Stripped of matching funds, Clean Elections loses appeal to candidates

With the linchpin of Clean Elections gone, participation in Arizona’s once-vigorous campaign financing system has nosedived to levels not seen since the program’s infancy.

Only 72 candidates have signed up for public financing this election cycle, compared to 121 in 2010.

The reason: Clean Elections suffered a devastating blow in the middle of the 2010 campaign season, when the U.S. Supreme Court blocked the state from distributing matching funds.

The high court a year later ruled that the funding scheme — which awarded Clean Elections candidates a dollar-for-dollar match when their privately funded opponents outspent them — was unconstitutional.

“Without matching funds it’s not the gravy train it was before,” said Sen. Michele Reagan, a staunch opponent of Clean Elections.

The deadline to file for public campaign financing isn’t until Aug. 23, but the number of late-filers is expected to be small, meaning Clean Elections will almost certainly see its lowest participation levels since 2000, the first election cycle it was in place.

Publicly funded candidates still get a lump sum allotment from the Citizens Clean Elections Commission, but those who run against traditionally funded opponents face the risk of being vastly outspent.

Legislative candidates get $14,355 for the primary and $21,533 for the general election. But that may not be nearly enough, considering that some legislative candidates have raised more than $100,000 in the past few election cycles.

Arizona Chamber of Commerce and Industry President and CEO Glenn Hamer, whose organization was a leading opponent of Clean Elections, said the decreased participation will likely continue into the future, especially if publicly funded candidates fare poorly in the 2012 elections.

“My guess is … you’ll see a continued downward trend,” Hamer said.

Republican consultant and lobbyist Doug Cole agrees. While Clean Elections will still be a good option for offices like the Arizona Corporation Commission and for incumbents in noncompetitive races, Cole said it won’t be viable for most others.

It may still appeal to first-time candidates who have no fundraising ability, he said, but that just shows the inherent flaw in the system.

Cole said he expects participation to dwindle in future years, and after a few more election cycles expects a renewed push to put Clean Elections back on the ballot and eliminate it for good.

“If you’re running against a candidate that is running traditionally, that puts you at a disadvantage in a race that a lot of resources are being devoted to. You’re going into battle with one round of ammunition,” Cole said. “It will be a victim of attrition.”

Bill Scheel, a Democratic political consultant, disagrees that the slide will continue. Scheel expects participation to hold steady and said 2012 is likely the floor.

The end of matching funds may make it harder for Clean Elections candidates to get elected, but the system will always appeal to people who couldn’t otherwise raise the money to run for office. And those who budget well and have grassroots support will still be able to win, he said.

“I think this year will provide a great test for that,” Scheel said. “There’s lots of people who think about running for office but are concerned about not being able to raise money.”

Rep. John Kavanagh, R-Fountain Hills, used public funding in his first three campaigns. But in 2012, he’s running traditional for the first time.

Kavanagh said he used the Clean Election system the first time he ran because he had no fundraising base and had never been to the Legislature. He also ran clean the next two times, “but now that the match is gone, if you have the ability to raise more than $20,000, you put yourself at a competitive disadvantage (running as a clean candidate).”

Of the 66 legislative candidates who are running with public financing, only nine are sitting lawmakers. In 2008, the last cycle with matching funds, at least 33 sitting lawmakers used Clean Elections funding.

“That is a stunning indictment of the system,” Cole said of the dramatically reduced participation by incumbents.

Rep. Carl Seel, R-Phoenix, is one of the few incumbents running clean in 2012. Seel said he planned to raise private money for 2012, but ultimately realized that he had a lot to learn about traditional fundraising before leaving the system.

“Having matching funds as an option meant that anyone running traditionally was at a strategic disadvantage,” Seel said of the matching money Clean Elections candidates would get. “Without it, obviously, I think it’s one of the largest reasons why candidates, not unlike myself, have considered moving away from being a participating candidate.”

Rep. Ed Ableser, who is seeking his district’s open Senate seat, said Clean Elections funding is enough to run a good campaign. But the Tempe Democrat also remains committed for philosophical reasons, saying candidates who use public funding aren’t beholden to lobbyists and special interests.

“There’s nothing that would ever sway me against the system,” he said.

But while few incumbents use Clean Elections anymore, the system is still relatively popular with non-incumbents, even without matching funds.

