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Analysis

New York’s Wealthiest Played Outsized Role in Funding 2018 Campaigns

A new Brennan Center analysis underlines the need for small-donor public financing, which would give ordinary New Yorkers a much louder voice in elections.

December 20, 2018

Update 2/26/19: The Bren­nan Center has released a new report, The Case for Small Donor Public Finan­cing in New York, which provides more in-depth research and analysis on how to reform New York State’s campaign finance system by enact­ing a small donor public finan­cing program. 

New Bren­nan Center numbers under­score the outsized role that New York’s wealth­i­est donors play in fund­ing campaigns. They high­light the urgent need for a small-donor public finan­cing system to amplify the voices of ordin­ary New York­ers — a solu­tion Gov. Cuomo announced his support for Wednes­day. 

In the 2018 elec­tion, just 100 people in the state donated more to state candid­ates than all 137,000 small donors combined, accord­ing to a Bren­nan Center analysis of 2018 campaign contri­bu­tions. Small donors are those who gave $175 or less.

The top 100 indi­vidual donors in 2018 contrib­uted an astro­nom­ical $7,525,311.14, the analysis found. That far surpasses the small-donor total of $5,807,914.

This dispar­ity between mega donors and every­one else in New York prob­ably under­states the gap between big donors and every­one else because, as the analysis notes, these numbers do not include the tens of millions of dollars in contri­bu­tions to candid­ates from LLCs, PACs, corpor­a­tions and other non-party groups, much of which also came from the state’s biggest donors and special interests.

The Bren­nan Center analysis also shows:

• More than half of all contri­bu­tions came from indi­vidu­als or entit­ies who gave $10,000 or more. Three quar­ters came from indi­vidu­als and entit­ies who gave $1,000 or more. 

• Small donors made up only 5 percent of all donors to statewide and legis­lat­ive races. That likely puts New York among the very worst states in terms of share of dona­tions that came from small donors. 

These data are consist­ent with other ongo­ing research show­ing that small donors are vastly under­rep­res­en­ted in New York elec­tions. They high­light how under the state’s current campaign finance system, a small group of wealthy donors enjoys far more influ­ence than aver­age citizens. 

“These stag­ger­ing figures show the urgency of boost­ing the power of small donors through a public finan­cing program,” said Nirali Vyas, a researcher for the Bren­nan Center’s Demo­cracy program, who conduc­ted the analysis.

A separ­ate analysis released Thursday by the Campaign Finance Insti­tute (CFI) makes clear how a small-donor public finan­cing system could fix the prob­lem. It finds that such a system, with contri­bu­tion limits as proposed by Cuomo, could have more than tripled the share of 2018 dona­tions to Assembly candid­ates that came from small donors, making small donors the single biggest source of money for these candid­ates. For Senate candid­ates, it could have quin­tupled it. And the propor­tion of dona­tions from LLCs, non-party organ­iz­a­tions, and large money indi­vidual contrib­ut­ors would decrease substan­tially in the state’s Assembly, Senate, and gubernat­orial races, accord­ing to the CFI analysis.

On Wednes­day, Cuomo announced his support for an over­haul of the state’s campaign finance system, the center­piece of which would be a public finan­cing program. 

Small-donor public finan­cing would help tackle the influ­ence of wealthy donors

Small-donor public finan­cing is by far the bold­est solu­tion currently possible for giving ordin­ary voters a much louder voice in the polit­ical process. Numer­ous cities and counties have recently adop­ted or expan­ded small-donor match programs, includ­ing New York City and Suffolk County. 

New York City has had a largely success­ful public finan­cing program for nearly 30 years, which matches small-donor contri­bu­tions collec­ted by candid­ates. In its most recent form, the program provides public match­ing funds at a $6-to-$1 rate for contri­bu­tions up to $175 from city resid­ents. Voters opted to expand the program in Novem­ber’s midterm elec­tions.

Cuomo has consist­ently suppor­ted bring­ing a similar small-donor match system to all of New York State. “Every day, ordin­ary New York­ers struggle to make their voices heard in our polit­ical system,” he said in his Janu­ary 2017 State of the State speech. “The only way to truly fix this prob­lem is to insti­tute a public finan­cing system for polit­ical campaigns that matches funds from small dona­tions.” 

After the elec­tions last month, Fair Elec­tions for New York — a coali­tion of more than 150 organ­iz­a­tions that includes community, labor, envir­on­mental, faith, and tenant groups — sent a letter call­ing for Cuomo and the New York Legis­lature to prior­it­ize small-donor public finan­cing.  The letter criti­cizes New York’s exist­ing campaign finance system for allow­ing “an exor­bit­ant amount of power to be concen­trated in the hands of the very wealthy and well-connec­ted.” 

If New York enacted statewide small-donor public finan­cing, it would become the first state to do so, making it a national leader in compre­hens­ive campaign finance reform. That would be a major turn­around from its current status: A 2016 Poli­ti­fact analysis found that the state has more office-hold­ers who have been convicted, sanc­tioned, or accused of wrong-doing than any other in the nation. 

A public finan­cing system would bring other bene­fits, too 

The CFI analysis found that enact­ing a statewide public finan­cing program would cost just over $58 million, includ­ing admin­is­tra­tion costs, which trans­lates to less than one penny a day per New Yorker.

Small-donor public finan­cing would also help increase the diversity of donors in New York. New York City’s multiple match system. A 2012 Bren­nan Center study, coau­thored with CFI’s Michael Malbin, compared small donor activ­ity in City Coun­cil campaigns under multiple match to Assembly campaigns, which received no match­ing funds. It found that City Coun­cil races gener­ated a far more geograph­ic­ally and demo­graph­ic­ally diverse set of donors. This was true in neigh­bor­hoods with lower incomes, greater poverty, and more people of color.

Now’s the time for New York to enact small-donor public finan­cing

In Novem­ber’s midterm elec­tions, voters across the coun­try cham­pioned demo­cracy reforms and signaled their dissat­is­fac­tion with campaign finance systems that favor the wealthy. New York lawmakers have the oppor­tun­ity to heed that signal by enact­ing small-donor public finan­cing, which will help redir­ect the atten­tion of candid­ates to ordin­ary citizens. It would strengthen the state of demo­cracy in New York — and lead the way for other states to do the same.

Learn more in the Bren­nan Center report The Case for Small Donor Public Finan­cing in New York.

(Image: Getty)