Campaign Finance in Local Elections: Buying the Grassroots 9781626371705

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CAMPAIGN FINANCE IN LOCAL ELECTIONS

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CAMPAIGN FINANCE IN LOCAL ELECTIONS Buying the Grassroots

Brian E. Adams

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Published in the United States of America in 2010 by FirstForumPress A division of Lynne Rienner Publishers, Inc. 1800 30th Street, Boulder, Colorado 80301 www.firstforumpress.com and in the United Kingdom by FirstForumPress A division of Lynne Rienner Publishers, Inc. 3 Henrietta Street, Covent Garden, London WC2E 8LU © 2010 by FirstForumPress. All rights reserved Library of Congress Cataloging-in-Publication Data Adams, Brian E., 1973– Campaign finance in local elections: buying the grassroots / by Brian E. Adams. Includes bibliographical references and index. ISBN 978-1-935049-17-3 (hardcover: alk. paper) 1. Local elections—United States. 2. Campaign funds—United States—States. I. Title. JS221.A33 2009 324.7'80973—dc22 2009030502 British Cataloguing in Publication Data A Cataloguing in Publication record for this book is available from the British Library. This book was produced from digital files prepared by the author using the FirstForumComposer. Printed and bound in the United States of America The paper used in this publication meets the requirements of the American National Standard for Permanence of Paper for Printed Library Materials Z39.48-1992. 5 4 3 2 1

Contents

List of Tables and Figures Preface

1

vii ix

Local Elections, Campaign Finance, and the Health of American Democracy

1

2

The Cities and the Data

17

3

Campaign Finance, Competition, and Electoral Success

39

4

Why Campaign Spending Matters

59

5

Electoral Accessibility and the Campaign Finance Barrier

83

6

Biases in the Contributor Pool

101

7

The Effects of Contribution Limits

145

8

The Impact of Public Financing

167

9

Conclusion: Reforming City Elections

193

Appendix A: Coding for Contributions Appendix B: Coding for Expenditures References Index

v

203 209 211 223

Tables and Figures

Tables

2.1 Overview of Cities

18

2.2 Fundraising Overview

19

3.1 Incumbency Advantage

43

3.2 Competition in Open Seat Races

46

3.3 Predictors of Candidate Vote Share, Competitive City Council Open Seat Primary Elections in New York and Los Angeles

50

3.4 Fundraising Patterns

53

4.1 Itemized Expenditures

61

5.1 Comparison of Fundraising Thresholds and Voting Age Population (VAP), City Council Races

88

5.2 Fundraising Thresholds as a Ratio of Dollars per Population, City Council Races

91

6.1 Summary of Itemized Contributions

103

6.2 Summary of Known Independent Expenditures

106

6.3 Occupations of Individual Contributors

108

6.4 Classification of Individual Contributors by Estimated Earnings

110

6.5 Percent Raised from the Real Estate, Legal, and Financial Sectors

113

6.6 Geographic Distribution of Itemized Contributions

116

6.7 Geographic Bias Within Cities

117

vii

viii

Tables and Figures

6.8 Variation in Fundraising Coalitions

122

6.9 Number of Single-Interest Candidates

124

6.10 Candidate Reliance on Wealthy Contributors

126

6.11 Non-City Funds

127

6.12 Business, Working-Class, and Nonprofit/Government Coalitions

129

7.1 Contribution Limits

146

7.2 Percent of Donors Who Maxed Out, by Contributor Type

153

7.3 The Impact of Contribution Limits on Aggregate Fundraising, City Council Races

155

7.4 Contribution Sizes and Incumbent/Challenger Fundraising Ratios, City Council Races

159

8.1 Overview of Public Financing Programs

170

8.2 The Number of Candidates, City Council Primaries

174

8.3 The Distribution of Matching Funds, City Council Candidates

176

8.4 Fundraising Gaps Between Incumbents and Challengers, City Council Primary Elections

178

8.5 Vote Share, City Council Candidates

179

8.6 Percent Matchable Contributions to City Council Candidates

183

Figure

7.1 Correlation Between Contribution Limits and Contribution Size

151

Preface

Local governments hold a peculiar place in the American political system. They are frequently criticized for their anti-democratic tendencies, from progressives attacking the corruption of big city machines, to civil rights leaders battling segregationist mayors, to critics of suburban exclusionary zoning practices. Yet, equally strong are voices that promote local governments as essential components of a democratic system, their relatively small size and direct impact on citizens’ lives providing the best means through which citizens can actively participate in governmental decisions. In this view, they are the foundation of a selfgoverning and free society. In short, local governments are alternatively portrayed as saviors of American democracy and its most potent nemesis. Regardless of which view we ascribe to, local governments clearly do not reach their democratic potential. As the smallest and most accessible units of government in the United States, they could generate more citizen participation and accountability than currently exists. Little research, however, has focused on explaining this dynamic: why does the level of government most capable of fostering participatory democracy, citizen engagement, and democratic accountability often fall radically short of these goals? Some answers are frequently proffered: local governments do not have enough power to make a difference, citizens are too apathetic, or powerful interest groups actively work to limit citizen input. But these hypotheses have not been theoretically developed or systematically explored, leaving a large void in our understanding of local democracy. This book contributes to an answer by focusing on one possible influence inhibiting local democracy: how campaigns are financed. Scholars studying federal and state elections often point to the campaign finance system as an institution undermining democracy. Contributions from interest groups and wealthy individuals, the argument goes, sever the ties between constituents and elected officials, lead to corruption, and damage the legitimacy of elections. Little attention has been paid, however, to whether money in local elections has such an impact. Is lo-

ix

x

Preface

cal democracy hindered by how candidates finance their campaigns? My analysis shows that candidates’ need to raise substantial sums of money reduces competitiveness, creates biases, and restricts accessibility to municipal office, undermining the capacity of local elections to reach their democratic potential. Of course, there are many factors that could potentially affect local democracy, and this book only addresses one small sliver of the issue. But by doing so it contributes to our understanding of local democracy and, hopefully, will prompt other research exploring this topic. The research presented in this book is based on a dataset of campaign finance activity in eleven large and mid-sized cities, the most comprehensive dataset of local campaign finance assembled to date. Using information on candidate fundraising and expenditures, I explore levels of competitiveness, biases within the contributor pool, the ability of candidates to win without raising funds, the influence of money on electoral outcomes, and the impact of campaign finance reform. Examining these issues illuminates the role that money plays in city elections and, in turn, whether it undermines cities’ ability to foster democratic values. *

*

*

I would like to thank Madhavi McCall, Richard Hofstetter, Farid AbdelNour, and Ron King for reading and commenting on parts of early drafts. I co-authored conference papers on campaign finance with Ronnee Schreiber and Renee Van Vechten, both of whom provided useful insights and perspectives. In 2007, I presented findings from this research at a conference sponsored by California Common Cause, and I would like to thank fellow participants Bob Stern, Susan Lerner, Steven Levin, and Nicole Gordon for their insightful comments. Filing agencies in the cities included in this study often provided invaluable assistance in dealing with the intricacies of the data, with special thanks going out to Bob DeWeese at the Seattle Ethics Commission and (my former boss) LeeAnn Pelham at the Los Angeles City Ethics Commission. Finally, I would most especially like to thank all of my colleagues in the Political Science Department at San Diego State University. I am truly fortunate to be in a department that has both a vibrant intellectual life and a friendly and supportive atmosphere. My colleagues have provided an endless amount of support and encouragement, without which I doubt I would have been able to complete this project.

1 Local Elections, Campaign Finance, and the Health of American Democracy

Over the past two decades research on state and federal campaign finance has flourished. The development of contribution and expenditure databases has allowed researchers to ask questions about the role and impact of money in elections that previously went unasked. As a consequence, our knowledge of campaign finance has grown exponentially, although there are still many important questions that cannot be addressed with the data currently available. Largely absent from this project is research on local elections. Timothy Krebs (1998; 2001; 2005a; 2005b; Krebs and Pelissero 2001) has written articles on campaign finance in Chicago and Los Angeles, and a handful of other scholars have contributed works on different cities (Lieske 1989; Fleischmann and Stein 1998; Fuchs, Adler and Mitchell 2000). There have also been reports prepared by city governments highlighting campaign finance trends (New York City Campaign Finance Board 1994; 1998; 2002; 2004; 2006; Los Angeles City Ethics Commission 2006). Despite this research, our knowledge of local campaign finance pales in comparison to that on the federal and state levels, largely a result of a paucity of data. The lack of research has left a void in our understanding of the role money plays in local elections. Local governments are not simply smaller versions of state and national governments, but rather have their own unique institutions and processes (for example nonpartisan elections and at-large legislative seats). These institutional differences, plus varying policy contexts, may translate into different campaign finance dynamics. Further, local elections have their own role in the larger scheme of American democracy. Localities’ smaller size (both geographically and population-wise1) creates the potential for widespread citizen participation, and thus are often touted as the level of

1

2

Campaign Finance in Local Elections

government where “average citizens” can get most directly involved in electoral campaigns as volunteers, contributors, or candidates. Given the distance between the federal government and the public at large, local governments are frequently seen as an important element of American democracy that provides a link between citizens and government. For these reasons, we cannot make assumptions about campaign finance dynamics on the local level based on studies at the state and national level. Not only may we find varying patterns, but they may have different implications for our understanding of American democracy. This book examines whether the campaign finance system—how candidates raise and spend funds—undermines the democratic character of municipal elections. Does the influence of money in electoral campaigns limit the capacity of citizens to freely choose their local officials? Do fundraising demands on candidates restrict who is able to mount competitive campaigns for municipal office? Do powerful, established interests dominate the contributor pool, crowding out the public’s voice? I explore these questions using a dataset of campaign contributions to candidates in eleven cities across multiple elections (described in Chapter 2). Local Elections, Campaign Finance and Democracy Elections and Urban Politics

Stone (1989, 6) argues that two basic facts of the political economy of cities are that the governments are popularly controlled and that businesses are held in private hands. The interplay of these institutional arrangements provides the context to the regime dynamics that Stone and others have documented (Elkin 1985; 1987; Stone 1989; Imbroscio 1998; Dowding 2001; Mossberger and Stoker 2001). These facts are also the central characteristics of municipal elections. They are a cornerstone of popular control of government, allowing citizens to influence the actions of their representatives by installing or removing them from office. At the same time, the owners of capital can influence electoral outcomes through campaign finance. Candidates for local office need to assemble both a coalition of voters as well as a coalition of financial backers (Krebs and Pelissero 2001), and thus elections are shaped by the interplay of votes and money. Regime theory highlights questions regarding the relative influence of campaign contributions versus votes: how much influence do campaign contributors have over electoral results vis-à-vis voters?

