McDonald’s Campaign Finance Challenge a Long Shot, Even Post-Citizens United

Janos Marton

When you are a relatively unknown candidate running for mayor of New York City on the Republican ticket, you might as well go “all-in” early. In the next two weeks, George McDonald’s challenge to New York City’s campaign finance laws will be decided by the New York Supreme Court. The result will either upend New York City’s vaunted campaign finance system in the middle of a mayoral campaign and garner McDonald substantial publicity, or deal a serious blow to a campaign that has struggled to gain traction in polling or fundraising.

George McDonald is the founder of the Doe Fund, and his campaign kick-off told a compelling story of McDonald’s 30-year involvement with helping the homeless and formerly incarcerated get back on their feet through employment. Since then, however, McDonald has largely been in the spotlight for his challenge to the New York City campaign finance system, as he seeks the maximum contributions permissible under state law ($19,700 for the primary, $41,100 for the general) rather than the far more restrictive city law ($4,950 total).

McDonald’s role as the standard-bearer for this cause is partly a function of timing. In 2004, the City Council passed legislation requiring all candidates to adhere to contribution limits, including a ban on corporate contributions, and disclosure requirements, regardless of their participation in the voluntary matching fund system (non-participating candidates do not have to adhere to expenditure limits). During the two subsequent mayoral campaigns, Mayor Michael Bloomberg funded his own campaigns and Democrats participated in the matching fund program. Only during this election cycle has there been a mayoral candidate such as McDonald who would benefit significantly from opting out of the matching fund system.

McDonald’s lawsuit, like most filed by political candidates, is both legal and political in nature. His legal arguments are not very strong, but the consequences of a successful lawsuit are enough for defenders of the current system to take them seriously. As a political play, standing up to a well-regarded campaign finance system and arguing for the right of his backers to donate huge sums of money is questionable.

The crux of McDonald’s legal argument is that New York City’s campaign finance law is inconsistent with state campaign finance law, and that state law “preempts” the field. This is not a frivolous claim. There is no dispute that New York City’s law differs from New York State’s. The question is whether the state Legislature intended for its laws to prevent New York City (and other municipalities) from enacting stricter contribution limits. Some legal commentators have surmised as much, and the legislation in question certainly could be clearer. The seriousness of McDonald’s claims might also be measured by his choice of counsel: the reputable election law firm Genova Burns Giantomasi & Webster and their lead attorney in this case, former New York City Campaign Finance Board general counsel Laurence Laufer. If the court agrees with McDonald, his campaign would be permitted to fundraise under the far more lenient state contribution limits, provided he declines to participate in the voluntary matching fund program.

On the other hand, the city and CFB have a strong legal argument that the state Legislature did not intend to prevent New York City from enacting stricter contribution limits. The relevant state statute does not explicitly or implicitly suggest that the Legislature intended to “occupy the field” or preempt municipalities from implementing their own campaign finance laws, so long as they did not frustrate the purpose of the state law. The city correctly argues that the lawsuit would have greater merit if New York City’s law allowed for higher contributions to candidates rather than requiring lower contribution limits.

For support, the city cites a 1987 letter from New York State Attorney General Robert Abrams to Mayor Ed Koch stating his opinion that the voluntary campaign finance system was not preempted by state law. Likewise, current Attorney General Eric Schneiderman has filed an amicus brief stating that the current uniform contribution system is compatible with state law. Finally, the burden is on McDonald to establish beyond a reasonable doubt that New York City’s law is inconsistent with the state—a heavy lift given the ample record of the state’s effort to reduce corruption in elections. Even in a post-Citizens United landscape, the city’s campaign finance laws are in a fairly strong position, and the city is likely to prevail in this lawsuit.

Politically, McDonald’s arguments fail to resonate. McDonald’s recent editorial in the Daily News was an expanded version of his previous pitch: running for mayor is impossible for those without a great deal of their own money or wide networks of contributors, and that only if McDonald’s supporters could cut him checks for $60,800, rather than $4,950, would he be able to run a viable race. McDonald argues that the current system discourages outsiders without wealth from running. Running against the status quo is often a reliable script, and McDonald is correct that amassing the war chest to run for mayor requires either a long history of networking with special interests or vast independent wealth.

The biggest problem with McDonald’s argument is that political observers of all ideological stripes have long conflated contributions and contributors with popular support. Whether or not he has connections inside the political system, one would expect McDonald to have an impressive Rolodex. In fact, to date only 82 individuals have donated to McDonald’s campaign, an anemic number for a high-profile race; many City Council candidates have hundreds of individual donors. Even if McDonald did have a groundswell of support to accompany his high-rolling donors, this lawsuit brings with it the unfortunate optics of McDonald arguing for a right to receive contributions that exceed New Yorkers’ median annual income. Predicating his argument on “fairness” would probably strike large swaths of the city as disingenuous.

Finally, McDonald’s pleas for fairness seem strange given the comparably restrained nature of political spending in New York City elections. All of the Democratic candidates are participating in the voluntary matching fund program, and will have their spending capped at about $13 million, much of which will be spent chasing each other for left-wing primary votes. On the Republican side, only John Catsimatidis’ personal wealth allows him to self-finance, and he has yet to spend in great quantities. Considering that Rahm Emanuel raised more than $14 million in his race for mayor of Chicago, Andrew Cuomo more than $20 million during his lopsided 2010 governor’s race, and Michael Bloomberg a whopping $102 million during this 2009 mayoral campaign, the 2013 New York City mayor’s race seems like a bargain by comparison. That is not to say that having so much money sloshing around in politics is a good thing, but McDonald’s solution to have his friends write him five-figure checks is hardly an improvement.

Judge Kathryn Freed has said that she would like to rule on this case before the March 15 filing deadline, though it is likely that the losing side will appeal her decision. If McDonald prevails, he will need to extract as much political momentum as he can from the decision, because from a fiscal perspective, his primary opponents Joe Lhota and Adolfo Carrion will benefit from it at least as much as McDonald. If the courts uphold New York City’s system, as they have for the past 25 years, McDonald will be out a campaign issue, and without the funds to compete. At that time, McDonald may go back to talking about the Doe Fund and his career as a way to earn support. (Given his commendable track record working with underserved communities, one wonders why he left the Democratic Party to run in a Republican primary.) Elections are still won by real people voting, and if George McDonald believes he should be mayor, he will have to convince New Yorkers to vote for him, whether or not he has the money.

Janos Marton is an attorney at Hogan Lovells who frequently writes about campaign finance law.