California lawmakers enacted a bill to limit local pay-to-play politics. Is it working in Sacramento?

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Examine the donations given during the primary cycle to hopefuls for Sacramento political offices and you will find dollar amounts that fall just below limits outlined in state law.

In August Alvin Cheung, a founding president of California Northstate University, donated $250 to Councilwoman Mai Vang’s re-election campaign. That amount was just one dollar less than the limit that would have prohibited Vang, who was facing no challenger, from casting a vote expected later this year on whether to award the university a tax break to build a Natomas hospital.

The March primary marked the first election cycle where state law mandated a 12-month moratorium on local politicians casting votes on questions that could benefit donors who gave more than $250 to support their re-election.

That law, called SB 1439, went into effect Jan. 1, 2023 as a way to combat so-called pay-to-play politics.This amendment builds off California’s landmark Political Reform Act passed 50 years ago.

California voters approved Proposition 9 in June 1974. The proposition addressed campaign finance, lobbying activity and conflicts of interest which made it “the most significant state-level response,” according to the state’s Fair Political Practices Commission, to the culture of corruption in politics that came to light with the Watergate scandal.

In the decades since voters passed the Political Reform Act, members of the state’s Assembly and Senate have proposed bills to further regulate campaign finance.The Levine Act (AB 1040) was added in 1982 after the Los Angeles Times reported that the state’s Coastal Commissioners were accepting large campaign contributions from people who had projects that required the commissioners’ approval. This act stipulates that appointed boards and commissions must recuse themselves for 12 months from decisions that would affect someone who contributed more than $250 to their campaign.

SB 1439’s passage expanded the Levine Act to apply these restrictions to local elected officials. Previously there were no such limits on local elected officials unless they were a member of an appointed board, such as the Planning and Design Commission.

While state lawmakers try to regulate individual campaign contributions, political action committees, which are federally regulated, represent another mechanism that funnels money into local elections. Individuals, businesses and corporations face no limit to what they can donate to a PAC. The only limitation for these donors is that they cannot earmark their donation, in this case called independent expenditures, to support a specific candidate; the decision of how much money to spend in support of electing an individual or passing a measure is left to the PAC.

California limits pay-to-play politics in local elections, but federal law enables a loophole

When it comes to donating money directly to a candidate, Cheung is far from the only voter giving money to candidates who may have a say in their financial dealings. Construction company Teichert also donated $250 to Vang in August, as well as $250 to Councilman Eric Guerra’s reelection campaign in April. In June, both Vang and Guerra participated in a vote to award a $3 million sole-source contract to Teichert without city staff conducting a competitive bidding process. The city would typically be required to solicit bids for a project of that price tag, but the council is able to approve exceptions if city staff place the item on the agenda and it passes.

Vang said donations do not sway her decisions.

“My vote is determined by how the policy will impact (harm or uplift) our most underserved communities,” Vang said. “It’s never been based on contributions.”

Cheung, set to seek a city tax break for his hospital later this year, agreed that his contribution was in support of Vang’s political vision not in an effort to buy her vote.

“I have contributed to many local and state elected officials who demonstrate an unwavering commitment to public service and my recent contribution to Councilmember Mai Vang’s re-election campaign is no different,” Cheung said in a statement.

Examples of donors giving just below the new donation limits demonstrate that the new law is working, said Sean McMorris of the transparency organization Common Cause.

“We can presume they would’ve given a lot more if SB 1439 wasn’t in effect,” McMorris said.“We don’t think $250 will influence how a person votes. But $1,000 might.”

How much money would buy votes?

SB 1439 passed in 2022 without a single no vote and has not been in effect for a full election cycle yet, but the question of how large a donation can be before it becomes a bribe remains unsettled.

Last year Sacramento County Supervisor Pat Hume and Rancho Cordova City Council member Garrett Gatewood joined the California Restaurant Association, California Retailers Association and other groups to sue the California Fair Political Practices Commission over the new pay-to-play law. Hume received many thousands of dollars from developers before he won election in 2022. That case is still active with a court date scheduled in December.

Sen. Bill Dodd, D-Napa, introduced a bill that’s gaining traction to water the law down. That bill, SB1243, which the Assembly Elections Committee advanced June 26, would raise the $250 threshold to $1,000. It would also allow multiple people from one organization, such as board members, to make individual donations. The current law treats donations from multiple board members not as separate donations, but all counting toward a single $250 allotment.

“The idea that our local elected officials can be bought and sold for $250 is both laughable and frankly offensive,” Dodd said during a May hearing, according to Cal Matters.

Assemblywoman Tina McKinnor, D-Los Angeles, has introduced a bill that would raise the limit even higher — to $1,500.

One of the original authors of SB 1439, Sen. Steve Glazer, D-Orinda, defended contribution threshold limits. He simply wants to clean up the bill with some small tweaks, such as requiring public meeting agendas to disclose the details of the law.

“The law we passed two years ago, to extend the Levine Act to all local officials, was arguably the most significant political reform since the enactment of the Political Reform Act 50 years ago,” said Glazer. “And if you were to judge it by how many local politicians have called me to complain about my bill I think it’s an indication the law is working.”