The Case for Small Donor Public Financing in New York

Small donor public financing is the most powerful, proven solution available to counter the overwhelming influence of wealth on our political process in the aftermath of the Citizens United decision, which gave the green light to unlimited special interest spending. It is built on six components:

• A $6-to-$1 match of small donations. For each small contribution by an in-state resident, a candidate for a state office would receive six times that amount in public money. A contribution of $10 would then be worth $70. This would boost the voices of regular New Yorkers.

• Qualifying thresholds. To ensure that funds are not wasted on frivolous or uncompetitive candidates, public financing participants would have to first demonstrate reasonable levels of support by collecting a minimum number of small donations from constituents.

• Reduced contribution limits. New York’s contribution limits are currently sky high. Individuals can give as much as $69,700 to a candidate for statewide office, $19,300 to a state Senate candidate, and $9,400 to a state Assembly candidate in an election cycle. footnotehttps—wwwelectionsnygov-cfcontributionlimitshtmlLimits_4wtm1MZXKUK9CrkY-rrhlbEZ3Pxt4CbNGnvFAnQg8Q_hO1DHa8zlWXp1 New York State Board of Elections, “Contribution Limits,” accessed February 15, 2019, https://www.elections.ny.gov/cfcontributionlimits.html#Limits. That’s much higher than federal contribution limits or those in most states. Candidates participating in small donor public financing would be required to agree to lower limits, to further the program’s goal of focusing fundraising on everyday constituents and voters rather than deep-pocketed donors.

• A cap on public funds, but no limits on total fundraising or spending. Participating candidates would be able to compete in the face of unlimited independent spending after Citizens United. They would be allowed to raise private funds even after hitting the public funding cap, subject to individual contribution limits, and to spend without limit if they need to do so.

• Transparency and oversight. To protect New York’s investment of public funds, the program would require public disclosure by participating candidates of fundraising and spending and enforce compliance rules effectively. Drawing on experience in Connecticut, it would establish effective oversight while making compliance easy and inexpensive.

• Adequate and reliable funding. If the program had been in place in 2018, even an aggressive projection of the cost to New York — assuming that every candidate opted in — would have come to less than 1/10 of one percent of the state budget for funding and administration, or less than a penny per day per New Yorker. footnote1_xs5JTnGIvflDGYV63ge1-lE0MwQh-hZQPzO96rakPOc_nYaDKHHKJNxH2 Michael J. Malbin and Brendan Glavin, “Small-Donor Matching Funds for New York State Elections: A Policy Analysis of the Potential Impact and Cost,” Campaign Finance Institute, February 2019, 12, http://www.cfinst.org/pdf/State/NY/Policy-Analysis_Public-Financing-in-NY-State_Feb2019_wAppendix.pdf.

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. footnote1_BAB-4H98Gb50NE-PaCptv8CXLcxnqsgWEkfCo9fYY_d968jxBLwyFW3See Moreland Commission to Investigate Public Corruption, “Preliminary Report,” State of New York, December 2, 2013, 41, 47, https://publiccorruption.moreland.ny.gov/sites/default/files/moreland_report_final.pdf (observing the increased influence of everyday people and greater trust in government under public financing); DeNora Getachew and Ava Mehta, Breaking Down Barriers: The Faces of Small Donor Public Financing, Brennan Center for Justice, June 9, 2016, https://www.brennancenter.org/sites/default/files/publications/Faces_of_Public_Financing.pdf (offering candidate testimonies on how public financing allows them to focus on constituents); Spencer A. Overton, “The Participation Interest,” Georgetown Law Journal 100, 2012: 1279, https://scholarship.law.gwu.edu/cgi/viewcontent.cgi?article=1167&context=faculty_publications (observing that “financial participation” can lead to other forms of civic engagement).

Since Citizens United, a small group of wealthy megadonors have come to dominate U.S. election financing. footnote1_uJssjccC3aERxnmp7aJkYQzPSCI0aU4URqHOii6tdA_nTeoiSXRnB9T17 Ian Vandewalker and Lawrence Norden, “Small Donors Still Aren’t as Important as Wealthy Ones,” The Atlantic, October 18, 2016, https://www.theatlantic.com/politics/archive/2016/10/campaign-finance-fundraising-citizens-united/504425/. The problem is especially acute in New York State. Not only do big donors have a disproportionate impact on the political system, but small donors play virtually no role at all. It’s a sharply tilted political system that gives a tiny number of big donors big power.

Today New York State has unusually lax campaign finance rules. Individuals can give as much as $69,700 to a candidate for statewide office, $19,300 to a state Senate candidate, and $9,400 to a state Assembly candidate in an election cycle. footnote2_4wtm1MZXKUK9CrkY-rrhlbEZ3Pxt4CbNGnvFAnQg8Q_xRoPKd001gkG18 New York State Board of Elections, “Contribution Limits,” accessed February 15, 2019, https://www.elections.ny.gov/cfcontributionlimits.html#Limits. (The federal cap on individual donations is $5,600 per election cycle.) footnote3_lfAVnazKUEMzjP5qgvf3SfwpGDj6XUij5uybmk1pY9A_zuKTcvWCZ1KU19 Federal Election Commission, “Contribution Limits,” accessed February 7, 2019, https://www.fec.gov/help-candidates-and-committees/candidate-taking-receipts/contribution-limits/. As a result, big donors almost completely dominated the 2018 New York State elections, with small donors pushed to the sidelines:

