.
For clarification, Council staff recommends that this prohibition be repeated in
§16-26,
Applicant
and PartiCipating Candidate Restrictions.
3. How should the Director of Finance limit distributions
if
the amount available in the
Fund is insufficient?
The Bill (see lines 191-194 at ©9) would require the Director to reduce each public
contribution to a certified candidate by the same percentage if there are insufficient funds.
Finance Director Joseph Beach suggested, in his testimony, that the Bill be amended to clarify
the order of priority of distributions if there are insufficient funds. Although the Bill would
require equal reductions, a candidate who was certified early in the process may receive more
funding per qualifying contribution than a candidate certified later after the Fund is drawn down.
One alternative is to establish a date certain before the primary for the Director to decide
if the amount in the Fund is sufficient to provide a full match to all candidates. With the primary
election currently scheduled for June, the full amount of appropriations to the Fund should be
4
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known after the fiscal year budget resolution is approved in May of the preceding year. The
Director could estimate the maximum public distribution necessary based upon the number of
candidates who participated during the preceding election cycle and announce percentage
reductions, if any, on or before July I of the preceding year. Although this determination would
be speculative for the first election cycle after the Bill is enacted, it would become easier to
estimate after the system has been in operation for future election cycles.
This alternative could be established by Executive Regulation or added to the Bill by
amendment. If the Committee wants to amend the Bill to use this alternative, it could be done as
follows:
Amend lines
191-194
asfollows:
@
On or before July 1 of the year preceding the primary election, the Director must
determine if the amount in the Fund is sufficient to meet the maximum public
contributions reasonably expected tQ be required during the next election cycle. If
the Director determines that the total amount available for distribution in the Fund
is estimated to be insufficient to meet the allocations required
Qy
this Section, the
Director must reduce each public contribution to
~
certified candidate
Qy
the same
percentage of the total public contribution.
4. Should the Bill establish an independent citizen committee to recommend an annual
appropriation for the Fund?
Although the Council establishes the salary for the Executive, Councilmembers, the
Sheriff, and the State's Attorney by law, the Council receives recommendations from an
independent citizen committee before enacting the law setting salaries for these elected officials.
A similar independent citizen committee could be established to recommend an appropriation to
the Fund each year to the Executive and the Council before the operating budget is approved.
Councilmember Navarro may introduce an amendment to do this at ©55.
5. Should the Bill direct complaints alleging violations of the law to the State Board of
Elections?
The Campaign Finance Reform Act of 2013 requires that a County enacted public
campaign financing system be regulated by the State Board of Elections (SBOE). The SBOE is
responsible for investigating and enforcing the State campaign finance laws. Finance Director
Joseph Beach suggested, in his testimony, that the Bill be amended to clarify that all complaints
alleging illegal uses of the public contribution be filed with the independent SBOE.
An
incumbent County Executive running for reelection would have a fatal conflict of interest if
required to investigate and enforce these types of alleged violations by another candidate.
Council staff recommendation:
amend lines 225-230 as follows:
5
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.cru
A participating candidate may only use the qualifying contributions and the
matching public contribution for
incurred for the election.
~
primary or general election for expenses
(hl
A complaint alleging an impermissible use of funds by a participating candidate
must be filed with the Board.
Within
12
days after the County Board certifies the results of the general election,
~
~
participating candidate must return to the Fund any unspent money in the
candidate's publicly funded campaign account.
6. Is the Bill consistent with the proposed regulations of the State Board of Elections?
The SBOE published proposed regulations governing the establishment and operation of
a County public campaign finance system. These proposed regulations are at ©50-51. The
SBOE is proposing to require each County to submit its public campaign finance law to the
Board for approval. According to the Board's staff, Montgomery County is the first County to
propose legislation establishing a public campaign finance system in the State. The current
proposed regulation would prohibit a participating candidate from joining a slate. The Bill
would permit a participating candidate to join a slate if each member of the slate is also a
participating candidate. See lines 250-252 at ©ll.
The Committee could amend the Bill to prohibit a participating candidate from joining a
slate by amending lines 250-252 as follows:
!fl
be
~
member of
!!
slate in any election in which the candidate receives
!!
public
contribution [[unless all members ofthe slate are participating candidates]],;. or
Also, for clarity, Council staff recommends adding a definition of "slate" that mirrors the
definition in the State Election Law after line 82 as follows:
Slate
means a political committee of two or more candidates who join together to conduct and
pay for joint «atnpaign activities.
7. Technical amendments.
Council staff recommends the following technical amendments:
Amend lines
67- 68
as follows:
Publicly funded campaign account
means
!!
campaign finance account established by a candidate
for the exclusive purpose of receiving qualifying contributions and
Amend lines 259-260 asfollows:
6
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Any violation of this [[Section]) Article is
~
Class A civil violation. Each day
~
violation
exists is
~
separate offense.
8. Digital signatures.
Lines 77-78 of the Bill require a contributor to sign a receipt for a qualifying
contribution, but are silent as to the acceptance of a digital signature. A solicitation through
electronic mail or websites is common in today's society. Although this can be resolved by
regulation, the Committee may want to consider expressly permitting a digital signature on the
receipt. However, in today's changing world of technology, the type of electronic signature
permitted may be better addressed by regulation.
The Committee could amend lines 77-78 of the Bill to expressly permit an electronic
signature as follows:
ill
acknowledged
.Q:y
~
receipt that identifies the contributor's name and
residential address and signed
.Q:y
the contributor directly or by a digital
signature using a method approved by the Board.
9. Annual CPI adjustments.
The Bill provides for an annual CPI adjustment to the $150 contribution limit to the
nearest multiple of 5 cents (lines 108-114). The Bill also provides for an annual CPI adjustment
to the public contribution limits for each office to the nearest multiple of 5 cents (lines 216-213).
This calculation will result in a difficult to remember contribution limit stated in both dollars
and
cents. One possibility would be to adjust the limits to the nearest multiple of $10 to keep to
whole numbers. This could be accomplished with Staff Amendment 1 at ©52.
Annual adjustments to the contribution limits could result in different contribution limits
for each year of the same election cycle. If the Committee decides that this adjustment should be
made only one time each election cycle to avoid confusion, Staff Amendment 1 could be
amended to require the adjustment to be made only one time at the beginning of each election
cycle.
10. Matching dollars after a CPI adjustment.
For County Executive, the Bill establishes a $6 match for each dollar of the first $50 of a
qualifying contribution, $4 for each dollar of the second $50, and $2 for each dollar of the third
$50. Although this works well when the qualifying contribution limit is $150, once it is adjusted
for an increase in the CPI, the math no longer works. Council staff recommends that the Bill be
amended to require the $2 match to cover the remaining amount ofthe contribution. Therefore,
if the limit is raised to $160, the first $50 would receive $300, the second $50 would receive
$200, and the remaining $60 would receive $120. The same change should be made for Council
candidates. This could be accomplished with Staff Amendment 2 at ©53.
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11. Deadline for the initial regulations.
The Bill requires the Executive to adopt regulations after consulting with the Board to
implement the Bill (lines 132-139).
It
is important that the initial regulations are adopted by the
Executive and approved by the Council before candidates start collecting qualifying
contributions in the next election cycle. The Committee may want to consider adding uncodified
language to the Bill requiring the Executive to submit the initial regulations to the Council on or
before a date certain. This could be accomplished by Staff Amendment 3 at ©54.
12. Should a qualified candidate be able to receive a match from qualifying donations
received before the candidate applies for public funding?
Many candidates solicit and receive campaign contributions before the one-year
qualifying period. The Bill would not pennit a certified candidate to receive a match for a
contribution of $150 or less received during the election cycle, but before the qualifying period.
The State law authorizing the County to enact a public campaign fmance law requires the County
law to:
Prohibit a candidate who accepts public campaign financing from transferring
funds:
(I)
to the campaign finance entity established to finance the campaign for
county elective office from 'my other campaign finance entity established
for the candidate; and
(II) from the campaign finance entity established to finance the campaign for
county elective office to any other campaign finance entity;
See © 14.
Pursuant to State law, a qualifying contribution must be deposited directly into the
candidate's publicly funded campaign account in order to be eligible for a match and cannot be
transferred into this account from another account established by the candidate. Once the
candidate establishes a publicly funded campaign account and files a notice of intent with the
Board to seek public financing, the applicant candidate must cease all campaign finance activity
using any other authorized campaign committee affiliated with the candidate.
If
the Committee wants to expand the opportunity to solicit and receive qualifying
contributions, the Bill could be amended to expand the qualifying period beyond one year. This
could be done by amending the definition of the qualifying period on lines 79-82 of the Bill at
©4-5 as follows:
Qualifying period
means the period of time beginning [[365 days before the primary]] on
January 1 following the last election for the office the candidate seeks and ending 45 days
before the date of the primary election. The qualifying period for
~
special election under
Section 16-17 must be set
Qy
Council resolution.
If the Committee decides to expand the qualifying period, the Bill could also be amended to
restrict the distribution of matching funds to the one-year period before the primary election in
order to ensure that public funding is only used in the last year of the election cycle.
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13. Should in-kind contributions be eligible for matching funds?
The Bill is designed to encourage a candidate to solicit small dollar donations from
County voters by offering matching public funds for each qualifying contribution. It is unclear if
an in-kind contribution valued at less than $150 would also be eligible for a match. If the
Committee wants to prohibit a match for an in-kind contribution, it could
be
done by amending
lines 184-186 as follows:
ill
The Director must not distribute matching dollars from the Fund to
~
certified
candidate
for~
ill
~
contribution from the candidate or the candidate's spouse: or
~
an in-kind contribution of prooertv. goods. or services.
14. Should the Bill expressly permit a candidate's designee to obtain a qualifying
contribution?
It
is unreasonable to require a participating candidate to personally obtain each qualifying
contribution. Council staff does not believe the Bill requires this. However, the Committee
could clarify this by amending lines 75-76 as follows:
ill
obtained through efforts made with the knowledge and approval of the
applicant candidate or the candidate's designee; and
15. How has public campaign financing worked in other States?
One of the goals of public campaign fmancing is to increase the participation of local
residents in elections by encouraging candidates to solicit small dollar contributions from local
residents. New York City has enacted a 6-to-l match for the first $175 contributed by a city
resident to a City Council candidate who voluntarily participates in public funding. The Brennan
Center at New York University Law School and the Campaign Finance Institute jointly studied
the effect of the New York City public campaign finance law on the diversity of small donor
contributors. The study compared the contributors to City Council campaigns with the
contributors to State Assembly candidates where there is no public campaign fmancing. The
study found that small donors to City Council campaigns came from 90% of the City's census
blocks.
In
contrast, small donors to State Assembly campaigns came from only 30% of the
City's census blocks. The Executive Summary for the Brennan Center Study is at ©56-61.
16. What are the various combinations of qualifying contributions that must be obtained
to be certified?
The Office of Legislative Oversight (OLO) has developed a calculator that computes the
matching funds a candidate would receive under the provisions of Bill 16-14. Upon entering
data on the number and amount of contributions received by a candidate, the calculator returns
the total amount raised by the candidate and the amount of matching funds the candidate would
receive. The calculator perfonns different calculations for County Executive, At Large County
Council, and District County Council candidates based on the matching fund requirements
9
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specified in Bill 16-14. OLO will gIve a brief demonstration of the calculator at the
worksession.
