Non-profits among no-nos
CITY HALL — A hefty 32 pages — listing the names of organizations, schools and companies — has dictated campaign financing for the City Council incumbents who are running for reelection on Tuesday.
The Taxpayer’s Protection Act, commonly known as the Oaks Initiative, bars city officials from receiving personal gifts from an individual or entity after the official, in this case a City Council member, has voted or somehow taken action to benefit that individual or entity. Santa Monica voters passed the initiative in November 2000.
Entities that have received a city contract in excess of $25,000, and their board of directors, trustees, partners and anyone with a 10 percent stake in the entity, fall under the regulations.
The result is a 32-page document known as the “Taxpayer Protection Log” that lists the name of the entity, its contract number, description of the contract, council members’ votes on the contract, and the date when the vote took place.
The cumbersome process of searching the names of campaign donors in the Taxpayer Protection Log to see if they are somehow involved in benefited entities has forced some City Council incumbents to return checks.
“I went through the list and spotted a company where I knew the principal of the company wrote me a check,” said Mayor Bob Holbrook, who is running for reelection.
The list of individuals who are involved with the benefited entities, which can include non-profits like the Santa Monica Pier Restoration Corporation and the Santa Monica Conventions and Visitors Bureau, is close to 40 pages long.
“One group has 121 people on the board of directors,” said Holbrook.
Holbrook, who is already facing the possibility of concluding his campaign with debt, had to refund $4,000 because he found donors on the Taxpayers’ Protection List. Since he already spent the donations, Holbrook spent the majority of last week trying to raise the money back.
The result for the mayor is an additional 4,000 letters sent to donors asking them to contribute, or if they have maxed out of the city limit of $250, finding another individual to donate.
The law does not make a lot of sense in barring nonprofit organizations that are run by non-compensated volunteers, said Councilwoman Pam O’Connor, who had to send back seven checks totaling approximately $1,300. The fact that it affects non-profit organizations and their volunteer board members is an unintended consequence of the act, she said.
The law has also barred Holbrook’s wife, Jean Ann, a volunteer board member on the Santa Monica Historical Society, from giving her husband a donation.
“There are 1,000 people in Santa Monica who can no longer participate in the campaign by being a donor,” Holbrook said.
City Council members are not even allowed to take contributions from the school board,since its budget is funded by the city.
“We are not full-time politicians, we’re not elected full-time,” O’Connor said.“This is making it harder for the average person to run for City Council.”
The law has affected council members differently. On the one hand, there is Holbrook who has had to refund close to 15 checks. On the other end, is incumbent Kevin McKeown, who has returned only one check from a donor who serves on Bayside District Corporation and the Santa Monica Pier Restoration Corporation.
Compliance is less of a problem for McKeown, who vowed to decline contributions from for-profit corporations and asked donors to confirm on the donation envelopes that they are legally able to financially support his campaign.
Still, the whole process might be nonexistent come Tuesday, if voters approve a City Council-drafted proposition to overturn the Oaks Initiative. Known as the “Good Government Act,” Proposition W is supported by Holbrook, but not McKeown, who said, “developers and special interests are already trying to buy Santa Monica elections, and Prop. W could make that problem worse.
“What we need is real campaign finance reform,” McKeown said. “The current rules eliminate some possible abuses, but ignore others.”
Originally published in the Santa Monica Daily Press print edition on November 6, 2006. Read the original PDF.