New Restrictions Proposed for Lobbyist Fundraising

HomeCampaign FinanceNew Restrictions Proposed for Lobbyist Fundraising

Lobbyists Can Only Give Candidates $25 But Can Collect Unlimited Contributions for Them

Updated Friday, January 27, 2012 3:20pm

Why would city regulations prohibit a registered city lobbyist from contributing more than $25 to an officeholder or candidate for mayor or city council, but allow a lobbyist to solicit and bundle unlimited contributions on behalf of officeholders and candidates?

That was a question the 2012 Charter Revision Committee dealt with in its meeting last Thursday.

Based on the case presented by its five-member working group, the Committee voted 12-1 (with David Butts and Kathleen Vale absent) to approve a recommended change that would limit the amount of bundled contributions by registered city lobbyists to a maximum of $1,750 per candidate per election cycle for individual bundlers and $3,500 per candidate per election cycle for firms that bundle. This restriction would not apply to anyone who is not a registered city lobbyist.

This restriction would put a severe crimp in the kind of fundraising that some registered city lobbyists are doing for current officeholders.

The Austin Bulldog’s analysis of the most recent contribution reports filed by the four members of the City Council running for re-election—Mayor Lee Leffingwell, Mayor Pro Tem Sheryl Cole, and Council Members Mike Martinez and Sheryl Cole—indicates that two registered city lobbyists bundled a total of $33,500 $44,470 in single reporting period for Leffingwell, Martinez, and Spelman. (Added Spelman’s bundled contributions to previous total January 27, 2012.)

In reality they bundled even more than that, but the contribution reports report filed by Cole and Spelman list lists only the names of bundlers and do does not identify the specific contributions these lobbyists solicited on their her behalf.

David Armbrust
David Armbrust

Lawyer-lobbyist David Armbrust of Armbrust & Brown PLLC bundled 24 contributions totaling $8,400 for Leffingwell, and 29 contributions totaling $10,150 for Martinez, and 36 contributions totaling $11,200 for Spelman. According to the lobbyist registration information posted on the city’s website, Armbrust has 17 clients involved in building, real estate and real estate development, financial services, hotels, property management, energy, and waste disposal.

Michael Whellan
Michael Whellan

Lawyer-lobbyist Michael Whellan of Graves Dougherty Hearon and Moody bundled 26 contributions totaling $8,050 for Leffingwell and 20 contributions totaling $6,900 for Martinez. City lobbyist registration records indicate Whellan has 13 clients, including property owners, real estate developers, taxi cabs, healthcare provider, and music.

The ambiguity of the current City Code regarding how to report bundled contributions was also addressed by the Charter Revision Committee. Members present voted unanimously to recommend more stringent and accessible disclosure of all bundled contributions.

With no discussion, the Charter Revision Committee also voted unanimously to recommend that Article X, Section 2 of the City Charter be clarified to indicate that ex-officio members of the Planning Commission are non-voting members whose attendance does not affect quorum requirements. Both the City Council and the Planning Commission had referred this matter to the Committee for consideration.

These recommendations will be forwarded to the Austin City Council, along with all the recommendations previously approved by the committee, for possible action.

What City Code requires

In 2008 the Austin City Council altered the Austin City Code to address the “appearance of impropriety and special influence” by prohibiting registered city lobbyists and their spouses from contributing more than $25 in a campaign period to an officeholder or candidate for mayor or city council, or to a specific purpose political committee involved in an election for mayor or city council.

City Code Section 2-2-53 states the purpose of the restriction is “to minimize the role of political contributions in the legislative and regulatory processes and awarding of public contracts….”

The solicitation of contributions on behalf of a candidate or officeholder is regulated by City Code Section 2-2-22, which requires disclosure. Bundlers are individuals who solicit and obtain contributions of $200 or more from five or more individuals. The reporting of bundlers’ names in contribution reports is required, although this requirement does not apply to an individual who raises $5,000 or less for a candidate through a fundraising event held at the individual’s home.

Although the names of bundlers must be reported, the code is silent with respect to whether individual contributions solicited by bundlers must be linked to the bundlers’ names.

In practice, some officeholders are linking contributions to bundlers’ names by using footnotes (Leffingwell, and Martinez and Spelman) while others are one is just listing the bundlers’ names (Cole and Spelman). It should be noted that Spelman’s system for linking bunders’ names is to put an asterisk in the “principal occupation” field for each bundled contributor, while Leffingwell and Martinez’ put an asterisk next to the names of bundled contributors.

The Committee’s working group summarized the situation with respect to unlimited bundling currently permitted by writing, “Through this practice, registered lobbyists may effectively gain the same favor, influence or access—or the appearance thereof—that our City Code specifically seeks to prevent. In fact, some might argue that the current system offers lobbyists the best of both worlds: they can’t be tapped for large contributions themselves, yet they gain whatever benefits may flow from such generosity by soliciting and proffering the money of others.”

The working group further stated, “Likely most candidates and officeholders would strenuously deny that large bundled contributions influence their decision-making, and this may well be true. However, as our City Code correctly notes, the appearance of special influence may be just as damaging as actual corruption, feeding a growing cynicism and detachment among voters that Austin can ill afford.”

The Committee’s recommended change to the system for reporting bundled contributions would require the bundler to report the following information in writing to the candidate or officeholder who must, in turn, cause this information to be filed as part of the contribution and expenditure reports:

• Identity of bundler and address (already required)

• Bundler’s employer and occupation

• Names of all registered lobbyists, if any, employed by the bundler and his/her firm or employer

• Name, address, occupation and employer of each individual contributor

• Total amount delivered to each candidate or officeholder for that reporting period

• Cumulative amount delivered to each candidate or officeholder for the current election cycle

To see the Charter Revision Working Group’s written recommendations, click here.

Next meeting February 2

The Charter Revision Committee’s next meeting is scheduled for 6:30pm Thursday February 2 at City Hall, in the Boards and Commissions Meeting Room. The agenda proposed for that meeting calls for voting on whether committee members want to recommend changing the current at-large system of elections.

If the committee members vote in favor of changing the election system, then there would be two more votes, as follows:

(1) Should the committee recommend that council districts be drawn by an independent commission?

(2) What form of representation should be recommended (e.g., the 10-1 plan being petitioned for by Austinites for Geographic Representation—in which only the mayor would be elected at-large—or a hybrid plan in which some at-large council members would be recommended, in addition to a certain number of geographic districts.

Comments made during the January 9 committee meeting indicated roughly half of the members favor the 10-1 plan while the other half wants to have some council members elected at-large.

Committee Chairman Gonzalo Barrientos, a retired state senator, said he would invite a district judge to act as parliamentarian at that meeting.

Related stories:

Committee Debates How to Elect Council: Charter Revision Committee Divided Over Pure Districts vs. Hybrid System, January 9, 2012

Thirteen Charter Changes and Counting: Charter Revision Committee’s Next Job: Tackle Plan for Geographic Representation, December 14, 2011

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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