Clean Campaigns Act

Summary

In August 2019, Councilmember M. Lorena González drafted legislation - the Clean Campaigns Act - to reform campaign finance laws in Seattle. After the legislation was introduced, Seattle saw an unprecedented amount of independent expenditures in the November 2019 election.

Aspects of the Clean Campaigns Act include but are not limited to

  1. a ban on foreign-influenced corporations from making any contribution to independent expenditure committees;
  2. a cap on all political contributions to independent expenditures of $5,000 (with the exception of limited contributor committees); and,
  3. new reporting requirements to increase transparency.

Seattle voters overwhelmingly support protecting the integrity of our democracy and elections. In November 2015, 63% of voters passed Initiative 122, “Honest Elections Seattle,” and enacted a set of transparency and disclosure requirements and created the first and one of its kind, taxpayer funded Democracy Voucher Program. These campaign finance reforms were intended to give voters control of the election process and get big money out of politics.

Since then our election cycles have shown us that we have a gap in our campaign finance reform laws that has allowed a limitless and an unprecedented flood of super PAC spending in our city; leaving our democracy vulnerable and raising the risk of quid pro quo corruption or its appearance.

Our Democracy’s Integrity Is Under Threat

Big Money in Politics Creates the Appearance of Corruption

Big money has a corrupting influence on our elections. The mere appearance of corruption, particularly quid pro quo, stemming from large individual financial contributions, is something that the U.S. Supreme Court has warned about as a danger to democracy.

Big Money is Growing Exponentially in Seattle

There is a deluge of Independent Expenditures (IEs), or outside spending, in Seattle elections. IEs more than doubled between 2013 and 2017. And IE spending is breaking new records in the 2019 election as well, more than doubling again. Large contributions to the groups that make independent expenditures present a serious risk of quid pro quo corruption or its appearance.

The Will of the Voters Is Being Subverted

Seattle voters overwhelmingly passed two anti-big money initiatives in recent years. Honest Elections, passed in 2015, was in part intended to minimize the ability of big money to buy local elections. I-735, passed in 2016, called for a constitutional amendment, clarifying that corporations don’t have the same free speech rights as individuals and money isn’t speech. While the City waits for constitutional action, we can still take action to limit quid pro quo corruption - whether real or perceived - and protect democratic self-governance from foreign influence.

How the Clean Campaigns Act Protects Our Democracy

No Money from Foreign-Influenced Corporations

Foreign election interference is on the rise in America, as the 2016 election showed. To protect democratic self-government, Councilmember González’s Clean Campaigns Act prohibits corporations with foreign influence (significant ownership by foreign shareholders) from making independent expenditures or contributions.

Ending Super PACs

The Clean Campaigns Act would effectively put an end to big money in Seattle politics. Contributions to IE committees would be limited to $5,000, meaning that a single organization or person could not contribute more than $5,000 to IE committees in total each election cycle. In contrast to current rules, the most that one company has contributed to IEs is $1,500,000.

Systemic Transparency of Political Money & Ads

Seattle’s landscape of political advertising is largely opaque, especially for IEs. The Clean Campaigns Act would require IEs, candidates, and advertisers to publicly report all advertisements, costs, etc. in order to create a comprehensive, transparent record.

Limited Contributor Committees

To allow for additional grassroots fundraising, the Clean Campaigns Act would establish Limited Contributor Committees (LCCs.) LCCs would be the only entities allowed to aggregate contributions above $5,000, all from small donors. These committees would mirror the requirements of the small donor threshold as Seattle’s Democracy Voucher Program.

FAQs

What are Super PACs and why are they a problem?

A Super PAC is a political action committee that can accept - and spend - an unlimited amount of money so long as it does not coordinate with a candidate.5 As a result, Super PACs have become vehicles for donors to evade campaign contribution limits designed to prevent corruption and the appearance of corruption.7 And Super PACs are being used by foreign interests to spend money on American elections.7

Why should campaigns, PACs and advertisers have to be transparent about political advertisements?

Transparency fosters accountability and helps combat misleading information. The people of Seattle deserve to know what information is being used to target them, influence the election outcome, and affect our political climate. This is particularly true of online ads that may only be seen by a subset of people who are targeted by the advertiser.

What makes a company foreign-influenced? Does foreign ownership really impact decision making?

According to federal law and academic literature, a single shareholder owning 1% or more of shares in a corporation may be in a position to influence corporate decision-making.2 Thus, the Clean Campaigns Act defines a corporation as having foreign influence if a single foreign owner holds, owns or controls at least 1% of total shares. Similarly, if two or more foreign owners control 5% of total shares in aggregate, a corporation is considered to have foreign influence.

What is an independent expenditure? Why would contributions to independent expenditure committees be limited to $5,000?

Independent Expenditures, or IEs, are campaign expenditures that are not coordinated with any candidate. But even when committees that make independent expenditures do not coordinate their expenditures with candidates, major contributors can engage in corrupt deals with those candidates. Limiting contributions to independent expenditure committees protects against this corruption or its appearance.

The only exception to the $5,000 contribution limit would be Limited Contribution Committees, which would allow for grassroots fundraising while mirroring the requirements of the small donor threshold in Seattle’s Democracy Voucher Program. For example, LCCs have to collect contributions from a minimum number of persons (150 for districted Council races / 400 for citywide Council races / 600 for Mayoral races,) and have contributions of less than $500 per person.

How Big Money Distorts Democracy

Big Money Reduces People’s Faith in Our Elections and Our Democracy

About two in three Americans say that they trust government less because big donors to Super PACs have more influence than regular voters. Republicans (67%) and Democrats (69%) uniformly agree.

Big Money Suppresses Voter Turnout

Roughly one in four Americans say that they are less likely to vote because big donors to Super PACs have so much more influence over elected officials than average Americans. Higher proportions of low income households (34%) are less likely to vote, as are African-American voters (29%) and Hispanic voters (34%.)

Big Money Makes the Public Believe that Elected Officials are Subject to Special Interests

More than three-quarters of Americans agreed that members of Congress are more likely to act in the interest of a group that spent millions to elect them than to act in the public interest. Similar numbers of Republicans (81%) and Democrats (79%) agreed. The perception that elected officials may be engaging in quid pro quo deals with the funders of these groups is a serious threat to our democracy.

Timeline

Action Item Anticipated Date
Refer Ordinance to Council’s Introduction & Referral Calendar November 12, 2019
Possible Executive Session December 2, 2019
Regular GESCNA-Ed Committee Hearing: Briefing and Discussion with Community & Subject Matter Expert Panel December 11, 2019, 9:30AM
Special GESCNA-Ed Committee Hearing: Briefing and Discussion of identified issues and discussion of possible amendments December 19, 2019, Time TBD
Possible Executive Session January 6, 2020
Special Committee Hearing: Briefing, discussion and possible vote on amendments and amended legislation January 7, 2020
Full City Council Vote January 13, 2020
[Alternative] Full City Council Vote January 21, 2020

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