• The top 100 donors gave more to candidates than all of the estimated 137,000 small donors combined. footnote4_JdlKLVGKJ7vEQ8PS8Bq6mswrPwizbJ-WxFVKTN8G9GA_poQHxTWLtdNr20 Chisun Lee and Nirali Vyas,“Analysis: New York’s Big Donor Problem.” (This does not even include the millions of dollars contributed by LLCs and corporations, which would skew the data even further to the wealthiest donors.)
• Small donations amounted to only 5 percent of all funds raised by candidates in New York State in the 2018 election cycle. This was the smallest source of funding to candidates. footnote5_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_jeF33t6q7dtg21 Ibid.
• The majority of funds to candidates came from people or entities who gave more than $10,000. footnote6_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_zn45Cl6Pgm0322 Ibid.

The most recent available studies by the nonpartisan Campaign Finance Institute show that New York consistently ranks among the worst states in the country when it comes to small donor participation. footnote7_99-xFUvRKjQZEirxOd4JnJOAK1G1SaHC4ylsSFbhWs_kO36MN9PBwlr23See Michael J. Malbin, Peter W. Brusoe, and Brendan Glavin, “Small Donors, Big Democracy: New York City’s Matching Funds as a Model for the Nation and States,” Election Law Journal 11, no. 1 (2012): 14,http://www.cfinst.org/pdf/state/nyc-as-a-model_elj_as-published_march2012.pdf; Michael J. Malbin, “Sources of Funds in 2012 State Legislative and Gubernatorial Elections,” Campaign Finance Institute, October 2014, http://www.cfinst.org/pdf/state/tables/States_12_table2.pdf; Michael J. Malbin, “Sources of Funds in 2014 State Legislative and Gubernatorial Elections,” Campaign Finance Institute, October 2014, http://www.cfinst.org/pdf/state/tables/States_14_table2.pdf. At a time when diversity is rising as a social value, the campaign finance system amplifies the voices of only a few New Yorkers. Big New York donors underrepresent the geographic, socioec‍onomic, and racial diversity of the state. In the 2018 New York State elections: footnote8_QvUtn15ba9kEqA893d6FCFAOL8kInpkmJIeGi8QQMM_gCAb7mu6o67424 Chisun Lee and Nirali Vyas,“Analysis: New York’s Big Donor Problem.”

• Two-thirds of big donors (who gave $10,000 or more) came from just three affluent counties: New York, Nassau, and Westchester.
• Big donors typically lived in neighborhoods that were whiter and wealthier and had more college-educated and employed people than neighborhoods where small donors lived.
• Donors from out of state gave nearly three times more than all small-donor New Yorkers combined. Close to 90 percent of that out-of-state money came in donations of $1,000 or more.

Today’s big-money politics, of course, tilts policy. Tax policy, environmental policy, real estate regulation, and more are shaped by the contours of the political money system. A massive study of federal policies over two decades found that the class of “economic elites” in the United States has “substantial” impact on government decisions, while “average citizens have little or no independent influence.” footnote9_GFFrMkw7K8xsmq4TiHQeEFqKe6iPlREJhTuTWJD0_he8EbXBDW9L325 Martin Gilens and Benjamin I. Page, “Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens,” Perspectives on Politics 12, no. 3 (2014): 572, 575, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf.

So, too, in New York. The Moreland Commission found that “access to elected officials comes at a price, and that the fight over legislation is often between entities with vast financial resources at their disposal.” footnote10_Th6o4fCJpQILH7rAsZ9QCb0QLFNgyuLbo6Kyl3dShaU_wT5H3oYt7OAp26 Moreland Commission, “Preliminary Report,” 34. It concluded, “When political power and access is so closely and disproportionately tied to large donations, the majority of New Yorkers are shut out of the political process.” footnote11_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_bvbii0lENCgI27 Ibid.

Events of recent years have created a wide public perception of corruption in New York State. Governor Cuomo established the Moreland Commission in 2013 “in response to an epidemic of public corruption that has infected this State.” footnote12_Cg4BF5ViL2R05YTt5OxsrXi2RQhPT9lem3PxBe3a5s_eQDQqxHeupVh28 Ibid., 3. The group of more than two dozen ethics scholars, prosecutors, defense attorneys, federal officials, and other civic leaders reported:

In recent years, too many local and state elected officials, staff members, and party leaders have been indicted and convicted for offenses running the gamut of shame: bribery, embezzlement, self-dealing, and fraud…One out of every eleven legislators to leave office since 1999 has done so under the cloud of ethical or criminal violations, and multiple sitting officials are facing indictments on public corruption charges. footnote13_YG1M70oBdZ4mVx2m646RiqyjJlhmVhJi3Dyj5v4lzo_fDEygKIlE2vl29 Ibid., 3–4.

The Commission also cited numerous instances where moneyed interests were accused of offering quid pro quo exchanges of donations for favors. footnote14_5Fold5wYloaeYaCpm8rVhetNMahHM3MHSwgUDZ3sew_wLXprZMYqU6U30 Ibid., 33–34.