Introduction

3

One reason for studying campaign finance is to examine whether candidates’ need to raise funds undermines the popular control of government that is supposed to result from electoral contestation. Elections are, of course, a central part of any democratic system, allowing the public to hold representatives accountable, providing a means through which citizens can exercise control over public policy, and promoting governmental responsiveness. Do campaign dynamics undermine these processes by limiting competition, restricting accessibility, or creating biases? The vote is viewed by some scholars as a critical resource held by “average citizens” that can counter other resources held by elites (e.g. Dahl 1961). If elections are run in such a way as to minimize the influence of the vote, it could have significant implications for our understanding of the democratic character of local political systems. The issue of popular control of city governments is important because, as front-line service providers, cities make critical decisions that affect citizens directly. Some scholars have argued that holding power within cities is a “hollow prize” due to constraints on municipal power, especially state restrictions on the power to tax, reliance on federal grants-in-aid, and market imperatives. This argument may hold some weight in declining cities that are caught in a vise of diminishing revenues and increasing needs, but most cities most of the time have a measure of power and influence. Cities have substantial budgets and perform basic functions such as providing for public safety and creating land use regulations. Market forces may restrict feasible policy options for cities (Peterson 1981), but they still make important decisions regarding the expenditure of public funds within the confines of market parameters. Given this power, who wins elections has consequences for city residents. Local Elections in a Federal Context

Beyond enhancing our understanding of democratic accountability in urban politics, municipal elections are also important to study as they relate to the American electoral system more generally. Local elections, because they occur in the smallest jurisdictions in the American political system, can potentially provide a counterweight to the biases and shortcomings of federal elections. Many scholars and commentators have documented the influence of interest groups and wealthy campaign contributors in federal elections (e.g., Clawson, Neustadtl and Weller 1998; Green 2002; Kobrak 2002; Lewis 2004). Federal elections are also criticized for lacking competition, with incumbents holding safe seats

4

Campaign Finance in Local Elections

that insulate them from public pressure. These dynamics becomes less of a threat to American democracy, however, if local elections do not exhibit the same patterns. The influence of large campaign contributions on the federal level is less problematic if candidates for federal office rise through a local governmental system where they do not need to play the money game. At least getting to the “big dance” would not require connections to wealthy individuals and established interests, even if once there candidates need to solicit their services. It is not necessary that every election in a democracy be a “grassroots” affair with minimal influence from elites, but some of them do need to be free of domination by the wealthy and accessible to non-elites.2 The same goes for competitiveness: even if most congressional districts are noncompetitive, if candidates must prove their mettle to win lower office at least there is a weeding out process that improves the quality of congressional candidates. The role of local elections in promoting a pluralistic electoral system is a critical one, as it is the venue where the influence of wealthy elites and established interest groups might be diminished and where non-elites are able to participate fully as volunteers and candidates. In many respects, elites will always dominate federal elections; the stakes are so high and the country is so large that presidential and congressional elections will never be grassroots affairs; it is even difficult to imagine what a “grassroots” presidential campaign would look like. But this problem could be mitigated if elections at lower levels of government were accessible to non-elites. At least the pipeline of candidates feeding into federal elections would be open to non-elites and citizens could cut their political teeth in these races. Specifically, there are three attributes that local elections should have to counter negative trends in federal elections: accessibility, competitiveness, and widespread participation by non-elites. If local elections were to exhibit these characteristics, they would counterbalance some of the problems displayed by federal elections. This mitigation is important for protecting the health of American democracy. Democratic theorists have argued that political inequalities are acceptable in a democratic system as long as resources are dispersed widely (Dahl 1961) or different resources are valuable across social spheres (Walzer 1983). Democracy is threatened, on the other hand, when resources are consolidated. Local elections can serve as a venue where different kinds of resources are needed and different types of candidates can succeed, enhancing the pluralistic nature of the American political system and limiting the problems caused by biases and inequalities in national politics.

Introduction

5

One benefit that local governments bring to American democracy rests on their greater capacity than state or federal governments3 to foster citizen participation as a result of smaller geographic and population size. Many political theorists have argued that small size is necessary for widespread citizen participation in politics (Dahl 1967; Barber 1984; Frug 1999; O’Leary 2006). Smallness allows citizens to attend and speak at public meetings, communicate directly with elected officials, and engage other participants in face-to-face conversation, activities that are limited in large jurisdictions. Even though voting is unaffected by size, many other forms of participation are made more difficult or more costly as jurisdictions get larger. The empirical research on the influence of size on political participation supports this conclusion. Studies of non-electoral participation have generally found that citizen involvement decreases when cities grow in size (Oliver 1999; 2000; 2001; Rose 2002). The strongest evidence is contained in Bryan’s (2004) study of New England town hall meetings which showed that meeting turnout decreased as town size increased. Studies examining the effects of size on electoral turnout, however, have found that size has minimal impact compared to other factors (Hajnal and Lewis 2003; Kelleher and Lowery 2004; Caren 2007). These findings make sense theoretically, as we should not expect voting to be heavily influenced by jurisdiction size given that the process of voting itself is unaffected by the number of voters.4 As the smallest units in the American political system, local governments are often considered to be “closest” to the people. Grodzins (1966) identified different ways that “closeness” can be understood. 5 Local governments could be closer to the people through the provision of services directly to citizens, leading to more influence over their lives. They may also be closer because they maximize citizens’ opportunities to participate in politics. Unlike higher tiers, citizen can get directly involved in the governance of localities through various forms of nonelectoral participation. A third meaning of closeness rests on the idea of policy responsiveness: local governments are closer because they are more responsive to citizen desires. This could be a result of greater participation, but could also be a function of elected officials having a greater knowledge and understanding of local opinions and conditions. Grodzins is critical of all of these applications of “closeness;” empirically local governments do not fare well on any of these measures. For example, turnout in local elections is often lower than national contests, and the federal government provides many services directly to citizens that have a profound impact on their lives (e.g. Social Security). Despite its widespread use, the vague and imprecise concept

6

Campaign Finance in Local Elections

of closeness is not a valuable way to conceptualize the contribution of local government to the American political system. In the context of local elections, a better way to think about their role is in terms of participatory capacity. Given the size of the electoral districts and the relatively small number of voters and money spent, local elections have the capacity to allow for more direct citizen involvement in all facets of elections. This would include volunteering for candidates, contributing funds, and running for office. This does not make local governments “close” to citizens in some general sense, but it is potentially one of the ways that they are differentiated from elections at higher tiers. One of the oldest strands in theorizing about local government posits that local governments are training grounds for democratic citizenship. John Stuart Mill (1951 [1861]) considered local governmental institutions to be “schools of political capacity” where citizens could learn how government operates. By engaging in politics on the local level, citizens can learn firsthand of issues, as opposed to national politics where citizens’ primary role is to elect representatives. The capacity to get directly involved in politics, as opposed to delegating responsibilities to representatives, is why Mill considered local institutions to be the “chief instrument” of the political education of citizens. Alexis de Tocqueville (2003 [1835], 335) also lauded township government as a place where citizens can gain political skills and knowledge. As more recent research has demonstrated, civic skills are an important component to political engagement (Verba, Brady and Schlozman 1995), and thus learning about politics and developing civic skills on the local level is likely to translate into greater participation in politics generally. The chief reason for why localities are a better venue for developing democratic citizens is that participants are able to engage politics in a deeper way locally. Citizen can engage in a wide range of participatory acts at all levels of government. They can write letters to both their member of Congress and city councilmember, they can protest at the state capitol as well as city hall, and they can circulate petitions on both national and local issues. But performing specific participatory acts does not necessarily lead to political learning. A citizen can attend a protest and chant slogans without learning anything about the issue, and spouting opinions in a letter to your Congressman will not be all that enlightening. What citizens can do on a local level that cannot typically be done at higher tiers is to engage in political strategizing and to be directly involved in policy making. When citizens participate locally, they frequently do not just engage in isolated political acts; they also develop strategies with fellow citizens and engage in policy discussions

Introduction

7

with elected officials (Adams 2007a). They are able to do this because fewer resources are needed locally and they can use their social networks to better effect. Even if the activities are the same, citizens can insert themselves deeper into the political process locally, and thus gain more knowledge and understanding of democratic politics. This type of activity is what provides the beneficial democratic training identified by Mill and Tocqueville. One of the best ways to acquire the type of political learning described by Mill and Tocqueville is for citizens to run for office themselves. There are over 85,000 local governments in the United States with almost 500,000 elected positions, one for every 450 adults (U.S. Census Bureau 1992).6 This creates ample opportunities for citizens to seek a local office and provides a means through which citizens can engage directly in the governance of their local communities. The smaller scale and limited power of local governments allows citizens without extensive political experience to seek and hold local office. It also creates “stepping stones” for citizens to move up into higher office, if their political ambitions prompt them to do so (Schlesinger 1966; Francis and Kenny 2000). Serving on a school board or a town council is a way to get their feet wet politically and can be used as a springboard to higher office.7 Holding local office benefits the aspiring politician by increasing name recognition, helping develop valuable political networks, and assisting with fundraising efforts. So, not only can citizens develop their political skills and enhance their knowledge of democratic governance, they can also acquire other politically valuable resources they can use in bids for higher office. This provides a path for non-elites to gain political power. For Tocqueville, townships provided more than just a venue where citizens can develop civic skills and learn about politics: they also developed an appreciation for freedom, democracy, and self-governance. He cited the robust townships in New England as one of the reasons for the maintenance of freedom in the early Republic: … [T]he strength of the free nation resides in the township. Town institutions are to freedom what primary schools are to knowledge: they bring it within people’s reach and give men the enjoyment and habit of using it for peaceful ends. Without town institutions a nation can establish a free government but has not the spirit of freedom itself (Tocqueville 2003 [1835], 73).

For similar reasons, Thomas Jefferson, towards the end of his life, promoted dividing the country into wards small enough where citizens

8

Campaign Finance in Local Elections

could get directly involved in governance. By “making every citizen an acting member of the government,” Jefferson believed the ward system would promote attachment to the country as well as allowing for a good measure of self-governance (Jefferson 1999 [1816], 213; also see Syed 1966; Arendt 1963, 248-255). These arguments rest on the questionable assumption that citizens will have a positive experience participating in local politics; negative experiences could create conflict and disillusionment with democratic governance. Whether participation in local government leads to a greater attachment to the country and a greater appreciation for democratic norms has not been empirically explored in the literature.8 Advocates of greater citizen involvement in politics often look to the local level as a venue where citizens can engage in self-governance and deliberation. A central component of Benjamin Barber’s (1984, 26773) plan to promote “strong democracy” was the creation of neighborhood assemblies where citizens would have the capacity to participate directly in policy deliberation. Even though Barber also proposed reforms to enhance involvement in national politics, he saw local participation as a “basic building block of democratic societies” (Barber 1984, 267).9 Civic republicans also see the value of local participation. Michael Sandel (1996, 349-50), for example, conceptualizes self-governance as “rooted in a particular place” and argues for the importance of local identities. Berry, Portney and Thomson (1993) argue that neighborhood associations can add to citizens’ political knowledge, problem-solving skills, and sense of political efficacy, and thus are a valuable reform that can enhance democratic practice. Even if they do not explicitly promote stronger local government per se, most proposals by communitarians also embody an important role for local participation (e.g. Bellah et al. 1991). None of these scholars promote radical decentralization or the elimination of large governments. They recognize the necessity of national government, and the impracticality of widespread local decision making, but also acknowledge a critical role for local participation in a democratic system. The bulk of political power may not reside in local government, but a robust and active local political system is critical as a foundation for a participatory democratic society. Theorists promoting deliberative democracy also rely on a robust local arena to accomplish their goals. Even though some events, such as Jim Fishkin’s (1991; 1995; Fishkin and Farrar 2005) deliberative opinion polls, can be carried out on either a local or national scale, most efforts at deliberation take place in a specific locale and draw from a local population. Even if the issue is national in scope, for example

Introduction

9

American foreign policy, the forums are rooted in a local political context. A good example of this dynamic are National Issues Forums, which promote deliberation on policy issues by bringing together citizens (self-selected) in two-hour forums. The issues are usually national, but the forums rely on local networks to bring people to the event, and follow-up occurs in a local context (Melville, Willingham and Dedrick 2005). Further, the most effective means of promoting deliberation is to do so on local issues, where citizens cannot only discuss issues but also act upon them (Leighninger 2006). To attain the benefits that deliberative theorists desire, such as widespread participation in politics and political learning, forums need to be local. Even efforts to allow groups of thousands of citizens to deliberate still need to be “local” in the sense that citizens need to be gathered in one place to deliberate (for example, see Lukensmeyer, Goldman and Brigham 2005). Because of this limit, most deliberative experiments have been implemented on the local level (Levine, Fung and Gastil 2005, 275-6). Not all scholars agree that promoting citizen participation and engagement is a worthwhile social goal. Minimalists like Schumpeter (1942) argue that as long as elections are free, fair, and present voters with a substantive choice, they serve their democratic functions (also see Przeworski 1999). For these scholars, elites inherently dominate politics, an acceptable state of affairs as long as there is some measure of popular control of government through elections. If one reduces democracy to competition between elites for the public’s vote, then the differences between local governance and its state and federal counterparts become irrelevant; voters can just as easily pick representatives on the national as the local level. Consequently, local governance has no specific democratic function, their primary role being to promote administrative efficiency (although they would still need to operate as an accountability mechanism). In a similar vein, Paul Peterson (1981) argues that the most important local issue—the promotion of economic growth—is not amenable to widespread citizen involvement, and the contribution local governments make is economic, not democratic; cities’ raison d’être is to promote economic growth. Here is not the place to engage in an extensive discussion of the merits of minimalist versus participatory approaches to democracy. 10 This book contributes to the debate by empirically examining the contribution of city elections to a participatory political system: do they contribute to the goals of enhanced citizen participation and involvement in government? Answering this question can shed light on the debate between participatory democrats and minimalists. If local governments

