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New York City Campaign Finance Board
Father Joseph P. Parkes, S.J. Chairman Art Chang Richard J. Davis Courtney C. Hall Mark S. Piazza Board Members Amy M. Loprest Executive Director Elizabeth Bauer Chief of Administrative Services Daniel Cho Director of Candidate Services Shauna Tarshis Denkensohn Director of Operations & Budget Sue Ellen Dodell General Counsel Eric Friedman Director of External Affairs Peri Horowitz Director of Campaign Finance Administration Onida Coward Mayers Director of Voter Assistance Kenneth O’Brien Director of Systems Administration Julius Peele Director of Auditing & Accounting Jesse Schaffer Director of Special Compliance Elizabeth A. Upp Director of Communications
A Look at “Out-Year” Spending in 2013
The day the calendar flipped to January 1, 2013 signified an important change for candidates in City elections, and it’s not just the reality that the general election is only 11 months away. For most candidates, the beginning of 2013 means closing the books on the “out-year” spending limit. Candidates who participate in the Campaign Finance Program agree to abide by strict spending limits, including an “out-year” limit that applies to all expenses incurred in the three years prior to the election year. The limit varies by office, ranging from $303,000 for mayoral and other citywide candidates to $45,000 for City Council races, and any overage is simply deducted from the amount candidates may spend on the primary election (or the general election, if the candidate is not running in a primary). Through December 31, 2012, candidates in the 2013 elections spent $9.09 million, a 1.5 percent increase from the same period in the 2009 elections. For 2013, 120 candidates have reported spending an average of $75,740 during the outyear. By comparison, at this point in 2009, 148 candidates reported spending an average of $60,518 during the out-year period.
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“Out-Year” Spending by All Candidates, 2001–2013
Peggy A. Willens Director of Management Analysis & Records Administration Matt Sollars Press Secretary Bonny Tsang Press Aide Ciara M. Remerscheid Press Intern FULL DISCLOSURE January 2013, No. 25 40 Rector Street, 7th Fl. New York, NY 10006 www.nyccfb.info Questions/Comments 212.306.7100 email@example.com
news from the CFB Opposes City Council Bill to Loosen Disclosureboard nyc campaign ﬁnance Rules
In 2010, New York City voters spoke out clearly for greater transparency of money in politics when they approved a new requirement to disclose independent spending in City elections. But with the 2013 elections approaching, the City Council is blocking full implementation of this new mandate, approving legislation to exempt unions and other organizations from disclosing how much they spend to promote candidates to their rank-andfile members. Following the U.S. Supreme Court’s controversial ruling in Citizens United, 84 percent of voters approved a Charter amendment to require public
Source: New York City Campaign Finance Board, Searchable Database, January 28, 2013, http://www.nyccfb.info/searchabledb/Start.aspx?from_screen=Expenditure
disclosure of independent expenditures in New York City for the first time. The Charter requires expenditures of $1,000 or more to be disclosed; an organization that spends $5,000 or more must disclose publicly the contributions it receives. After an open and deliberative process, the Board approved rules to administer the new requirement. They are some of the strongest independent disclosure rules in the country, at any level of government, and they will give New Yorkers the insight into spending on City elections that they clearly desire. The CFB’s rules, which took effect
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A Look at “Out-Year” Spending in 2013 (from page 1)
Comparisons of out-year spending between one election and the next are necessarily not precise because the candidate pool varies, as do the available resources. In 2013, candidates have raised an average of $230,610 in the out-year period, compared to an average of $128,709 in the 2009 out-year period.