In the past decade, 19 New York State legislators have been convicted on federal corruption charges, giving New York one of the worst records in the nation. footnote15_lgcBpJhaIctKOjefceoQfQ13dMhiYWUyxSe9T8urR4_zRgOR2QPseEF31 This number was reached by reviewing relevant press coverage on corruption convictions of New York State elected officials from 2008 to 2018. Sources included major New York news outlets such as the New York Times, New York Daily News, Rochester Democrat & Chronicle, and others. ,footnote16_HqYkI9S2poNTKjKYZ3wPG0ogQValPoENEz-9-hY-c5w_f56bMk996hjg32 Dan Clark, “Yes, New York Has More Corrupt Officials Than Any Other State,” PolitiFact, September 19, 2016, https://www.politifact.com/new-york/statements/2016/sep/19/elaine-phillips/new-york-has-been-most-corrupt-state-decades/.   A 2015 analysis by FiveThir‍‍‍‍tyEight found that from 1976 to 2010, New York had more public officials convicted on federal corruption charges than any other state. footnote17_jGp-KpbajXr25XkUWUY4FulsZHVAPssOiuKXzhwx5xw_oEDqCGhV3RzW33 Harry Enten, “Ranking the States From Most to Least Corrupt,” FiveThirtyEight, January 23, 2015, https://fivethirtyeight.com/features/ranking-the-states-from-most-to-least-corrupt/.

New Yorkers want better for their state. A 2018 poll found that 85 percent of New Yorkers think government corruption is either a “very serious” or a “somewhat serious” problem. footnote18_uH3zJDnxYgLANwNtm-Gkb04UOIfEHS7E3A3RXscVjfo_c89zgqdThkGN34 Quinnipiac University, “New Yorkers Say Almost 4–1 Increase Abortion Rights, Quinnipiac University Poll Finds; But Few Say Abortion Is Most Important in Gov Race,” Quinnipiac University Poll, July 19, 2018, https://poll.qu.edu/new-york-state/release-detail?ReleaseID=2556. And recent polls consistently show that large numbers of New Yorkers want state officeholders to reduce the influence of money in politics and end corruption. footnote19_GjdD9nL2z7CksqxYTyOvDDtPjp-jswGXi2ZSgLIkMc0_j692ZpWz8HDB35See End Citizens United, “New York CD 11 Survey Results,” September 4–5, 2018, https://endcitizensunited.org/wp-content/uploads/2016/04/NY11-Results.pdf; Siena College, “Cuomo Begins ’14 in Strong Position; Ratings With Voters Up,” Siena College Research Institute, January 20, 2014, https://scri.siena.edu/2014/01/20/cuomo-begins-14-in-strong-position-ratings-with-voters-up/; Siena College, “Majority of Voters Think Silver Should Step Down as Speaker,” Siena College Research Institute, June 13, 2013, https://scri.siena.edu/2013/06/13/majority-of-voters-think-silver-should-step-down-as-speaker/; Jefrey Pollock and Kieran Mahoney, “NY Friends of Democracy Survey: Strong Support for Campaign Finance Reform,” Global Strategy Group/Mercury, May 6, 2013, https://fairelectionsny.org/cms/wp-content/uploads/2013/05/MayPollingMemo.pdf. Stronger campaign finance laws would help yield higher voter engagement. Public anger about corruption helps dampen participation. The sense that only big donors have a say gives voters less reason to turn out and engage politically in other ways.

A small donor public financing system offers the best chance to improve politics in New York. It is based on and enhances — the successful system used in New York City and recently enacted in Suffolk County, and it has the following features.

1. $6-to-$1 Match of Small Donations

Governor Cuomo’s current small donor public financing proposal would provide $6 in public funds for every $1 of a donation from a New York resident up to $175, similar to New York City’s longtime model. footnote1_UIUuGMJQa9MJaZkgP2em9sIFpn5JX9VJNP6ZFXiJI6A_c7DLOe8S8bgt36 FY 2020 New York State Executive Budget: Good Government and Ethics Reform Article VII Legislation, Part B, § 14–206(2), (N.Y. 2019), https://www.budget.ny.gov/pubs/archive/fy20/exec/artvii/gger-artvii.pdf. Previous bills in the Senate and Assembly have also provided a $6-to-$1 match, though the matchable amount has varied, up to $250.

A multiple match on small donations, especially combined with lower contribution limits (discussed below), provides a strong incentive for candidates to spend more time raising money from and talking to their own constituents.

Officeholders who have campaigned in both New York City’s small donor public financing program and the state’s private financing system confirm this. Attorney General Letitia James, for instance, explained to the press that in running for statewide office, she needed to raise funds from the biggest donors to compete, in contrast to the way she could turn to constituents for support when she ran under the city’s system. footnote2_fiXJykR1gx8mOWHCW9Q5Ea1GJoqyeM6duvEiNhlH8kM_uzhPPf4MF3VW37 Russell Berman, “The Battle to Be Trump’s Javert in New York,” The Atlantic, August 6, 2018, https://www.theatlantic.com/politics/archive/2018/08/trump-teachout-attorney-general-new-york/566819/.