10

Campaign Finance in Local Elections

fail to perform the functions enumerated above, some basic assumptions of participatory democratic theory can be called into question; without a robust local governance system, it is difficult to imagine a wellfunctioning participatory democracy. The examination of municipal campaign finance in this book adds to the assessment of the feasibility of participatory democracy, even though the debate between participatory democrats and minimalists will not be addressed directly. In addition to being an accountability mechanism for popular control of municipal governments, then, local elections potentially contribute to American democracy by providing a venue where nonelites can develop political skills, learn about politics and policymaking, and engage in political activities. Citizens can participate on the state and federal levels, but their opportunities increase exponentially as we move to smaller governments. By volunteering, running for office and engaging in other activities beyond voting, citizens can develop civic skills, gain knowledge of the political system, and acquire democratic norms. Even though the electoral realm is not the only venue that allows for citizen involvement (and one could make an argument that non-electoral participation is more important in this regard), analyzing whether they generate the benefits described above is an important task for scholars. Competitiveness, Accessibility, and Participation Bias in Municipal Elections

This book explores whether campaign finance undermines the democratic qualities of municipal elections by focusing on three key attributes: accessibility, competitiveness and participation by non-elites. Campaign finance could also undermine democracy by corrupting elected officials: relying on donors for campaign funds could lead to unsavory relationships or prompt officeholders to engage in quid pro quos. Whether campaign contributions lead officeholders to change their behavior, however, is a notoriously difficult question to answer: determining whether an elected official voted a certain way on a piece of legislation because of a campaign contribution or genuine conviction is not possible in most cases.11 Given the difficulty of knowing whether campaign contributions corrupt local officials, I put that concern aside and instead focus on the impact of campaign finance on electoral dynamics, examining whether the process through which candidates raise and spend money limits accessibility, dampens competitiveness, and increases biases.

Introduction

11

Accessibility

Non-elites—those who are not especially wealthy and do not have extensive political experience—should be able to mount competitive campaigns for local office, particularly for city council seats that are frequently starting points for political careers.12 I refer to the capacity of non-elites to run for office as “electoral accessibility.” The analysis in Chapters 3, 4, and 5 indicates that raising money is necessary to run for municipal office. A lack of voter interest and sparse media coverage forces candidates to pay for advertising, preventing those without funds from mounting competitive campaigns. There were few candidates who were able to win a council seat without raising tens of thousands of dollars in smaller electoral districts or hundreds of thousands of dollars in larger ones. The need to raise money creates a significant barrier to candidate entry, and many non-elites are unable to raise sufficient funds to be competitive. Gross and Goidel’s (2003) comment that money is a necessary but not sufficient condition to run for office is an apt description of city elections. There is no simplistic correlation between the amount a candidate raises and their electoral fortunes: the best financed candidates did not always win. However, there were no “dark horse” candidates that were able to win with minimal campaign funds. The necessity of raising campaign funds limits electoral accessibility. Non-elites can (and do) make successful bids for mayor and city council, but their capacity to do so is limited unless they have wealthy friends, expendable personal wealth, or support from established interests. Even well-known candidates with wide social networks may not be able to raise sufficient funds to mount a competitive campaign without support from interest groups or wealthy donors. Critics of the current campaign finance system argue that the amount of money needed to run for office prevents all but a handful of wealthy or politically well-connected individuals from running. This is not quite accurate when applied to city elections: since the amount of money needed is less, some non-elites can find ways to raise the necessary funds (as discussed in Chapter 5, this is especially true in cities with small council districts). Even though the campaign finance barrier is not insurmountable, it is high enough so that most candidates will not be able to primarily rely on their social networks for funding. The inability of non-elites to acquire sufficient funds from their social networks is the principal means through which campaign finance demands limit accessibility. The campaign finance barrier, and the resulting limit on electoral accessibility, inhibits the ability of city elections from acting as an entry

12

Campaign Finance in Local Elections

point for non-elites into politics. As mentioned above, one way citizens can get involved in politics is to run and hold local office, using it as a stepping stone to higher office (or other political activity). But for citizens who are unable to overcome the campaign finance barrier, this avenue is closed. Even though there are other ways citizens can begin political careers, holding local office is an effective way that is not open to individuals without access to campaign funds. Further, campaign finance reforms, such as the partial public financing programs discussed in Chapter 8, only have a minor impact on the extent of the campaign finance barrier. Thus, the need to raise and spend money does present a formidable barrier to citizens beginning a political career via municipal office, and consequently has deleterious effects on the capacity of the local arena to promote access to political power. Competitiveness

State and federal legislative races are generally non-competitive with high incumbent re-election rates (Gelman and King 1990; Cox and Katz 1996), a pattern that also holds for city elections, as described in Chapter 3. City council incumbents almost always win re-election and rarely face serious opposition. Mayoral incumbents also have high re-election rates, although they typically face more opposition than councilmembers. The lack of competition in incumbent-challenger races results from the many advantages incumbents enjoy such as name recognition, a history of constituency service, and free media attention. Campaign finance also contributes to their advantages: incumbent councilmembers and mayors raise significantly larger sums than their opponents, creating an uphill battle for any potential challenger. Open seat races, on the other hand, usually boast of abundant competitive candidates and are decided by narrow margins. In most cities open seat elections are free-for-alls where voters are presented with a myriad of options, often three to six wellfunded candidates. This is true regardless of whether the open seat is the result of a retiring incumbent, an unexpected death, or term limits. It is also true for both council and mayoral elections. Occasionally an open council seat will have one dominant candidate, but for the most part they are highly competitive. One of the central goals of campaign finance reform is to prompt more competitive elections, an issue discussed in Chapters 7 and 8. The evidence suggests that contribution limits and public funding do little to reduce incumbency advantage. Contribution limits have a minor impact on reducing amounts raised by candidates, but it is not enough to significantly alter patterns of competitiveness or reduce incumbent-

Introduction

13

challenger fundraising ratios. Further, public financing does not prompt more candidates to run, especially when it comes to challenging an incumbent. Most public funds are expended in open seat races and have the effect of increasing the ability of those candidates to communicate with voters. Public funds are much less frequently used by challengers taking on incumbents. Even though campaign finance reforms in the cities under study do not amount to an “incumbency protection act” as is often alleged (e.g. Smith 2001), they are not effective at promoting more competitive elections. The lack of competition in incumbent/challenger races inhibits the ability of municipal elections to promote citizen engagement as well as potentially reducing accountability. Without vigorously fought contests, voters will be uninterested and may not participate by voting, volunteering, or contributing money. Lacking competition, elections are unlikely to foster the type of participation that can create a learning environment for citizens, as they will not learn much if they are not involved. Hard-fought electoral contest are a positive mobilizing force, piquing citizens’ interest and prompting candidates to seek volunteers and contributors. Further, if incumbent officeholders do not face serious opposition when they stand for re-election, they have fewer incentives to be responsive to their constituents. This study will not directly assess whether local officials are less responsive because they face minimal competition, but the lack of competition does diminish one of the means through which citizens can hold officials accountable. Participation Bias

Who gives to municipal candidates? Chapter 6 addresses this issue from two perspectives. The first part of the chapter examines aggregate levels of giving. No one group dominates fundraising in any of the eleven cities, unless one considers the “business community” as a unified group (a very questionable supposition). Many different sectors of the business community are active in campaign finance and, contrary to the predictions of growth machine theorists (e.g. Logan and Molotch 1987), real estate interests do not dominate (even though they are very active). Non-business interests, such as unions, retirees and homemakers, also donate to municipal candidates but give less than the business community in the aggregate. Despite the diversity of the contributor pool there is a distinct bias towards the wealthy and business. The most active groups are individuals in high-income occupations (such as corporate executives) and businesses with an interest in city policy. We can characterize the contributor pool as being pluralistic but skewed;

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Campaign Finance in Local Elections

despite the lack of domination by one group, not all groups are proportionately represented. The second part of Chapter 6 examines contributions from the candidate’s perspective by exploring the fundraising coalitions they assemble. Candidate fundraising coalitions tended to reflect both the diversity and the biases in the contributor pool as a whole. Most viable contenders drew on a variety of different groups for funds, with few “single interest” candidates. There was also little differentiation between aspirants for the same office: even though some relied more heavily on unions, the real estate industry, or other groups, coalitions were not that different from one candidate to the next. Further, there were few “grassroots” candidates whose donors were primarily non-elites; even those who raised modest amounts relied on the wealthy and business interests to fund their campaigns. Few candidates assembled a coalition of primarily non-business interests, a conclusion that even applies to candidates backed by organized labor. Surprisingly, the biases in the contributor pool are similar to those found on the state and federal levels; we might have expected to find fewer biases towards elites because average contribution sizes and average amounts raised by candidates are smaller. Biases in the contributor pool indicate that one of the avenues of participating in city elections—financially supporting candidates—is disproportionately utilized by elites. The relative lack of activity by non-elites shows how city elections are not funded through grassroots activity of non-elites, and thus do not match the conception of local elections as venues for strong citizen involvement. Of course, contributing money is just one form of participation among many, but given the importance of money (as demonstrated in Chapters 3 and 4), the biases in the contributor pool is a poor showing for city elections. These biases sever one of the links between constituents and elected officials, as one way that constituents creates ties with elected officials is to financially support their campaigns. Receiving contributions from non-constituents, or an unrepresentative group of constituents, creates incentives for elected officials to focus their energies on issues of importance to that group rather than what the majority of their constituents desire. Campaign Finance and the Limits of Local Democracy

Local elections have an important role to play in American democracy. Beyond being a central accountability mechanism for popular control of local governments, they are a venue where citizens can get directly involved in politics and a means through which they can develop civic

Introduction

15

skills and political knowledge. State and federal elections often lack these qualities, as jurisdiction size and the cost of running limits citizens’ involvement. Citizens can vote in these elections, but other forms of participation that would lead to civic learning or accumulation of political influence are, in practice, limited (although still possible). The shortcomings of state and federal elections can be countered by a more open and inclusive local electoral system. The city elections in this study, however, exhibit many of the same characteristics as their state and national counterparts. They are not a counterweight to problemridden federal elections; rather they are for the most part smaller versions. Money plays an important role in city elections, limiting their “grassroots” character, creating biases towards elites, and inhibiting the participation of non-elites. The evidence points to the conclusion that the campaign finance system does limit the democratic capacity of city elections. Existing campaign finance rules and regulations are unable to address the problems caused by the influence of money. The eleven cities in the study vary in the extent of their regulation of campaign finance, from Chicago which is close to a “disclosure only” model to New York and Los Angeles which have extensive public financing programs. I already mentioned that campaign finance reforms have only modest impact on competitiveness and campaign spending. The assessment of whether reforms meet their other objectives is equally pessimistic. For example, public funding does not prompt candidates to have a more democratic funding base or prevent interest groups from spending money on campaigns and continuing their influence. Reforms have been unable to enhance the democratic characteristics of city elections. In Chapter 9, I conclude by arguing that the best ways to address the role of money is not through campaign finance regulations per se, but through other reforms that will reduce the amount of funds that candidates need. Notes 1. Of course, some cities are quite populous. New York City, for example, has more residents than many states. The argument presented here relies on the fact that on average cities are smaller than states, and that in any given state the cities are smaller than the state as a whole (e.g., New York City may be larger than many states, but it is smaller than New York State). 2. “Non-elites” refers to citizens who are not wealthy and not wellconnected politically.

