The Case for Small Donor Public Financing in New York

February 26, 2019

INTRODUCTION

New York State has a chance to take a bold step to strengthen democracy: enacting small donor public financing. This system has worked for decades in New York City. Expanded to state elections, it would be the biggest single response in the nation to the decision in Citizens United. And it would meet a surging public demand for change. 

Countering big money in elections would help transform New York politics. It would free legislators to better represent their constituents. It would bolster the diversity of donors, officeholders, and candidates. It would curb corruption. It would respond to the explosion of civic engagement seen in the 2018 election and boost it further. And it would enhance public confidence.
 
Reshaping the way campaigns are financed is widely popular; all across the country, the public has demanded reform. The very first bill introduced in the new U.S. House of Representatives — H.R. 1 — would enact small donor public financing nationwide. With opposition from the Senate majority leader, that package will likely not become law this year. But with a governor and a new majority in the state legislature that have expressed support for progressive change, New York has the chance to lead.
 
How does small donor public financing work? Constituents who give small amounts to participating candidates will see their contributions matched by public money. The system is voluntary: Candidates opt in by raising enough small initial donations to qualify, and they accept conditions including lower contribution limits. Governor Andrew Cuomo’s current proposal would provide a $6-to-$1 match on each private contribution of up to $175. Under this formula, a constituent donation of $10 would be worth $70 to a participating candidate, and $175 would be worth $1,225. The Assembly passed a similar bill several years ago, and leaders of both legislative houses have proposed a comparable plan.
 
This system reviewed in this report is based on New York City’s program, considered to be the nation’s best. The city’s system has transformed the political participation of non-wealthy residents both as donors and as candidates. The vast majority of candidates who run for district or citywide office participate in the program. In the past few years alone, eight local governments including Washington, D.C., and Suffolk County, New York, have adopted similar reforms. Following the 2010 Citizens United decision, which enabled unlimited special interest spending, and with a Supreme Court today that is unlikely to reverse course soon, small donor public financing is the most powerful solution available to counter the influence of wealth on our political process.
 
New York State needs this transformative change. For too long, Albany has fostered a “pay-to-play political culture [that] is greased by a campaign finance system in which large donors set the legislative agenda,” as the Moreland Commission to Investigate Public Corruption put it in 2013. In 2018 big donors almost completely dominated New York’s state elections. The top 100 donors gave more to candidates than all of the estimated 137,000 small donors combined. Small donations made up 5 percent of all money given to New York State candidates — a far smaller share than the 19 percent in small donations at the federal level in 2018. Between a system that enables huge donations to dominate, and processes that make it too hard to vote, it is little wonder that New York suffers one of the lowest civic engagement records in the country.
 
This is the year to enact small donor public financing. Governor Cuomo’s current proposal closely resembles bills recently carried by now-Senate Majority Leader Andrea Stewart-Cousins and by Assembly Speaker Carl Heastie, presenting a genuine chance for change. A broad and diverse coalition of more than 200 groups has joined to press lawmakers to finally enact this powerful democracy reform that they have supported in name for years. The coalition includes major unions; prominent environmental, racial justice, and reproductive rights groups; politically active community organizations; and business and civic leaders.
 
By taking this step, New York would lead the nation. It would be the first to enact a robust small donor matching program statewide. Passage would send a message to the nation that even in the age of Citizens United, transformative change to take back democracy for everyday people is still possible.