The Campaign Finance Institute found that New York City’s small donor public financing program “brought more low-dollar donors into the system,” leading to a “substantial increase not only in the proportional role of small donors but in their absolute numbers per candidate.” footnote3_l18lI2UTC53F77EMfRGtg5KRrx4TNWST846wMTOlmQ_n2LNL2t8ZEvP38 Michael J. Malbin, Peter W. Brusoe, and Brendan Glavin, “Small Donors, Big Democracy,” 9. In essence the reform, by increasing the value of small donors’ modest contributions, can transform candidates into agents of civic participation who bring more — and new — constituents into the political process.

The table on page 5 makes plain the multiplier effect of a $6-to-$1 match on contributions up to $175 from New Yorkers. Adjusting the matchable amount to $250, as in last year’s State Senate bill, does not change the essential mechanisms of the program.

To ensure that small donor public financing meets its intended purpose — to encourage candidates to seek reasonable support from constituents rather than huge checks from wealthy interests or out-of-state donors certain restrictions should apply to contributions that are matched. For instance, as mentioned above, contributions should be matched only up to a modest amount $175 or $250, as New York bills have specified. And only donations from human beings — who could give to multiple candidates — residing in New York State should be matched. The governor’s current bill and recent proposals of the Legislature all contain such restrictions on matchable contributions.

Table 1: The value of New Yorkers’ small donations after a $6-to-$1 match, compared with other donations under Governor Cuomo’s proposal.

2. Reduced Contribution Limits

New York State’s contribution limits are unusually high. Individuals can give as much as $69,700 to a candidate for statewide office, $19,300 to a state Senate candidate, and $9,400 to a state Assembly candidate in an election cycle. footnote4_8B7c92-vPQPlsI5FGGVlktrpFZY973RYceZiKjSm5Bg_it2ivszcCjYM39 New York State Board of Elections, “Contribution Limits,” accessed February 15, 2019, https://www.elections.ny.gov/cfcontributionlimits.html#Limits. These limits are so high that, according to the Moreland Commission, “they can scarcely be called limits at all.” footnote5_Ib1FAXpD5S35ROh4n25pVWjUh-F9llf6S3SH60nWZac_g9RlAktSbkoi40 Moreland Commission, “Preliminary Report,” 35.

Any comprehensive campaign finance proposal for Albany should decrease contribution limits for all candidates. Candidates who wish to participate in small donor public financing should, in exchange for receiving public matching funds, be held to still lower contribution limits. The reduced contribution limits for participating candidates, coupled with a multiple match on small donations, would further encourage these candidates to focus their fundraising efforts on constituents who cannot afford to write the large checks that current limits allow.

Table 2: Limits on matching funds under Governor

3. A Cap on Public Funds, but No Limits on Total Fundraising or Spending by Candidates Who Participate in Public Financing

Unlike some other plans, proposals in Albany for small donor public financing, including the governor’s current bill, have not set limits on how much participating candidates would be able to spend. The Brennan Center supports this choice, which acknowledges the perception and occasional reality in the post–Citizens United era that campaigns will have to contend with high spending by independent expenditure groups such as super PACs.

Candidates should not have to skip the benefits of public financing because they fear they will not be able to run a competitive campaign.

Participating candidates would be free to continue to raise funds privately, subject to individual contribution limits, once they maxed out on public funding. To limit the total expense of a public financing system, Governor Cuomo’s bill, as with all recent proposals, sets a maximum in available matching funds for each type of office. footnote6_Vdl6Qql5XoXE3uEBMmYCZBjxdAgpMpa-ec1FBrBTngs_geCfEOMQZMNg41 FY 2020 New York State Executive Budget: Good Government and Ethics Reform Article VII Legislation, Part B, § 14–205.

4. Qualifying Thresholds

To ensure that funds are not wasted on frivolous or uncompetitive campaigns, candidates seeking to join a small donor public financing program should first have to demonstrate a viable base of support by collecting a minimum number of small donations in New York. Governor Cuomo’s bill includes a qualifying threshold of $650,000 in small donations for gubernatorial candidates, made up of at least 6,500 small contributions (between $10 and $175) from New York residents. Similarly, candidates for state Senate would have to raise $20,000, including at least 200 small contributions, and candidates for State Assembly would have to collect $10,000, including at least 100 small contributions. footnote7_ih2mOWX4-a6xnoSdckfheLDhwxzqH32LNIiu4pgzks_yTuI8ASbiiba42 Ibid., Part B, § 14–204(2).

According to an analysis by the Campaign Finance Institute, only 17 percent of gubernatorial candidates in 2018 would have qualified for funding. In the state Senate and Assembly, only 29 percent and 28 percent of candidates, respectively, would have qualified. footnote8_tA8kUu1fmuzp8cIi5OeW27EtE7yLD99xVpvXti1En4_tBKYKdny53MG43 These percentages are based on how much candidates had raised by September 1, 2018, which the Campaign Finance Institute’s analysis estimates would have been the approximate date by which candidates running in a general election would need to meet qualifying thresholds for public funds. See Michael J. Malbin and Brendan Glavin, “Small-Donor Matching Funds for New York State Elections,” 14. Yet candidates can change those results, the analysis observes, by changing their fundraising strategies. Indeed, the point of small donor public financing “is to give [candidates] a good reason to look for small donors from their districts.” That said, the thresholds should not be so inaccessible that candidates do not even try to take advantage of matching funds. The CFI report concludes that “the sponsors would be well advised to revise the qualification requirements as they perfect a new bill.” footnote9_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_qOxkx9zIFVk644 Ibid.