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Campaign Finance in Local Elections

3. State and federal governments will collectively be referred to as “higher tiers.” 4. We could theorize that perhaps turnout would be higher in smaller jurisdictions because one vote carries more weight, creating greater incentives for citizens to vote. But the research on local turnout, as well as our understanding of the reasons for why citizens vote, does not support this theory. 5. Grodzins identifies six meanings of “closeness,” but most of his discussion, and our discussion here, focuses on the three most common uses of the term. 6. This includes cities, counties, towns, school districts, and special districts. 7. Research on candidate recruitment frequently uses prior office held as a key measure of candidate quality (e.g. Squire and Smith 1996). The literature examining the political careers of female candidates also uses prior office held as an explanatory variable (Lawless and Fox 2005; Sanbonmatsu 2006; Deckman 2007). 8. The social capital literature has addressed this issue to some extent, but the focus of most of those studies is the connection between belonging to associations and attitudes towards government rather than the influence of other forms of political participation (e.g. Putnam 2000; Warren 2001). 9. Along these lines, Hannah Arendt (1963), in her study of revolutions, saw local councils as being the foundation for the maintenance of freedom after a revolution, as they allowed citizens to directly participate in political activity. 10. For an examination of the debate see Mueller (1999) and Berry, Portney, and Thomson (1993). 11. For a discussion of the methodological problems entailed in determining the policy impact of campaign contributions, see Roscoe and Jennings (2005). Some scholars have tried various statistical techniques to separate out the influence of contributions from ideology. For examples see Neustadtl (1990), Davis (1993), Fleisher (1993), Dow and Endersby (1994), Wawro (2001), and Fellowes and Wolf (2004). The approaches employed in these studies cannot be reproduced on a local level due to a lack of necessary data. 12. This argument does not hold for mayoral elections in large cities, such as New York and Los Angeles.

2 The Cities and the Data

This study examines campaign finance in eleven cities. Basic descriptive data for each is provided in tables 2.1 and 2.2. These cities were chosen based on the availability of data; all eleven cities require electronic disclosure of campaign contributions. Despite not being randomly chosen, the cities present an excellent set of venues to study campaign finance.1 They vary across most relevant dimensions, such as electoral structure, campaign finance rules, and political culture. In some respects less variation would have been desirable so the effects of campaign finance regulations could be isolated. On the other hand, the advantage of have so much variation is that they represent a range of different types of cities, allowing for examinations of campaign finance effects in diverse contexts. One shortcoming of the data is that small cities and towns are not included (the smallest city in the study, Lexington, has 260,000 residents). Most small cities and towns do not require candidates to file campaign statements electronically, and the few that have data available (mostly in Kentucky and Florida) were not included because of an absence of supplemental information. Interpreting campaign finance patterns requires some knowledge of the political and electoral context in which candidates are raising and spending money. This information, which can be gathered from newspaper articles, campaign websites, and scholarly works, is difficult to find for small cities. Thus, even when campaign finance data is available, conducting an analysis of small cities is problematic due to a lack of supporting data. Ideally, a study of local democracy would include small cities and towns because that is where we would expect to find the greatest democratic capacity; we can hypothesize that as cities get smaller their ability to foster direct citizen involvement, and the democratic benefits flowing from that, increases. We cannot assess the merits of this line of thought given the absence of small cities in this study. The focus instead will be on whether large and mid-sized cities perform the democratic

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Campaign Finance in Local Elections

functions described in the last chapter. Even without being able to generalize the findings to smaller cities, this study makes an important contribution to our understanding of local democracy. A significant portion of the American public lives in mid-sized and large cities, and thus the democratic health of the local governmental system is heavily influenced by their politics. Analyzing campaign finance dynamics in these cities is an important piece of a larger puzzle regarding the democratic capacity of local governments. Below are brief descriptions of the politics, electoral rules, and structure of each city, along with a discussion of data sources. The cities are listed from largest to smallest. New York

New York is not only the largest city in the country, it is also one of the most expansive city governments. It is divided into five boroughs (Bronx, Brooklyn, Manhattan, Queens, and Staten Island), each of which has the legal status of a county. Thus, it performs the functions of both city and county government (it also runs the K-12 education system, which is controlled by an independent school district in many municipalities). In addition, the City has an extensive university system, unique among American cities. Total expenditures in 2004 were $69 billion, six times the size of the next highest expenditure total, Los Angeles’ $11 billion (U.S. Census Bureau 2008). New York holds partisan elections to elect a mayor, public advocate, comptroller, a 51-seat city council, and five borough presidents. The City has a strong mayor form of government both in law and practice. Before charter reform in the late 1980s, the borough presidents were quite powerful as members of the Board of Estimate, but today their role is more limited (Berg 2007). Despite being less influential, they are still desirable offices and are frequently stepping stones to mayoral bids. New York has off-cycle elections and do not stagger terms (i.e., all offices are elected at once). The primary is in September of an odd-numbered year and the general follows in early November. This schedule was disrupted in 2001 when the primary was scheduled for September 11th (it was eventually pushed back to September 25th). It was also disrupted in 2003 when, due to a redistricting dispute, there was a special election for the entire city council to fill the remaining two years of their term. An unusual characteristic of New York elections is that if no candidate receives 40 percent of the vote in a citywide primary, there is a special “runoff” election between the top two votegetters to determine who will stand in

The Cities and the Data

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the general election. There were runoff elections for the 1997 and 2001 Democratic nomination for mayor. In 1988, the City of New York implemented sweeping reforms of its campaign finance system, at the time the most comprehensive reforms at either the state or local level. The centerpiece was partial public financing of campaigns for all city offices, with candidates who accept public funding agreeing to contribution limits, expenditure ceilings, and electronic filing of their campaign statements. Initially, candidates collected a 1:1 match for donations from individuals who lived in the city, up to $1,000 in matching funds per contributor; in 1998, the formula was changed to a 4:1 match (although still only up to $1,000). The 1998 revisions also lowered contribution limits for participants. For the first time in 2005, candidates not participating in the public funding program were required to file their campaign statements electronically and were bound by the city’s contribution limits (previously they were bound by New York State’s limits, which are much higher). The data for this study includes regularly scheduled elections between 1993 and 2005 (special elections are excluded except for the 2003 election where the entire City Council was re-elected). Information was acquired from New York City’s Campaign Finance Board, which is charged with enforcing campaign finance regulations. Even though 1989 data is available, it was dropped from the study because the City changed its charter in 1990, altering the relative power of elected officials and increasing the size of the City Council (among other changes). These changes make a comparison between pre-and postcharter reform elections problematic.2 The data include itemized contributions to all candidates participating in the City’s public financing program. For each contributor who gave $100 and over, their name, address, occupation, and employer are listed. Contributions under $100 only have to be itemized if the candidate requests matching funds for that contribution. Non-participants began filing electronically in 2005 under the same rules as participants. Data for 2003 council nonparticipants were entered manually.3 Itemized contributions for nonparticipants before 2003 are not included. For these candidates, summary data on contributions and expenditures were acquired from the New York City Campaign Finance Board. The missing data for nonparticipants is a limitation, although the majority of candidates (over 70 percent in most elections) did participate. Further, even though itemized contributions are not available for non participants before 2003, we do have accurate summary totals for funds raised and spent for all candidates in all elections.

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Campaign Finance in Local Elections

Mayoral elections in New York are highly competitive, given the power, prestige and visibility of the office. Despite a five-to-one Democratic registration advantage, the four mayoral elections included in this study were all won by Republicans (two by Rudy Guiliani and two by Michael Bloomberg).4 City Council races are less competitive. In 1993 and 1997, most incumbents (almost all of whom were Democrats) easily won re-election. 2001 saw term limits force out almost all incumbents, leading to the most competitive council elections in decades with 300 candidates spending over $20 million. The status quo ante returned, however, in 2003 and 2005 and most incumbents were able to cruise to re-election. The few serious challenges to incumbents usually happened in the primary from members of their own party; there may be partisan competition for the mayoralty, but this does not extend down to the City Council. Los Angeles

Los Angeles is the nation’s second largest city with a population over 3.5 million. Like many west coast cities, it has a “reformed” style of government with an emphasis on professional management, a strong civil service, and a weak mayor. In the mid-1990s, Los Angeles voters approved charter reforms that strengthened the mayor relative to the council and the bureaucracy (Sonenshein 2004). Thus, Los Angeles mayors are stronger today than in the past, although still not as strong as some of their east coast counterparts. The City Council is comprised of only 15 members, leading to large districts of over 250,000 residents each. Not only are these the largest council districts in the country, but they are larger than most state legislative districts. Despite the charter reforms strengthening the mayor, the council is still a powerful entity and highly desirable for aspiring politicians. Unlike most councils it is full time (with a salary of close to $150,000) and is often used a platform to run for higher office. It is so attractive than some state legislators choose to run for council after being termed-out of their state offices (for example, Tom Hayden and Antonio Villaraigosa). Los Angeles has nonpartisan elections for all City offices (in addition to the mayor and council, they also elect a city attorney and controller). Candidates run in a blanket primary where all the candidates are listed together. If a candidate receives over 50 percent of the vote in the primary, they are elected and no runoff is held. If no candidate reaches 50 percent, a runoff election is held between the top two votegetters. Elections are held off-cycle in the spring of odd-numbered years. Like New York, Los Angeles has a voluntary public financing

The Cities and the Data

23

program that matches qualifying contributions and imposes expenditure ceilings on participants. Unlike New York, all candidates regardless of participation in the public financing program are bound by contribution limits, which are set at $1,000 per election for citywide candidates and $500 for council candidates. Campaign finance data was acquired from the Los Angeles City Ethics Commission for the 1993 through 2005 elections. The data includes the name, address, occupation, and employer for all contributors who gave $100 and over (contributions smaller than $100 are not required to be itemized per California law). Special elections are included in the database (through the November 2005 special election). Additional summary data was also acquired from the Ethics Commission, including fundraising and expenditures totals for all candidates, matching funds disbursed, and independent expenditures made on candidates’ behalf. Summary data was also collected for the 1989 and 1991 elections, although it is generally not used in the analyses that follow because itemized contribution data is not available. Its primary use will be to make a pre/post campaign finance reform comparison in Chapter 8. Three of the four mayoral elections included in the study were highly competitive; the exception is Richard Riordan’s 1997 re-election bid (a well known candidate, Tom Hayden, ran against him but only received 34 percent of the vote). City Council races exhibit the same pattern as in New York: most incumbents easily cruised to re-election with minimal opposition, Term limits, which forced out most incumbents in 2001 and 2003, created open seats that were highly competitive. Los Angeles’ multi-ethnic, multi-racial population figures prominently in many local elections, with shifting and fluid coalitions. This is particularly true of the four mayoral elections, each of which featured different racial and ethnic dynamics (Kaufmann 1998; Sonenshein and Valentino 2000; Sonenshein and Pinkus 2001; Kaufmann 2003; Austin and Middleton 2004; Barreto, Villarreal, and Woods 2005; Abrajano, Nagler, and Alvarez 2005). Chicago

Chicago is known for its machine-style politics, epitomized by the tenure of Richard J. Daley as mayor from the mid 1950s to the mid 1970s. While no longer a traditional machine, the machine legacy is still felt in the operation of its politics; despite the absence of a formal, hierarchical party organization, politics under the current mayor, Richard M. Daley, still has patronage elements (Krebs 2005a). Daley