Top “Out-Year” Expenditure Categories, 2013 Election Consultants Fundraising Pre-2010 Funds Charge* Professional Services Campaign Worker Wages Other Office Expenses $2,679,705 $1,699,926 $1,178,399 $914,808 $765,851 $695,913 $441,328 29.5% 18.7% 13.0% 10.1% 8.4% 7.7% 4.9%
Campaigns’ spending habits can also shift from election to election although some spending remains consistent. An analysis of expenditure purpose codes as reported by campaigns shows that spending on consultants and fundraising top the out-year expenses for candidates in the 2013 elections, accounting for 61 percent of all spending (including the “Pre-2010 Funds Charge”). Those were also the top spending categories in 2009, accounting for 44.7 percent of out-year spending. Other spending types varied between the two election cycles both up and down. Professional services expenses are 10 percent in 2013, compared to 14 percent in 2009. Spending in the “Other” category fell to 7.7 percent in 2013, compared to 13 percent in 2009. Campaign worker wages accounted for 8.4 percent of out-year spending in 2013, compared to 6.6 percent of spending reported in 2009. Looking back to 2009 is very helpful as a guide to what campaigns will start to spend money on from here to Election Day: television ads and campaign mailings. Four years ago, those two categories accounted for nearly 45 percent of all spending reported by campaigns after January 1, 2009.
* The “Pre-2010 Funds Charge” is a cost allocation applied to candidates who “froze” their 2009 campaigns following the extension of term limits. The flat 15 percent charge applies to all funds held in that campaign account on January 11, 2009, to reflect the cost of raising those funds.
CFB Opposes City Council Bill to Loosen Disclosure Rules (from page 1)
in May 2012, require labor unions, membership organizations and corporations to disclose some of the spending they make to send campaign-style messages to their members or shareholders. Intro 978-A, approved earlier this month by the City Council, would loosen those rules and shield some of that spending from view. The legislation would exempt from disclosure mass mailings that unions, corporations and member organizations send to their members or shareholders. These mailings can make up a significant amount of campaign spending. Indeed, in the first election under the new rules — the special election in Council District 12 in the Bronx — spending on these mailings accounted for more than 10 percent of all spending made on the winning candidate’s behalf. This disclosure is important for two reasons: it helps voters understand who is speaking to them and it empowers voters with the information they need to hold candidates accountable for their supporters and positions. The CFB believes its rules provide New Yorkers with a complete picture of election-related spending, and we opposed Intro 978-A because it would deprive voters of information about that spending. For more information about this legislation, please read the testimony Executive Director Amy Loprest delivered at the City Council’s Government Operations Committee hearing on January 16, 2013.
What’s Coming Up
February 8 February 9 February 11 February 15 February 19 February 21
Disclosure Statement 2 due for Special Election candidates on Council District 31. Voter Registration deadline for Special Election in Council District 31 Voter Assistance Advisory Committee Public Meeting 2013 Debate Sponsor Application due Special Election for Council District 31 Campaign Finance Board Public Meeting
2013 Special Election for the 31st Council District in Queens
Voters in Council District 31 (comprising Arverne, Bayswater, Edgemere, Far Rockaway, Laurelton, Rosedale, and Springfield Gardens) will have the opportunity to select a new council member on February 19. The seat was vacated at the end of December when Council Member James Sanders, Jr. resigned to take his new position as a state Senator. Since the special election was called, nine candidates have registered with the CFB and have opted to join the Campaign Finance Program, which provides eligible participants with public matching funds. The first $87 of qualifying contributions from New York City residents are matched $6-to-$1 under the program. On January 30, five candidates were paid a total of $209,419 in public matching funds (see next page for details). In their first campaign finance disclosure statement candidates reported raising a total of $127,298 in contributions. The next disclosure deadline is February 8. To qualify for public financing, candidates must meet a two-part threshold which includes minimum funds of $5,000 raised and collecting at least 75 contributions from District 31 residents. Candidates that opt into the public matching funds program are subject to a $168,000 spending limit. All candidates are subject to contribution limits of $1,375.
Important dates for the February 19, 2013 special election for Council District 31
To register or vote absentee: • February 9: Last day to register to vote. The application must be postmarked or hand delivered to the Board of Elections (BOE) by this date. • February 12: Last day to postmark absentee ballot application. • February 18: Last day to postmark absentee ballot. • February 18: Last day to apply in person at a BOE office for an absentee ballot. • February 19: Last day to hand deliver an absentee ballot to a BOE office. For military voters: • February 9: Last day for BOE to receive application by mail for military ballot if not previously registered to vote. • February 12: Last day for BOE to receive application by mail for military ballot if previously registered to vote. • February 18: Last day for to apply in person for a military ballot if previously registered to vote. • March 4: Last day for the BOE to receive military ballot by mail.