The New York City program’s thresholds may provide guidance for determining the qualifying levels for state elections. To receive the city’s match in the 2021 elections, mayoral candidates must raise $250,000 from at least 1,000 small-dollar contributors residing in New York City. City Council candidates must raise $5,000 from at least 75 small dollar contributors residing in their districts. footnote10_yIQtsePYf0IZZW4lOygwSXbZfFjAJO3ZlChfC-fOf3Q_hD3772Ywi6JW45 New York City Campaign Finance Board, “Limits & Thresholds: 2021 Citywide Elections,” Candidate Services, accessed January 22, 2019, https://www.nyccfb.info/candidate-services/limits-thresholds/2021/.

5. Transparency and Oversight

A successful public financing program requires fair and efficient oversight, with ample support services so that candidates can participate without having to hire sophisticated compliance staff. This oversight should include standard internal processes to identify and resolve minor reporting or administrative issues, to ensure that only sufficiently serious issues receive a formal compliance review, and to make sure that all candidates are treated equally. Also necessary is public disclosure of participants’ compliance with requirements such as individual contribution limits, to preserve the integrity of the program and the public’s trust.

This proposal improves on the New York City system and its enforcement methods. Many legislators in New York State are familiar with the Campaign Finance Board, the agency charged with oversight of New York City’s public financing system. Lessons learned from candidates’ experience with the CFB have been incorporated into current public financing proposals in New York State. Connecticut has a statewide public financing program that also provides important insight for how New York can achieve transparency and robust compliance in its public financing program without unduly burdening candidates. Connecticut’s State Elections Enforcement Commission (SEEC) has developed a reputation among candidates for being supportive and committed to minimizing undue administrative burdens, and its public financing program has only grown in popularity, with a record 335 candidates receiving funds in 2018. footnote11_ExJ3TKa2wWlbFLLBNgQERDOyFMko8hYecg5qyxbHAs_i4qqWGqrWYVc46 Max Reiss, “Public Campaign Financing Sees Record Year as Governor Picks Ignored It,” NBC Connecticut, December 12, 2018, https://www.nbcconnecticut.com/news/local/Public-Campaign-Financing-Sees-Record-Year-as-Governor-Picks-Ignored-It-502623861.html.

One significant decision Connecticut’s SEEC made to reduce the burden of compliance on candidates was to restrict postelection audits to no more than 50 percent of all legislative campaigns, selected by lottery (weighted by recency of any past audit), although all statewide office campaigns do get audited. footnote12_m4i061Ctfi2jP7FLDDEuF5vkruDNQfQVYNbT6N63lc_jishrbxRjS7n47 Conn. Gen. Stat. § 9–7b(5)(B) (2017). Even though this lottery method is less burdensome to candidates than New York City’s approach of auditing 100 percent of campaigns, the SEEC reports that its system has been effective at enforcing compliance. Governor Cuomo’s current proposal contains an audit procedure like Connecticut’s. footnote13_DOt8EWh9p7CrPKAX-Y8dkhGRyEPmoUtOxXUfjrXTExY_kzzl5rITQkGb48 FY 2020 New York State Executive Budget: Good Government and Ethics Reform Article VII Legislation, Part B, § 14–209(1).

6. Ensuring an Adequate Funding Stream

To serve the democracy-enhancing interests of New York State and the need of participating candidates for sufficient funds to compete, the small donor public financing program must receive adequate and reliable funding.

The Campaign Finance Institute analyzed what it would cost to sustain the program proposed in Governor Cuomo’s current bill. Its most aggressive estimate which assumes that every statewide and legislative candidate in 2018 would opt in and that a far greater number of donors would make matchable contributions than is currently the case — is an annual cost of $38.6 million in disbursements and $20.9 million in administrative costs. footnote14_YDw5xhy84eaHlxRfemD0vYTtdDcDtmYYWfAvRNznL2E_iGpvqNW9PDue49 Michael J. Malbin and Brendan Glavin, “Small-Donor Matching Funds for New York State Elections,” 12. The $59.5 million total amounts to less than 0.1 percent of the state’s $175 billion budget, or less than a penny a day per New Yorker.

The bill designates funding for the public financing program from a $40 tax check-off ($80 for joint filers), the abandoned property fund, contributions from individuals and organizations, transfers from other funds or sources when authorized by law, and backup funding from the general fund. footnote15_MxFP7y8Me0GH7MHxNpQWshAJdcBftkMn6FZcJDHa6SQ_peC5xYChUC9350 FY 2020 New York State Executive Budget: Good Government and Ethics Reform Article VII Legislation, Part B, § 9. But as the Moreland Commission noted, once small donor public financing begins to take effect and reduces government favors for powerful donors, “the elimination of just one wasteful tax expenditure or one unnecessary spending program could cover the full cost of the program.” footnote16_UBMVWsmQRMKXvA3qUqTWKWTZu4IMmKMa6WKtm7QZQLY_cxJdOG0a4T7V51 Moreland Commission, “Preliminary Report,” 47.

Public Financing in the Era of Super PACs

Would small donor public financing matter in the age of super PACs and dark money? Yes. In fact, it is the only reform that can counter the corrosive impact that such groups have had on our politics, altering a dynamic that has given an increasingly large voice to a tiny number of big donors at the expense of regular constituents.

