Small Donor Public Financing Plays Role in Electing Most Diverse New York City Council

On Tuesday, New York City voters elected the most diverse and representative legislature in the city’s history. The numbers of women and people of color elected increased significantly, better reflecting their numbers in the city’s general population, our analysis of candidate demographics found. A robust small donor public financing option for campaign fundraising, where candidates can join a city program that matches modest donations they earn from residents by $8-to-$1, played an important role in these trends.

Women, who are 52 percent of residents, will increase their representation on the city council from 27 percent now to 61 percent come January. footnote1_omrzcyq 1 Underlying data on file with the Brennan Center. People of color, who are 68 percent of residents, will increase their representation on the council from 51 percent now to 67 percent. footnote2_3ypqhmh 2 Underlying data on file with the Brennan Center. Women of color in particular drove these racial and gender diversity gains, running and winning in sufficient numbers to more than double their seats in the 51-member body. footnote3_12a7ypn 3 Underlying data on file with the Brennan Center.

New York City’s small donor public financing program “was one of the factors that opened the opportunity for more women from diverse backgrounds to run for office,” Jessica Haller, executive director of 21 in ’21, an organization devoted to gender equality on the council, told us. Her colleague and vice-chair, Yvette Buckner, explained that public matching dollars enabled women to invest in campaign tools such as digital outreach to broaden and diversify their levels of engagement, which was critical in a pandemic election.

Our analysis of city campaign finance records and the demographics of candidates bears out the strategists’ observations. footnote4_1wmfahk 4 We compiled and analyzed certain data about the 309 city council candidates who appeared on the primary ballot in June. We logged gender and race self-identification for each candidate, as shared in campaign literature or public statements, following methodology used in previous studies on federal candidates. See Bernard L. Fraga, “Separating Race and Party in Congressional Elections,” (Working Paper, Emory University, June 9, 2020), https://static1.squarespace.com/static/5fac72852ca67743c720d6a1/t/5feb9121ff4ef250d3d34c52/1609273635650/racepartycandidates_060920.pdf%22%20/t%20%22_blank; and Bernard L. Fraga and Hans J. G. Hassell, “Are Minority and Women Candidates Penalized by Party Politics? Race, Gender, and Access to Party Support,” Political Research Quarterly 74 (2020): 540–555, https://myweb.fsu.edu/hanhassell4/FragaHassellParty.pdf. We used primary cycle data from the New York City Campaign Finance Board to determine each candidate’s total fundraising and reliance on contributions from small donors (individual donors of $175 and less) and on matching funds. We measured reliance on small donations by calculating the proportion of a candidate’s total fundraising they raised from donors giving $175 (the maximum eligible for matching with public dollars). We measured reliance on matching funds by calculating the proportion of a candidate’s total fundraising they received in public funds. For the full fundraising dataset, see New York City Campaign Finance Board, “Campaign Finance Summary – 2021 Citywide Elections,” July 15, 2021, http://www.nyccfb.info/VSApps/WebForm_Finance_Summary.aspx?as_election_cycle=2021. Among the women and people of color who won city council seats this week, 97 percent raised money through the voluntary small donor public financing program. Remarkably, they and other candidates of color and female candidates who were competitive in the primaries raised as much, on average, as their white and male counterparts. footnote5_pizk2rr 5 ‘Competitive candidates’ in this analysis refers to the two top vote recipients in the first round of the ranked-choice voting process of the primary election. All of the general election victors who ran in a contested primary placed in the top two during the first round of ranked-choice voting. (In New York City, the primary election of the incumbent party, more than the general, tends to be the contest that matters most. Indeed, as of this writing, only one council district will definitely flip parties in 2022, even in a cycle that saw unusually high major-party competition. footnote6_kw5ompi 6 At the time of publication, three races remain undecided, two of which involved contested primary election victors. Therefore, this figure could increase based on the pending results. ).

