ENJAMIN ALLOS CHAIR B J. K Planning, Dispositions, TH COUNCIL MEMBER, 5 DISTRICT & Concessions

244 East 93rd Street COMMITTEES New York, NY 10128 Civil Rights (212) 860-1950 Voice Education (212) 980-1828 Fax Governmental Operations www.BenKallos.com Higher Education THE COUNCIL OF THE Land Use [email protected] CITY OF NEW YORK Oversight & Investigations Women’s Issues

New York City Campaign Finance Board Public Hearing on 2017 Elections January 29, 2018

Good afternoon and thank you for the opportunity to testify. I am Ben Kallos, Council Member of the 5th District and author of Introduction 1130-A, a piece of legislation I introduced in 2016 along with 31 of my colleagues and a diverse group of advocates ranging from good government to labor to academics to women’s organizations to organizations representing low income communities.

As we discuss the 2017 city elections I am here today to ask that the Campaign Finance Board include this legislation, which will be re-introduced at the January 31st Stated Session, as one of its recommendations in its forthcoming mandatory post-election report.

New York City has the model public finance system in the country. It is a system that has survived court challenges, helped me get elected, and one that I am invested in protecting and improving upon during my time in the City Council.

For anyone here or watching on the live-stream who may not be fully familiar with the system: New York City’s campaign finance system matches the first $175 of contributions from city residents at a 6:1 ratio and gives participating candidates a partial public matching grant of up to 55% of the total spending limit in competitive races.

As good as this system is there is one glaring flaw: a funding gap between the total spending cap and the amount a candidate can receive with the small dollar match.

Every candidate will tell you that if you do not try to raise the maximum and keep up with your opponents, you will not be competitive and you will lose.

The “big dollar gap” for City Council is $65,217 and for Mayor it grows to a staggering $2.5 million. In the 2013 Mayoral race half the money raised ($23.9 of $48.9 million) came from contributions of $4,950, the maximum allowed under the law.

Candidate for Mayor must make a choice on how to raise 7 million dollars. Collect 1,408 contributions of $4,950 from individuals with special interests who have given to every Mayoral candidate before, knowing that the first $175 of each contribution might be matched on a public funds payment that will likely be returned. Rely on the public match of nearly $4 million and do ten times the work collecting more than 17,920 contributions of $175 or less to raise $3 million. If you came from a community with residents that couldn’t contribute $175 and instead needed to run on contributions of $10, that would require 313,605 contributions, more contributions than were given to all candidates in 2013.

BENJAMIN J. KALLOS MEMBER DISTRICT 5,

If we matched every contribution someone could run for mayor collecting 5,689 contributions of $175, raising about one million in small dollars seeing everyone matched at 6 to 1 to receive $6 million in public funds having met the nearly $7 million dollar spending limit ready to run a competitive race.

We live in the age of Trump, with a president who once said “[a]s a business man and a very substantial donor to very important people, when you give, they do whatever the hell you want them to do.” Statements like these and the many well-documented cases of corruption and malfeasance create an appearance of impropriety that leads residents to wonder about the integrity of their government. Introduction 1130-A would match every small dollar, eliminating the big money gap and allowing a candidate to fully fund a campaign on just small dollar contributions of $175.

The ability to run a 100% grassroots campaign, where a candidate is beholden to no one except the voters, will revolutionize city politics and restore confidence in government that has been steadily eroding for decades.

This also happens to be the rare example of legislation with no downside. If candidates pursue a small dollar, grassroots campaign we will have elected officials who earned their positions based on their knowledge of the issues, their ideas, and their ability to communicate with the voters instead of their ability to convince millionaires and billionaires to open their wallets. If candidates do not pursue this option, then it’s business as usual and the City is no better or worse off than it is now.

This legislation has received strong support from labor organizations including 32BJ SEIU and CWA District One, political parties like the Working Families Party, Eleanor Roosevelt Legacy Committee, New Kings Democrats, and the New York Democratic Lawyers Council, advocates for low-income communities of color like New York Immigration Coalition, New York Communities for Change, Make the Road, Community Voices Heard, Strong Economy for All, and Bridge Roots, political activists like the New York Progressive Action Network, housing advocates Urban Justice Center, Tenants & Neighbors, Historic Districts Council, Friends of the Earth, and good government groups like Women’s City Club of New York, Effective NY, Reinvent Albany, Citizen Action, Demos, Public Citizen, NYPIRG, Common Cause, and Brennan Center. In the City Council the legislation previously had and continues to have the support of Speaker Corey Johnson and new Governmental Operations Committee Chair Fernando Cabrera.