17. Should a candidate be permitted to pre-pay expenses with other sources of income
before applying for certification?
The Bill would prohibit a candidate from using campaign funds from another campaign
account other than the public campaign account set up to qualify for public funding. However,
the Bill does not expressly prohibit a candidate from pre-paying for goods and services with
funds from other sources before applying for certification. Using these pre-paid goods and
services after the candidate applies for certification would violate the spirit and intent of the BilL
However, there are certain expenditures for services, such as creating a website, which may be
paid for before a candidate applies for certification yet still used after certification. The
Committee may want to provide for exceptions to this rule adopted by regulation.
Councilmember Riemer may introduce the following amendment to prohibit this practice:
Amend lines
225-227
as follows:
W.
A participating candidate may only use the qualifying contributions and the
matching public contribution for
!!
primary or general election for expenses
incurred for the election.
A
participating candidate must
not
pay in
advanc~
goods and services to be used after certification
with
non-qualifying contributions
received before applying for certification unless the expenditure is permitted by
Executive regulation adopted under Section 16-21.
This packet contains:
Bill 16-14
Legislative Request Report
House Bill 1499 (excerpt)
Councilmember Andrews Memorandum
Summary of Bill
Fiscal and Economic Impact statement
Testimony
Joseph Beach
Kate Waybright
Jennifer Bevan-Dangel
Toni Holness
William Roberts
Ronald Levin
Brian Doherty
Shelley Sherman
Tom Moore
Marc
Korman
Evan Glass
Circle
#
1
12
13
15
16
17
24
25
26
27
28
31
33
34
35
37
39
10
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Dan Funnansky
Natali Fani-Gonzalez
ArminBehr
Beth Allen
Alan Hyman
Ralph Watkins
SBOE Guidelines for Loans
SBOE Proposed Regulations
Staff Amendment 1
Staff Amendment 2
Staff Amendment 3
Navarro Amendment - Committee
to
Recommend Funding
Brennan Center Study Executive Summary
Maryland Common Cause Cost Analysis
40
42
43
44
45
47
48
50
52
53
54
55
56
62
F:\LA w\BILLS\1416 Elections - Public Campaign Financing\GO Memo 9-15-14.Doc
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Bill No.
16-14
Concerning: Elections
Public
Campaign Financing
Revised: February 3. 2014 Draft No. 16
Introduced:
February 4. 2014
Expires:
August 4.2015
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: _--:-:_ _ _ _ _ _ __
Sunset Date:
_N:..!.o~n~e~
_ _ _ _ __
ChI _ _, Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Councilmembers Andrews, EIrich, Berliner, Riemer, Council Vice President Leventhal,
Council President Rice, Councilmembers Navarro, Floreen, and Branson
AN
ACT to:
(1)
(2)
(3)
(4)
(5)
establish a Public Election Fund to provide public camprugn financing for a
candidate for a County elective office;
regulate certain campaign fmance activity of a candidate for County elective office
who voluntarily accepts public campaign fmancing;
authorize the Maryland State Board of Elections to administer and enforce the public
campaign financing system;
provide for penalties for violations ofthe public campaign financing system; and
generally amend the law governing elections for County elective offices.
By amending
Montgomery County Code
Chapter 16, Elections
Section 16-17
By adding
Montgomery County Code
Chapter 16, Elections
Article IV, Public Campaign Financing
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law wu:iffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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BILL No. 16-14
1
2
Sec.
1.
Section 16-17 is amended as follows:
16-17. Council vacancy - election required.
3
4
5
*
(c)
applicable:
*
*
Except as otherwise provided in this Section, and to the extent
6
7
(1) The special election must be conducted in a manner consistent
with provisions of state law that govern special elections to fill
vacancies in the office of representative in Congress.
The
8
9
10
11
12
deadlines and time periods required under those provisions of
state law apply to a special Council election unless the Council,
acting under subsection (d) or subsection (e), expressly modifies
them.
(2) Except as provided in paragraph
(l),
the general provisions of
state and County law that govern quadrennial elections for
Councilmembers apply to the special election conducted under
this Section.
(d)
(1)
Within 30 days after a Council vacancy occurs, the Council must
13
14
15
16
17
18
19
adopt a resolution that:
(A) sets the dates of the special primary election and the
special general election;
.ill) sets the timeline for certification of!! candidate for public
campaign financing for the special primary election and
the special general election; and
[(B)]
{Q
j
20
21
22
23
24
25
takes any other action authorized by this Section or
state law.
If a Councilmember submits a resignation with a later effective date, the
vacancy occurs when the Council receives the resignation.
26
27
@
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BILL
No.
16-14
28
29
30
*
*
*
Sec. 2. Article IV of Chapter 16 is added as follows:
Article IV. Public Campaign Financing.
16-18. Definitions.
31
32
In this Article, the following terms have the meanings indicated:
Applicant candidate
means g person who is running for g covered office and
who is seeking to be g certified candidate in g primary or general election.
Board
means the Maryland State Board ofElections.
Campaign finance entity
means g political committee established under Title
33
34
35
36
37
.u
ofthe State Election Law, as amended.
Certified candidate
means g candidate running for g covered office who is
certified as eligible for public campaign fmancing from the Fund.
Consumer Price Index
means the Consumer Price Index for All· Urban
Consumers: All items in Washington-Baltimore, DC-MD-VA-WV (CMSA),
as published
Qy
the United States Department of Labor, Bureau of Labor
Statistics, or g successor index.
Contested election
means an election in which there are more candidates for an
office than the number who can be elected to that office. Contested election
includes
~
38
39
40
41
42
43
44
45
46
special election held to fill
f!
vacancy in
f!
covered office under
47
48
Section 16-17.
County Board
means the Montgomery County Board of Elections.
Covered office
means the office of County Executive or County
Councilmember.
Director
means the Director of the Department of Finance or the Director's
designee.
Election cycle
means the primary and general election for the same term of g
covered office.
49
50
51
52
53
54
6)
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BILL No. 16-14
55
56
57
58
Fund
means the Public Election Fund.
Noncertified candidate
means
who either:
~
person who is running for
~
covered office
59
60
ill
ill
chooses not to
mmlY
to be
~
certified candidate; or
applies to be
~
certified candidate but fails to qualify.
~
Non-participating candidate
means
office who is either
~
person who is running for
~
~
covered
61
noncertified candidate or
certified candidate who
62
63
declines to accept
~
public contribution.
Participating candidate
means
~
certified candidate who
has
received
~
public
contribution from the Fund for
~
primary or general election.
64
65
66
67
Public contribution
means money disbursed from the Fund to
candidate.
~
certified
Publicly funded campaign account
means
~
campaIgn finance account
68
established for the exclusive purpose of receiving qualifying contributions and
spending funds in accordance with this Article.
69
70
QualifYing contribution
means
~
donation of at least $5.00 but no more than
71
72
73
$150.00 in support of an applicant candidate that is:
ill
ill
made
J2y
~
registered voter of the County;
made after the beginning of the designated qualifying period, but
no later than
li
days before the election;
74
75
76
ill
obtained through efforts made with the knowledge and approval
of the applicant candidate; and
77
78
79
ill
acknowledged
J2y
~
receipt that identifies the contributor's name
and residential address and signed
J2y
the contributor.
Qualifying period
means the period of time beginning 365 days before the
primary election for the office the candidate seeks and ending 45 days before
80
@
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BILL
No. 16-14
81
82
83
84
the date of the primary election. The qualifYing period for
under Section 16-17 must be set
!2y
Council resolution.
16-19. Public Election Fund established.
~
special election
W
(Q)
The Director must create
~
Public Election Fund.
This Fund
IS
85
86
continuing and non-lapsing.
The Fund consists of:
87
88
89
90
91
92
ill
ill
all funds appropriated to
i!
!2y
the County Council;
any unspent money remaining in
~
certified candidate's publicly
funded campaign account after the candidate is no longer
candidate for
~
covered office;
~
ill
ill
ill
W
any public contribution plus interest returned to the Fund
Qy
participating candidate who withdraws from participation;
all interest earned on money in the Fund; and
voluntary donations made directly to the Fund.
~
93
94
95
96
97
98
16-20. Collecting Qualifying Contributions.
Before raising any contribution governed
Qy
this Article, an applicant
candidate must:
ill
ill
file notice of intent with the Board on or before April 15 of the
year ofthe
electio~
on
£!
form prescribed by the Board: and
establish
~
99
100
101
102
103
publicly funded campaign account for the candidate
for the purpose of receiving contributions and spending funds in
accordance with this Article.
(Q)
Other than
~
contribution from an applicant candidate or the candidate's
spouse, an applicant candidate must not accept
~
qualifYing contribution
from an individual greater than $150.
An
applicant candidate or the
candidate's spouse must not contribute or lend
~
combined total of more
than $6000 each to the candidate's publicly funded campaign account.
104
105
106
107
(i)
f:\law\bills\1416 elections - public campaign Iinancing\biIl16.doc
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BILL
No. 16-14
108
109
110
III
112
113
ill
Annual adjustment.
The Chief Administrative Officer must adjust the
contribution limit established in Subsections
ili1
effective July
L
2016,
and July
1
of each subsequent year,
Qy
the annual average increase, if
any, in the Consumer Price Index for the previous calendar year. The
Chief Administrative Officer must calculate the adjustment to the
nearest multiple of
.2.
cents, and must publish the amount of this
adjustment not later than March
1
of each year.
16-21. Requirements for Certification.
114
115
116
tru
To qualify as
~
certified candidate:
117
118
119
120
121
122
ill
~
candidate for Executive must collect at least:
500 qualifying contributions; and
an aggregate total of$40,000;
.cAl
.em
ill
~
candidate for At-Large Councilmember must collect at least:
250 qualifying contributions; and
an aggregate total of $20,000; and
.cAl
.em
ill
~
123
124
candidate for District Councilmember must collect at least:
125 qualifying contributions; and
an aggregate total of $1 0,000.
CA)
125
126
.em
!.Q}
An
applicant candidate must deposit all qualifying contributions
127
received into the candidate's publicly funded campaign account.
An
applicant candidate must deliver to the Board
each qualifying contribution.
~
£QPY
128
129
130
of
~
receipt for
ill
@
A candidate must
.M!Qly
to the Board for certification during the
qualifying period.
The Executive, after consulting with the Board, must adopt regulations
under Method
1
that specify:
131
132
133
(9
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BILL
No. 16-14
134
135
136
ill
ill
ill
ill
ill
how and when receipts for qualifying contributions from
contributors must be submitted to the Board;
the documents that must be filed with the Board for certification;
the allowable uses of money
in
!!
publicly funded campaign
account; and
other policies necessary to implement this Article.
137
138
139
140
141
142
143
144
145
146
147
16-22. Board Determination.
The Board must certify an applicant candidate if the Board fmds that the
candidate has received the required number of qualifying contributions
and the required aggregate total dollars for the office no later than 10
business days after receiving:
ill
ill
!!
declaration from the candidate agreemg to follow the
regulations governing the use of
!!
public contribution; and
!!
campaign finance report that includes:
148
149
150
151
152
CA)
§
§
list of each qualifying contribution received;
list of each expenditure made
Qy
the candidate during the
ill}
qualifying period; and
(9
the
receipt associated
with
each contribution
and
expenditure.
