New Campaign Finance Rule Would Impact Future Milpitas Elections

Should Milpitas limit campaign donations, reign in certain expenditures and require more disclosures in time for the November 2012 and future local elections?

The Milpitas City Council thinks so. A new campaign finance ordinance that addresses these issues was introduced Tuesday .

City staff will review the ordinance prior to adoption within 30 days. The vote was 4-1 with Councilwoman Debbie Giordano opposed.

Giordano read from a letter by resident activist Ed Riffle saying, “Such restrictions are a violation of the constitution. Restrictions of free speech favor incumbents.”

Another letter received by the council and staff late Tuesday from a Sacramento attorney, Charles H. Bell Jr. of the law firm Bell, McAndrews, Hiltachk, LLP, urged the council to reject the proposals.

He cited “constitutional flaws (limits on contributions to independent expenditure committees), state preemption issues (attempt to require state general purpose committees to file special local reports), vagueness issues (over consultant disclosures) and toothlessness' issues (with respect to the ineffectual voluntary spending limit provisions).”

Milpitas City Attorney Mike Ogaz said he read Bell's letter but had not reviewed it. Giordano was concerned about legal challenges. Councilman Armando Gomez said, “Change is never easy, when adding disclosure.” He indicated he was up to the challenge.

The Campaign Finance Task Force, comprised of Councilwoman Althea Polanski and Councilman Armando Gomez, has worked since March on their proposal, which they presented in six parts:

Contribution amount: Changed from a $350 limit to $500 to adjust for a higher Consumer Price Index (CPI).

Questioned about the amount by Giordano, Polanski, the task force chairwoman, said some cities have no contribution limits, and others have a range of figures. “Union printers cost more than non-union ones, and postal rates are going up,” she added.

Council members approved the amendment on a 3-2 vote, with Giordano and Mayor Jose Esteves dissenting.

Aggregation: Contributions within the limit from a person must be aggregated or combined with contributions from their company, business, and/or organization controlled by that individual. The council unanimously approved the proposal.

Independent Expenditure Committees: After some discussion, the council struck the $100 trigger mechanism from the text for requiring such independent committees to file a form with the Milpitas city clerk and recommended they file a copy of their state form with the clerk.

Giordano expressed disagreement with this provision.

The vote was 4-1 with Giordano opposed to moving forward with this recommendation

Voluntary Campaign Expenditures: A $60,000 ceiling is recommended that is adjusted every two years to reflect changes in the CPI.

Polanski said she decided on a single amount as reasonable. Vice Mayor Pete McHugh and Gomez agreed this was reasonable as a voluntary limit.

Giordano said, “I won't be supporting this, as it favors incumbents.”

Esteves said he felt the limit for council races should be lower. Gomez said, “campaign costs are going up. Keep the same amount.” Polanski added, “Candidates (mayor and council) all have to reach the same amount of voters. I'm comfortable with the task force recommendations.”

The vote was 4-1 with Giordano against.

Campaign Consultants: The task force recommends that persons who are paid to formulate campaign strategy or manage an effort to defeat, elect or recall a candidate for elected city office be required to register with the city clerk and disclose business contact information and clients in order to increase transparency in the electoral process and ensure public confidence in elections.

Gomez said the public has a right to know about consultants' current clients. McHugh asked if campaign managers would have to register as consultants. Modifications were discussed to clarify the matter.

Giordano voted no, and the other four voted yes on the recommendation.

City Council Meeting Disclosures: The task force recommends  that the Open Government Ordinance be revised to encourage elected officials to disclose the receipt of any campaign contributions in the preceding 12 months from persons or companies appearing before the City Council at the council meeting in which the donor appears.

Giordano was concerned about tracking residents who spoke at public forums and on agenda items.

Polanski said, “The intent is not toward those who just make donations, but those who are doing business with the city.”

City Manager Tom Williams said a public hearing item could be a threshold for such disclosures.

McHugh proposed having a data base in the city clerk's office to help council members stay current on contributors to be disclosed. City Manager Tom Williams said, “Staff will assist with making a searchable data base.”

The recommendation was approved with a 4-1 vote. Giordano was opposed.

Three members of the public stepped up to speak:

Former council candidate and neighborhood activist, Bill Ferguson thanked the council for appointing the task force. He said, “The aggregation recommendation is good. It closes a loophole. The increased max from $350 to $500 is not good. Most people can't  afford $350.” He added, “The voluntary limit should be $20,000 for council and $30,000 for mayor.”

Ferguson had previously filed complaints in past elections against Bob Livengood and Giordano over campaign contributions that were ultimately dismissed. His concerns led to the appointment of the task force.

Rob Means, a former mayoral candidate and former commissioner, agreed with Ferguson's comments. He wanted Milpitas to consider an instant runoff form of election. He said Milpitas would have to become a charter city to accomplish this, however.

Milpitan Robert Marini said, “ I want $10,000 and $20,000 campaign limits, and council members must announce the amount of money they receive from developers.”

The council set Oct. 18 for the second reading and adoption of the
ordinance.