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Campaign Finance in Local Elections

has emphasized government efficiency and has championed reforms when politically expedient, but has also maintained a centralized and closed governing system that rewards political supporters and punishes enemies. Perhaps the best characterization of this mix of elements is to refer to Daley’s current regime as “machine politics, reform style” (Grimshaw 1992; Simpson 2001). Daley the younger has not “reformed” Chicago but rather has adjusted to economic and demographic changes that require a different kind of politics than practiced by his father. Despite the machine politics legacy, Chicago has formally nonpartisan elections for its local offices similar to Los Angeles, where a runoff ensues if no candidates received over 50 percent in the primary.5 Its elections are off-cycle in February (primary) and April (runoff), with all municipal offices on the ballot at the same time. The City Council has fifty seats, making for small wards averaging less than 60,000 residents.6 In highly-segregated Chicago, the small wards lead to a council “organized around group-based representation” and competition between racial and ethnic groups for control of wards (Pinderhughes 2003, 145). Chicago also elects a mayor, treasurer and city clerk in nonpartisan elections. Itemized contribution and expenditure data was acquired for the 2003 municipal elections from the Illinois State Board of Elections. All candidates who raised over $25,000 in contributions are required to file electronically, candidates who raised between $3,000 and $25,000 are required to file on paper, and candidates who raise less than $3,000 do not have to file. A database of the first group was acquired on CD-R, and the disclosure statements of the candidates in the second group were acquired on microfiche and added manually to the database. Thus, the database has itemized contribution data for all candidates who raised over $3,000. Candidates are required to itemize all contributions (including the donor’s name, address, occupation and employer) above $150 and report the rest as a lump sum. Summary campaign finance data, which includes non-itemized contributions, were obtained from the Illinois State Board of Elections for the 1999 and 2003 elections. For the former election, candidates did not have to file electronically, and thus itemized contribution data is not available. When possible, the 1999 elections will be included, but the lack of itemized contribution data limits its utility. Unlike New York and Los Angeles, Chicago has few campaign finance regulations. There are no contribution limits except for a $1,500 limit on entities that have business before the city and a $250 limit on cash contributions. There is no public funding program. Chicago comes very close to the “disclosure only” model favored by some opponents of

The Cities and the Data

25

campaign finance reform: few regulations on raising or spending money but requiring public disclosure. Chicago, however, does not have strong disclosure requirements. The $150 itemization threshold (which is higher than most other cities) means that candidates can collect thousands of contributions in $100 increments without any disclosure of their names, occupations, and employers. Further, independent expenditures made on behalf of candidates are not made easily available to the public; even though they must be reported, identifying them and determining their amount can be problematic. That said, there are few independent expenditures in Chicago elections because contributors are allowed to give large sums directly to candidates, reducing the need to spend funds independently. The 2003 mayoral election was not competitive, with Richard M. Daley cruising to an easy victory over poorly-financed opponents (Daley raised over $6 million while his three opponents raised less than $50,000 combined). He received 78 percent of the vote in an election with a turnout of only 34 percent to earn his fifth term. Unlike his father, Daley has reached out to various racial groups within the city, expanding his political support beyond his white-ethnic base (Krebs 2005a). Most of the incumbent aldermen also easily won re-election, with only four of the 49 incumbents running for re-election losing their bids. Incumbents had a massive fundraising advantage over challengers, raising over $20 million compared to only $2.5 million for challengers. A significant portion of the incumbents’ funds were not spent, but rather served as a war chest to scare off potential challengers, a successful strategy as evidenced by the ten who ran without opposition. The City Council is dominated by Daley allies (Simpson 2001), although he does not always get his way in council elections: several hopefuls backed by Daley lost their campaigns in 2003 (Washburn and McCormick 2003). The incumbent treasurer and city clerk both won re-election without opposition, so in general there was little competition during the 2003 elections except for a handful of council races. A similar pattern holds for the 1999 elections, with Daley cruising to easy victory and only two council incumbents losing their seats. Miami-Dade

Miami has a two-tiered (“federated”) city-county form of government. Cities within the county exist and provide basic city services such as police and fire protection. Miami-Dade County provides all municipal services in unincorporated areas and some public services within the cities. The County has a population of approximately 2.2 million, with

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Campaign Finance in Local Elections

over a million of those residents in unincorporated areas. It has 35 incorporated cities, the largest being Miami with a population of 362,000. For this study, I will focus on elections to the Miami-Dade County government (also known as Metro-Dade), which is governed by a mayor and a 13-member county commission. Elections are nonpartisan and held on-cycle (the primary in September and the runoff in November of even-numbered years). In 1992, voters approved a strongmayor plan that gave the mayor executive powers (including the power to appoint the county manager subject to commission approval) and veto power. Later efforts to reduce the power of the mayor failed (Hill, Moreno, and Cue 2001), as did a 1997 proposal to dissolve the city of Miami, making it an unincorporated area of the county (Steinacker 2001). Data for the 2004 and 2006 Metro-Dade elections (one complete election cycle) were downloaded from the Miami-Dade County Elections Department website. All candidates are required to file electronically and provide the name and address for all contributors regardless of size (occupation is also listed for donors who give over $100). Miami voters passed a partial public financing program in 2000. Unlike New York and Los Angeles, Miami’s program does not use a matching funds system; rather, it provides a lump sum payment to candidates who meet the eligibility requirements and agree to the program’s restrictions. Florida has a statewide contribution limit of $500 per election that applies to local candidates. In 2004, the limit for Miami-Dade elections was lowered to $250, but it was raised back to $500 for the 2006 elections. Groups making independent expenditures must report their activities, but local election officials do not track them, so accurate data were not available. The 2004 mayoral election was a hard-fought open seat contest featuring five major candidates (three Cubans, one Puerto Rican, and one of mixed Cuban and Puerto Rican heritage) spending in excess of $7 million combined. Carlos Alvarez, a former county police director, emerged as the victor, winning a close runoff against County Commissioner Jimmy Morales. None of the twelve incumbent county commissioners running for re-election in 2004 or 2006 lost their races, and only one received less than 60 percent of the vote in the primary (no incumbents were forced into a runoff). Despite the ease with which incumbents got re-elected, the two open seat contests featured many candidates and hard fought campaigns. Miami-Dade is divided along both racial and partisan lines, which shapes electoral dynamics (Grenier and Castro 2001; Warren and Moreno 2003). The population is majority Latino, but political and cultural divisions exist between Cuban-

The Cities and the Data

27

Americans and Latinos of other nationalities (for example, Cubans tend to vote Republican while other Latinos favor Democrats). Further, among registered voters both blacks and non-Latino whites are large enough blocs to be crucial swing votes, as was the case in the 2004 mayoral race. Even though Cubans tend to dominate local politics in Miami, they do not have the numbers (at least in county races) to assume victory without support from other groups. In addition to this dynamic, the Metro-Dade government had its fair share of scandals, financial woes, and controversial policy decisions, leading to a contentious and volatile political scene. This contentiousness, however, typically only manifests itself in open seat races. San Francisco

Despite being in one of the largest metropolitan areas in the country, the city of San Francisco has only 776,733 residents, accounting for just 11 percent of the total population of the San Francisco Bay metropolitan area. It is also quite small area wise, with 47 square miles of territory. It has a consolidated city/county form of government with an elected mayor, an eleven member city/county board of supervisors and six other executive officers. As a consolidated government, the City/County of San Francisco provides almost all local services, with the exception of K-12 schools and community colleges, which are governed by separately elected boards. The City/County is a powerful government in terms of service provision and regulation, but is limited as a relatively small part of a highly fragmented metropolitan region. Contribution and expenditure data were acquired from the San Francisco Ethics Commission for the 1998 through 2006 elections. All candidates who raise over $5,000 must file campaign statements electronically; candidates below that threshold are listed as raising zero funds.7 The contributor information provided is the same as for Los Angeles: name, address, occupation and employer for all contributions $100 and over, with smaller contributions reported as a lump sum (aggregate data for non-itemized contributions were also acquired from the Ethics Commission). Independent expenditures play a major role in San Francisco elections, but individuals and groups making them do not have to file statements electronically. The Ethics Commission tracks independent expenditures, but their database is not completely accurate. All known independent expenditures have been incorporated into the analysis, but these figures are probably underreported. San Francisco changed its electoral structure twice during the time period of this study. Prior to 2000, Supervisors were elected in at-large

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Campaign Finance in Local Elections

elections.8 In that year, as the result of a ballot initiative, the city moved to district elections with all eleven seats open (terms were staggered thereafter). During the 2000 and 2002 elections, there was an on-cycle nonpartisan primary held in November of even-numbered years, and an off-cycle runoff in December if no candidate received over 50 percent of the vote. In 2004, the city implemented ranked-choice voting for Supervisorial races9 as a result of yet another ballot initiative. In this system, voters rank candidates in order of preference, and if no candidate receives a majority of first choices, the candidate who received the fewest number of first choice votes get dropped and her supporters’ second choice votes are given to the other candidates; this process is repeated until a candidate receives a majority. Ranked choice voting eliminates the need for runoff elections. Reform-happy San Francisco also changed its campaign finance system during the time period of this study with the introduction of partial public financing in 2002 for Supervisorial races. In the face of these changes, one constant is that elections in San Francisco are formally nonpartisan. Another constant is the unusual practice of electing mayors and other citywide offices at different times than the Board of Supervisors. While supervisors are elected in November of even-numbered years, mayors are elected off-cycle in November of odd-numbered years. San Francisco is known for its unconventional politics and active political life (DeLeon 1992; Hartman 2002). This translates into more candidates running for office and more competitive elections. Occasionally an incumbent will run unopposed, but frequently they have to work to get re-elected. Open seat races attract large number of candidates, occasionally upwards of 15 for a supervisorial seat. Elections are very expensive given the small population of the city. This is particularly noticeable in supervisorial elections, where districts with less than 80,000 residents (and as few as 35,000 registered voters) sometimes see aggregate spending top half a million dollars. One reason for the high spending is the presence of Willie Brown, elected mayor in 1995 and termed out of office in 2003. Brown, a former speaker of the California State Assembly, was a prolific fundraising and, in addition to funding his own campaigns for mayor, provided support (usually in the form of independent expenditures) to allies contesting supervisorial seats. His fundraising efforts prompted opponents to respond with independent expenditures of their own in their (ultimately successful) campaign to prevent Brown from gaining control of the Board of Supervisors. This battle between pro-Brown and anti-Brown forces was the defining feature of the 2000 Supervisorial elections (Hartman 2002; DeLeon 2003), and was a factor in the 1998 and 2002 elections as well.