Importantly, none of the current proposals caps what participating candidates can raise or spend. So if a candidate faces super PAC spending, she can continue to raise money from private donors to counter independent expenditures even after she has reached the maximum public cap.

This reform does not pretend to take all private money out of the political system. The Supreme Court would not allow such a reform in any case. But it gives candidates a chance to forge a campaign fueled by constituents while retaining the ability to fight outside money without having to resort to dark money.

Already, New York State has taken key steps that limit the ability of super PACs to have undue influence on candidates. It was the first state to enact accountability measures for online ads; it has also demanded increased disclosure and banned coordination between candidates and super PACs. A small donor public financing system would complement these changes, allowing candidates to focus on small donors, amplifying the voice of everyday constituents, bringing greater diversity, and inspiring a much-needed renewal of public faith in government.

1. Increasing the Voice of Small Donors

Public financing would increase the importance of small donors. Applying the $6-to-$1 match to donations from New Yorkers in 2018 state contests, as well as other aspects of Governor Cuomo’s public financing proposal, we find a dramatic increase in the proportion of money candidates would have raised from small donors (see Figures 1, 2, and 3 on page 9).

Experience in New York City and elsewhere shows that adopting a small donor public financing system can lead to candidates engaging more of their constituents when fundraising, and voters responding by adding their voices with more small donations. If this were to happen in New York State (as we expect), the percentage of funds from 

small donors in future elections would be even greater.

In a recent study, the Campaign Finance Institute noted that while it is impossible to know how many more small donors would participate if the state adopted a public financing program, a threefold increase in small donors is reasonable to expect. Figure 3 (on page 9) shows the impact that such an increase in small donations would have had on the share of funds from small donors in 2018.

The Campaign Finance Institute further broke down what this kind of increase in small donor giving would have meant in 2018: footnote1_gq3NpFQseKEndyE89qAAUOefsLOLkqqj2IkQJwJYJ1M_iet0tjZ8GJlq52 Michael J. Malbin and Brendan Glavin, “Small-Donor Matching Funds for New York State Elections,” 6–7, for findings that follow.

• Assembly candidates would have raised more than four times as much from small donors, making small donors the single largest source of Assembly campaign funds.
• Senate candidates would have raised six times as much from small donors.
• Small donors would have been the biggest source of funding for a majority of legislative candidates.

• Nearly every Assembly candidate and 91 percent of Senate candidates would have raised at least as much as they actually did, if not more, if they had participated in a small donor public financing system.

2. Allowing Candidates to Focus on Their Constituents Instead of on Big Donors

One whispered concern among lawmakers about adopting small donor public financing is their assumption that it will serve to displace incumbents. But as longtime users of the New York City program have noted, and as independent studies have confirmed, the chief impact of the reform is to enable all candidates to shift their focus from deep-pocketed donors to constituents — not to advantage any type of candidate over another. footnote2_hjP13So3gZarOTszIhEzbU0rOUcCYuD4o0cJ9uAHVzc_hYLrt27Zw43X53See Elisabeth Genn, Sundeep Iyer, Michael Malbin, and Brendan Glavin, Donor Diversity Through Public Matching Funds, Brennan Center for Justice, May 14, 2012, 13, http://www.brennancenter.org/sites/default/files/legacy/publications/DonorDiversityReport_WEB.PDF; DeNora Getachew and Ava Mehta, Breaking Down Barriers, 27; Michael J. Malbin, Peter W. Brusoe, and Brendan Glavin, “Small Donors, Big Democracy,” 12–13.

Small donor public financing enables people to win and stay in office by being more representative of constituents than of wealthy donors. footnote3_8vjYQSaiNCDQ4t1lR-1RDgCgtDy0saptU8PB4vJ7ZI_zkyLRzJOZQkc54 Adam Skaggs and Fred Wertheimer, Empowering Small Donors in Federal Electionsem, Brennan Center for Justice, 2012, 14, http://www.brennancenter.org/sites/default/files/legacy/publications/Small_donor_report_FINAL.pdf. Attorney General Letitia James said in a 2015 interview, when she was New York City’s Public Advocate, that she “would not be in this position but for campaign finance reform and the support of working-class people.” footnote4_s26Hs33wKwBy85OJFRIn0MOv-XheBXBPQbQKQTQHqU_mXqFZm4rifEd55 Samar Khurshid, “After Making History, James Seeks Change,” Gotham Gazetteem, March 22, 2015, http://www.gothamgazette.com/government/5631-after-making-history-james-seeks-change. In a speech last year, she said that participating in small donor public financing meant that “I’m free from the stranglehold of …big donors demanding meetings and policy changes. Every New Yorker …know[s] they can come to my door, and their voices will be heard. Because every elected official in this country needs the freedom to represent the interest of Americans. And it is through public financing that we will get one step closer to ensuring that our elected representatives are representatives of our electorate.” footnote5_vO-rI2CsA9qg4xMdxE907TfvOBaTYXJpx2UqqpE8EFI_ztEJ2bgsvqtg56 Letitia James, “Public Financing” (speech, Unrig the System Summit, New Orleans, Louisiana, February 2–4, 2018), https://www.youtube.com/watch?v=MWxzfB2L_ks.