Eric Shelley, a Democrat who is running for the Legislative District 28 Senate seat, said he’s concerned about the loss of matching funds.

But even though he’s running against a traditionally funded incumbent, Sen. Adam Driggs, he said Clean Elections will enable him to run a good campaign.

“I just felt that running as a Clean Elections candidate still gives me enough money to run the race that I want to run, reach the number of voters that I want to reach, and have a good chance of winning,” said Shelley, who also ran in 2010.

Clean Elections Executive Director Todd Lang said the drop in participation was expected after the U.S. Supreme Court ruled that matching funds were unconstitutional. But he said the system is still viable, especially for first-time candidates who often lack the ability and connections to raise a lot of money on their own.

Even if many of the candidates who are running clean in 2012 lose, Lang said he will view the continuing participation in Clean Elections as a success story.

“What’s important here is not whether they win … it’s whether they are running, which is the essence of our democracy because they’re giving voters a choice,” Lang said.

Lang also said he believes plenty of Clean Elections candidates will prevail this year, and noted that some publicly funded candidates in 2010 still defeated privately funded opponents who outspent them 2-to-1 or 3-to-1.

For example, in the 2010 Senate race in Legislative District 10, incumbent Republican Sen. Linda Gray, a Clean Elections candidate, defeated Democratic challenger Justin Johnson, who spent $135,000 on his campaign.

And Clean Elections may remain popular with statewide candidates, as well. All six Corporation Commission candidates this year — three incumbents and three challengers — are running clean.

Republican candidate Bob Burns, a former Senate president, said public funding is not only adequate for a Corporation Commission campaign, but actually brings a fundraising advantage.

“If you do not run clean in a campaign for the Corporation Commission and the others do, you will be severely outspent because there’s just not the capacity to raise money like there is in a legislative campaign, for example, because the major players that are going to appear before the Corporation Commission, they won’t participate,” Burns said.

But Lang hopes that future changes can be made to strengthen Clean Elections enough that incumbents are willing to come back. One suggestion he made was a “hybrid” system that would allow participating candidates to raise additional money if their privately funded opponents outspend them.

“The bottom line is incumbents are going to be reluctant to participate when they feel that they could be subject to nasty, misleading attack ads and not have the money to respond. So ultimately, Clean Elections could be improved by finding a way to provide for an opportunity to respond to attack ads. And the hybrid idea is one such proposal,” Lang said.

But Reagan, R-Scottsdale, said she would be steadfastly opposed to the kinds of reforms Lang is talking about.

“Pick one way or the other,” she said. “You’re either going to stand there and say, ‘I am completely untouched by outside influence money,’ or you’re not.”

 Legislative compromise kept Clean Elections from further scrutiny

Even in its pared-down form, Clean Elections owes its continued existence to a judge’s ruling and a legislative compromise.

The Legislature in 2011 referred a proposition to the ballot that would have asked voters to eliminate public funding altogether, and the Arizona Chamber of Commerce and Industry was poised to pour millions into a campaign for the measure.

But after a judge struck it from the ballot for violating the single- subject clause in the Arizona Constitution, Clean Elections Executive Director Todd Lang reached a deal with lawmakers that kept the Legislature from referring another anti-Clean Elections measure.

Under the provisions of HB2779, the CCEC can no longer spend money on promotional advertising, though it can still spend up to 10 percent of its funds on voter education.

The bill also eliminated a requirement that non-participating candidates file “trigger reports” when their fundraising exceeds 70 percent of their publicly funded opponents’ Clean Elections funding.

The reports helped the CCEC determine when participating candidates were eligible for matching funds.

Due to the end of matching funds and the 2012 agreement, Sen. John McComish, a plaintiff in the matching funds case and one of the architects of the legislative compromise, said he isn’t too bothered by the continued existence of Clean Elections.

“If I could wave a magic wand I would’ve had it go away. But I don’t have a magic wand. What I got was the potential to send it to the ballot, and that was questionable — would it pass or not? And one thing was sure for both sides — it would’ve cost a lot of money. So there was incentive from that aspect, for both sides, to want to compromise,” said McComish, R-Phoenix. Reagan, said she too would prefer that the entire system would be abolished, but is pleased with the changes, especially the elimination of the trigger reports. She said she would be open to future reforms to make the system “less egregious.”