Charter Changes to Enhance Accountability

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Charter Revision Commission’s Next Job: Tackle Plan for Geographic Representation

The council-appointed 2012 Charter Revision Committee has now formulated a baker’s dozen recommendations that will be forwarded to the Austin City Council for the planned November 2012 charter amendment election.

The most important task assigned to the committee—recommending whether council members should be elected from geographic districts and if so under what plan—will be taken up at a meeting scheduled for January 5.

That’s when the committee will discuss the pros and cons of the current all-at-large system vis-à-vis hybrid (some geographic districts plus some council members at-large) and single-member systems (in which all but the mayor would represent geographic districts).

At that same meeting the committee will discuss the pros and cons of several different plans under consideration (a 6-2-1 plan proposed by Mayor Lee Leffingwell, an 8-4-1 plan advocated by two citizens, and a 10-1 plan advocated by Austinites for Geographic Representation, a broad coalition of organizations and individuals that is petitioning to get this plan on the ballot).

The committee will not vote on these matters until a later meeting, scheduled for January 19.

In its September 29 meeting the committee approved seven recommendations for charter changes (more about that later).

At the December 8 meeting the committee considered nine proposals and voted to recommend that the City Council put six of these on the ballot for voters to decide, as follows:

• To permit fundraising by election winners to retire campaign debt.

• To raise the maximum funds that may be held in an officeholder’s account to $40,000.

• To give the city’s Ethics Review Commission more power to address campaign finance and campaign disclosure violations.

• To require reporting of last-minute campaign contributions.

• To require electronic filing of campaign finance and lobbying reports.

• To require voter approval before issuing revenue bonds of more than $50 million.

These decisions were based on the recommendations formulated by the committee’s five-member working group. The committee discussions and recommendations are detailed below.

Responses to City Council resolutions

Four of the potential charter amendments were addressed in response to City Council resolutions, as follows:

Campaign contribution limits—The committee voted to table a council proposal that would increase the allowed individual campaign contribution limits for at-large seats (all members of the council are currently elected city-wide) to $700 per person per election, twice the current limit of $350.

The $350 limit on campaign contributions resulted from a charter amendment, Proposition 5, that was approved by 68 percent voters May 13, 2006. Proposition 5 raised the limit from $100  and provided for a cost of living adjustment.

Committee member Fred Cantu, a political consultant, objected to limiting campaign contributions because he said it puts candidates of modest means at a disadvantage when running against wealthy candidates who can pour large sums of their own money into a contest.

“People should be allowed to contribute what they want, with disclosure,” he said.

Actually, unlimited campaign contributions were allowed before the November 4, 1997, charter election. That’s when 72 percent of the 61,382 voters who cast ballots opted to limit campaign contributions to $100, in response to a citizen-driven petition

Fundraising to retire debt—The committee voted 9-5 to allow winning candidates to continue fundraising for 30 days after the election to retire campaign debt and fund officeholder accounts.

Article 3, Section 8(F)(4) of the charter already allows losing candidates to continue fundraising after an election until reimbursed.

But this provision for winning candidates was recommended only if new restrictions are placed on the purposes for which officeholder accounts could be used. Contributions to charities, nonprofit organizations, and payments for membership dues, advertising and newsletters would be prohibited.

The basic reasoning was that these kinds of expenditures are not related to the functions of running a council office but instead are used to build goodwill that more resembles campaigning. “These restrictions are not relevant to performing duties” of the office, said Ann Kitchen, a former state representative and vice chair of the committee.

Committee member Fred Lewis, an attorney with long experience in dealing with campaign finance issues, pointed out that the funds in officeholder accounts are, in fact, kept in the same bank account as campaign contributions.

Assistant City Attorney Sabine Romero, staff advisor to the committee, noted that the City Charter currently allows $20,000 to be kept in an officeholder account after an election; any excess over that amount must be given away, for example to a nonprofit or put in the city’s Fair Campaign Fund (provided for in City Code Section 2-2-61).

These excess funds cannot be contributed to a candidate, Lewis said. Kitchen noted that excess funds could also be returned to contributors.

Doubling officeholder accounts to $40,000—The committee voted with two opposed to recommend a charter amendment to allow officeholders to keep $40,000 in accounts to defray legitimate office expenses—but with a prohibition, added by committee member and campaign consultant David Butts, on converting those funds into campaign funds for reelection.

When running for reelection, an officeholder “should start on an equal footing with everyone else,” Butts said.

Runoff election contributions—Without voting, the committee accepted the working group recommendations not to include a charter amendment that campaign contributions for a runoff election may only be collected after the election day for the general election.

The working group’s recommendation stated that  Article 3, Section 8(F)2 of the City Charter and City Code Section 2-2-7 already address this concern.

Additional recommended changes

Five other proposals were strongly recommended by the working group as “key campaign finance and election reforms that are urgently needed and deserve the durable protection afforded by the City Charter,” as follows:

Give Ethics Review Commission more authority—Without discussion, the committee unanimously voted to recommend a charter amendment to explicitly state that the Ethics Review Commission has jurisdiction over all alleged city campaign finance and campaign disclosure violations.

This would clear the way for the council-appointed commission members to deal with such alleged violations in way that they have not been allowed within the city’s current legal guidance.

The recommendation includes giving the Ethics Review Commission, established by City Charter Article 2, Chapter 2-7, the authority to hire a special prosecutor at its discretion in cases where it believes such action is necessary, with funding provided by the city.

The recommendation would also require funding of all reasonable and necessary expenses of the commission to perform its assigned duties.

In addition, the recommendation would specifically prohibit future City Councils from weakening or limiting the powers of the commission by ordinance, but would give the council authority to strengthen the commission’s powers if desired.

