Re: Charter §§ 25(b)(5); 1052(b); 1503; Administrative Code §§ 3-702(3); 3-703(1)(c), (f), (i), (j), (1-a), (2)(a)(iv); 3-705(2)(a), (b); 3-706(1)(a), (2); 3-710(2)(c); 3-719(2)(b); 3-801; 3-802; Campaign Finance Board Rules 1-04(f); 1-05(h); 1-07(a); 1-08(c)(1); 5-03(e)(2); 7-03(c); 11-01—11-05; Advisory Opinion Nos. 1991-2, 2000-6, 2007-2; Op. No. 2008-3.
Councilman Dennis P. Gallagher has announced that he will resign from office, thereby creating a vacancy in the 30th City Council District.1 When that vacancy occurs, the Mayor "shall proclaim," within three days of the vacancy, a date for a special election to fill the vacancy which is approximately 45 days after the date of the announcement. See NYC Charter § 25(b), et seq. This Opinion outlines the requirements of the New York City Campaign Finance Program (the "Program") for this anticipated special election (the "Special Election") and the subsequent 2008 primary and general elections.2
Deadline to Join the Program
The New York City Campaign Finance Act (the "Act") provides that "the deadline for filing a certification for a special election to fill a vacancy shall be on the seventh day after the proclamation of such special election." New York City Administrative Code ("Administrative Code") § 3-703(1)(c). Following the Special Election, there will be a subsequent primary and general election in September and November 2008. See NYC Charter § 25(b)(5). The deadline for filing a certification for the 2008 primary and general elections will be the thirtieth day after the date of the Special Election. Administrative Code § 3-703(1)(c)(ii). Candidates who have already been raising funds for the 2009 elections may use their existing committees and bank accounts in the Special Election provided they amend their registration with the Board of Elections to reflect the new election cycle. However, all candidates running in the Special Election must file a new filer registration or certification with the Board specifically for the Special Election. The Board will make these forms available once the Mayor announces the date of the Special Election.
Contribution Limit, Expenditure Limit, and Maximum Public Funds Payment
The following limits will apply to candidates in the Special Election:3
- Contribution limit: $1,375
- "Doing Business" contribution limit: $1254
- Expenditure limit: $161,0005
- Public funds maximum: $88,5506
Public Funds Payments
To be eligible for public matching funds, candidates in the Special Election must meet the same threshold eligibility requirement as candidates in a primary or general election.7See Administrative Code §§ 3-703(1)(j), (2)(a)(iv). See also Advisory Opinion No. 1991-2 (April 9, 1991). Under the Act, however, the definition of "matchable contribution" for the special election is different from the definition of "matchable contribution" for the primary and general election. Only matchable contributions are eligible to be counted toward the threshold. For the Special Election, only contributions of up to eighty-seven dollars are matchable and count toward threshold, while contributions of up to one hundred seventy-five dollars may be applied to the primary and general election threshold. See Administrative Code §§ 3-702(3), 3-705(2)(a).
Previous Financial Transactions
For candidates running in the Special Election, disclosure statements filed with the Board and the Board of Elections after the candidate's most recent election will be considered to be for the Special Election, as provided in Rules 1-04(f), 1-05(h), 1-08(c)(1), and 7-03(c), notwithstanding any original intent that these statements pertained to the 2009 primary and general elections.
According to Rule 1-04(f), a contribution is presumed to be accepted for the first election in which the participant is a candidate following the day that it is received. Thus, all contributions received prior to the Special Election are presumed to be for that election. Because some of these contributions will have been accepted with the reasonable belief that they were to be used for the 2009 primary and general elections, however, the Board will consider that presumption to be rebutted for any contribution:
- received on or before the date the Special Election was first reasonably anticipated,8 and
- not exceeding the contribution limit in effect for the 2009 elections.
However, candidates must abide by the applicable contribution limit for the Special Election. Therefore, for any contributions received on or before the date the Special Election was first reasonably anticipated which are in excess of the contribution limit for the Special Election, candidates may:
- refund the excess portion to the contributor, or
- attribute the excess of each contribution to the 2008 or 2009 primary and general elections.9
These contributions will be matchable at a rate of six dollars for each dollar of matchable contributions up to five hundred and twenty-two dollars in public funds per contributor. Administrative Code § 3-705(2)(a).10 The portion of contributions accepted in excess of the contribution limit for the Special Election that the candidate has attributed in the manner described above will be eligible to be claimed as matchable contributions for the 2009 elections.