As the 2021 elections kick-off with every city-wide and boro-wide elected official as well as 36 Council Members term limited and seeking higher office the time is now to pass this important change that will finally close the big dollar gap in our public campaign finance system.

I ask that you join me, so together we can offer New Yorkers a path to a better government. If we truly want a government of, by, and for the people, that government must also be funded by the people.

2 of 2 Get Big Money Out of City Politics Match Every New York City Resident’s Small Dollars

New York City’s campaign finance system 95% of the amount contributed to 2013 matches the first $175 of contributions from Mayoral candidates were Big Dollars residents by 6 to 1 and gives participating candidates a partial public matching grant of up

to 55% of the spending limit in competitive races. This leaves more than 1/3 of the funds $24M in contribtuions of outstanding between the public matching grant Exactly $4,950 and the spending limit, which must be reached 49% 5% to be competitive. The “big dollar gap” for $3M from $175 or less Mayor is $2.5 million.

Introduction 1130-A by Council Members $23M in contributions of Kallos, Lander, and Cabrera, increases the between $175 and $4,950 public matching grant from an arbitrary partial 46% match of 55% to a full match. Every small dollar raised from city residents would be matched 6 to 1. Candidates could still raise contributions of $4,950 for Mayor, but would be incentivized to seek small donations from many more residents 5% of big dollar contributions of by matching every small dollar. $4,950 accounted for nearly half of the money in the 2013 race for Mayor.  Reduce Big Money by filling the “big dollar gap” with small dollars matched with a full public matching grant.

 Increase the Number of Small Donors by a minimum of 50% for candidates seeking a full public matching grant.

Fundraising for Mayor Small Number of $175 contributions necessary for 3,650 Dollars Partial Public Match $639K 9% Amount raised for Partial Public Match $638,825 Big Partial 55% Public Matching Grant $3,832,950 Dollar Partial Gap Public “Big Dollar Gap” after Partial Public $2,497,225 $2.5M Grant Match remaining to reach Spending Limit $3.8M 36% 55% Minimum number of contributions under 5,689 $175 for proposed Full Public Match Total raised for proposed Full Public Match $995,571

Full Public Matching Proposal Get Big Money Out of City Politics Borough Borough Public Advocate Public Advocate Council Council President President Comptroller Comptroller Mayor Mayor Current Proposed Current Proposed Current Proposed Current Proposed Maximum Match $ 175 $ 175 $ 175 $ 175 $ 175 $ 175 $ 175 $ 175 Multiplier 6 6 6 6 6 6 6 6 Maximum Public Funds $ 1,050 $ 1,050 $ 1,050 $ 1,050 $ 1,050 $ 1,050 $ 1,050 $ 1,050 Total After Match $ 1,225 $ 1,225 $ 1,225 $ 1,225 $ 1,225 $ 1,225 $ 1,225 $ 1,225 Maximum Public Funds $ 100,100 $ 156,000 $ 862,950 $ 1,344,857 $ 2,396,350 $ 3,734,571 $ 3,832,950 $ 5,973,429 Threshold In-District Contributions 75 75 100 100 500 500 1,000 1,000 Full Match ($175) Contributions to Reach Public Matching Grant 95 149 822 1,281 2,282 3,557 3,650 5,689 Minimum Raised for Full Public Matching Grant $ 16,683 $ 26,000 $ 143,825 $ 224,143 $ 399,392 $ 622,429 $ 638,825 $ 995,571 Minimum Percentage Raised 9% 14% 9% 14% 9% 14% 9% 14% Public Matching Grant $ 100,100 $ 156,000 $ 862,950 $ 1,344,857 $ 2,396,350 $ 3,734,571 $ 3,832,950 $ 5,973,429 Match Percentage 55.00% 85.71% 55.00% 85.71% 55.00% 85.71% 55.00% 85.71% Total Raised + Public Match $ 116,783 $ 182,000 $ 1,006,775 $ 1,569,000 $ 2,795,742 $ 4,357,000 $ 4,471,775 $ 6,969,000 Spending Limit $ 182,000 $ 182,000 $ 1,569,000 $ 1,569,000 $ 4,357,000 $ 4,357,000 $ 6,969,000 $ 6,969,000 "Big Money Gap" Remaining After Public Funds $ 65,217 $ - $ 562,225 $ - $ 1,561,258 $ - $ 2,497,225 $ - Number of Small Dollar ($175) Contributions Needed to Fill "Big Money Gap" 373 - 3,213 - 8,921 - 14,270 - Contribution Limit $ 2,750 $ 2,750 $ 3,850 $ 3,850 $ 4,950 $ 4,950 $ 4,950 $ 4,950 Number of Contributions at the Limit Needed to Fill Gap 24 - 146 - 315 - 504 -