GEOFFREY BERG | PARTNER

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LICENSED IN TEXAS
COLORADO PENNSYLVANIA

October 6, 2014
(Via Email David.Feldman@houstontx.gov and
CMRRR # 9407 1118 9956 1760 9257 01)
Mr. David Feldman
Houston City Attorney
P.O. Box 368
Houston, Texas 77001

Re: Houston City Code of Ordinances, Sec. 18-38, LIMITATION ON TOTAL
CONTRIBUTION BY INDIVIDUAL AND POLITICAL ACTION COMMITTEE (the
Ordinance)

Dear Mr. Feldman:

I am counsel to my law partner, Chris Bell, who as you know, is considering running for Mayor
of Houston in 2015. I write in connection with a recent email you sent to Mr. Bell and an article
in the Houston Chronicle concerning your view of the Ordinance.

It is apparently your view that a non-city office holder may transfer into a city campaign account
any sum of money raised in connection with a non-city elective public office provided that the
contributions that comprise it dont fall outside the fundraising restrictions in Chapter 18. If we
understand your email and the Chronicle article correctly, this means that non-city officeholders
may transfer unlimited sums of money from their non-city campaign accounts into their city
campaign accounts. This view is at odds with the plain language of the ordinance, its use since
enactment, and legislative history. Request is made that you reconsider and revise your opinion.
(If our understanding of your view of the Ordinance is in error, please advise.)

Subsection (b) of the Ordinance reads as follows:

A candidate may utilize unexpended political contributions raised in
connection with a non-city elective public office in an amount not to exceed
the maximum contribution that the candidate may accept from a single
donor under subsection (a), regardless of category, provided he files with
the city secretary a statement of intent to do so at the time of the filing with
the city secretary of his campaign treasurer designation, or if the filing of a
campaign treasurer designation is not required, prior to the making of any
expenditure in connection with his campaign for city elective office.
The provisions of this subsection shall also be applicable to a run-off
election, provided that the statement of intent shall be filed within three days
after the run-off election is called.
MR. DAVID FELDMAN PAGE 2
HOUSTON CITY ATTORNEY

(Emphasis added.) The maximum contribution a candidate may accept from a single donor under
subsection (a) is $10,000. The Ordinance simply cannot reasonably be read to mean anything
other than what it says: the maximum amount which may be transferred from non-city campaign
accounts is $10,000. Your current interpretation that non-city officeholders may transfer
unlimited amounts of money into their city campaign accounts renders the Ordinance
meaningless. See, eg, City of Houston v. Todd. 41 S.W.3d 289, 298 (Tex.App. Houston [1st Dist.]
2001, pet. denied) (City ordinances should be given full effect intended by council and not read to
render the law meaningless or absurd.)

When debated and ultimately passed, City Council made clear that the Ordinance was being
enacted to limit the amount of money non-city officeholders could transfer from non-city accounts.
The amendment was considered by City Council on J anuary 25, 2005 and there was discussion at
the table regarding its intent and effect. One such question concerned what could happen if the
ordinance was delayed and not passed that day. Then-City Attorney Arturo Michel explained to
Council that if the ordinance was not passed that day, then on February 1, 2005, a candidate would
be able to transfer any amount of money from his or her non-city account into his or her city
account. Councilmember Galloway asked the City Attorney for clarification:

Councilmember Galloway stated that she wanted to verify what Mr. Michel stated,
that if they passed it [sic] prior to February 1, 2005 that a person who planned to
run could file on February 1, 2005 with a treasurer and take that money and transfer
into their account for a City election, and Mr. Michel stated that was correct, that
they could not transfer after the time of passage, and Councilmember Galloway
stated that she wished Councilmember Wiseman could release her tag so they could
put the ordinance into effect, that she liked the level playing field, that she thought
it was a good ordinance and wanted to applaud the Ethics Committee for coming
forth with it.

Houston City Council Minutes No. 2005-0047-1, 1-25-05, P. 17 (enclosed). Obviously, if money
could be transferred before passage of the ordinance but a candidate could not transfer after the
time of passage, the ordinances very purpose was and is to prevent the wholesale transfer of
funds from non-city office campaign accounts to city accounts. This is accomplished by treating
non-city campaign accounts as political action committees, limiting their maximum contributions
to $10,000.

Earlier at that same J anuary 25, 2005 meeting, Councilmember Gordon Quan, then chair of the
Council Ethics Committee, explained why the amendment was introduced:

Councilmember Quan states that as Chairman of the Ethics Committee he wanted
to say that the item was brought by Councilmembers to discuss a fair playing field
for people seeking to run for City Council, that it had been brought to their attention
that many people ran other campaigns and accumulated monies in other campaigns
and were allowed to solicit funds during periods where they as Councilmembers
were not soliciting funds therefore they could accumulate a very large amount of
money and then transfer to a Council account which would give them an advantage
MR. DAVID FELDMAN PAGE 3
HOUSTON CITY ATTORNEY
to somebody not subject to those rules, that there were two meetings of the Ethics
Committee to look at it and working with the Legal Department and the
administration what they sought to do was simply provide a fair playing field, that
they be allowed to transfer up to what was legally permissible now, which would
be $10,000 but subject to any changes in the Council rules in the future, so that was
the reason for bringing the item to Council.

Houston City Council Minutes No. 2005-0047-1, 1-25-05, P. 16. If current non-city officeholders
are permitted to transfer unlimited sums from non-city accounts in connection with the 2015 city
elections in violation of the plain language of the ordinance, Mr. Bell and every other non-
officeholder who may wish to run for city office will be placed squarely on the wrong end of the
unfair playing field City Council sought to equalize in the first place.

As you know, the City of Houston is now in a fundraising blackout period. Non-city officeholders
may not raise money for city races. Permitting officials who want to run for city office in 2015 to
raise money using non-city accounts which may then simply be transferred in full to city accounts
defeats the very purpose of the blackout period and unjustly disadvantages those who do not
currently hold elective office. The blackout period was not intended to be a fundraising bonanza
for officeholders at the expense of citizens who may wish to get involved in public service, but
that is precisely what a deviation from the plain meaning of the Ordinance would make it. We
urge you not to allow that to happen.

Finally, when Ellen Cohen ran for City Council in 2011, she still had unexpended funds left in
her state campaign account. That money was not transferred to her campaign for City Council
but was instead refunded to her contributors. It was then left up to them to decide whether they
wanted to donate to her for her race for City Council. Simply transferring that money from her
non-city campaign account to her council account would have been in plain violation of the
Ordinance.

Request is made that you reconsider your initial opinion of the Ordinance and render a new,
superseding opinion. In light of upcoming deadlines and the need to provide sufficient time for
litigation should that become necessary, please provide a response on or before the close of
business on Friday, October 10, 2014. I am available to discuss at your convenience.

Respectfully,
BERG FELDMAN J OHNSON BELL, LLP



By: /s/ Geoffrey Berg
Geoffrey Berg

cc: Chris Bell [Firm]