This benefit applies to officeholders as well as candidates. In Albany, a small donor public financing system would enable elected officials to spend more time and energy on their constituents. The Moreland Commission noted, “Instead of having to shape their official actions to the values and concerns of large donors, elected officials and candidates will be able to focus on ordinary citizens.” footnote6_w36xsDX9osRpaCRJypH0HK4PFXnBDWSdV9zLJHgfKUE_mQcUmHz3URZB57 Moreland Commission, “Preliminary Report,” 50.

Increasing the relative importance of small donors also increases the diversity of viewpoints influencing officeholders who court contributors. In the 2018 New York State elections, small donors lived in neighborhoods that were far more representative of the real makeup of New York than big donors’ neighborhoods in terms of race, income, and education level. footnote7_ngkusjXVBWqnYFTxTecSGQEqqw4ieW2tyWX7C2Slk_p2L2a7a9AJ8758 Chisun Lee and Nirali Vyas, “Analysis: New York’s Big Donor Problem.” Small donors also hailed from every county in the state. footnote8_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_hKLvyj77DTIQ59 Ibid.

The prospect of amplifying the power of constituents like hers in Bushwick, Brooklyn, prompted Assemblymember Maritza Davila and community board member Gladys Puglla to make a powerful case for enacting statewide small donor public financing. In an op-ed in El Diar‍‍‍‍io last December, they argued that Davila’s constituents need more resources for public schools, affordable housing, and immigrant protection. The state’s inability to produce results, they said, “in large part, is due to a system that allows the rich and large corporations to give massive contributions to protect their interests, without giving an opportunity to working class and low-income people to raise their voices.” footnote9_xPhCsmKuUHq1VRp90NoCQuMFdaTQiYJuXaEqx7sO5Y_ooX4jMPpvEHw60 Maritza Davila and Gladys Puglla, “Necesitamos Transformar la Democracia en Nueva York,” El Diario, December 19, 2018, https://eldiariony.com/2018/12/19/necesitamos-transformar-la-democracia-en-nueva-york/. Further, they argued:

“Now, with a new Democratic majority in the Senate for the first time in a decade, it is time for change… [We must transform our democracy…[W]e must set up a public finance system in which the state would give six dollars for each dollar donated by a member of our community…which would benefit the candidate and assure that the candidate is looking for help from within our communities — not just from the rich who can send large checks…Throughout our lives, despite all our efforts to organize and push for laws that would benefit us, the voices of our community have not been heard sufficiently in Albany. Now we have the opportunity to transform our state’s democracy. We cannot lose.” footnote10_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_bziT3CSGAJbD61 Ibid.

3. Changing the Perception of Cronyism and Corruption in Albany

To address “an epidemic of public corruption that has infected this State,” the Moreland Commission in 2013 urged “[f]undamental reform” to the state’s campaign finance system “that promotes public trust and democracy, changes our pay-to-pay political culture, and empowers ordinary New Yorkers.” footnote11_Y-CQW78GoNEkuC35zpHmj04lytMsGvDRJiRy3eZMMY_hXSuNuQT6RIC62 Moreland Commission, “Preliminary Report,” 41. Its top recommendation: enacting small donor public financing. The reform would work against the state’s culture of big-money cronyism by “leveraging the power of ordinary individuals and reducing the influence of large donors and special interest money.” footnote12_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_nWsxMLJ41gnF63 Ibid.

The success of small donor public financing in New York City shows how transformative this reform could be for the state. Downstate, just three decades ago, cronyism and bribery ran rampant through City Hall. Campaign finance reform, centered on public financing, was a major part of the city’s response. Although occasional donorrelated scandals still arise, systemic corruption among the city’s elected officials has by all accounts decreased substantially. In the past decade, while New York State racked up a troubling record of 19 federal corruption convictions of legislators, New York City saw only four. footnote13_33kkV-olc8QQ7pUwzdnJLmdNjcOGDMVjiAZ279Pp2h8_wHMWaqT2reXL64 These numbers were reached by reviewing relevant press coverage on corruption convictions of New York State’s and New York City’s elected officials and their government office staff members from 2008 to 2018. Sources include major New York news outlets such as the New York Times, New York Daily News, Rochester Democrat & Chronicle, and others. Even considering federal corruption convictions in terms of respective rates, New York State has seen a higher rate of conviction: 4.87 percent of unique New York State legislators convicted, as compared with 3.67 percent of unique New York City legislators, over the same time period. As a 2018 New Yor‍‍‍‍k magazine article put it, “it would be hard to find a cleaner, more dynamic, more progressive, and less corrupt big city in America.” footnote14_fHJDprClpgXzzvzWpBrSzgKKaLtzclzq483ghntdLjg_m5Iru2UDE03E65 David Freedlander, “Not That Long Ago New York City Really Was Run From a Smoke-Filled Backroom,” New Yorkem magazine, June 2018, http://nymag.com/intelligencer/2018/06/when-new-york-city-really-was-run-from-a-smoke-filled-room.html.