153
154
155
156
(Q)
(£)
The decision
Qy
the Board whether to certify
§
candidate is final.
A candidate may submit only one application for certification for any
election.
@
If the Board certifies
§
candidate, the Board must authorize the Director
to disburse
§
public contribution to the candidate's publicly funded
campaign account.
157
158
159
16-23. Distribution
of Public
Contribution.
(j)
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BILL
No. 16-14
160
161
162
163
164
165
166
167
168
169
170
171
172
173
174
175
176
177
178
ill
The Director must distribute
f!
public contribution from the Fund to each
certified candidate in
f!
contested election as follows:
ill
for
f!
certified candidate for County Executive, the matching
dollars must equal:
®
ill)
$6 for each dollar of
f!
qualifying contribution received for
the first $50 of each qualifying contribution;
$4 for each dollar of
f!
qualifying contribution received for
the second $50 of each qualifying contribution; and
(Q
$2 for each dollar of
f!
qualifying contribution received for
the third $50 of each qualifying contribution.
ill
for
f!
certified candidate for County Council, the matching dollars
must equal:
CA)
$4 for each dollar of
f!
qualifying contribution received for
the first $50 of each qualifying contribution
ill)
$3 for each dollar of
f!
qualifying contribution received for
the second $50 ofeach qualifying contribution; and
(Q
$2 for each dollar of
f!
qualifying contribution received for
the third $50 of each qualifying contribution.
ill
The
total public contribution payable to
g
certified candidate for
179
180
181
182
183
184
185
186
either
f!
primary or
f!
general election must not exceed:
CA)
ill)
$750,000 for
f!
candidate for County Executive;
$250,000 for
f!
candidate for At Large Councilmember;
and
(Q
$125,000 for
f!
candidate for District Councilmember.
@
The Director must not distribute matching dollars from the Fund to
f!
certified candidate for
f!
contribution from the candidate or the
candidate's spouse.
®
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Bill
No.
16-14
187
188
189
190
191
192
193
194
195
196
197
198
199
200
(£l
A certified candidate may continue to collect qualifying contributions
and receive
!!
matching public contribution
!ill
to
primary or
!!
general election.
li
days before
!!
A qualifying contribution must not
exceed $150 from any individual during an election cycle.
@
If the total amount available for distribution in the Fund is insufficient to
meet the allocations reguired
Qy
this Section, the Director must reduce
each public contribution to
!!
certified candidate
Qy
the same percentage
of the total public contribution.
.c.ru
Within
J
business days after the County Board certifies the results ofthe
primary election, the Board must authorize the Director to continue to
disburse the appropriate public contribution for the general election to
each certified candidate who is certified to be on the ballot for the
general election.
ill
Within
Q
days after the County Board certifies the results of the
primary election,
!!
participating candidate who is not certified to be on
the ballot for the general election must return any unspent money in the
candidate's publicly funded campaign account to the Fund. Within
li
days after the County Board certifies the results of the general election,
!!
participating candidate must return any unspent money in the
201
202
203
204
205
206
candidate's publicly funded campaign account to the Fund.
207
208
209
210
(g)
A certified candidate nominated
Qy
petition may receIve
i!
public
contribution for the general election if:
ill
ill
the candidate's nomination is certified
Qy
the County Board; and
the candidate did not participate in
i!
primary election.
211
212
213
au
A participating candidate must submit
i!
receipt for each qualifying
contribution to the Board to receive
i!
public contribution. The Director
must deposit the appropriate public contribution into
i!
participating
o
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BILL
No.
16-14
214
215
216
217
218
219
220
221
222
223
224
225
226
227
228
229
230
231
232
candidate's publicly funded campaign account within
after the Board authorizes the public contribution.
J
business days
ill
Annual adjustment.
The Chief Administrative Officer must adjust the
public contribution limits established in Subsection (a)(3) and the
qualifying contribution limit established in Subsection
(£1
effective July
.L
2016, and July
1
of each subsequent year,
Qx
the annual average
increase, if any, in the Consumer Price Index for the previous calendar
year. The Chief Administrative Officer must calculate the adjustment to
the nearest multiple of
.2.
cents, and must publish the amount of this
adjustment not later than March
1
of each year.
16-24. Use of Public Contribution.
{ru
A participating candidate may only use the qualifying contributions and
the matching public contribution for
expenses incurred for the election.
~
primary or general election for
(Q}
Within
1.2.
days after the County Board certifies the results of the
general election,
~
participating candidate must return
to
the Fund any
unspent money in the candidate's publicly funded campaign account.
16-25. Withdrawal.
~
A certified candidate may withdraw an application for
!!
public
contribution any time before the public contribution is received
Qx
the
candidate's publicly funded campaign account.
233
234
235
236
237
238
(Q}
A participating candidate may withdraw from participation if the
candidate:
ill
files
~
statement of withdrawal with the Board on
~
form
prescribed
.Qy
the Board; and
®
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BILL
No. 16-14
239
240
241
242
243
244
245
246
247
248
249
250
251
252
253
254
255
256
257
ill
repays to the Fund the full amount of the public contribution
received, together with the applicable interest established
Qy
regulation.
16-26. Applicant and Participating Candidate Restrictions:
An applicant candidate or
~
participating candidate must not:
W
accept
~
private contribution from any group or organization, including
~
political action committee,
~
corporation,
~
labor organization, or
~
State or local central committee of
~
political party;
(Q)
accept
~
private contribution from an individual greater than $150, or
~
the maximum amount of
Section 16-23(i);
qualifying contribution as adjusted
Qy
W
be
~
member of
~
slate in any election in which the candidate receives
~
public contribution unless all members of the slate are participating
candidates; or
@
transfer funds:
ill
ill
16-27. Penalties.
to the candidate's publicly funded campaign account from any
other campaign finance entity established for the candidate; and
from the candidate's publicly funded campaign account to any
other campaign finance entity.
258
259
260
261
Any violation of this Section is
~
Class A civil violation. Each day
~
violation
exists is
~
separate offense.
Sec.2. Effective Date.
This Bill takes effect on January
L
2015.
®
f:\Jaw\bills\1416 elections - public campaign financing\bill16.doc
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LEGISLATIVE REQUEST REPORT
Bil116-14
Elections
-
Public Campaign Financing
DESCRIPTION:
Bill 16-14 would establish a Public Election Fund to provide public
campaign financing for a candidate for County Executive and County
Council. The Bill would also regulate the campaign finance activity
of a candidate who voluntarily accepts public campaign finance.
State law recently authorized a County to enact a public campaign
finance law for the election of County Executive and County
CounciL Under current law, a candidate for County elective office,
who must raise significant amounts of private donations, will often
need large donations from businesses and other large organizations to
run a campaign.
The goal is to encourage candidates to seek out large numbers of
small donations from County residents and open opportunities for
more people to run for County elective offices.
State Board of Elections, Finance, County Attorney
To be requested.
To be requested.
To be requested.
To be researched.
Robert H. Drummer, 240-777-7895
Not applicable.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIP ALITIES:
PENALTIES:
Class A civil violation.
F:\lAW\BILLS\1416 Elections - Public Campaign Financing\LEGISLATIVE REQUEST REPORT. Doc
@
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HOUSE BILL 1499
(excerpt)
13-505.
SUBJECT TO THE PROVISIONS OF THIS SECTION, THE
GOVERNING BODY OF A COUNTY MAY ESTABLISH, BY LAW, A
SYSTEM OF PUBLIC CAMPAIGN FINANCING FOR ELECTIVE
OFFICES IN THE EXECUTIVE OR LEGISLATIVE BRANCHES
OF COUNTY GOVERNMENT.
(2)
WHEN ESTABUSHING A SYSTEM OF PUBUC CAMPAIGN
FINANCING FOR ELECTIVE OFFICES IN THE EXECUTIVE OR
LEGISLATIVE BRANCHES OF COUNTY GOVERNMENT, THE
GOVERNING BODY OF A COUNTY SHALL SPECIFY THE
CRITERIA THAT IS TO BE USED TO DETERMINE WHETHER AN
INDIVIDUAL IS ELIGIBLE FOR PUBLIC CAMPAIGN
FINANCING.
(B)
A
SYSTEM OF PUBLIC CAMPAIGN FINANCING ENACTED UNDER
SUBSECTION (A) OF THIS SECTION:
(1) SHALL PROVIDE FOR PARTICIPATION OF CANDIDATES IN
PUBLIC CAMPAIGN FINANCING ON A STRICTLY VOLUNTARY
BASIS;
(2)
MAY NOT REGULATE CANDIDATES WHO CHOOSE NOT TO
PARTICIPATE IN PUBLIC CAMPAIGN FINANCING;
(3)
SHALL PROHIBIT THE USE OF PUBLIC CAMPAIGN
FINANCING FOR ANY CAMPAIGN EXCEPT A CAMPAIGN FOR
COUNTY ELECTIVE OFFICE;
(4) SHALL REQUIRE A CANDIDATE WHO ACCEPTS PUBLIC
CAMPAIGN FINANCINGTO:
(A)
(1)
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ESTABLISH A CAMPAIGN FINANCE ENTITY SOLELY
FOR THE CAMPAIGN FOR COUNTY ELECTIVE OFFICE;
AND
(II) USE FUNDS FROM THAT CAMPAIGN FINANCE ENTITY
ONLY FOR THE CAMPAIGN FOR COUNTY ELECTIVE
OFFICE;
(5)
SHALL PROHIBIT A CANDIDATE WHO ACCEPTS PUBLIC
CAMPAIGN FINANCING FROM TRANSFERRING FUNDS:
(I) TO THE CAMPAIGN FINANCE ENTITY ESTABLISHED TO
FINANCE THE CAMPAIGN FOR COUNTY ELECTIVE
OFFICE FROM ANY OTHER CAMPAIGN FINANCE
ENTITY ESTABLISHED FOR THE CANDIDATE; AND
(II) FROM THE CAMPAIGN FINANCE ENTITY ESTABLISHED
TO FINANCE THE CAMPAIGN FOR COUNTY ELECTIVE
OFFICE TO ANY OTHER CAMPAIGN FINANCE ENTITY;
(6)
SHALL PROVIDE FOR A PUBLIC ELECTION FUND FOR
COUNTY ELECTIVE OFFICES THAT IS ADMINISTERED BY THE
CHIEF FINANCIAL OFFICER OF THE COUNTY; AND
(7)
SHALL BE SUBJECT TO REGULATION AND OVERSIGHT BY
THE STATE BOARD TO ENSURE CONFORMITY WITH STATE
LAW AND POLICY TO THE EXTENT PRACTICABLE.
(C)
A
SYSTEM OF PUBLIC CAMPAIGN FINANCING ENACTED UNDER
SUBSECTION (A) OF THIS SECTION MAY:
(1)
PROVIDE FOR MORE STRINGENT REGULATION OF
CAMPAIGN FINANCE ACTIVITY BY CANDIDATES WHO
CHOOSE TO ACCEPT PUBLIC CAMPAIGN FINANCING,
INCLUDING CONTRIBUTIONS, EXPENDITURES, REPORTING,
AND CAMPAIGN MATERIAL, THAN IS PROVIDED FOR BY
STATE LAW; AND
(2) PROVIDE FOR ADMINISTRATIVE PENALTIES FOR
VIOLATIONS, IN ACCORDANCE WITH ARTICLE
25A,
§
5
OF
THE CODE.