These findings stand in stark contrast to typical trends in U.S. campaign finance, where historical disadvantages hinder candidates of color and female candidates in the race to raise big money from wealthy donors. footnote7_mwct7w5 7 Tom Shapiro, Jessica Santos, and Sylvia Stewart, The Black-White Racial Wealth Gap, Institute on Assets and Social Policy and LDF Thurgood Marshall Institute, 2019, 2, https://tminstituteldf.org/wp-content/uploads/2019/11/FINAL-RWG-Brief-v1.pdf; Judith Warner, Opening the Gates: Clearing the Way for More Women to Hold Political Office, Center for American Progress, 2017, 10, https://cdn.americanprogress.org/content/uploads/2017/05/17132756/Gatekeepers-reportMay.pdf; Kira Sanbonmatsu, Research Inventory: American Women and Politics, Center for American Women and Politics, 2015, 42, https://www.politicalparity.org/wp-content/uploads/2017/10/Parity-Research-Full.pdf; Denise Baer and Heidi Hartmann, Building Women’s Political Careers: Strengthening the Pipeline to Higher Office, Institute for Women’s Policy Research, 2014, https://iwpr.org/iwpr-general/building-womens-political-careers-strengthening-the-pipeline-to-higher-office/; and Center for Responsive Politics, Common Cause, and Representation 2020, Individual and PAC Giving to Women Candidates, 2016, 1, https://d3n8a8pro7vhmx.cloudfront.net/fairvote/pages/4944/attachments/original/1480999514/Giving_to_Female_Candidates_2016.pdf. Research shows women and people of color running for office tend to rely more on small donors than their male or white counterparts and, thus, especially benefit from public matching models.

To use New York City’s small donor public financing program, a candidate first must show a sufficient level of public support by raising a threshold sum in small donations from a minimum number of residents. The candidate must also follow strict disclosure rules and contribution limits and earn every dollar they receive in public funds by raising matchable contributions from city residents. Participation is voluntary: candidates can, instead, raise money strictly through private donations.

The program has seen a number of improvements over its three decades, including increases in the size of the match. This year’s was the first citywide election to happen after 80 percent of voters decided in a referendum to increase the public financing match from $6-to-$1 to $8-to-$1 and to slash contribution limits in city council races from $2,850 to $1,000. Many of this cycle’s history-making candidates credit this increase for encouraging them to run and empowering their grassroots campaigns.

Our analysis found race and gender equity in fundraising across all competitive council candidates in the primary. footnote8_hjzsjew 8 Our analysis focuses on the top two vote recipients in the first-round tally of ranked-choice ballots in each city council primary contest. Though subsequent rounds of tallying changed the positions of these top two in four primary contests, in only one primary contest did a candidate originally in the top two not remain in the top two by the final round. Among these candidates, men and women raised, on average, nearly the same amounts, with women raising 4 percent more than men. White candidates and candidates of color also raised, on average, nearly the same amounts, with candidates of color raising 2 percent more than white candidates. These candidates also relied to similar degrees on small donations and public matching funds in their fundraising, regardless of their race or gender identity. footnote9_g1atzi0 9 Source: New York City Campaign Finance Board. Underlying data on file with the Brennan Center. This remarkable parity in fundraising trends held true not just for council candidates overall, but also in one-to-one contests when the top two candidates in a given district were of different races or genders. footnote10_oj8bu05 10 In order to control for district-level dynamics in contests, we also completed one-to-one comparisons where a male candidate and female candidate were the top two vote recipients in the first-round tally of ranked-choice ballots in a given district, and likewise where a nonwhite and white candidate were the top two vote recipients in a given district. Source: New York City Campaign Finance Board. Underlying data on file with the Brennan Center.