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Brown’s own re-election campaign in 1999 was also expensive and highly competitive, as was the open seat race in 2003 to replace him. Ideologically, most elections in San Francisco pit a moderate liberal (frequently a Brown ally) against candidates on the far left; only in one or two supervisorial districts do conservatives have a chance of success. Louisville

In November, 2000 Louisville voters approved a merger of the City with Jefferson County, of which it is a part.10 At the time, the City of Louisville only had a population of 256,000, less than half of the residents of the County. The result, known as Metro Government, includes the former City of Louisville and unincorporated areas of Jefferson County, boasting a population of 693,000. Even though the City of Louisville was dissolved in the merger, smaller suburban jurisdictions were left intact, as were some special districts, preventing it from being a comprehensive regional government. In this respect it resembles Miami-Dade’s federated system. Metro is governed by a mayor, a 26-person Metro Council elected from districts, and other elected county officers.11 Elections are partisan and held on-cycle. In 2002, after the merger, there was an election for all 26 seats on the Metro Council, but terms were staggered thereafter. Prior to the merger, the City of Louisville had a 12-person Board of Aldermen, also elected in partisan elections but to only two-year terms. Metro Government does not have any campaign finance regulations of its own and thus is governed by Kentucky’s state regulations. Candidates are bound by a $1,000 contribution limit per election, a very high limit given the small size (less than 30,000 residents) of Metro Council districts. Kentucky has a voluntary electronic filing system for local candidates, but for those who file on paper their contributions are entered manually into a central database maintained by the Kentucky Registry of Election Finance. This database, which includes all candidates for local office spending $1,000 or greater, was downloaded from their website, inclusive of the years 1998-2006 (both pre- and postmerger data is included). Contributions of over $100 need to be itemized, disclosing the donor’s name, address, occupation and employer, with smaller contributions reported as a lump sum. Independent expenditure reports were obtained on paper forms from the Registry of Election Finance and manually added to the dataset. The merger fundamentally changed the political dynamics in Louisville (Savitch and Vogel 2004b). The old City of Louisville was solidly Democratic with a large African-American voting bloc. The

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Campaign Finance in Local Elections

merger diluted the power of African-Americans in government, as they became a smaller proportion of the total voting population. It also altered partisan competition. Jefferson County’s suburbs are heavily Republican, leading to more partisan balance on the metro council. Even though the Metro Council is closely divided by party (in 2007, 15 Democrats and 11 Republicans), many districts are overwhelmingly of one party or another, and thus only a handful of districts exhibit true party competition. The first mayor after the merger was Jerry Abramson, a Democrat who was instrumental in selling the merger plan to voters (Savitch and Vogel 2004b). Abramson cruised to victory in 2002 against minimal opposition, and won big again in 2006 (with 67 percent of the vote) despite a better funded opponent. Even though mayoral elections have not been competitive, the first election for the Metro Council was fiercely fought, with over 200 candidates contesting the 26 seats. This was a major change from the old Louisville Board of Aldermen where most elections had minimal competition. Fewer candidates ran in 2004 and 2006, although competition levels have remained higher than prior to the merger. Seattle

Like San Francisco, the Seattle metropolitan area is large but the city itself is relatively small, at 563,000 residents. Despite being a central city in a major metropolitan area, Seattle has the political dynamics of a mid-sized city. It is governed by a mayor, an elected city attorney, and a nine-person city council. The council is elected in a mixed atlarge/district system: the City is divided into nine districts each of which has a separate election to choose a councilmember, but all voters cast ballots for all councilmembers. Another peculiarity of Seattle elections is they have mandatory runoff elections. Elections are nonpartisan with a standard blanket primary, but a runoff election is held between the top two votegetters even if one receives over 50 percent of the vote. This set-up leads to odd situations where a candidate finishes second in the primary with less than 20 percent of the vote, advancing to the runoff just to be trounced again. If less than three candidates run for an office, the primary is skipped and just a runoff is held. The 1997 through 2005 elections are included in this study. At one point, Seattle had a public funding program but it was eliminated prior to 1997. Despite the lack of public funding, Seattle still has strong campaign finance regulations with contribution limits and mandatory electronic filing. All contributions of over $25 need to itemized, with the rest reported as a lump sum. Name and address is reported for all

The Cities and the Data

31

itemized donations, and occupation and employer information is provided for donations of $100 and over. Contribution databases were acquired from the Seattle Ethics Commission along with information on independent expenditures. Seattle politics is dominated by the same types of issues as many other cities: downtown redevelopment, public safety, the quality of services, and economic growth. The only atypical issue to emerge during the study was the fallout from the Seattle Police Department’s handling of the protesters at the World Trade Organization’s 1999 meeting. Other than that episode, Seattle during this time had a relatively quiet civic life. This, however, did not stop voters from exercising their power to remove officials from office. In the 2001 mayoral election a rarity occurred: not only did the incumbent mayor (Paul Schell) lose, he was unable to even advance to the runoff, finishing third with less than 22 percent of the vote. In 2003, three out of five council incumbents running for re-election lost, atypical for Seattle and an extraordinary occurrence for any city. There were plenty of reasons for voters to be unhappy with them, such as squabbling with the mayor, a campaign finance scandal involving contributions from a strip club, and rising utility bills. Incumbents, however, can usually survive such displeasure and win re-election anyway (see Chapter 3). All of this leads to the conclusion that Seattle is a bit different in its local political dynamics. Some aspects of city politics may be the same. For example, Gibson’s (2004) analysis of redevelopment and homeless policy in the 1980s and 1990s paints a picture similar to other cities. But voters appear to be more independent minded which, along with the campaign finance dynamics discussed in later chapters, leads to elections that are less predictable. Long Beach

Long Beach is a city of almost one-half million located in southern Los Angeles County. The second largest city in the Los Angeles metropolitan area, it is the fifth largest in California and would be considered a major city if not for being located next to Los Angeles. It is very diverse, with no ethnic group comprising over 40 percent of the residents and an almost 30 percent foreign-born population. It was once known as a quiet middle-class city, but economic and demographic changes have made Long Beach into a prototypical “inner-ring” suburb with urban problems and wealthy neighborhoods existing side-by-side (Marchevsky and Theoharis 2006). In response to these changes, from the 1970s to the present, the City has engaged in a number of

32

Campaign Finance in Local Elections

questionable redevelopment schemes that have had racial overtones and generated controversy (Marchevsky and Theoharis 2006). Long Beach employs a council-manager form of government, with a nine-member city council elected from districts, a separately elected mayor, and three other elected executives (city auditor, city prosecutor, and city attorney). Elections are nonpartisan and held off-cycle (spring of even-numbered years). The timing of elections, with no state or national elections on the ballot, lead to very low turnout, exacerbated by the fact that most media outlets focus their attention on Los Angeles politics. Less than 30 percent of registered voters turned out in a competitive mayoral race in 2006, with lower turnouts for most council races due to voter roll-off. Long Beach passed a campaign finance ordinance in 1994, establishing a matching fund program and implementing contribution limits. The program, however, has not had much of an impact, as few candidates have applied for and received public funding. Campaign finance data for the 2004 and 2006 elections were downloaded from the Long Beach City Clerk’s website, and independent expenditure figures were acquired on paper reports from the City Clerk’s office. There was a hotly contested open-seat mayor’s race in 2006, in which businessman Bob Foster pulled ahead of four other candidates to win. Even though some incumbents easily won re-election (as is the norm for most cities), a few lost: two council incumbents in 2004 as well as the city auditor in 2006. A third council incumbent also lost in 2006, although she was forced to run as a write-in candidate due to term limits (under Long Beach’s term limit law, termed-out incumbents cannot put their name on the ballot but they can still run as a write-in, a tactic successfully used by former Mayor Beverly O’Neill). Like Seattle, elections in Long Beach can be a bit unpredictable although for different reasons. With small districts and low turnout, it does not take many votes to win. The typical victorious council candidate receives about 3,000 votes, and in some races was as low as 1,200. The lack of media coverage may also contribute to uncertainty, as voters may not know much about the candidates and vote based on cues such as surname or the occupation of the candidate listed on the ballot. For these reasons, elections in Long Beach have not followed any clear pattern. Sacramento

Sacramento, the seventh largest city in California with 407,000 residents, is smaller than Long Beach but is a central city. Sacramento has a council-manager form of government, nonpartisan elections, eight

The Cities and the Data

33

councilmembers and a separately elected mayor (it does not elect any other executive officers). Campaign finance data for 2002 through 2006 was downloaded from the Sacramento City Clerk’s website. The City uses the same electronic filing system as San Francisco, and thus the information is identical. All candidates who raise or spend over $1,000 are required to file electronically. Sacramento has very high contribution limits given its size. Council candidates can receive donations of up to $800 from individuals and corporations, and $3,300 from “large political committees” such as unions. The corresponding figures for mayoral candidates are $1,100 and $5,500. The City also has a public matching funds program for council candidates that went into effect in 2004, but only one candidate received funding in the 2004-06 election cycle. There are two defining features of Sacramento elections. First, they are incredibly expensive on a per voter basis, as will be discussed further in Chapter 5. Second, elections are generally non-competitive. Not only did all ten incumbents up for re-election win, but none were even forced into a runoff election and received on average 76 percent of the vote. There were two open seat council races in 2004, but they only attracted two candidates each, unlike the four to six major candidates found in other cities. There were only fifteen non-incumbents who ran for thirteen offices during this time period, and most of those candidates were not serious contenders. There are a few possible explanations for why Sacramento elections are so non-competitive. A lack of hot-button issues may be the culprit, or perhaps a general contentment with the state of city policy. As a state capitol, residents may be more focused on state politics that than local issues. Campaign finance, particularly highspending incumbents who chase away potential challengers, may also be to blame. Regardless of the reason, Sacramento elections are typically lackluster affairs. Tampa

Like Seattle and San Francisco, Tampa is a relatively small central city (pop. 303,000) in a large metropolitan area (2.4 million). It has a mayorcouncil form of government with an elected mayor and a seven-person council elected off-cycle (March of odd-numbered years). Tampa does not stagger its terms, so the mayor and entire council were elected in March 2003 and again in March of 2007, the elections included in this analysis. The council has four members elected from districts and three elected at-large (like Seattle, in separate “districts” for each seat). They have nonpartisan elections with a runoff following only three weeks

34

Campaign Finance in Local Elections

after the primary if no candidate receives over 50 percent of the vote. The mayor and councilmembers are limited to two four-year terms, but councilmembers holding district seats can run for an at-large seat when they are termed out (and visa-versa). The Hillsborough County Supervisor of Elections, the filing officer for Tampa elections, provides campaign finance data electronically. Tampa does not have its own campaign finance rules, so the state of Florida rules apply: a $500 contribution limit for individuals, corporations, and PACs with a higher limit for political parties. There are no public financing provisions in Tampa. The contribution database lists the name and occupation of each donor, but does not include their address and employer, limiting its utility. The centerpiece of the 2003 elections was an open seat contest to replace termed-out mayor Dick Greco. It was an expensive election with over $2 million spent, a large figure for a city with only 150,000 registered voters. Pam Iorio, the Hillsborough County Supervisor of Elections, finished first in the primary with 46 percent of the vote and cruised to victory in the runoff. Political observers were expecting a closer race given the funding and strength of her opponents, but Iorio ran a strong campaign and connected with voters. She easily won reelection in 2007 with almost 80 percent of the vote. Some of the council races in 2003 and 2007 features high levels of competition, although all of the incumbents won re-election, There were not any unusual events, scandals or hot-button issues during this time in Tampa, and thus elections were generally low-profile affairs. Lexington

Like Louisville, Lexington has a consolidated city/county form of government, although the merger occurred much earlier (1974) and no independent suburban cities exist. Known as the Lexington/Fayette Urban County Government, it is governed by a Mayor and a 15-member Urban County Council.12 The council has 12 members elected from districts (which are small, averaging 21,700 residents), and three members elected at-large. Elections are nonpartisan and are held oncycle. If more than two candidates run for a district seat, they have a primary election and a mandatory general election between the top two votegetters. If less than three candidates run for an office, the primary is skipped and only a general is held. For the at-large seats, the top six votegetters in a multi-member election advance to the general election where the top three finishers are elected (the highest votegetter automatically becomes vice-mayor). Councilmembers elected from

The Cities and the Data

35

districts have two-year terms and at-large councilors have four-year terms. Data for the 1998 through 2006 elections were acquired from the Kentucky Registry of Election Finance. Like Louisville, Lexington does not have its own campaign finance regulations, and thus are governed by the state contribution limits and reporting requirements described above. The majority of council district races are not competitive and few incumbents lose (only four out of 49 seeking re-election). These elections are low-key affairs with little media coverage, few dollars spent, and minimal public interest. At-large contests are more competitive (and more expensive) as councilmembers holding districts often seek the more prestigious at-large seats. All three mayoral elections during this time period were competitive. Pam Miller narrowly won re-election in 1998, and decided not to seek the office again in 2002. The race to replace her, won by Councilwoman Teresa Issac, is notable for $350,000 in contributions provided to candidate Scott Crosbie by the Republican Party, the largest direct party contribution to any candidate in the study (and in a “nonpartisan” city to boot). In 2006, Isaac lost her re-election bid to Jim Newberry, a political newcomer who had never held elective office. Not only did Isaac become the first incumbent to lose since consolidation in 1974, she lost big, garnering only 37 percent of the vote in the general election. All three mayoral elections were high-cost races given the size of the city and number of registered voters. In sum, Lexington elections run the gamut from lowcost uncompetitive races to highly-visible, fiercely fought elections. Data Collection and Accuracy