(I)
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MONTGOMERY COUNTY COUNCIL
ROCKVILLE, MARYLAND
PHIL ANDREWS
COUNCILMEMBER - DISTRICT 3
MEMORANDUM
January 29, 2014
TO:
FROM:
SUBJECT:
Councilmembers
Phil Andrews, Councilrnember
/J
r
~
,
j
Public financing option for County Council and Executive candidates
Since 2001, the County Council has urged the General Assembly to provide Montgomery
County with the authority to adopt campaign fmance reforms.
In
2013, the General
Assembly adopted a bill that enables counties to provide for the option of public
fmancing for county elections beginning with the 2015-18 election cycle. Participation by
candidates would be voluntary.
The goals of Bill 16-14, which is attached, are to reduce the influence ofbig money in
County elections, encourage more voters to participate in County elections, and to expand
opportunities for more candidates to run for County office who do not have access to big
contributions from interest groups or individuals. The bill provides strong incentives for
candidates to seek small, individual contributions from County voters.
A summary of the bill's major provisions is attached.
The bill is scheduled for introduction on February 4. Please let me know if you would
like to co-sponsor the bill or have any questions or suggestions. I look forward to
working with you on this measure ..
100 MARYLAND AVENUE. 6TH FLOOR' ROCKVILLE, MARYLAND 20850
240-777-7906 •
TTY
240-777-7914 • FAX 240-777-7989 • COUNCILMEMBER.ANDREWS@MONTGOMERYCOUNTYMD.GOV
,If;
PRINTED ON
RECYCLED
PAPER
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SUMMARY OF BILL16·14
Campaign Finance Reform
• Public Election Fund Established
Requirements for Qualifying
• Notice of Intent must be filed by a candidate prior to collecting qualifying money
• Publicly funded campaign account must be established
• Qualifying contribution· a donation of more than $5.00 but no more than $150 from a
registered voter in Montgomery County
• Qualifying number of contributions - County Executive - 500; Council At-large - 250
Council- District -125
Qualifying dollar threshold-$40,OOO County Executive; $20,000 Council At-Large; $10,000
Council District
• Qualifying timing - beginning 365 days before the primary election and ending 45 days before
the primary election
Public Matching Fund Ratios
• Matching dollars - County Executive - $6 for each dollar of a qualifying contribution received for
the first $50; $4 for each dollar for the second $50; $2 for each dollar for the third $50
• Matching dollars - County Council- $4 for each dollar for the first $50; $3 for each dollar for the
second $50; $2 for each dollar for the third $50
Maximum Limits on Public Funds to a Candidate
• County Executive - $750,000; Council At-Large - $250,000; Council District - $125,000 (matching
dollars are not distributed for self/spouse contributions)
• Funding for system from general revenues
Allowable Contributions for Participating Candidates
• System is voluntary for candidates, but candidates who participate must limit their fundraising
to individual contributions of $150 or less except for contributions from the candidate or
spouse, which are limited to $6,000 each. No PAC money, labor organization, corporate money.
Application to Slates
• If a candidate is a member of a slate, all slate members must participate in public funding
system for anyone of them to qualify
Other Provisions
• Unspent money must be returned to the fund
• Spending and contribution limits would be adjusted for inflation
Effective Date
• System would be effective beginning for the 2015-18 election cycle
@
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ROCKVILLE, MARYLAND
MEMORANDUM
March 6, 20 I3
TO:
FROM:
Craig Rice, President, County Council
Jennifer A. Hughes, Director,
Joseph F. Beach, Director,
Departm~n;;e
Offi:f~nt
and Budget
SUBJECT:
Council Bill 16-14, Elections - Public Campaign Finance
Please find attached the Fiscal and Economic Impact Statement for the above­
referenced council bill.
JAH:fz
c: Bonnie Kirkland, Assistant Chief Administrative Officer
Lisa Austin, Offices of the County Executive
Joy Nurmi, Special Assistant to the County Executive
Patrick Lacefield, Director, Public Information Office
Joseph F. Beach, Director, Department of Finance
Robert Hagedoorn, Department of Finance
Margaret Jurgensen, Election Director, Board of Elections
Rachel Silbennan, Office of Management and Budget
Blaise Defazio, Office of Management and Budget
Alex Espinosa, Office of Management and Budget
@
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Fiscal Impact Statement
CODneD Bill 16-14, Elections - PubUe CampaigD Financing
1. Legislative Summary:
The proposed legislation would:
establish a public campaign finance system for County Executive and
County Council elections;
- regulate the campaign finance activity of candidates voluntarily accepting
public campaign finance;
- designate the Maryland State Board of Elections to certify candidates and
administer the public campaign financing system;
- direct
the
Department of Finance to establish a Public Election Fund and
distribute public contributions to certified candidates; and
- provides for penalties for violations of
the
public campaign system.
w
2.
An
estimate of changes in County revenues and expenditures regardless of
whether the revenues or expenditures are assumed in the recommended or
approved budget
Includes source of information, assumptions, and
methodologies used.
The bill would have no impact on County revenues. County expenditures will
be
limited by the Public Election Fund balance. Demand for public campaign
financing is indeterminable at this time. Costs are estimated
to
be $33,700 to
administer and reconcile the Public Election Fund representing 0.5 contractual
FTE in the Department of Finance.
3. Revenue and expendinrre estimates covering at least the next 6 fiscal years.
County expenditures would
be
limited by the Public Election Fund balance.
Demand for public campaign Financing is indetenninable at this time.
Expenditures
to
support Public Election Fund administration would be $33,700 in
FYl8 and FY19
to
support the June 2018
primary
and November 2018 general
elections.
4.
An
actuarial analysis through the entire amortization period for each bill that
would affect
retiree
pension or group insurance costs.
The bill would not affect retiree pension or group insurance costs.
S:\AD"MNSTR\FEIS\Legislation\FYI4\Bi1I 16-14, Elections - Public Campaign
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5. Later actions that may affect future revenue and expenditures ifthe bill authorizes
future
spending.
Not applicable.
6. An estimate of the staff time needed to implement the bill.
The Department of Finance reports that a 0.5 contractual FTE Accountant!Auditor
II during the election cycle would be required
to
administer and reconcile the
Public Election Fund, estimated at $33,700.
7. An explanation ofhow the addition ofnew staff responsibilities would affect
other duties.
As stated above. the Department ofFinance estimates that a 0.5 contractual FTE
Accountant!Auditor II will be required to administer and reconcile the Public
Election fund. Staff responsibilities outside the election cycle would
be
absorbed
within the existing personnel complement.
8.
An
estimate ofcosts when an additional appropriation is needed.
Not applicable.
9. A description of any variable that could affect revenue and cost estimates.
Factors affecting demand for public campaign financing include; the frequency of
special elections,
the
nuniber ofloeal candidates choosing to participate
in
public
campaign financing, the number of candidates running for contested seats, and the
ability ofparticipating candidates to raise funds under the public campaign
financing system. The existence ofpublic campaign. financing could result in an
increase in candidates for local public office, resulting in an increase in demand
for public campaign. financing funds.
10. Ranges of revenue or expenditures that are uncertain or difficult to project.
While program expenditures are limited by the Public Election Fund balance,
demand for public campaign financing could range from $0 in election cycles
S:\ADMNSTR\FEIS\Legislation\FY14\Bi1l 16-14, Elections - Public Campaign
Financing\Bill 16-14, Elections - Public Campaign Financing.doc
®
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.'
where no candidates participate to $13.0 million (based on the 2006 election
cycle) assuming all eligible candidates participate and are able to raise the
maximum match (attachment 1).
11. [f a bill is likely to have no fiscal impact, why that is the case.
Not applicable.
12. Other fiscal impacts or comments.
None.
13. The following contributed to and concurred with this analysis:
Joseph F. Beach and Robert Hagedoom, Department of Finance; Margaret
Jurgensen, Board of Elections; and Rachel Silberman and Jed Millard, Office of
Management and Budget
Date
S:\A.DMNSTR\FEIS\Legislation\FY14\Billl6-14, Elections - Public Campaign
Financing\Bill 16-I 4, Elections - Public Campaign Financing.doc
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Economic Impact Statement
Bill 16-14, Elections - Public Campaign Financing
Background:
This legislation would:
• Establish a Public Election Fund to provide public campaign financing for a candidate for
a County elective office;
• Regulate campaign finance activity ofa candidate for County elective office who
voluntarily accepts public campaign financing;
• Authorize the Maryland State Board of Elections to administer and enforce the public
campaign financing system; and
• Provide for penalties for violations ofthe public campaign financing system.
Bill 16-14
(Bill)
would require the Director, Department of Finance, to establish the Public
Election Fund and to distribute the public contributions to certified candidates. The County
Council would appropriate funds for the Public Election Fund (Fund). The Bill also provides a
distribution formula for the public contribution from the Fund.
1. The sources of information, assumptions, and methodologies used.
The Office of Management and Budget provided an analysis ofthe amount ofpublic funds that
may potentially be spent for public campaign financing based on the number of contested
elections in prior primary and general elections.
2. A description of any variable that could afleet the economic impact estimates.
• The number of certified candidates in contested elections in both the primary and general
elections.
• The total amount appropriated and spent in an election cycle by the County Council
• The total amount ofqualifying contributions collected and spent by a certified candidate
3. The BiU's positive or negative effect,
if
any on employment, spending, saving,
investment, incomes, and property values in the County.
Based on an analysis provided by the Office ofManagement and Budget, the total public
contribution could have been as high as S13 million based on the number of contested elections
in 2006. The actual amount will vary based on a number ofvariables including the number of
certified candidates
in
contested elections.
The Bill will provide an increase in business income to those companies that provide campaign
consulting services and materials. However, because the funds are appropriated by the County
Council, there is an opportunity cost such that the amount of funding appropriated by the County
Council could offset or reduce spending for public programs. In addition, the additional public
funded expenditures may offset what were previously privately funded campaign expenditures.
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·.
Economic Impact Statement
Bill 16-14, Elections - Public Campaign Financing
Because of these potential offsetting factors, it is
uncertain
whether
the
bill will have a
material
net economic effect.
4.
If
a BiD
is
likely to have no economic impact, why
is
that the case?
Please see paragraph #3
5. The following contributed to and conculTed with this analysis: David Platt
and
Rob
Hagedoom, Finance; Rachel Silberman, Office of Management
and.
