The Senate Democratic majority is blocking House Speaker J. Brendan Sharkey, D-Hamden, and minority Republicans from closing a loophole in Connecticut’s system of publicly financing campaigns — the parties’ ability to funnel unlimited special-interest money to taxpayer-supported candidates.
A foundational element of the voluntary public financing program was a cap on spending and contributions, but Gov. Dannel P. Malloy and the Democratic majority neutered those caps in 2013 with revisions allowing unlimited coordinated expenditures on legislative races by the state parties.
The result is that state parties are free to funnel unlimited amounts of money from major donors to taxpayer-supported campaigns. Donors who can only give $100 directly to a publicly financed candidate can indirectly give them $10,000 through the state party.
Taxpayers spent $33.4 million on publicly financed campaigns in 2014.
With a committee deadline on campaign bills fast approaching, the Senate Democrats are standing fast, saying the parties must have the ability to pump unlimited funds into campaigns as a defense against independent expenditure groups.
“It’s still being driven by outside money. That is a major issue, millions of dollars are being thrown into elections that you can’t control,” said Sen. Steve Cassano, D-Manchester. “You have to have some protection against it. Nobody knows better than me.”
Cassano, who is the Senate co-chair of the Government Administration and Elections Committee, was one of a half-dozen Democratic incumbents attacked by a Republican-affiliated super PAC late in the 2012 campaign.
“My budget was already spent,” Cassano said. “You have to be able to respond to something like that.”
Republicans acknowledge they have little ability to pressure the Senate Democrats, even with the House speaker on their side.
“That’s the position of the minority. We pound the drum, and hopefully they open the door,” said Rep. Richard Smith, R-New Fairfield, the ranking House Republican on the committee. “But I think it was pretty clear from the top what they don’t want to do.”
At a press conference Thursday afternoon, Republican leaders complained of the Democrats’ refusal to embrace a series of reforms, including reimposing a cap on what state parties can spend on legislative races. The GOP also wants to lower contributions to state parties from $10,000 to $5,000.
The Republicans, with backing from advocacy groups, such as Common Cause, say the changes are needed to maintain the integrity of the Citizens’ Election Program, the formal name of the public financing program.
“Connecticut’s Citizens’ Election Program is broken, and so is Connecticut’s promise to taxpayers,” said Senate Minority Leader Len Fasano, R-North Haven.
Sharkey declined to comment, but a spokesman said he intends to submit testimony calling for a cap on party expenditures on behalf of legislative candidates. The Government Administration and Elections Committee is holding a public hearing Friday on campaign-finance legislation.
The spending by Voters for Good Government, a super PAC overseen by the former executive director of the Connecticut Republican Party, failed to unseat a Democratic Senate incumbent in 2012. But the spending prompted the 2013 revisions.
Under the U.S. Supreme Court’s decision in Citizens United, outside groups like Voters for Good Government can make unlimited expenditures, so long as they do not coordinate with campaigns.
“If Citizens United was gone tomorrow, much of this legislation would change. That’s the key, Citizens United and this tremendous influx of money,” Cassano said Wednesday.
But candidates who accept public financing are making a bargain: They are accepting taxpayer money — nearly $100,000 in the case of a Senate race — in return for agreeing to insulate themselves from the influence of private funds.
The only private funds they can accept are small-dollar qualifying donations of no more than $100. With the 2013 change, donors can make $10,000 donations to the party, which now can effectively be passed through to a publicly financed candidate.
Sen. Ted Kennedy Jr., D-Branford, and several family members gave $10,000 to the state party, which then contributed more than $200,000 to his publicly financed campaign. Democrats say they feared that Kennedy would draw attacks from conservative super PACS.
But they never materialized.
House members are not immune from outside spending, but they are a less attractive target.
With smaller districts, House members more easily can counter independent expenditures with direct voter contact. Also, winning control of the Senate is far more competitive in Connecticut, where a shift of just four seats would give the GOP a majority.
Sharkey has said he is not pressing to re-establish the $10,000 cap on contributions to legislative candidates from the state parties, but the expenditures should not be unlimited.
The Government Administration and Elections Committee is holding a public hearing Friday on its major campaign finance bill of the session, which makes no changes on party expenditures.
“This bill does nothing to regain the public’s expectation of clean elections in Connecticut,” said House Minority Leader Themis Klarides, R-Derby.
One of the provisions actually would weaken oversight by the State Elections Enforcement Commission, which currently conducts random audits of campaigns.
The proposed bill would bar the commission from auditing a candidate without cause for two years after a random audit and would impose tighter time frames on completing audits.
“It looks like they would make it very difficult for Elections Enforcement to do audits,” said Karen Hobert Flynn, a vice president of Common Cause. “To me, there is a lot in here that is bad.”