Beyond reducing outright corruption, the Moreland Commission noted, small donor public financing would reduce the financial wastefulness of governance based on cronyism. It wrote that “the Commission believes that reducing the role of big donors in financing campaigns will reduce in turn the pressures donors place on our elected officials to provide targeted tax breaks for special interests and to spend public funds on pork barrel projects of doubtful public value.” footnote15_UBMVWsmQRMKXvA3qUqTWKWTZu4IMmKMa6WKtm7QZQLY_tl9TVFrLAwTA66 Moreland Commission, “Preliminary Report,” 47. Once small donor public financing begins to take effect at the state level, “the elimination of just one wasteful tax expenditure or one unnecessary spending program could cover the full cost of the program.” footnote16_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_xWr0b9ShAQ5M67 Ibid.

Newspapers that have covered state corruption scandals for years have called on Albany to use its new governing majority to enact small donor public financing as a part of comprehensive campaign finance reform. Lawmakers must “approve public financing of statewide elections along the lines of New York City to help take special-interest money out of elections or at least reduce its importance,” wrote the editorial board of Long Island’s The Island Now. footnote17_Ptxe3EfYb1WSweMnnYTgkYowO9jk5pRa4DcWoL-vr7c_nhmktGPloNUn68Island Now Editorial Board, “Editorial: Put Up or Shut Up on Cleaning Up Albany,” The Island Now, November 13, 2018, https://theislandnow.com/opinions-100/editorial-put-up-or-shut-up-on-cleaning-up-albany/. “The short but urgent list includes campaign finance reforms that reduce the influence of big money in politics,” wrote the Albany Times Union’s editors, who go on to suggest “a fair, honest and affordable system of publicly-funded elections.” footnote18_LKw0ju8HGLtFqJfSR7dMdaVFG9eC5IGNJJS9aHe7fE_pYl4SF4l07Sc69Albany Times Union Editorial Board, “Editorial: All the Power in New York,” Albany Times Union, November 10, 2018, https://www.timesunion.com/opinion/article/Editorial-All-the-power-in-New-York-13380635.php. The Times Her‍‍‍‍ald–Recor‍‍‍‍d urged legislators “to reduce the temptation and corruption that money has on elections following the example of New York City which is moving toward more public funding of elections.” footnote19_2VBpOtMPJX32MCFjd5bnaIKifPghRuY6toFG4rPc_tt3XQNaLrPzy70Times Herald-Record Editorial Board, “Editorial: Dems Have to Make a Difference,” Times Herald-Record, November 7, 2018, https://www.recordonline.com/news/20181107/editorial-dems-have-two-years-to-make-difference. Newsday called public financing “probably the best solution” to the corrosive influence of big money on the state’s politics. footnote20_1fREc5MDiv1lUSqQ5bFeiYVs1A-90JVlvBwPDbRCSHA_yLkYDcWaliou71Newsday Editorial Board, “Break Up the Game Among Long Island Political Insiders,” Newsday, March 3, 2018, https://www.newsday.com/opinion/editorial/gary-melius-oheka-castle-long-island-politics-1.17047730. The New Yor‍‍‍‍k Times, which has long urged the legislature to adopt this transformative change, has called it “the most crucial reform of all.” footnote21_jnhbc8SBprMuxavhorjPIgufgFZTeA6bbqpHyvdIGHs_dAqMshZMxowe72New York Times Editorial Board, “New York Reform = Public Financing,” New York Times, April 19, 2013, .

Albany’s new governing majority took office this January with the promise of a new day. They would not do business as usual. They would move long-awaited progressive reforms swiftly to passage. The people of New York could count on them.

So far, the governor and legislature have been true to their word. Early voting passed quickly. So did the Gender Expression Non-Discrimination Act, the Reproductive Health Act, and the DREAM Act. These are significant and even bold actions. But along with them has come the quiet message that not everything worthy can happen this year. Some changes may take patience. Lawmakers may not be ready for some of the biggest ones.

The urgency of achieving small donor public financing for New York State cannot be overstated. That’s because, as Senate Elections Committee Chair Zellnor Myrie wrote in the Daily News in January with Jonathan Westin,

executive director of New York Communities for Change, “It doesn’t matter who’s in power. Where the power goes, the money follows.” footnote1_XNOCV9PenEQLFB2BWmEiESVbZCTAyPgUPodLk7LgSVs_okABdJLBdyhM73 Zellnor Myrie and Jonathan Westin, “Fight for Lower Rents by Fixing Campaign Finance: Moving to a System That Prioritizes Small-Dollar Donations Will Weaken the Influence of the Real-Estate Lobby,” New York Daily News, January 14, 2019, https://www.nydailynews.com/opinion/ny-oped-fight-for-lower-rents-by-fixing-campaign-finance-20190114-story.html. A new day for Albany could all too quickly become business as usual, they warned.

A champion of tenants’ rights in his Brooklyn district, Myrie noted how quickly real estate developers had switched their support in the final days of the election from their traditional Republican advocates to the Senate Democrats who were clearly about to prevail. “If we do not change how elections are financed in New York, we will never be able to truly win for tenants,” he and Westin wrote. “We need a small-donor public financing system that…makes it easier for elected officials to represent the values of the people of New York.” footnote2_R-evMuEyk1Q1nYEVtOB7Iv2nSIrt1A1obCw-OZlkEXk_cgPMJTa3uUPK74 Ibid.

This year Albany has the rare chance to restore faith in democracy for all New Yorkers. That faith will reverberate across the nation. It is a chance too precious to let slip away.