Budget
Date
I
Page2of2
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Modellne Demand
Bill 1fi..14, Elections - Public Campaign Flnanclne
2014 Election Cycle
General
Primary
Democratic Republican Maximum
Total
Maximum
candidates Candidates
Match
Candigates
~
County Executive
3
1 2,250,000 TBD
TBD
Council at large
TBD
6
3
1,500,000 TBD
Council District 1
250,000 TBD
TBD
2
1
Council District 2
2
500,000 TBD
TBD
2
Council District 3
4
500,000 TBD
TBD
0
Council District 4
1
OT8D
TBD
0
Council District 5
625,000 TBD
5
TBD
0
Total
5,625,000
0
2010 Election Cycle
Primary
General
Democratic Republican Maximum
Total
Maximum
Candidates Candidates
Match
Match
candidates
County Executive
1
2 1,500,000
2 1,500,000
Council at large
9
4 2,250,000
9
2,250,000
Coundl District 1
1
250,000
2
250,000
2
Council District 2
625,000
2
250,000
5
1
Council District 3
250,000
1
0
0
2
2
Council District 4
1
250,000
1
0
2
Council District 5
250,000
1
1
0
4,625,000
5,000,000
Total
Grand
Total
5,625,000
Grand
Total
9,625,000
2006 Election Cycle
Primary
General
Total
Grand
Democratic Republican Maximum
Maximum
Candidates candidates
Match
Match
Total
Candida!f:s
County Executive
1 2,250,000
3 2,250,000
3
8 2,000,000
Council at large
13
4 3,250,000
2
250,000
Council District 1
1
1
0
Council District,2
2
500,000
2
250,000
2
Council District 3
500,000
2
250,000
2
2
2
250,000
Council District 4
500,000
2
2
2
2
250,000
Council District 5
2
500,000
7,500,000
5,500,000 13,000,000
Total
Assumptions:
1)
All
eligible candidates elect to participate in public financing.
2)
All
eligible candidates receive the maximum match.
Note: 2014 primary candidate counts posted on the State Board of Elections website as of February 28.
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Testimony
Bill 16-14,
Elections - Public Campaign Financing
{
Good evening, my name is Joseph Beach, Director of the County Department of Finance,
and I am here on behalf of County Executive Isiah Leggett to testify in support of Council Bill
16-14 Elections Public Campaign Financing. Based on authority granted
in
2013 by the
Maryland General Assembly. Bill 16-14 would establish a Public Election Fund and a voluntary
system of public campaign financing beginning with the 2015 elections. The County Executive
shares the Council's interest in creating a public campaign ftnancing mechanism that would
encourage greater voter participation in County elections, increase opportunities for residents to
seek elective office, and reduce the irifluence of large contributions.
County Executive Leggett believes that certain amendments would clarify and strengthen
the law and streamline its administration. First, the bill should clarify responsibility for
investigation and enforcement of alleged violations of the law. The State Board of Elections
currently has the responsibility to address violations of the campaign financing laws; however,
the bill is silent on this issue, other than specifying that a violation is a Class A civil violation.
It
is important that investigation and enforcement be independent to assure that monitoring
compliance would be carried out objectively and to enhance public conftdence in the results of
any investigation.
In
addition, an amendment to clarify the order of priority in disbursing County
contributions to certified candidates would clarify the Council's intent on administration of the
Fund, especially in the event of an insufficiency of funds. For example,
if
more candidates
participated in the Public Election Fund than anticipated in the amount appropriated to the Fund,
those candidates who applied for and were certified early in the process could receive more
funding than those candidates who applied later in the process.
Finally,
it
should be noted that, depending on the number of candidates in any contested
election who participate in public campaign financing, the law could have a material fiscal
impact. For example, the cost for the 2010 primary and general elections under the proposed
legislation would have been over $9.6 million and for the 2006 elections would have been as
much as $13 million, if all of the candidates participated in public financing and received the
maximum amount of public funds. Because the public contribution would be funded out of
general revenues, this allocation would compete with other general fund services including
education, public safety, and safety net services. Before a qualifying period begins, there should
be a public financial statement as to the total amount available for public ftnancing of the
ensuing election cycle.
Thank you for affording me the time to address the County CounciL The Administration
looks forward to working with the Council to refine this important legislation.
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State Headquarters
33 University Boulevard East
Silver Spring, MD 20901
www.ProgressiveMaryland.org
Baltimore Office
9 W. Mulberry St., 4th Floor
Baltimore, MO 21201
Phone: 301.494.4998
Mailing Address:
P.O. Box 2181
Silver Spring, MD 20915
Contact@ProgressiveMaryland.org
Testimony in Support of Montgomery County Council
BiJll6-14
Public Funding of Elections
TO:
FROM:
DATE:
POSITION:
Montgomery County Council
Kate Planco Waybright, Executive Director
March 4, 2014
Support
Thank you, Mr. President and Members of the Montgomery County Council, for the opportunity to testify tonight in
support of Montgomery County Council Bill 16-14. Progressive Maryland is a grassroots, nonprofit organization of
more than 23,000 members and supporters who live in nearly every legislative district in the state, many of whom
reside right here in Montgomery County. In addition, there are 26 religious, community and labor organizations that
are affiliated with our work. Our mission is to improve the lives of working families in Maryland. Please note our
strong support for this bill.
Bill 16-14 would establish a Public Election Fund to provide public campaign financing for a candidate for a County
elective office. We are absolutely delighted that this longtime priority of Progressive Maryland has been introduced
here in Montgomery County and has your unanimous support.
Progressive Maryland began advocating for public financing of elections as a result of our efforts nearly a decade
ago to expand healthcare coverage and raise wages for all Marylanders. Organizationally, we noticed that the
playing field was tilted against us and it remains so today. The average middle class family isn't able to contribute to
a campaign in the same way a wealthy special interest entity is able. This creates a public opinion climate in which
people feel as if they aren't being heard.
But public funding of elections will change that public perception.
Public funding works because it shifts the focus of the campaign away from big dollar, wealthy donors and back to
everyday people. Investing in clean elections is an investment in our democracy. In states from Maine to
Connecticut, public funding has improved the election process. These programs allow more diverse candidates to
run for office, increase competitiveness in the process, and result in a more substantive legislative debate. These
bills have the potential to change the very nature of elections in Montgomery County and beyond and are essential
to a governing body that values enacting policies that build a strong middle class.
Thank you so much for your time and consideration of this critical legislation. We urge a favorable vote on Bill 16-14.
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3
March 4, 2014
Testimony on Bill 16-14 ­
Elections
...;Public
Campaign
Financ:ina
Position: Favorable
Common Cause
Maryland supports
Bi1116--14"
which
would
create
a robust
program
for
public
funding for candidates
for
the
county
council or county executive.
Bill 16--14
is
shaped
by
the
most
recent
models for public fundjng
Under
the
program
es1ab1ished
in
this
bill,
a
candidate -would
have
tD
prove
he
or she
is
a
viable
by
aggressively
mising
money
fium
small dooms
in
the
county.
The
candidate would
then
be
able
tD
.match
individual
donations ofless
than
$150
at
a
graduated
mte,
with a
greater
match for smaller
donations.
Public
funding
is
a
popular
mol
for improving
our elections.
In
a 2009
Gonzales poll"
1()D/o
of
MaryJandeJ:s
favored
using
public
money
tD
pay for politiad
campaigns..
And
public
funding
is
wmking
in
the
slates
that
have adopted
it.
According
tD
analysis
of
the
Connecticut
program.::
• TJO/o
of state
legislators
who
were
elected in 2012
:ran
on public funding;
• Latino
representdion in
the
state
legislablTC
increased
33% after
the
program
was
implemented;
• Policies adopted after public
financing
was
implemented
were
more
aligned
with
the
public's ptefetences.
I
Special
inI:eR:st
:6mdjng
is
increasingly determining
the
outcome of
elections.
Public
funding
gives candidates another choice: focus on
constituents
through
the
campaign
and keep
the
focus
on
constituents
through
the
legis1ative process.
Public
:6mding
cannot
fight
the
escalating
cost
of
elections;
only
the
Supreme
Court
can
re'VeISe
that
disturbing
trend..
But
public
fundjng
can
shift
the
fucus
of
campaigns
away
from
specia1
interests and back to·cvecyday
constituents.
Poblic
:funding
strengthens
our
democracy
by
getting
special
:interests
out ofelections and voters
back
in.
We
urge
a favorable report on
Bill 16--14.
eo.-.on
Cm&se
M~
is
II
~
gros.:rroots
orglllliz;Dlion
tIetIicatetl
to
restoring
the
COI"l!
WIf:ue.s
l!f
~
~ ~
QIl
~
ItioIrest
and
IICCOIITJItlhIe
gt:1W!TIIIIIDfI
drat1ll'Of".b
in
the
public
interest.
and
~
ordinary
people
to
make their
l10icet
heard
121
CaIhedral
St.,
AImapoIis
MD 21401*
410-286-7410"
W"Ilf'W..commoncause.org/md
@
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TONI HOLNESS
PUBLIC POLICY
ASSOCIATE
AMERICAN CIVIL LIBERTIES UNION
of
MARYlAND
Testimony for the County Council for Montgomery County, Maryland
March 4,2014
Bill Number 16-14: Elections-Public Campaign Financing
SUPPORT
The ACLU of Maryland supports Bill 16-14, which establishes a system of public
financing for candidates for County Executive and County Council of
Montgomery County. Public campaign financing enhances the accountability of
public officials to general voters, so they are thereby less obliged to the interests
of high-dollar contributors. Public campaign financing allows candidates and
officials to invest their time and energies into investigating and remedying the
concerns of the electorate, not seeking campaign contributions.
The election of public officials is an essential aspect of a free society and the
integrity of the electoral process is of critical concern. However, the ACLU of
Maryland is also concerned that election campaign reforms are sometimes
achieved by means that sacrifice other civil liberties values, especially freedom of
expression and rights of association.
Although free speech principles call for scrutiny of limitations on expenditures
and contributions, the current system of private campaign financing disadvantages
certain groups and individuals trying communicate their views. Such imbalances
tend to frustrate the goal of full political participation by all citizens and raise
concerns about the greater influence that some individuals and groups have on
political processes. The appropriate civil liberties response is to expand, not limit,
the resources available for political advocacy.
Public financing of campaign activity is a promlSlng way to facilitate the
opportunity for political participation by everyday citizens. Such approaches,
which are less drastic alternatives than government restriction of political
expenditures and contributions, also minimize the danger of heavy handed and
repressive governmental regulation of political speech and association.
The escalating cost of campaigns for public office restricts the breadth of political
expression in America. More and more, money, not political support, determines
who runs for office. Many candidates fail because they cannot garner the
requisite financial support to run a viable campaign, which deprives the public of
the full range of public debate. Public financing remedies this problem and would
advance a number of positive free speech values.
It
would facilitate candidacy
and significantly broaden the spectrum of campaign debate. Public financing can
also reduce the dependency of candidates upon private contributions regardless of
the extent to which such contributions may be permitted.
For the foregoing reasons, the ACLU of Maryland supports Bill Number 16-14.
AMERICAN CIVIL
LIBERTIES UNION
OF MARYLAND
MAIN OFFICE
&
MAILING ADDRESS
3600 CLIPPER MILL ROAD
SUITE 350
BALTIMORE, MD 21211
T/41
0-889-8555
or
240-274-5295
F/41
0-366-7838
FIELD OFFICE
6930 CARROLL AVENUE
SUITE 610
TAKOMA PARK. MD 20912
Tl240-274-5295
WWW.ACLU-MD.ORG
OFFICERS AND
DIRECTORS
ALL! HARPER
PRESIDENT
SUSAN GOERING
EXECUTIVE DIRECTOR
C. CHRISTOPHER BROWN
GENERAL COUNSEL
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Prepared Statement of
William
J.
