Are Tax Dollars Paying for Statewide Ballot Campaigns?

Remember in last year’s election, when $11 million in in special interest money passed through the hands of a shadowy Arizona non-profit and wound up in the hands of the No on 30/Yes on 32 campaign?

Well, for the last decade, a similar game of hide-and-seek has been going on with some homegrown Super PACs. Only this time, the secret deep pocket may actually be the taxpayers.

Since 2003, more than $17 million of campaign money has been funneled through “non-public funds” — anonymous accounts run by taxpayer-financed non-profits like the League of California Cities. The League alone has spent more than $12 million out of these secret accounts.

No FPPC number. No donor reporting. Nothing but the cryptic “non-public funds”.

So where does the money come from? Well, at the same time they’ve been spending millions in secret funds, the League and CSAC have been collecting millions in “marketing fees” from a JPA they created to sell taxpayer-subsidized bonds for public projects.

These bond-sale proceeds are, according to the state, public funds, which means they can’t be spent on campaigns. Yet, in 2006, the Orange Co. Register reported that the League moved about $3.6 million in “marketing fees” into their hidden money account and then and spent about $3.5 million from that same account to defeat that year’s Prop. 90. In 2010, $1.7 million in “fees” were collected by the League, and just north of $2 million of hidden money was spent to pass Prop. 22, protecting redevelopment subsidies.

Pretty amazing coincidences, aren’t they? Remind you of anything?

Recently introduced reform legislation – SB 594 by Senator Jerry Hill– takes on this shell game. The ban on spending taxpayer dollars for campaigns is strengthened. More importantly, the door is opened on this anonymous campaign-spending spree.

Want an idea just how big this is? Sen. Hill’s bill is supported by organized labor and the Howard Jarvis Taxpayers Association (get your cameras out – that doesn’t happen too often!) It also has the backing of the California Clean Money Campaign, Consumer Federation and Peace Officers Research Assn. of California.

Not surprisingly, the League and its allies are in full-tilt damage control, arguing the details and process to draw attention away from their indefensible secrecy.

— “It will hurt charitable foundations.” It won’t – 501(c)3s are exempt.

— “It’s too complicated for small organizations.” Not if they’re not making campaign contributions. And if they are making contributions, they are already required to report on it. If they’re getting public dollars, doesn’t the public deserve to know if it’s being spent on politics?

— “It will silence our voice in the Capitol.” It won’t – lobbying’s not covered and there’s no ban on political endorsements or any activism not involving public funds – just like current law.

— “It will un-level the playing field.” To the contrary, it levels the playing field, especially when it comes to reporting. Labor unions have to report every dime they collect and spend, either through campaign finance reports or through federal LM-2 filings. But the League is spending millions out of an unreported black hole. Everyone else has to report up the wazoo. Why not them?

— “The FPPC says we’ve followed the law.” That’s why the law needs to be changed.

— “Take our word for it – we don’t spend public money on politics.” Because nobody ever tried to get around campaign reporting law, right? Seriously, what are they trying to hide? If everything’s on the up-and-up, why oppose reporting?

— “It’s a last-minute gut-and-amend!” (Insert hyperventilation here) Yes, a “gut-and-amend “ that, over the course of six weeks, will have had no fewer than six separate policy and fiscal committee hearings (all public) and at least two public floor votes. Sorry, but the only thing that’s hidden here is the source of that $17 million in campaign spending.

No matter how complex they try to make it, the issue is pretty simple. Voters deserve to know who’s paying for political campaigns. And they need to know if public dollars – their tax dollars — are paying for those campaigns.

It’s time for these “non-profits” to open up their campaign books like everyone else. Make your voice heard at www.stoptheshellgame.com.