As described above, I collected datasets of campaign contributions to municipal candidates as the basis for the analysis that follow. By themselves lists of thousands of contributions are not very useful and quite unwieldy. Thus, additional data was gathered. As mentioned, summary data on campaign finance was acquired from some of the cities, typically including total raised and spent by each candidate, as well as matching funds disbursements and independent expenditures. Election returns were also acquired for each city. Other candidate characteristics, such as incumbency status and party, were acquired from various sources (such as newspapers or government websites) if it was not included with the campaign finance data. Individual contributions were also coded on a variety of measures. Contributions were divided between individuals and non-individuals, and individual contributors’ occupations were coded as well. Candidate personal funds were

36

Campaign Finance in Local Elections

separated out from other donations, and other categories (such as for city employees) were created. The coding for these variables is in appendix A and will be described as they are used throughout the book. One problem with the contribution data collected is that it does not always include independent expenditures, which is spending made by a third party on behalf of a candidate (without the candidate’s knowledge). Independent expenditures cannot be limited and are not subject to contribution limits, but usually have to be reported. Accurate independent spending data was acquired for Los Angeles, Louisville, Lexington, Long Beach and Sacramento. Data was gathered for San Francisco and Seattle but is probably incomplete. That leaves four cities with no independent expenditure data: New York, Chicago, Miami, and Tampa. It is unlikely, however, that they played a major role in the latter three cities; the local press did not mention any activity and they did not appear to be a campaign issue. There probably was some unreported spending, but it is likely only a small fraction of direct candidate spending. There are indications, however, that independent spending by parties and unions played a role in New York elections, but New York law does not require electronic disclosure of this spending nor are there paper reports that clearly document it. Even though this constitutes a limitation of the New York data, it is unlikely that independent expenditures are a large percentage of total spending; with high contribution limits most donors are able to give ample amounts to candidates directly. As indicated on Table 2.1, the election years covered varies across the cities. The earliest elections are in 1993 (Los Angeles and New York), but for some cities the data does not go back further than 2003 or 2004. The starting point for the data was dictated by the availability of data (i.e. when the city required electronic filing).13 The endpoint for most of the cities was 2005 or 2006. The two exceptions are Chicago and Tampa, both of which held elections in 2003 and 2007 (these cities do not stagger council terms). Chicago ends at 2003 because at the time of the study data was not yet complete for the 2007 elections. The Tampa 2007 elections were complete at that time, and thus were included. The dataset assembled has approximately 1.1 million contributions worth over $450 million, raised by almost 2,900 separate campaigns. This is a comprehensive dataset of local campaign finance that provides an excellent overview of campaign finance activity for municipal offices in the eleven cities. The data are not perfect (no data are), but they are generally accurate and provide sufficient detail and depth to address the research questions under study.

The Cities and the Data

37

Notes 1. The fact that requiring electronic disclosure itself is a campaign finance reform did not limit the range of cities included, as its presence does not indicate that a city is “reform-minded” or is atypical when it comes to campaign finance. For three of the cities (Chicago, Louisville, and Lexington), electronic disclosure was mandated by the state government, and thus is not a reflection of local politics. In some of the other cities (e.g. Sacramento), electronic disclosure was implemented despite a weak campaign finance regime overall. 2. Also, because 1989 was the first year of the campaign finance program, and in an era before computers were very powerful, the accuracy of the data is questionable. 3. Two candidates’ campaign statements, James Sanders and Pedro Espada, were unavailable and thus not entered. 4. There are many reasons for these Republican victories, not the least of which was a severely divided Democratic party and intraparty ethnic and racial tensions—see Kaufmann (2003), Mollenkopf (2003), Kraus (2004), and Thompson (2006). 5. Nonpartisan elections went into effect in 1999 due to changes in state law. 6. A note on terminology: members of Chicago’s City Council are generally referred to as Aldermen, who represent wards, not districts. 7. Most candidates below the $5,000 do, in fact, raise zero funds. There were very few candidates who raised between $1,000 (the minimum threshold for reporting contributions on paper forms) and $5,000. 8. See DeLeon (2003) and Hartman (2002) for an analysis of the debate surrounding at-large versus district elections in San Francisco. 9. Ranked choice voting was used for the first time in a mayoral contest in 2007. 10. See Savitch and Vogel (2004a) for a description of the debate over consolidation. 11. Only the Mayor, Legislative Council, and pre-merger Board of Aldermen were included in this study. 12. By state law, the County also has elected executive officials, such as a Sheriff and County Clerk. These offices are not included in this study. 13. There are two exceptions. In New York, data goes back to 1989, although that election was dropped for the reasons described above. Also, Miami data is available online for 2002, but the author was informed by the Board of Elections that much of that data is incorrect because of problems with getting their online system started and resistance from candidates.

3 Campaign Finance, Competition, and Electoral Success

This chapter examines levels of competitiveness, asking two specific questions. First, how strong is the incumbency advantage in municipal elections? The advantage incumbents enjoy is well documented on the federal and state levels (Sorauf 1992; Cassie and Breaux 1998; Jacobson 2004), but whether this pattern also holds in local races is less well understood. Second, what impact does campaign spending have on electoral outcomes? One factor that could undermine the competitiveness of city elections is campaign finance; if candidate spending determines success at the polls, it would provide a disincentive for non-elites to run, reducing competition. Answering these questions will help us examine whether a lack of competitiveness inhibits the ability of city elections to serve the democratic functions described in Chapter 1. Before examining these issues, a few methodological notes on how I classify candidates and measure campaign finance activity are necessary. Candidate Classifications and Measures of Campaign Finance Activity Major, Minor and Competitive Candidates

Not all candidates that run for municipal office have a legitimate shot at winning. Candidates with few campaign funds, low name recognition, and no base of community support have minimal chances of winning but run anyway in the hopes of getting a message out or influencing the political discourse. Others lack enough knowledge of city elections to realize how slim their chances really are, or may have succeeded in deluding themselves that they really could win. Still others run because

39

40

Campaign Finance in Local Elections

appearing on the ballot strokes their ego and makes them feel important. Regardless of the reason, city elections typically exhibit many of what I term “minor” candidates. These individuals pose a problem for the study of campaign finance because their numbers randomly fluctuate from one race to another and can significantly influence averages, medians, and correlations. Research on state and federal elections deal with this problem by eliminating third party candidates, assuming that all elections are a two-way race between a Republican and a Democrat. This fix does not work in nonpartisan races where party affiliation is sometimes not known and a primary race could have three or more major contenders from one party. In order to focus the study on candidates with a legitimate shot at winning we need to develop criteria for separating out and eliminating minor candidates. I use total money raised to discriminate between major and minor candidates. Specifically, in order to be classified as a major candidate, an individual must meet one of the following thresholds: 1. Raise at least $1,000 in electoral districts less than 50,000 total population; 2. Raise at least $5,000 in electoral districts between 50,000 and 500,000 total population; 3. Raise at least $10,000 in electoral districts over 500,000 total population. These thresholds are much lower than what candidates typically spend to be competitive, but they do a nice job of separating out those that are not serious contenders. Spending at least some money on a race indicates that a candidate is making an effort to mount a competitive campaign, which is why a fundraising minimum (even a very low one) serves well to discriminate between major and minor candidates. In all the cities combined, there were 960 minor candidates (average vote share: 15 percent)1 and 2,470 major candidates (average vote share: 39 percent). Not all major candidates are competitive; even if they spend some money, they may not do well at the polls. For some analyses we need to limit the pool of candidates to just competitive ones. Federal and state campaign finance research typically defines a competitive candidate as someone who receives at least 40 percent of the two-party vote. This measure works well with only two candidates, but falters if there are more than two. For example, in a race with 10 candidates the winner may only receive 35 percent of the vote, and a second place finisher may only get 20 percent. With so many candidates 20 percent is a good

Campaign Finance and Electoral Success

41

showing, especially in a nonpartisan primary where it can advance a candidate to the runoff election. The percentage of votes a candidate receives is influenced by the number of opponents; the fewer opponents, the higher the vote share is likely to be (see Table 3.3 below). Thus, we need to account for number of opponents when deciding whether a candidate should be considered competitive. I define a competitive candidate as someone who received at least 80 percent of a hypothetical “equal vote share,” which is what the candidate would receive if everybody in the race garnered the same number of votes. In a two-person race, an equal vote share is 50 percent; in a ten person race, an equal vote share is 10 percent. 80 percent of an equal vote share for a two person race would be 40 percent of the vote (the standard cutoff point for competitiveness in a two person race); in a ten person race, it would be eight percent. Even though this latter figure may seem low, with so many contenders, a candidate could advance to a runoff election (i.e. “win” the primary) with as little as 15-20 percent of the vote, and in some cases did so.2 With so many candidates splitting the vote, eight percent isn’t necessarily that bad of a showing, and could be sufficient to capture third place. The 80 percent equal vote share measure is not perfect, but it is the most accurate way to define a competitive candidate because it accounts for the influence of the number of candidates on vote share. Further, it does a good job of including most serious candidates and eliminating others. In all there were 1,836 competitive candidates (average vote share: 51 percent) and 1,594 non-competitive candidates (average vote share: 10 percent). Candidate Status

Candidates were classified into three status groups: incumbents, challengers, and open seat candidates (for some analyses, the latter two groups are combined into a “non-incumbent” group). In most cases, the classification is obvious, but there were a few instances where the lines were blurred. In Louisville after the merger most of the previous members of the Board of Aldermen ran for the new Legislative Council, technically as non-incumbents. Because they enjoyed many of the benefits of incumbency (e.g. name recognition and a history of constituency service), they were classified as incumbents. The same goes for San Francisco Supervisors after that city moved from at-large to district elections. On the other hand, when incumbents in Tampa or Lexington who held district seats ran for an at-large seat, they were not considered incumbents because they were running in a larger electoral district with many voters with whom they have had minimal prior

42

Campaign Finance in Local Elections

contact. In a few instances there were two incumbents in the same race because of redistricting or after a merger. In these cases, both candidates were considered incumbents. Contributions and Expenditures

Most of the analyses in this and subsequent chapters will use contributions rather than expenditures as a measure of campaign finance activity, the primary reason being a lack of expenditure data for some cities: Lexington and Louisville do not provide any expenditure information, Seattle only provides summary data, and Los Angeles only has data for 1999 onwards. Ideally expenditures are a better measure of candidate financial activity, but contributions work just as well because most candidates spend all the money they raise, as evidenced by similar fundraising and expenditure figures in the cities where we have complete data. The only exceptions are incumbents who run unopposed or face minimal opposition, but in many of the analyses that follow they are excluded. The most frequent measure of financial activity is what I term “total money,” which are contributions received by the candidate, personal funds used, public funding received, plus independent expenditures made in support of the candidate. This figure will be used to represent both total fundraising and total spending. When necessary, total money will be adjusted for inflation to 2006 dollars. Incumbency Advantage and Competition

A central concern with American elections is that they are not competitive. Re-election rates for member of the U.S. House of Representatives are over 90 percent and about 80 percent for the Senate (Smith 2006, 124). State legislative and gubernatorial re-election rates are also very high (Cassie and Breaux 1998, 103; Gross and Goidel 2003, 66; Rosenthal 2004). Not only do most state and federal officials get re-elected, but many face minimal or no opposition. For example, many U.S. House members either run unopposed or win with over 55 percent of the vote (Corrado 2000, 50). Similarly, in some states, only a handful of state legislative seats are competitive every year. Incumbency advantage is also evident locally, as illustrated by Table 3.1, with most incumbents winning re-elected and almost 18 percent running unopposed. Mayoral elections are typically more competitive than council races: incumbent mayors usually face as least some opposition, and four of the 15 incumbents who ran for re-election lost. The high incumbency re-election rates are generally consistent