Roberts,
Esq.
Vice President, Montgomery County Young Democrats
Before the Montgomery County Council Public Hearing on
Bill 16-14,
Public Campaign Financing
March 4, 2014
Thank you for allowing me to testify. I'm William Roberts, I live upcounty in the
Rockville-Gaithersburg area and I'm the Vice President of the Montgomery County
Young Democrats.
Why
The Young Democrats Support this Measure:
The Young Democrats stand in strong support of this legislation, which would
allow voluntary citizen funded elections for the County Council and County Executive.
We want to
thank
each of the members of the County Council for standing together to
universally support this legislation. We know all too well the power of special interests in
our public discourse. Whether it comes to advocating for more affordable housing, or
pushing efforts like increasing the minimum wage to support working families - our
county has powerful special interests on the other side of issues that we and many of your
other constituents care deeply about. And although these special interests won't get a vote
in our upcoming elections, we all know that they have an outsized voice
in
our political
process because of the amount of money they are able to pour into County elections.
We support this legislation because we know that ending excessive campaign
spending will remove a barrier and allow more members of middle class families, young
people, women, and minorities to run for office and contribute to campaigns. This
proposal also levels the playing field so that elections and the policy making process are
about bold ideas and not big checks. We believe in the power of small donor driven
public fmancing to shift the playing field and put the ownership of our electoral process
back in the hands of everyday constituents.
The Problem:
There exists near universal agreement on the problem. Across the country in
elections from County Council to President of the United States, there is just too much
money in our political process and it's drowning out the voices of everyday citizens. The
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cost of running for office is steadily increasing and too many special interests attempt to
and succeed at currying favor through giving massive campaign contributions.
Meanwhile, an ever decreasing number of average citizens feel like their concerns
actually matter to elected officials or that their voices actually count in the public
discourse.
Locally,· candidates are being forced to build up ever-growing war chests to
compete in elections. Millions were spent in the last truly competitive County Executive
race. You all know very well that
it
costs well over $200,000 to run for the County
Council, on average. Only a third of that funding came from small donors of $250 or less.
In the face of this money, many people are tuning out. They're fed up with politicians
who they perceive cannot or will not hear them over the deafening sounds of a river of
campaign cash.
Citizen funded elections can flip this paradigm on it's head. Reducing the primacy
of wealthy donors and special interests, clean election systems allow constituents to own
elections again. As a constituent, knowing that your small donation will be enhanced
through a matching fund and will really matter to the candidate of your choice empowers
you and changes your view of the process. As a candidate and an elected official,
knowing that you can spend your time discussing issues and reaching out to more voters
changes the way you can do your job.
Why Would This System Work
in
Montgomery County:
Public Financing holds special benefits for diverse populations as well. Research
conducted by Public Campaign - a national reform organization - shows that under the
New York City Public Financing System, low dollar donors tend
to
be women and
minorities from non-affluent communities. As a consequence, Public Funding systems
across the country are enabling a more diverse citizenry - women, minorities, and young
people - to become part of the political process as either candidates or donors.
Comparably, Montgomery County is now majority-minority and only growing
more diverse. We are also residents of a county stuck in an economic duality where many
people are prospering and flourishing and yet there are dramatic increases in the wage
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gap, the income gap, and the wealth gap. Enacting a public financing system will enable
all citizens, especially those at the margins, to participate fully in our electoral process
and allow our elected officials to spend more time studying the issues and connecting
with constituents in need instead of raising money.
Montgomery County is ready to lead our state on Public Financing, as we have on
countless issues before. The Young Democrats are ready to stand up beside you and we
urge you to pass Bill 16-14.
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SIERRA
CLUB
FOUNDED 1892
I
Testimony on Public Financing of Elections
Bill 16-14
Montgomery County, MD
March 4, 2014
I am Ron Levin. I am speaking on behalf of the 5,000
members of the Sierra Club of Montgomery County. The
Sierra Club endorses Bill 16-14.
Conventional wisdom holds that the states and cities are the
laboratories of democracy, but no longer is public financing
of elections an experiment. Fourteen states, including
Maryland, provide public financing. All that experience was
available to 16-14's drafters.
A poll of Maryland voters in 2009 found that 77% believe
political contributions have a corrupting influence. In the last
election cycle, two thirds of the donations to County Council
campaigns came from donors who gave more than $250.
Some donations were for thousands of dollars. Maryland's
citizens clearly want to reduce the influence of money on
who gets elected in our state. Public financing counteracts
public cynicism, cynicism that is toxic to our democracy_
Public financing results in better,
~[e
objective government
decisions. It frees candidates to spend their time talking to
voters instead of to big contributors! It will free lawmakers to
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devote their attention to the full time work of legislating, not
fund raising.
Critics of public funding claim that it will produce a flood of
frivolous candidates. This bill, however, sets high hurdles to
qualify for public funding.
Critics have said that public funding does not work because
incumbents continue to be overwhelmingly re-elected. That
criticism is built on a myth because public funding is not
intended to be an incumbent removal scheme. At most, it
can only take away one of incumbents' many advantages.
Opponents of public financing may complain that it would be
a fiscal burden. But cost estimates range from only
$2
million
to $8 million an election cycle, depending on the number of
candidates. That's not $8 million a year, that's $8 million per
election cycle
-$2
million per year. Two million dollars is a
little more than
1%
of just the growth in revenue between
this fiscal year and the next as forecast by the Department of
Finance. Only a bit more than
1
%
of revenue growth.
We can afford
16-14.
We can afford a measure that
delivers healthy government, fosters objective decision­
making and reduces public cynicism. Is there another
measure that can do so much so cheaply?
The Sierra Club of Montgomery County urges you to pass
Bill
16-14.
Thank you
Ron Levin
North Bethesda, Md
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\3
Progressive Neighbors
Testimony on Bill 16-14 Elections-Public Campaign Financing
Tuesday, March 11,2014
Thank
you for the opportunity to testify this evening. My name is Brian Doherty, I'm from
.
Bethesda, and I
am.
a co-chair of the organization Progressive Neighbors.
Our group is a Montgomery County-wide organization active since 2006, primarily at the state
. and county level, in a wide variety of progressive causes on issues related to progressive
taxation, education, affordable housing and tenant rights, labor, gender, health care, civil rights,
immigrant issues, democracy, environment, and transportation.
We
are
a democratic grassroots group
that
accepts no outside funding. We endorse candidates
and work on issue advocacy.
I
am
happy
to
report that our group strongly supports bill 16-14, a public financing option for
Montgomery County Council and Executive candidates. We commend Councilmember Phil
Andrews and his cosponsors for introducing this far-sighted legislation.
Action by the legislature in 2013 enables counties to provide a public financing option--a
longtime progressive goal--beginning with the 2015-2018 election. Montgomery County
has
the opportunity
to
lead the way on a local level, as it did a few years ago on the trans fat issue,
and as it did recently with its well-received move to raise the
minimum
wage. We're ready to
lead again.
This legislation, by favoring small contributions within the reach of the average voter, will help
to
slow a profoundly disturbing trend in our County in which less
than
a third of donations in
County Council campaigns come from those making $250 or less. Under such circumstances,
while all voters
are
equal, some are clearly more equal than others.
The
structure
of this bill is reasonable and appropriate. Once candidates meet a modest
fundraising threshold, donations of $150 or less are matched with public funds, with smaller
donations receiving the higher match. With these changes in the law, candidates will still spend
time raising funds-you can't get around that. But the biggest '"bang for the buck" in
fundraising will come from
smaller
donor, whose everyday concerns
are
more likely to be
addressed in the electoral process. This will mean a new type of voter and, just as assuredly, a
new type of candidate.
Again, thanks to Councilmember Andrews and others for putting this bill on the agenda. Let's
make it law as promptly as practical, and let Montgomery County become a "laboratory for
democracy" in Maryland.
Brian Doherty,
4613
North Chelsea Lane, Bethesda 301-237-5282 bridoherty@aol.com
Web: progressiveneighborsmdnationbuilder.com Twitter: @progneighborsmd
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eTION
Testimony in support of Bill 16-14
By Shelley Sherman
March 4, 2014
Good Evening. My name is Shelley Sherman. I am representing over 1300 USAction
members in Montgomery County. USAction is a national progressive organization that
fights for working people to have a voice in democracy. We are proud of the leadership
of our affiliate, Progressive Maryland, in this fight for clean elections. I am here tonight,
because I have been a Montgomery County voter for over three years and care about
my county.
In my role of finance director at USAction, I deal with money every day. We are a non­
profit organization that relies on donations from average people. We have a lot of
contributors, but no matter how many dollars come through USAction, it is only a tiny
drop in the bucket compared to what the super wealthy and corporations spend in the
political world. It's harder and harder in this country and this county for the average
person to have a voice and representation. That's why we urge the Montgomery
County Council to pass Bill 16-14. Public funding works because it shifts the focus of
the campaign away from big dollar, wealthy donors and back to everyday people.
Investing in clean elections is an investment in our democracy. These programs allow
more diverse candidates to run for office, increase competitiveness in the process, and
result in a more meaningful legislative debate that matters to real people.
Change starts at the local level. We need an America, a Maryland and a Montgomery
County that works for all of us. And a Montgomery County that works for all of us starts
when everyone and anyone can afford to run for public office so that government
reflects who we are as a community.
Thank you for your time tonight.
Shelley Sherman
7333 New Hampshire Avenue Apt 617 Takoma Park, Maryland 20912
Main Office • 1825 K Street, NW, Suite 210 • Washington, DC 20006 • Tel: 202-263-4520 • Fax: 202-263-4530
E-mail: usaction@usaction.org • Web: www.usaction.org
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TESTIMONY OF
TOM MOORE
CANDIDATE FOR THE MONTGOMERY COUNTY COUNCIL
REGARDING
BILL'16-14-
PUBLIC CAMPAIGN FINANCING
BEFORE THE MONTGOMERY COUNTY COUNCIL
MARCH 4, 2014
Good evening. My name is Tom Moore. I live at 11 Forest Avenue in
Rockville. I currently serve as a member of the Rockville City Council,
but I appear before you tonight as a private citizen who is currently a
candidate for the Montgomery County Council. I am therefore intimately
aware of the impact this bill would have if it becomes law.
As a candidate, I spend a lot of time knocking on people's doors. Going
door to door is something I enjoy, and I learn a lot about what's on the
community's mind every time I go out. But I also spend a lot of time as a
candidate calling for contributions - often calling businesses and people
who live outside the district or the county.
Those making corporate contributions have little more than a 'financial
interest in this county. Those making contributions who live outside the
county have no direct stake in the outcome of our elections or in the life
of Montgomery County. Yet our current campaign-finance system
requires me to spend far too much time focusing on these folks.
Instead of talking to corporations, I want to be talking to the moms and
the dads of Montgomery County, to the young people and the seniors. I
want to hear from them about the county they want to live in, raise their
kids in, retire in. I want to hear what I need to know to best govern our
county.
It's their voices and their stories that should be driving the messages of
our campaigns. A good bill that gives candidates and councilmembers
the ability to spend more time focused on their neighbors will produce
better governance for Montgomery County, and, in the end, will produce
a better Montgomery County.
