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Democracy North Carolina and N.C. Voters for Clean Elections, the broad coalition
backing public financing options in elections, had two priorities during the 2004
legislative session. One was to obtain better funding for the judicial public
funding system, which is in its inaugural election year. The second was to pass
legislation to enable local governments to sponsor "voter-owned," public
financing programs in their local elections.
JUDICIAL PUBLIC FINANCING:
With significant support from inside and outside the General Assembly, an additional
$900,000 was allocated to fill any immediate shortfalls in implementing public
funding for judicial races this year. (This includes $725,000 in new funds and
authorization for the State Board of Elections to retain about $150,000 in unused
2003 funding.) However, legislation to provide new, long-term revenue sources
for the judicial public funding program could not get past stiff opposition from
the House Republican Co-Speaker Richard Morgan and his allies, so that goal must
wait for the next legislative session.
The $900,000 was needed because the new $3 income tax check-off didn't produce
as much money as anticipated in its first year. Despite extensive public education,
inaccurate tax preparation computer programs and resistance from tax preparation
professionals became structural barriers to the public's acceptance of the check-off
option. Also, attorneys were asked to contribute $50 when they paid their annual
privilege license, but fewer than 12 percent did so in 2003. Finally, resignations
increased the number of appellate court elections and pushed the funding needs
beyond the anticipated levels for the program's first year.
The $900,000 in new money should help provide adequate funding for all eligible
appellate candidates, plus enough to mail out a Judicial Voter Guide to households
before the General Election. There are four appellate court races (1 Supreme Court,
3 Court of Appeals). Seven of the eight candidates (all but Barbara Jackson) have
qualified to receive public funding in the General Election. Another race in the
Supreme Court is expected with the pending resignation of Bob Orr, and funds will
be
available for qualified candidates for that office, too.
Several other "tweaks" will be needed to improve the Judicial Campaign
Reform Act after this first year of operation, so a package of changes and new
funding proposals will likely be debated in the 2005 General Assembly. Meanwhile,
we need broad support for the $3 check-off that will appear on the 2004 state
income-tax form. (The check-off doesn't change a person's tax bill or refund;
it just directs $3 to the Public Campaign Fund for the judicial reform program.)
LOCAL PUBLIC FINANCING:
Senate Bill 760, enabling local campaign finance reform, passed the state Senate
in 2003. The bill was heard in the House Election Law Committee in 2004. Reformers
managed to get a majority of the committee on its side through grassroots organizing,
but this bill was blocked from advancing by opposition to public financing from
House Republican Co-Speaker Morgan and other key Republicans and by the opposition
of the N.C. Home Builders Association, whose members are a major source of campaign
money in local elections. Democracy North Carolina's summer interns led a protest
at the Home Builders headquarters because of its strong-arm tactics. A last-minute
effort in the Senate to pass a bill to authorize Chapel Hill to sponsor public
financing program was also stymied by the Home Builders.
ANOTHER REFORM:
In the final hours of the session, H-737 passed to limit corporate funding in
North Carolina elections. This landmark legislation prohibits corporations, trade
groups, and unions from financing "issue ads" that target candidates
shortly before a state election; and it requires significant disclosure from legal
funders of an "electioneering communication" that names a candidate
but previously escaped regulation because it didn't expressly advocate the candidate's
election or defeat.
The new law is part of an ongoing effort in North Carolina to (1) regulate electioneering
that masquerades as "issue advocacy" and (2) prohibit the intervention
of corporations in elections. The federal Bipartisan Campaign Reform Act or McCain-Feingold
law tackles these same concerns in regard to federal elections, with the blessing
of the U.S.
Supreme Court. Only a few states have passed laws that adapt the language of McCain-Feingold
to state elections. It is an important effort to undertake, because the ban on
unlimited "soft money" donations going to the federal parties has spurred
the advent of new vehicles for special-interest money, such as 527 committees,
named for the section of the IRS code that grants them tax-exempt status.
The new law won't stop all the ways wealthy special interests influence who
wins or even who can run. Hog barons, home builders, bankers, or video-poker hucksters
could still put $100,000 or more of their personal money into a 527 committee
or other association and sponsor "issue ads" that blast a candidate's
character, without calling specifically for the candidate's defeat. Under the
new law, such ads could continue; the contributions paying for them would just
need to be fully disclosed to the State Board of Election and come from the donors'
personal bank accounts.
Because there are so many ways for a special interests to exert influence in
an elections, campaign reformers applaud restrictive efforts like H-737, but also
believe it is imperative to create incentives and alternative sources of "clean"
or "voter-owned" campaign funds for candidates who voluntarily
reject special-interest money altogether.
If you need more information, feel free to contact Bob Hall, Democracy North
Carolina Research Director, at 919-489-1931.
www.democracy-nc.org
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