Campaign Finance and Electoral Success

43

Table 3.1 Incumbency Advantage

New York Los Angeles Chicago Miami-Dade San Francisco Louisville (pre-merger) Louisville (post-merger) Seattle Long Beach Sacramento Tampa Lexington All city council All mayoral All other Citywide All candidates

Number of Incumbents 220 46 102 12 34

Percent ReElected 96.8 91.3 94.1 100 82.4

Percent Running Unopposed* 10.5 19.6 22.5 25.0 17.6

Incumbent Fundraising Advantage** 2:1 3:1 8:1 5:1 3:1

18

100

38.9

2:1

36

88.8

11.1

2:1

21 10 11 7 54

81.0 60.0 100 100 90.7

9.5 10.0 27.2 28.8 35.2

2:1 2:1 2:1 3:1 1:1

514 15

93.8 73.3

17.9 0.0

*** ***

42

90.5

23.8

***

571

93.0

17.9

***

*To run unopposed, a candidate must have been unopposed in both the primary and general/runoff elections. Excludes multi-member elections. **Ratio of average total money raised by opposed incumbents versus average total money raised by challengers (major candidates only). Rounded to the nearest whole number. ***Since the average raised varies significantly across cities, aggregating these figures is not feasible.

across the eleven cities. Long Beach is an outlier, as four out of ten incumbents lost (three councilmembers and the city auditor). Each of these races had different circumstances. One defeated incumbent, Jackie Kell, ran as a write-in candidate because term limits prevented her from having her name on the ballot. A second council incumbent lost to a challenger opposed to the expansion of Long Beach International Airport, and the third lost to a union-backed candidate opposed to the contracting out of city services supported by the incumbent. The city auditor’s race, which saw the defeat of a 15-year incumbent, was a negative, mudslinging affair in an office that ordinarily generates little voter interest (Marder 2006a). What accounts for the poor showing of

44

Campaign Finance in Local Elections

incumbents in Long Beach is unclear; with the exception of Kell running as a write-in candidate, none of these races were particularly unusual. When incumbents lose, there are sometimes unusual circumstances that explain their defeat. Seven of the 40 incumbents who lost did so after structural changes undermined their incumbency advantage, three in Louisville after the merger and four in San Francisco after the move from at-large to district elections. Two of the four Los Angeles incumbents, City Councilman Nick Pacheco and Mayor Jim Hahn, were defeated by Antonio Villaraigosa, a former California State Assembly speaker forced out of office due to term limits. The remaining 31 incumbents generally lost due to poor decisions on their part. For example, Los Angeles City Councilwoman Joan Milke Flores unsuccessfully sought higher office twice in the four years prior to losing her re-election bid in 1993, not only questioning her commitment to being a city councilmember but also highlighting her vulnerability. A few losing incumbents were embroiled in scandals, such as Allan Jennings, a New York City Councilman who was censured by the City Council for sexually harassing two female subordinates. There were some cases where a strong incumbent lost to an even stronger challenger, but they were rare; usually challenger victories required a weak incumbent who had made numerous missteps as well as a strong challenger to take advantage of them. Incumbents have many advantages that contribute to their electoral success: a history of constituency service, pork-barrel projects, name recognition, and fundraising. The fundraising advantage is significant in most cities. The last column of Table 3.1 provides the ratio of average money raised by incumbents versus their challengers for council elections.3 This is a conservative measure since it only includes major candidates, eliminating the many challengers who raise no funds. Even with this conservative measure, incumbents in most cities out-raise their opponents by a 2:1 or 3:1 ratio.4 Occasionally challengers will raise more than incumbents (and when they do they have a good chance of winning), but most of the time incumbents hold the fundraising advantage, adding to their other advantages. Ascertaining whether incumbents lose because they face well-financed challengers or because they have difficulty raising money due to perceived vulnerability is difficult, as will be discussed further below. What is clear is that incumbents usually have a significant fundraising advantage over their challengers, especially on the council level. Even though most incumbents are re-elected with minimal opposition, open seat races, (where no incumbent is present) are usually quite competitive, attracting over four major candidates per race (Table

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45

3.2). There were a few races, notably in Sacramento and Lexington, where open seats did not generate much interest among potential candidates, but these are exceptions. Further, Table 3.2 indicates that the typical first place finisher in an open seat primary received less than 50 percent of the vote. In these free-for-all primaries, some candidates were able to advance to a runoff/general election with as little as 16 percent of the vote, with 80 candidates managing to advance with less than a third of the vote. General/runoff elections are less competitive, especially in partisan cities (New York and Louisville) where districts typically lean heavily towards one party (making the party primary the key race). In the nonpartisan cities, winners’ vote totals are usually below 60 percent, albeit higher than in the primary because there are only two candidates (as opposed to the four, five or six frequently seen in primaries). Open seat contests present a stark contrast to incumbent/challenger races; there is no lack of interest or competitiveness when seats become vacant. When term limits took effect in New York (2001) and Los Angeles (2001-2003), the resulting plethora of open seats led to incredibly competitive elections that attracted a large number of candidates, the most competitive elections either of those cities have seen in recent memory. Critics of term limits argue that they provide disincentives for challengers to take on incumbents (preferring to wait until the seat opens) and thus decreases competitiveness in seats that are not open (Cain, Hanley and Kousser 2006). The evidence from cities without term limits, however, indicates that incumbent/challenger races are not competitive even without the prospect of the forced retirement of the incumbent, and thus there is little reason to blame the lack of competitiveness in incumbent/challenger races on term limits. Other factors that increased competitiveness were structural changes in San Francisco and Louisville. In 2000, the races resulting from San Francisco’s move to district elections were highly competitive: even though most of the current supervisors ran, they faced stiff opposition (and four of them lost). The first election after the merger of the City of Louisville and Jefferson County was also highly competitive (especially when compared to elections in pre-merger Louisville), mostly due to the creation of open seats (the new Legislative Council had more seats than the old Board of Aldermen). These dynamics indicate that city elections typically are very competitive if incumbents are not present or are weakened through structural reforms. There is interest among potential candidates in running for local office, but they often wait until a seat opens up rather than taking on an incumbent.

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Campaign Finance in Local Elections

Table 3.2 Competition in Open Seat Races

New York Los Angeles Chicago Miami-Dade San Francisco Louisville (pre-merger) Louisville (post-merger) Seattle Long Beach Sacramento Tampa Lexington Average

# of Open Seats* 67 26 4 3 14

Avg. # of Major Candidates 4.8 5.5 3.8 5.3 5.6

First Place Finisher’s % of Vote, Primary** 44.4 42.1 42.1 39.1 35.8

Winner’s % of Vote, General or Runoff 74.8 55.4 54.8 59.3 58.7

7

3.4

50.7

91.2

20

6.7

49.3

64.7

8 3 2 6 12

3.4 5.3 2.0 4.3 2.5 4.4

36.8 45.5 69.8 51.1 37.6 45.4

58.4 62.4 -58.2 59.0 58.6

*Excludes multi-member districts. **Excludes minor party primaries.

Money and Electoral Success

One of the central questions in campaign finance research is whether money influences electoral outcomes. Do the best funded candidates usually win? Does spending large sums of money increase a candidate’s vote share? Jacobson’s (1978; 1980; 1990) seminal work on U.S. House races found that increases in challengers’ spending had a positive impact on their share of the vote, but incumbent spending made little difference. Jacobson concluded that challenger spending is more effective because they are less well known and thus need to use campaign funds to increase their name recognition and communicate their message to voters. Campaign spending by incumbents, who are already well known through prior elections or activities in office, will have minimal influence on their vote share. Research on Senate elections has found similar results (Abramowitz 1988) Research responding to Jacobson has highlighted three methodological problems with using multiple regressions to determine the influence of campaign spending on electoral outcomes (Green and Krasno 1988; 1990; Gerber 1998; Gerber 2004). First, the relationship between campaign spending and vote share is not linear. Returns

Campaign Finance and Electoral Success

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diminish as candidates spend more money; increasing spending from $100,000 to $200,000 will have a greater return than an increase from $800,000 to $900,000. This non-linear relationship will bias regression coefficients. Second, some variables that can influence vote percentages, such as challenger quality, are not included in Jacobson’s model. The most problematic methodological issue is simultaneity bias. Incumbents who are vulnerable will spend the most money: when faced with a wellfinanced and popular challenger, incumbents will step up their fundraising efforts (Green and Krasno 1988). The more competitive the election the more incumbents will spend. Causation between incumbent spending and vote share can work both ways: more incumbent spending could lead to a greater vote share, or a reduction in the likely incumbent vote share could lead to a reduced ability of the incumbent to raise funds. Similarly, as challengers’ electoral prospects increase, donors will be more willing to contribute. Open seat races may also have a similar problem: the perceived frontrunner in a race might be able to raise more because they are more likely to win. Thus, even if there is a correlation between electoral success and fundraising, it is not clear whether money is leading to electoral success or the likelihood of succeed leads to more money being raised. Even though the first two methodological problems can be dealt with through statistical techniques, simultaneity prevents developing a definitive causal model predicting electoral success. There have been efforts to overcome this hurdle with two-stage least squares regressions, but these have run into problems because of difficulty in finding good predictors of the endogenous independent variables (Leal 2006; Green and Krasno 1988). Using regression models is further complicated in this study by the structural variation across the eleven cities that prevent combining them into one model (with too small of an n in most cities to run separate models). To deal with these methodological issues, I will examine the relationship between campaign spending and electoral outcomes using multiple approaches. First, I will explore this issue though descriptive statistics and limited causal models of races where simultaneity problems are minimized. Second, I will examine how much candidates need to raise to be competitive, which provides a measure of the importance of money for electoral success. Finally, qualitative analyses of selected races presented in the next chapter will explore the role fundraising played compared to other factors, providing a compelling explanation for the quantitative findings in this chapter. None of these analyses by themselves provide a conclusive answer to whether money determines electoral success, but collectively they paint

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Campaign Finance in Local Elections

a coherent picture of the role of money in municipal elections and illustrate the connection between money and votes. Correlates of Electoral Success

85 percent of victorious candidates were the top fundraiser in the deciding election.5 Restricting the analysis to just competitive races (defined as where the winner received less than 60 percent of the vote), 72 percent of the winners were the top fundraiser. The same pattern holds in primary elections: in competitive primaries, the top votegetters were one of the top two fundraisers 96 percent of the time. There is no doubt that the best funded candidates usually win. Why the best funded candidates usually win, however, is the key issue. We cannot assume that they win because they have more money than their opponents. Perhaps they win because strong candidates are able to attract both votes and contributions, or perhaps donors are more likely to give to candidates who are likely to win. One way to sort through these relationships is to focus specifically on competitive open seat primaries, which have a few advantages over other types of elections as a focus of study. First, because there is no incumbent, we do not have to worry about other assets that help incumbents win re-election (such as a history of constituency service). Second, as we saw above open seat primaries usually feature many competitive candidates and, even though some candidates are favored over others, there is frequently no clear frontrunner.6 Open seat races can be unpredictable, meaning that potential contributors cannot be certain who is going to be the likely winner. Even though there may still simultaneity problems, especially in races where there is a clear frontrunner, these problems are minimized as much as possible, and will provide a valuable assessment of the influence of money on electoral outcomes. As Erikson and Palfrey (2000) argue, simultaneity bias is worse in races where a clear frontrunner exists and is quite small in races where the outcome is uncertain. A correlation between fundraising rank7 and place in competitive open seat council primaries8 can begin our analysis. There were a total of 153 races that met these criteria with 585 major candidates.9 There is a strong correlation between fundraising and place, with a Spearman’s Rho of .740 (p