Councilman Proposes Cigarette-Style Warnings on Independent PAC Ads

A mock independent expenditure, courtesy of Councilman Lander's office.

A mock independent expenditure warning. (Photo: Councilman Lander’s office.)

City Councilman Brad Lander is looking to rein in exploding expenditures from super PAC-like groups with proposed new legislation that would slap cigarette-style warnings on their mailings, among other regulations.

The package of proposed reforms comes as outside groups are pouring millions of dollars into city races through so-called “independent expenditures,” following the Citizens United court decision, which allows near-unlimited spending, as long as the groups don’t directly co-ordinate with campaigns. Of particular concern to Mr. Lander in the real estate industry-backed “Jobs 4 NY” committee, which has already spent hundreds of thousands of dollars on local City Council races–sometimes in the face of candidates’ opposition.

In some races, the group’s spending is expected to far eclipse the total candidates are permitted to spend on their own campaigns under the city’s stringent campaign finance system.

“I think what we’re seeing this cycle is that New York City’s strong campaign finance system is under threat from a flood of corporate cash,” Mr. Lander told Politicker in an interview, explaining that the spending–often on extremely negative mailers– is “an existentialist threat to our campaign finance system.”

Mr. Lander’s reform plan, which is set to be formally unveiled at a press conference tomorrow, would eliminate the so-called “LLC loophole,” which allows real estate limited liability corporations to contribute as though they are individual New Yorkers. The groups are already prohibited from directly contributing to city candidates, and Mr. Lander said he believes the city has the authority to further rein them in regarding independent expenditures.

Mr. Lander will also propose forcing the groups to identify–by name–their top-five contributors in mailings and other communications so that residents immediately know who’s behind an effort. “Knowing who’s behind saying something makes a big deal,” said Mr. Lander, pointing to the fact that Connecticut and California already have similar regulations in place.

Finally, the plan calls for the addition of explicit warning labels so recipients are guaranteed to know when mailers are funded by independent expenditures. Mr. Lander’s first idea for language, he said, was: “Warning: This mailing is toxic to Democracy.”

“I thought everyone would appreciate the comparison to the cigarette warning label. I believe these IEs are toxic democracy,” he said, noting that perhaps a more realistic option would be a notice reading, “This mailing is funded by an independent expenditure paid for by [the top 5 donors], and is not subject to the contribution and expenditure limits of the New York City Campaign Finance Board, which were designed to protect New York City’s elections from the undo influence of money in politics.”

Phil Singer, a spokesman for Jobs 4 NY, pushed back at the proposals, arguing the group, which is “one of numerous independent expenditure efforts” currently spending money on local races, “is fully complying” with city and state campaign finance rules.

“Considering that much of what Mr. Lander is proposing does not appear to be legal – based on what the Campaign Finance Board itself has said – it is clear that that this proposal is a political document that has no chance of withstanding legal scrutiny,” he said in a statement. “The City would be better served  if Mr. Lander focused on developing proposals that create good jobs and additional housing and improve economic opportunities for New Yorkers.”

A spokesman for the city’s campaign finance board, however, welcomed the new disclosure efforts.

“The strong disclosure rules we adopted for this year’s elections have shown that independent expenditures are going to play a large role, and we are supportive of efforts like these to provide even more information to voters about the sources of the funds that pay for them,” the spokesman told Politicker in a statement.

Susan Lerner, executive director of the the good-government group Common Cause/NY, also supports the effort. In a statement, she called independent expenditures “an end run around the proper limits imposed by the City’s campaign finance system.”

While the legislation has little chance of being implemented before the end of the election, Mr. Lander said he hopes the spending serves as a wake-up call to fellow lawmakers and that steps can be taken before the next election.

Updated at 8:10 p.m. with Jobs 4 NY response.