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Newsom Uses Prop H to Attack Peskin
by Paul Hogarth‚
May. 12‚ 2008
With Prop 98, the State Senate race and the Bayview initiatives dominating attention on San Francisco’s June ballot, very few voters know about Proposition H. Sponsored by Mayor Gavin Newsom, Prop H looks like a modest campaign finance reform measure. But it’s tailored to remind us of how Clear Channel gave $20,000 to last year’s Muni Reform measure – a “controlled” campaign committee by Supervisor Aaron Peskin. Prop H plugs a small loophole in existing law, but fails to define what is a “controlled committee” – a far greater problem that has allowed Newsom and others to raise hefty sums to various ballot initiative campaigns. Newsom put Prop H on the ballot without going through the Ethics Commission, which is common protocol for campaign finance measures. Peskin has introduced similar legislation at the Ethics Commission – which goes further by actually defining what is a “controlled committee.”
It’s already illegal for a company who contracts with the City to contribute to an elected official who would vote on that contract. But even if it were legal, you can only give up to $500 to a candidate’s campaign. Initiatives, on the other hand, have no contribution limit – so a quick end-run is to give huge sums to a ballot initiative campaign near and dear to the elected official’s heart. So the law forbids contractors from giving to a campaign committee that is “controlled” by such an elected official.
The fundamental question, however, is what is a “controlled committee”? Was Care Not Cash a “controlled” committee when Gavin Newsom used it to get elected Mayor? Not according to its campaign filings. What about the committee set up last year to oppose Question Time at the Board of Supervisors – which was Newsom’s main priority for November 2007? No. While one can argue that they should have been registered as such, it all depends upon the (under-funded) Ethics Commission to enforce existing law.
But when Board President Aaron Peskin put his Muni Reform measure on the ballot, he registered “Yes on A” as a controlled campaign committee. Two days before the Board of Supervisors voted to give Clear Channel a contract to run Muni bus shelters, the company gave $20,000 to “Yes on A.” At the time, Peskin told the Chronicle that he knew nothing about the donation, and that he did not solicit it. “If any contribution violated the law,” he said, “we will refund the money.”
In other words, Peskin complied with the law by registering “Yes on A” as a “controlled committee” – and then got in trouble when Clear Channel gave money. If he had never registered it as a “controlled committee,” nobody would have noticed.
Now Newsom says that Prop H is necessary to “prevent even the appearance of a conflict of interest.” But it really doesn’t do much. Current law already makes it illegal for such contractors to give to a controlled committee. Prop H would just extend the liability to the elected official, saying they shall not “solicit or accept” such a contribution. It still doesn’t address the basic question – what is a “controlled committee” and when would an elected official be required to disclose it as such?
State law – California Government Code §82016 – says an elected official “controls” a campaign committee (either “directly or indirectly” through his or her agents) if they have a “significant influence” on the campaign’s “actions or decisions.” The state law doesn’t define “significant influence,” but under this broad definition Newsom arguably controlled the Care Not Cash campaign – as well as the “No on Question Time” effort.
According to the Ethics Commission, most local ballot initiative campaigns do not register as “controlled” committees. There have only been three in recent memory: (a) “Citizens Against Recall Abuse” controlled by Supervisor Jake McGoldrick, (b) “San Franciscans for Free Wireless Internet” controlled by Assessor Phil Ting, and (c) “Yes on A” controlled by Peskin. It’s common practice for local politicians across the spectrum (from Chris Daly to Sean Elsbernd) to promote local ballot measures – but why are so few campaign committees “controlled”?
Which brings us to current legislation that Peskin has introduced which would clarify existing law. Under Peskin’s proposal, which the Ethics Commission reviewed at their March 24th meeting, a controlled committee would be any campaign committee where an elected official: (1) has a “significant influence” on its actions or decisions, (2) is the legislative sponsor of the local ballot measure, or (3) solicits $10,000 or more in contributions.
Last year, Newsom headlined a fundraiser at the Pacific Heights mansion of Dede Wilsey for the “No on E” campaign against Question Time. Guests were asked to give anywhere from $1,000 to $25,000; according to campaign filing reports, Wilsey herself gave $10,000. So under the Peskin legislation, the “No on E” campaign would clearly be defined as “controlled” by Newsom.
Clear Channel gave $25,000 to “No on E” – as did Forest City Realty, PG&E, Bechtel, and San Francisco Water Partners. In 2002, when Newsom’s Care Not Cash was on the ballot – which was not registered as a “controlled” committee – it got a $20,000 donation from Chevron. Other donors included the Jaidin Consulting Group, the CEO of Wells Fargo, Viacom Outdoor and Webcor Builders. If any of these entities did business with the City, their contributions would also be illegal.
But Newsom didn’t bring Prop H to the Ethics Commission. He merely placed it on the June ballot, and will promote it as plugging a serious loophole. Prop H does not address the corruption behind ballot initiatives – other than to make Aaron Peskin look bad. It’s part of Newsom’s recurring pattern: after having demonized Chris Daly in the court of public opinion, Peskin is just the Mayor’s new target.
With Prop H on the June ballot, will the Chronicle go along for the ride?
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May 16, 2008