Pursuant to Rule 1-08(c)(1), expenditures are presumed to be for the candidate's next following election. Therefore, all expenditures made prior to the Special Election will be presumed to be made for that election and subject to the Special Election expenditure limit notwithstanding the original intent that they were made for the 2009 primary or general elections. In addition, participating candidates who have received public funds may not make expenditures after the Special Election except for narrowly defined Special Election purposes until unspent campaign funds from the Special Election are repaid. See Administrative Code § 3-710(2)(c); Rule 5-03(e). Further, any post-Special Election expenditures made by the Special Election committee will be presumed to be for the 2008 or primary and general elections and covered by the expenditure limits applicable for those elections. See Rules 1-08(c)(1).
Transition and Inaugural Activities
The winner of the Special Election, whether a Program participant or a non-participant, will be subject to the limitations and disclosure requirements for the financing of transition and inauguration activities. See Administrative Code §§ 3-801; 3-802; Rules 11-01 - 11-05.
NEW YORK CITY CAMPAIGN FINANCE BOARD
2 While the Special Election has not yet been announced, the Board is issuing this Advisory Opinion at this time for the convenience of potential candidates who may be affected by its conclusions. When the Mayor proclaims the date for the Special Election, the Board will set forth the actual deadlines for candidates to join the Program and for the filing of disclosure statements for the Special Election.
4See Administrative Code § 3-703(1-a), (1-b). Beginning February 2, 2008, all candidates for offices covered by the Program (including the Special Election) were required to ask contributors who give in excess of the "doing business limit" to complete a doing business form, and candidates must keep records of their attempts to obtain completed forms. Individuals having business dealings with the City are listed in a database that is available to the public through the Board's website and campaigns can check whether a contributor is listed. The Board will notify candidates — both participants and non-participants — within three days of the filing of each disclosure statement for the Special Election if any contributors who gave more than $125 are listed in the database. Candidates will then have twenty days to return the excess portion of any such contributions. Failure to return the excess portion of the contribution following notification from the Board will result in a reduction in the amount of public funds otherwise due and may result in the assessment of a penalty. Doing business contributions are not matchable and do not count towards meeting the threshold for eligibility for public funding.
5See Administrative Code § 3-706(1)(a). The separate $43,000 expenditure limit pursuant to Administrative Code § 3-706(2) for the three calendar years preceding the year of the election applies only to regularly scheduled elections and is not available for the Special Election. See also Advisory Opinion No. 2007-2 (March 6, 2007).
6See Administrative Code § 3-705(2)(b).
7Candidates who owe repayments of public funds or penalties to the Board from an earlier election will not be eligible to receive public funds for the Special Election. The Board will notify candidates of such issues. See Administrative Code § 3-703(1)(n).
8 While the Board finds that the Special Election was first reasonably anticipated on March 17, 2008, the date that Mr. Gallagher announced that he would resign, the Board will not assess penalties for any contributions in excess of $1,375 — but below the $2,750 contribution limit for the 2008 and 2009 elections — accepted prior to the date of the issuance of this advisory opinion, provided the candidate either refunds the excess portion of the contribution to the contributor or attributes the excess portion to the 2008 or 2009 primary and general elections. Participants must make such refunds and attributions prior to the date they file a certification to join the Program, and non-participants must make such refunds and attributions prior to the deadline for filing a filer registration which is the date of the first disclosure statement. Any contribution accepted after the date of the issuance of this advisory opinion which exceeds the contribution limit for the Special Election will be considered a violation of the Campaign Finance Act and may be subject to financial penalty. See Administrative Code §§ 3-710.5, 3-711.
9 The Board will assist candidates in making any required attribution. Candidates will be required to transfer the excess contributions they choose to keep to a bank account other than that being used for the Special Election. The Board will provide candidates with individual guidance on disclosure, recordkeeping, and maintenance of separate committees and bank accounts.
10 The Rule 1-07(a) prohibition against matching contributions originally received for a different election does not apply to contributions originally received for a future election to an office covered by the Program that, pursuant to Rule 1-04(f), are ultimately used for an intervening election to fill a vacancy in an office covered by the Program.