Keeping corrupting money out of politics is why I led the fight on the
Rockville City Council to ensure that elected officials follow the highest
standards when disclosing financial interests. It is why I led the Rockville
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Mayor and Council to pass a tough ethics bill that went beyond the state
of Maryland's newly tough standards.
.
It is also a major part of what I do from day to day. In my day job, I work
for Progressive Majority, a national organization that works to recruit,
train, and support progressive champions to run for local and state office
in battleground states throughout America. Institutionally, we strongly
SlJpport the public financing of campaigns, as do most groups interested
in clean government, such as Common Cause and Progressive
Maryland.
But we do hear words of warning from elsewhere in the country that
poorly crafted public-financing laws create as many problems as they
fix. I urge you to pay careful attention to the thresholds this bill
provides. The balance they establish is the key to creating an effective
system of public campaign financing. Set them right and they will enable
new voices to be heard. Set them wrong and they can give artificially
large megaphones to extremists on both ends of the spectrum,
megaphones paid for with taxpayer dollars.
Montgomery County has been graced by a long history of dedicated
public servants who have governed our county well and wisely. It is a
tradition I hope to join. This bill reflects priorities that I have pursued
throughout my career in public service.
-,'
This·bill will allow candidates to connect with voters as we would want
them to - talking to people's hearts rather than their checkbooks.
This bill will allow those with deep roots but shallow pockets to compete
effectively.
This bill will allow those with the best ideas, and not the best Rolodexes,
,to guide Montgomery County into the future.
I urge that this Council pass Bill 16-14 and that the County Executive
sign it.
Thank you.
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Testimony of Marc Korman
Bill 16-14
March 4, 2014
Good evening. My name is Marc Korman. Although I hold several
affiliations with organizations in the County, I wish to emphasize that I
am testifying today
in
my individual capacity and speak only for myself. '
I applaud the County Council for taking up Bill 16-14. For many years a
delegate in my legislative district, Susan Lee, has fought to grant
Montgomery County the authority to enact this type of legislation. The
authority was granted in 2013 and the Council's quick action to
implement a public financing system is to its credit.
You have heard, and will continue to hear, tonight many important
points about the legislation before you. First, the system will reduce the
impact of special interests on our elections. Second, it will ensure that
serious candidates have the funds necessary to share their message and
ideas with voters. Third, it will reign in sonle of the costs of
electioneering. I agree with all of these important points, but wish to
emphasize one particular issue.
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I am optimistic that in a county like ours, public financing can become a
cultural norm. What do I mean by "cultural norm?" For constitutional
reasons and tortured interpretations of the Supreme Court, a public
financing system cannot be made legally mandatory. But I hope it
becomes mandatory as a matter of public relations and good
government.
An
analogy that has been made is to the use of union
printing by Democratic candidates, which is not required but is generally
done by any candidate running with a D next to their name. I hope the
cultural norm of public financing is not limited to Den10crats, but
embraced by all candidates in the future.
I also hope to see such a system expanded to our state elections as soon
as possible.
Thank you for the opportunity to speak on this important bill. I am
hopeful that a system of public financing will reduce the int1uence of
special interests, ensure serious candidates are heard, and, perhaps, free
up our elected leaders to spend more time on policy and less time on
political fundraising. Thanks.
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9
Testimony
by
Evan Glass on Bill 16-14, Public Campaign Financing
Good evening. My name is Evan Glass and I am a candidate for the Council from the 5
th
District.
I'm here to bluntly state: raising money for political campaigns stinks.
The amount of time I've spent on the phone asking family, friends, neighbors, colleagues and
acquaintances for money to support my campaign is time I would rather be talking with voters
about the hopes and dreams they have for our community.
But in this age of politics where the amount of money in a candidate's campaign account is
more important than the ideas in a candidate's head, we have to acknowledge that the system
is broken.
And let's face reality -this is how politics is played in most jurisdictions -especially a few miles
down the road on both ends of Pennsylvania Avenue. I used to be a journalist covering national
politics for CNN and I know all to well how much time our Congressmen, Senators and
Presidents spend raising money. And all too often I covered a story that fell into the category of
"follow the money" - where the actions of an elected official were tied to financial contributions
he or she received.
Well, here in Montgomery County we are ready to set a new example. Now is the time to
create public campaign financing for candidates seeking office here in Montgomery County.
By providing matching funds for donations below $150, we are opening the doors of elected
office to individuals from diverse socio-economic backgrounds.
And when the new system of matching funds is established, it will allow more individuals like me
to run for office - non-establishment candidates who represent the full spectrum of their
community. I grew up in a home with a single mother who worked two jobs. My modest
upbringing provided me with a set of values and experiences that I want to bring to the County
Council-values that promote social and economic justice for all of our residents.
By creating a system of matching funds for donations below $150, we are allowing the voice of
the people to prevail. Political action committees and corporations should not have the ability to
drown out the collective voice of the voters.
And by maintaining a qualifying period that begins 365 days before the primary election, we are
leveling the playing field for new candidates with new ideas by no longer allowing incumbents to
spend years raising funds regardless of the office they seek.
The best way for government to function is by having open debates about important issues that
affect our lives. Campaign finance reform is a way to encourage more residents from diverse
backgrounds to enter the political arena and truly bring about the progressive reform that our
communities need.
let's elevate our public discourse and pass this legislation.
®
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Testimony
in
favor of Bill 16-14
Elections-Public Campaign Financing
Dan
Furmansky
1524 Hanby
Street
Silver Spring, MD 20902
March 4, 2014
I
want
to
thank Council Member Andrews
for
puHing forth this proposal. which
I
know
you have championed since your days leading Common Cause Maryland.
And
I
want
to·thank
to
all
of
you on the County Council for cosponsoring this
measure.
I make my living as political
strategist,
lobbyist. and organizer for organizations
.. focused
on achieving social
justice.
I
am very glad
to
be
here
in
support
of
public
financing
of
elections because I understand this to
be
a social
justice
issue.
Public financing is a fundamental part
of
building a sIronger democracy.
H
is
about ensuring that the voices
of
those
who have greater access to money do
not drown out the voices
of
individual citizens.
H
is
about
aJlowing the interests
and priorities
of
working-and middle-class constituents
to
be better considered.
Public finance of elections is also about increasing public confidence in
government. and
elected
officials, increasing public participation in
tOO
political
process, diversifying
who
runs for public office, and allowing incumbent
legislators
to
focus
1heir
fundraising on their
own
constituents, not special
interests, and
to
free
up more
of
their time for lawmaking and policy.
Jurisdictions
from
Hawaii
to
Connecticut, and
from
Los
Angeles
to
New
York
City.
have successful pubrlC financing programs.
a
According
to
a report
by the
center
for
American Politics and Citizenship. which
polled. thousands
of
legislators across the country, in general. the average
state
. legislative candidate in a
state
without public financing spends 28 percent
of
their
time fundraising. The average
state
legislative candidate in a pubflC financing
state spends just 11 percent
of
their time fundraising.
.
In Connecticut
in
2012, 77 percent
of
successful candidates were pubrlCly
financed. and an analysis by the DEMOS has shown that public financing in that
state
has
inaeased representation
by
both women and minorities, as well as
voter participation in general.
. ' . .'
Or take the example of New York City Council races (where
there
is a small .
dollar. matching program) vs. races
for
the
NeW
York
Assembly.
which does
not
have pubrlC
financing..
Data
shows that
small
donors
to
City
Council candidates
broader array of
city
neighborhoods than
do
the cily's smaU
.come
from
a
donors
to
State
Assembly candidates. Small donor matching funds help bring
much
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participants into the political process who are traditionally
less
likely to
be
active,
and
strengthens
the (:Onnection between public
officials
and their constituents.
It
was Theodore Roosevelt who said, in
1907,
"'The need for collecting large
campaign
funds
woUld
vanish
if
Congress provided an appropriation for
the
proper
and
legitinate expenses
of
each
of
Ihe
great national parties.» This
was
one
of
the
first
public
calls for
public financing
of
campaigns iii our
country.
Today. the
. challenges of building a
perfect
democracy are ongoing. That
is
why your leadership
on this issue
is
so
noteworthy, and
so
appreciated
by
your
constituents
in
Montgomery
County..
I hope
Montgomery
County
will
be
the
first
of
many local
jurisdictions
in
Maryland
to pass public financing. and
that
this move will spur
the
state to follow suit for
state
legislative
elections.
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t\
Testimony presented to the Montgomery County Council
in
favor of Public Campaign Financing, Bill 16-14
th
Submitted by Natali Fani-Gonzalez, Candidate for State Delegate
in
District 18
NataliFaniGonzalez@gmaiLcom 301.442.8459
March 4, 2014
Good evening President Rice and members of the County CounciL My name is Natali Fani-Gonzalez and
I'm from Kensington. I'm here before you to testify in favor of Bill 16-14, which establishes a Public
Election Fund to provide public campaign fmancing for a candidate for a County elective office, among
other regulations.
As most of you know, I'm a candidate for the House of Delegates in District 18th, hence your bill won't
affect me. With that said, I think my situation can shed some light on why it is important to create a Public
Election Fund.
This is about building an opportunity for people who have never
run
for office due
to
the fear of not having
enough money to
run
a successful campaign.
I grew up in a low-income family, just like it happened to my closest friends. I share this because my
childhood friends represent my closest network. They are the ones who without hesitation contribute and
volunteer to my campaign. They do it because they share my values, and also do it because they feel so
proud of seeing someone coming from their community
run
for office. It's a big deal not just for me, but also
for them.
Due
to
their fmancial pressures, my average friend can only contribute up to $50 towards my campaign. It's
just my reality. That's the reality of candidates like me who come from low-income neighborhoods.
I know not everyone has the courage I have to
run
for office knowing very well that I will not raise as much
money as other candidates. Yet, I doubt that other candidates could gather the enthusiasm that my campaign
brings. These are folks who are not super-voters; some of my friends have only voted for President Obama.
It's a community who feels disenfranchised; voting it's just not in their radar. Again, my network does not
contribute with large amounts of money, however they do extremely well in canvassing efforts.
Having access to a Public Election Fund could drastically change my situation. I could focus more on voter­
contact and less on how to pay for everything.
Nowadays when we ask why we have only
6
Latino elected officials throughout the state of Maryland, it's
hard not to ponder on the financial constraints that exist within the Latino population in order to seek an
elected position. It's not just about motivating Latinos to vote for a Presidential election as we have done
very well in the past, but also to vote in large numbers in local elections. For that to happen, we need more
candidates who reflect the population.
I strongly believe that having access to a Public Election Fund will produce more diverse candidates and
more community members participating in our local elections. That is what is happening
to
me, with the
exception that I don't have access
to
a Public Election Fund and, therefore, have to end up self-financing a
significant portion of my campaign, which most people coming from low-income communities just cannot
do.
I
thank
you for cosponsoring this measure and serving as a model elected body for the rest of the state. I
hope this will give a needed push for the General Assembly to move forward with public fmancing of state
legislative campaigns.
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STATEMENT TO MONTGOMERY COUNTY COUNCIL ON BILL 16-15
Public Financing of Campaigns March 4, 2014
/~
My name is Armin Behr. I live at 6310 Swords Way in Bethesda and have been a
resident of Montgomery County for the past 49 years. I am a retired Federal
employee.