JANUARY BOARD ACTIONS
Candidate Joseph Lazar Stephen T. Levin Melissa Mark-Vivierito Darlene Mealy James J. Sanders, Jr. Cleofis Sarete
Election March 2010 2009 2009 2009 2009 2009
Office Sought CD #44 CD #33 CD #08 CD #41 CD #31 CD #10
Penalties $144,374 $808 $2,222 $6,253 $10,113 $3,9101
The Board reduced certain penalty amounts to avoid penalties disproportionate to the size of the campaign.
Public Funds Repayments
Candidate Joseph Lazar James J. Sanders, Jr. David I. Weprin
Election March 2010 2009 2009
Office Sought CD #44 CD #31 Comptroller
Repayments $92,4001 $19,690 $319,7112
The Campaign Finance Board determined that the campaign of Joseph Lazar CD #44 (March 2010) is required to repay all public funds. The campaign breached the obligations affirmed and accepted by the campaign in joining the Program and is not eligible for public matching funds. This amount was revised by the Board.
The candidate Stephen T. Levin CD #33 (2009) has already repaid the remaining bank balance in the campaign’s bank account. The candidates Darlene Mealy CD#41 (2009) and Lynn C. Schulman CD #29 (2009) are required to repay the remaining bank balance in the campaign’s bank account. The candidate Brad S. Lander CD #39 (2009) is required to repay to remaining bank balance in the campaign’s bank account or the Qualified Expenditure Deficit of $42,365, whichever is higher.
Public Funds Payments
All payments were made on January 30 to candidates in the special election for City Council District 31 that will be held February 19, 2013. Candidate Selvena N. Brooks Michael R. Duncan Jacques M. Leandre Pesach Osina Donovan J. Richards Public Funds Payments $37,324 $38,532 $42,887 $37,848 $52,828
“TIP OF THE MONTH”
from CFB Candidate Services
After every disclosure statement, the CFB conducts a preliminary review of the financial activity disclosed by each campaign. This review contains one or more reports that require your response. This is an opportunity for you to correct any misreporting and preliminary instances of non-compliance. These reviews are cumulative, and may include issues from previous filings to which your campaign has yet to respond fully. Materials filed by campaigns in response to the statement review may include amendments to filings and/or supplemental documentation, such as letters from contributors or additional copies of backup documentation. In the statement review, you may receive any one of the following: 1. Statement Review Findings: These reports address issues with contributions collected by your campaign, including (but not limited to) contributions from unregistered political committees, over-the-limit contributions, and contributions with missing employment information. An instruction sheet accompanying each report will provide detailed instructions on how to remedy the specific issue. 2. Invalid Matching Claims (IMC): This report lists contributions claimed for match that are preliminarily deemed to be invalid. Each transaction will have one or more invalid code explaining the basis for invalidation. To the right of each transaction, you check the box or boxes that describe the action(s) you’ve taken to correct the invalid claim. An instruction sheet accompanying the IMC report contains more detailed guidance on how to respond. 3. Threshold Status: This report provides preliminary information regarding your campaign’s threshold status to qualify for matching funds. Please remember that only valid matching claims count toward the threshold requirement. If your candidate has not indicated which office s/he is seeking, the threshold report will not contain the number of residents who can be counted for threshold purposes. Please review the following checklist before responding to your Statement Review to ensure that all necessary steps have been taken. Read the CFB letter and the instruction sheets accompanying each report, as they contain detailed instructions on how to respond. Responses may vary, depending on what was cited in the review. Responses must include: A copy of the Statement Review Checklist & Verification Statement, signed by the candidate or treasurer. Documentation in response to a specific finding (for example, a refund check for a prohibited contribution) must be referenced with its Transaction ID and placed with a copy of the corresponding findings report. A copy of your IMC report, including detailed notes, explaining your campaign’s response to each invalid matching claim. Additional documentation provided by your campaign in response to the IMC report should be attached to the back of the report, noted with the corresponding transaction ID. Amendments for each disclosure statement affected by modifications in C-SMART, if applicable. Responses must be received by the due date, as noted in the Statement Review cover letter. If you have any questions, contact the Candidate Services Unit at (212) 306-7100 or CSUmail@nyccfb.info.
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