To be sure, the city’s small donor public financing program was not the only election reform in play this year. Term limits, in place since 1993, opened more than half the council seats to newcomers, a window of opportunity not seen in two decades. footnote11_ja7mo38 11 According to secondary source literature about federal elections, women have the best chance of being elected to office when a seat is open. Eric R.A.N Smith and Richard L. Fox, “The Electoral Fortunes of Women Candidates for Congress,” Political Research Quarterly 54, no. 1 (2001): 217, https://journals.sagepub.com/doi/abs/10.1177/106591290105400111?journalCode=prqb&. The Center for American Women and Politics explains that when large numbers of incumbents choose not to seek reelection, this can create “nearly unprecedented structural opportunities” for women to win seats in Congress. Kelly Ditmar, Unfinished Business: Women Running in 2018 and Beyond, Center for American Women and Politics, 2019, 20, https://womenrun.rutgers.edu/2018-report/why-how-women-run/. Ranked-choice voting, adopted by ballot referendum in 2019, converted the primary from a winner-take-all contest to one that cycled through voters’ rankings of up to five candidates until one candidate received more than 50 percent of the vote. Research on term limits and ranked-choice voting, however, shows the policies do not always have the effect some proponents seek of increasing diversity and representation, sometimes resulting in the opposite. footnote12_a7hgwi3 12 Research on the effects of both ranked-choice voting and term limits on candidate and elected official diversity offers mixed conclusions. For ranked-choice voting, some studies have shown that candidates of color and women candidates benefit since the reform allows for more affordable campaigning, eliminates vote splitting, rewards issue-based campaigns, expands voter participation, and ensures more representative outcomes. Deb Otis and Nora Dell, Ranked Choice Voting Elections Benefit Candidates and Voters of Color, FairVote, 2021, https://d3n8a8pro7vhmx.cloudfront.net/fairvote/pages/20267/attachments/original/1620768112/RCV_Benefits_Communities_of_Color_Report.pdf?1620768112; and RepresentWomen, In Ranked Choice Elections, Women WIN, 2020, https://www.representwomen.org/research_voting_reforms. Other studies show that ranked-choice voting may have unintended consequences that negatively impact diversity among candidates and elected officials. For example, the policy may increase information costs for voters, resulting in low-information elections in which candidates of color are significantly penalized. Melody Crowder-Meyer, Shana K. Gadarian, and Jessica Trounstine, “Ranking Candidates in Local Elections: Neither Panacea nor Catastrophe,” January 21, 2021, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3787548.A 2001 study examining several state legislatures with term limits found a slight decrease in the number of women in office because of term limits during the 1998 and 2000 elections. Conversely, the authors found a slight increase in the number of people of color in office due to term limits in those same election cycles. Increasing Diversity or More of the Same? Term Limits and the Representation of Women, Minorities, and Minority Women in State Legislatures, Rutgers University, August 2001, https://cawp.rutgers.edu/sites/default/files/resources/termlimitsdiversity_0.pdf. In 2006, a study on the impact of term limits on representational diversity in the Florida state legislature found no statistically significant change in the diversity of legislators after the imposition of term limits. Scot Schraufnagel and Karen Halperin, “Term Limits, Electoral Competition, and Representational Diversity: The Case of Florida,” State Politics & Policy Quarterly 6, no. 4 (2006): 448–62, http://www.jstor.org/stable/41289401. Indeed, the historical barriers that women, people of color, and particularly women of color face in traditional fundraising have impeded their ability to compete even for open seats.

New York City’s public financing program continues to be a model for jurisdictions looking to address historical inequities in fundraising. In 2020, New York became the first state to enact a matching program since Citizens United. Last year, several cities held their first elections with either new public financing programs or recently increased matches. After enacting its program, Portland, OR, saw contribution sizes shrink but more small donors participate even in non-wealthy zip codes. In Washington, DC, the new Fair Elections Program diversified the donor pool, increasing participation most dramatically in areas where more people of color and lower-income residents live. Ahead of the 2020 elections, San Francisco increased its match from $2-to-$1 to $6-to-$1 and saw private funds become less important to candidate spending than in previous elections. These trends line up with research showing the policy increases diversity and participation among small donors and incentivizes candidates to seek more support from the constituents they seek to represent.

Candidates across the country attest to the democracy-enhancing benefits of small donor public financing. The policy enables them to spend more time with their constituents, improving the responsiveness of government, officials elected with public financing told us earlier this year. And it helps break down barriers to entry that historically have disadvantaged women and people of color. New York Attorney General Letitia James, who previously became the first Black woman to win citywide office using New York City’s small donor public financing program, told us that “public financing is a critical tool to ensure that more people from more diverse backgrounds have the opportunity to hold elected office and serve our communities.” She stressed, “It’s imperative that our government be reflective of the people it represents.”

Congress could be next. A small donor public financing program for U.S. House races currently awaits passage as part of the Freedom to Vote Act. The legislation would provide congressional candidates the opportunity to opt into a match similar to New York’s. Congressional public financing would help close the fundraising gap that persists for women, candidates of color, and especially women of color, and increase diversity on Capitol Hill as it has in City Hall.