Require reporting of last-minute contributions—The committee voted unanimously to recommend a charter amendment that would require timely disclosure of campaign contributions made within nine days of an election.

Currently such reporting is not required and the working group noted that some parties have exploited this loophole to prevent voters from learning the sources and amounts of major campaign contributions or expenditures until after ballots have been cast.

“Sometimes there’s cheating going on,” said attorney Fred Lewis. “The candidate knows the money is coming but we cannot prove it.”

These late contributions allow a candidate to put on a last-minute media blitz with surprise attacks with no notice of who paid the expenses until after the election is over.

Enhanced disclosure of independent expenditures—The committee voted unanimously to recommend a charter amendment to explicitly require the disclosure of independent expenditures and electioneering communications by all persons, including corporations, unions, 501(c) nonprofit organizations, unincorporated associations and individuals.

The recommendation addresses a problem that is likely to only get worse unless addressed, due to the Citizens United case decided by the U.S. Supreme Court that allows corporate and union funds to be used to exert greater influence over elections.

Entities that are not candidates or political action committees currently may avoid disclosure of independent expenditures and funding sources because state and city laws have not been updated to address the increasingly common practice of using nonprofit organizations, ad hoc groups, unions, corporations or others for political purposes.

Current city law does not require independent expenditures of more than $1,000 to be disclosed within seven business days or, if made in the last nine days before the election, within 48 hours.

Neither state law nor city law explicitly defines independent expenditures to require disclosure of electioneering communications such as sham ads, i.e., ads that do not expressly say to vote for or against a candidate but are clearly intended to influence an election.

The definition recommended would include both express advocacy—in which voters are urged to vote for or against a specific candidate—and electioneering communications.

The recommendation would mandate all independent expenditures and their sources of funding be reported within five business days if made more than 60 days before an election. If made between 60 days before and 10 days before an election, independent expenditures would have to be made within 48 hours. If made within nine days before an election, reporting would be required within 24 hours.

Also, “paid by” disclaimers on communications purchased by independent expenditures in City of Austin elections would be required to state the names of the five largest contributors within the preceding 12 months.

“Someone could raise unlimited contributions totaling $100,000 and run TV ads” for independent expenditures, attorney Fred Lewis said. But these new rules (established by the Supreme Court decision) “would not let you bash candidates and say it’s not electioneering.”

Require electronic filing of campaign finance and lobbying reports—The committee voted unanimously to recommend a charter amendment to require any entity that contributes, accepts, or expends funds related to a city election to file all required reports electronically and in a format that would be published by the city in a searchable, and downloadable, database.

At present, candidates who raise large amounts of money typically file campaign contribution reports on a compact disc in portable document format (pdf), City Clerk Shirley Brown told The Austin Bulldog, while less well funded candidates may file paper copies. In either case, the records are posted on the City Clerk’s website as pdfs to make them publicly available, but not in a user-friendly format that facilitates analysis.

The working group’s research noted that both the State of Texas and City of Houston already require electronic filing of these documents in a searchable database.

“For a city that prides itself on technological savvy, it is surprising that Austin does not facilitate meaningful public access to this information because it clings to a paper filing system,” states the working group’s recommendation.

If the City Council puts this item on the ballot and voters approve it, this charter amendment would require that the database be fully operational no later than six months after the election.

Require voter approval for revenue bonds of more than $50 million—The committee approved this recommendation by a vote of 11-3 with one member off the dais, but only after lengthy debate.

Article 7, Section 11 of the City Charter states, “All revenue bonds issued by the city shall first be authorized by a majority of the qualified electors voting at an election held for such purpose.”

This requirement has been ignored for decades based on the city’s legal advice citing a superceding state law that allows cities to issue revenue bonds without voter approval.

This was done, for example, in the years when the South Texas Nuclear Project was being built and incurred huge cost overruns. When this happened, the City Council headed by Mayor Ron Mullen issued bonds to cover the city’s increased share of the costs. The thinking at the time was the city had no choice in the matter and must meet its contractual obligations as part-owner.

The purpose of this charter amendment is to reassert the requirement to follow the City Charter regardless of what state law might allow.

Seven other charter amendments recommended

On September 29, the committee approved seven other recommendations to go on the ballot for the next charter amendment election for voters to decide:

• Move City Council elections from May to November.

• Prohibit City Council members from switching places for the purpose of avoiding term limits.

• Require the same number of signatures for initiative and referendum petitions as are required for City Charter amendment petitions, i.e., five percent of the city’s qualified voters.

• Require the City Attorney to report to the City Council (instead of the City Manager) and allow the City Attorney to directly appoint deputy city attorneys.

• Allow City Council members to appoint their staff members.

• Allow the City Clerk to appoint deputy city clerks.

• Allow the City Auditor to appoint deputy auditors.

To see the details concerning the September 29 recommendations, click here.

Related stories:

Council Confirms November 2012 Election Date for Charter Amendments, November 3, 2011

Coalition Launching Petition Drive to Get on the Ballot for May 2012 Election, October 18, 2011

Broad Community Interest Focusing on How Mayor and Council Members Elected, October 4, 2011

Coalition Nearing Petition Launch for Grass-roots Council District Plan, August 24, 2011

Maps Prove Select Few Govern Austin: Forty Years of Election History Expose Extent of Disparity, August 4, 2011

City Council to Consider Proposal to Create Geographic Representation: Election Dates, Term Lengths, Redistricting and Other Charter Changes in Council Resolution, April 27, 2011

Petition Launch Imminent to Force Election for Geographic Representation in City Elections, March 7, 2011

This report was made possible by contributions to The Austin Bulldog, which operates as a 501(c)(3) nonprofit to provide investigative reporting in the public interest. You can help sustain this kind of reporting by making a tax-deductible contribution.

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