Our national government is not working well. The reasons for this can be debated,
but there is little doubt that one of the main reasons is the vast and continually
increasing amounts of money spent on campaigns. Members of Congress are forced
to spend a large proportion of their time raising funds, much of it from large
donors who expect a return on their investments. Distinguished, long serving
legislators have retired rather than face the fund raising necessary for re-election,
not to mention the countless others with great potential who are deterred from
even making a run.
For State offices, the costs of campaigning have also risen to an alarming level.
County offices don't yet require huge campaign chests, but many candidates for
county offices do receive substantial contributions from real estate, construction
and other development-related businesses which stand to benefit from decisions of
the County government This makes it difficult for those candidates to compete who
choose not to seek such contributions because they want to represent all of their
constituents fairly.
There are only two ways to counteract the malicious effect of money on our
electoral process. One is to regulate contributions in order to reduce spending.
This has been attempted through federal and state legislation, but these laws have
been largely struck down or rendered ineffective by Supreme Court decisions. As a
result, campaign spending is growing at an accelerated rate.
The tool that is left is public finanCing. The existing program for presidential
campaigns worked well for several election cycles by leveling the playing field and
freeing the presidential candidates from having to spend their time raising money.
In recent years, so much money has been available from private sources that
candidates of both parties have decided they could do better by waiving public
funding. However, public financing is working reasonably well in several states.
The legislation being considered by the Montgomery County Council would make it
possible for candidates to campaign with small contributions supplemented by
public funds, provided they do not accept any large contributions. This should go a
long way toward placing and keeping power in the hands of the voters and reducing
the power of special interests. The cost to taxpayers seems reasonable and by
reducing corruption and spending which is not in the public interest, will likely
more than be repaid.
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Testimony in Support of Bill 16-14, Elections - Public Campaign Financing
Beth Allen
I am speaking today in support of Bill 16-14, which would provide public campaign financing for
candidates for Montgomery County elective office. I live in Takoma Park, and have been a
resident of Montgomery County for almost 12 years.
It's no secret that Americans are fed up with the influence of money in politics. Recent national
polling indicates that more than 70% of voters think that the U.S. election system is biased in
favor of the candidate with the most money and more than half of all voters believe that most
politicians are corrupt.
1
Think about that. Conventional wisdom is that elections are bought and politicians are corrupt.
And, I must admit, my opinions are no different. As a result, while I am a faithful voter, I rarely
make individual political contributions any more.
When I talk to people about campaign finance reform there's a lot of cynicism about whether bills
like this one will make a difference. They think that special interests will find and exploit loopholes
and that public money will go to waste. I disagree. I think that bills like this, especially at the local
level, are critically important to restoring the health of our electoral system because they:
• Enable potential candidates
with
broad community support to run credible campaigns for
office.
• Serve as a test bed for creating strong campaign structures within the public financing
framework without relying on corporate contributions. Ideas pioneered and perfected at
the local level will, over time, have a beneficial effect on state and federal campaigns.
• Allow elected officials to spend less time fundraising and courting a small group of
wealthy donors and more time interacting with larger numbers of constituents.
• Most importantly, perhaps, public financing will change voter expectations for how
campaigns are run. In some cases in Montgomery County, a single special interest has
contributed more than half of a candidate's campaign funds. That's just not acceptable,
and we cannot allow
it
to become the norm.
The same polling I mentioned earlier found that an overwhelming 92% of voters say it's important
for elected leaders to reduce the influence of money in elections. I have been proud that my
county has been leading the way in issues that are important to me - including, recently, raising
the minimum wage. I urge you to take the lead in restoring faith in our democracy by passing this
important public financing legislation. And I promise, that when public financing passes, I will
happily put my money where my mouth is and make contributions to candidates who participate
in the public financing system.
1
http://mfolJr.com/wp-contenUuploads/2013/12/representus.mediarelease.FINAL .pdf
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Testimony in support of
Bill 16-14
To: Montgomery County Council
From: Alan Hyman
Date: March
4th, 2014
Position: Support
President Rice, Vice- President Leventhal, fellow Councilmembers. Simply put, I
testify here today as a young person concerned with the future of his society, as
well as the corrosive dissipation of the fundamentals of the republic in which we
live Our political culture is defined by a state of paradox; on the one hand we
hear the constant complaints that they're not enough young people involved in
our political debates and civic culture, that our system suffers from a lack of
diversity, but on the other hand one cannot help but notice how the very system
that complains is in many ways designed to discourage or sometimes even block
those very voices they cry for.
The bill before us would unlock the voices of the silent, but passionate majority of
underrepresented citizens waiting for an inclusive political system that welcomes
them with open arms. According to a
2009
Gonzales poll, roughly
70
%
of
Marylanders support a public financing system for electing our elected officials.
This bill would also allow you to spend more time thinking about the issues we
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face as a county and as a people, and in return possibly bring better solutions to
the table, as well as new ways of imagining what our County and our society could
look like.
The future of our political system lies before us tonight with this bill. We can
either collectively reaffirm that Montgomery County is a Progressive county that
firmly believes that the role of the common person in his or her government is
fundamental. Or we can completely fail to address what I believe is not only the
greatest social project of our time, but the most pertinent to preserving our
republic.
During the early years of our nation's founding Benjamin Franklin was asked what
type of government our country would be governed by. He responded, "a
Republic, madam, if you can keep it/' Hopefully with the passage of this bill we
can move one step closer to preserving it.
Thank you very much. I urge an affirmative vote on bill 16-14.
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I~
Testimony Concerning Bill 1&-14
Ralph Watkins, Silver Spring
Thank
you for the opportunity to testify.
My
name
is Ralph Watkins and
I
am
a resident ofSilver Spring, Maryland.
Bill 1&-14 is modeled after the Presidential Campaign Fund.
At
first, I was one who checked the
box for that
fimd
on
my
income tax returns, but as
I
continued to study
campaign
financing,
however,
I
became convinced that the matching
fimd
programs are an unnecessmy detour on the
road to effective reform Fortunately, there is an alternative
that
would
be
far
more effective.
The
problem with adding taxpayer money to political campaigns is
that
we
will
get more of what
we don't want - robocalls
and
bumper
stickers and yard signs
with
no information on
the
issues.
Further,
many
voters are left in the dark as candidates
direct
their literature
mailings
to their base,
Throwing more money into
this
broken system
will
do nothing to improve the
quality
of
information being provided to the voters.
Studies of
similar
prognum in other cities and states
reveal
that
they
are
ineffective in reducing
the influence ofmoney in politics as independent expenditures
easily
cirqumvent the
limits
placed
on the candidates. Further, several ofthese programs have
been
tainted
by
misuse ofthe public
contributions.
There is a proven alternative to
this
approach that would be
far
more effective in serving voters.
For more than
a
century,
Oregon and Washington have mailed to every voter a Voter's Pamphlet
that includes statements from
aU
the
candidates.
In
Oregon and Washington, voters said that
it
was their most important source ofinformation. Because of
this
success, voters' guides with
candidate statements have since been adopted
in
six more states as well as some counties and
cities.
This
successful model ofpublicly ftmded voter services could readily be expanded to include
debates, videorecorded for broadcast and streaming through the Internet.
This
would provide
voters a convenient way to compare candidates,
in
a format
that
would
help
to draw out more
specific statements on the issues.
As
I note in
the
appendix, even one
think
tank
that has advocated public campaign
fimding
has
conceded that voters' guides are effective in reducing
the
influence of money in politics and have
the added benefit ofencouraging more citizens to vote.
Candidates would prefer, of course, to have access to taxpayer money to spend
any
way they
choose. Voters, however, would
IIIlm
prefer a voters' pamphlet and debates. In
this
situation,
you
IIIlst
choose whether you
will
serve the public interest or
the
politicians' interests.
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Maryland State Board ofElections
Chapter 10- Loans
10.1
Generally
Loans are a permissible way for a campaign to receive funds. There is no limit on the amount of
money that can be loaned to the campaign. However, unless the loan is executed properly and
paid off in a timely manner, the loan will be converted into a contribution. This could have
serious legal consequences for the political committee and the lender if the loan exceeds
applicable contribution limits.
10.2
Receipt of Loans
1. Non-Candidate committees
Non- Candidate committees may receive a loan only from a financial institution or an entity in
the business of making loans.
It
may not receive a personal loan from an individual.
2. Candidate Committees
A.
Formal
A candidate committee may receive a loan from anyone only if the loan is:
• Personally guaranteed by the candidate; and
• Repaid by the end of the next election cycle immediately following the election cycle in
which the loan was received.
B.
Informal Candidate Loans
A candidate or the candidate's spouse may make an informal loan to the candidate's committee.
To do so, the candidate (or the candidate's spouse) simply loans money to his or her own
campaign and he or she does not file the loan consent form or charge interest. By making an
informal loan, the repayment period (by the end of the next election cycle) is not a applicable.
However, if the candidate does want to charge interest, the loan consent form must be filled out
(and filed with the campaign finance report) and the loan must be repaid by the end of the next
four-year-cycle.
- §
13-230 ofthe Election Law Article
10.3
Interest
Interest must be calculated and charged on all loans, based on the prime rate on the day that the
loan is made.
• If the lender agrees not to be paid
Interest
Rate
It
is the responsibility of the candidate to document,
interest, the interest amount that should
using a commercially reasonable standard, the prime
have been paid must be treated as an in­
rate on the day the loan was made. For example: the
kind contribution from the lender.
Wall Street Journal publishes the prime rate every day
in its "Money Rates" column. The definition of prime
rate in the Journal is the rate on "corporate loans at
large U.S. money center commercial banks."
53
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Maryland State Board ofElections
• Ifthe lender agrees to an interest rate that is less than the prime rate, the difference between
interest at the agreed rate and interest at the prime rate must
be
treated as an in-kind
contribution from the lender.
10.4
Loan and Repayment Examples
Example 1
Entity Name
Date Loan Accepted
, Loan Amount
Interest Rate Charge
Prime Interest
Balance
In-Kind Interest Amount
Repayment Terms
Bank of Mary\and
10/26/2010
$1,000
8% per annuln
8% per annum
$1,080
0
1 year
i
The loan, amount, source of funds and interest expense must
be
reported on the campaign
finance report.
'
Example 2
Candidate Committee
General Loan
Bank of Maryland
1012612010
$10,000
4% per annum
6% per annum
$400
$600
$200
5 years
i
Entity Name
Date Loan Accepted
Loan Amount
Interest Rate Charge
Prime Interest
Interest Paid
Interest Rate (prime)
In-Kind Interest Amount
Repayment Terms
Assume the loan inception date is
10/20/10,
thus incurred within the 2010 contribution cycle
(1/1/07 through
12/31110).
If the Joan is not from a financial institution, the loan must be repaid
before the end of the next election cycle or the 2014 Election Cycle (1/1/011 through
12/3112014)
and must
be
personally guaranteed by the candidate. If the loan is not repaid by the
end of the next election cycle, it becomes a contribution and would exceed the $4,000
contribution limit.
Additionally, in this example the interest rate charged on the loan is 4%, whereas the prime rate
is 6%. The 2% difference must be accounted for as an in-kind contribution of $200.
(See Section 11.10 of the Summary Guide for information on how to report/oans on the
campaign finance report)
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