A BUCK WELL SPENT

Review of How Reform Would Have Affected Spending And Fundraising During The 2000 Election And The 2001-03 State Budget

January 7, 2002

INTRODUCTION

In today’s economy, $1.05 gets you very little - a can of soda, a small bag of chips, two hours of parking, five minutes of long-distance calling.

But in the world of Wisconsin politics where well-heeled special interests spend thousands of dollars on campaign contributions for favorable legislation, $1.05 could buy a person something of immeasurable value - a campaign finance reform plan that puts voting constituents ahead of cash constituents on the policy agendas of state lawmakers.

Right now, legislative leaders lure special interest cash with proposals and promises that favor big donors while voting constituents are left ill-represented, even cheated. This non-stop flow of special interest money is then used to subject the public to seemingly endless rounds of negative television, radio and mailed propaganda that leaves them disenchanted and uninformed about their representatives and the issues.

Comprehensive campaign finance reform, namely Senate Bill 104, would cut the money flow. This proposal eliminates leadership-run campaign committees, reduces spending and fundraising and shines a spotlight on the sources of issue ad and independent expenditure groups. Senate Bill 104 also would produce a more level playing field between incumbents and challengers. The result would be more choices for voters, more competitive elections and less special interest influence over the legislative process.

This can all be done at a cost of just under $4.1 million a year, which is equivalent to $1.05 a year for each of Wisconsin’s 3.9 million taxpayers. That is a bargain compared to the cost of other state programs or purchases that each citizen will pay for in 2002, including more than $221 per taxpayer in state gasoline taxes and car registration fees, $19 each for a new prison in northwestern Wisconsin, $16.98 for a new prescription drug program and $6.31 for recycling. In the 2001-03 state budget crafted earlier this year, large campaign contributions and influence netted special interests breaks and benefits equivalent to $211 for each taxpayer.

In this report, "A Buck Well Spent," the Wisconsin Democracy Campaign found that spending during the 2000 election and fundraising during legislative budget deliberations in the first six months of 2001 would have been slashed had Senate Bill 104 been in effect.

KEY FINDINGS

  • Spending in the 1999-2000 election cycle by legislative candidates on the general election ballot would have been reduced by at least 23 percent, or $1.9 million. This would have reduced the cash advantage that incumbents wielded over challengers, which was as high as 14:1 only months before the November 2000 election. The effect of the spending limits would make for a 1:1 spending ratio in many races.
  • An analysis shows that legislative fundraising during the first six months of 2001 would have been slashed 90 percent, or $1.6 million, through a prohibition on fundraising by legislators during consideration of the 2001-03 state budget.
  • Fundraising in the 1999-2000 election cycle by legislative candidates on the general election ballot would have been cut 59 percent, from $10.1 million to an estimated $4.1 million. In addition, Senate Bill 104 would have affected the timing and flow of an additional $1 million in individual and committee contributions accepted by legislators while they worked on the 1999-2001 state budget.

SPENDING

Legislative candidates on the 2000 general election ballot spent $8.4 million in the 1999-2000 election cycle, including $7.9 million in regular campaign spending and $472,391 in contributions to other candidate campaign committees.

Senate Bill 104 would have reduced candidate spending by at least $1.9 million, or 23 percent. This is the difference between what the candidates actually spent in 1999-2000 and Senate Bill 104’s spending limits, which are $60,000 for Assembly candidates and $120,000 for Senate candidates.

Senate

Senate Spending by all Senate candidates on the general election ballot, which totaled $3.4 million, would have been pared at least $1.2 million, or 37 percent.

Incumbent spending, which totaled $1.9 million, would have been cut $587,747 or 31 percent. That is the total amount by which incumbents in six races exceeded the $120,000 spending cap.

Chart 1: Senate Incumbent Spending

Three incumbents, two of whom lost, exceeded the cap by more than $100,000 each, including former 10th District Democratic Sen. Alice Clausing, who spent $312,707; 16th District Democratic Majority Leader Charles Chvala, who spent $298,709; and former 30th District Republican Sen. Gary Drzewiecki, who spent $230,570. The others who spent more than what would have been allowed under Senate Bill 104 were 8th District Republican Sen. Alberta Darling, $169,549; 22nd District Democratic Sen. Robert Wirch, $161,363; and 20th District Republican Senate Minority Leader Mary Panzer, $134,849.

Chart 2: Senate Challenger Spending

Spending by challengers, which totaled $939,898, would have been cut $380,690 or 41 percent. The spending overage came from three challengers, including 10th District Republican Sheila Harsdorf, who spent a record $409,557; 16th District Republican Lisa Nelson, who spent $184,781; and 30th District Democrat Dave Hansen, who spent $146,352.

Candidate spending in the hotly contested open seat race in the 32nd Senate District would have been slashed by more than half under Senate Bill 104. The candidates spent $505,634 - $265,634, or 53 percent, more than what they could have spent under Senate Bill 104. Republican candidate Dan Kapanke spent $258,821, compared to the winner, Democrat Mark Meyer who spent $246,813.

In addition to the 32nd District race, spending in Harsdorf and Clausing’s 10th District contest would have been substantially different in a reform environment. Total spending by the candidates would have been limited to $240,000, one-third of the $722,264 that they ended up spending. Meanwhile, spending by outside groups on issue ads and independent expenditures likely would have been only a fraction of the estimated $2 million that they spent in the 10th District race. That is because candidates who are victimized by groups that spew propaganda against them or on behalf of their opponent would receive a supplemental grant equal to the amount being spent by the issue ad or independent expenditure group. Wealthy special interests are likely to realize that it is a waste of money to interfere in an election when campaign finance laws guarantee an equal amount of money to help candidates stung by their ballyhoo.

Assembly

Assembly Spending by all Assembly candidates in the general election, which totaled $5 million, would have been cut by at least $630,250, or 13 percent.

Incumbent spending, which totaled $3.1 million, would have been cut $480,816, or 16 percent. That is the amount by which incumbents in 10 races exceeded Senate Bill 104’s $60,000 spending limit on Assembly candidates. Republican Assembly Speaker Scott Jensen spent by far the most - a total of $318,361, which is $258,361 over Senate Bill 104’s limit.

 

Candidate Party District Total Spending Overage
Scott Jensen R 32 $318,361 $258,361
Jerry Petrowski R 86 $112,696 $52,696
Steven Foti R 38 $106,065 $46,065
John Gard R 89 $96,001 $36,001
Rick Skindrud R 79 $91,989 $31,989
Eugene Hahn R 47 $78,277 $18,277
Antonio Riley D 18 $76,952 $16,952
Joseph Leibham R 26 $71,803 $11,803
Mark Pettis R 28 $64,509 $4,509
Stephen Freese R 51 $64,163 $4,163
TOTAL $480,816

Jensen spent a substantial amount on fundraising during the cycle when he was eyeing a possible run for governor in 2002.

Spending by challengers, which totaled $1 million, would have been cut $37,418, or 4 percent. Only two of the 66 candidates who challenged Assembly incumbents in 2000 exceeded the $60,000 spending cap imposed by Senate Bill 104 - 28th District Democratic candidate Robert Dueholm, who spent $82,246, and 68th District Republican candidate Howard Ludwigson, who spent $75,172.

Candidate spending in Assembly open seat races totaled $922,429 and would have been cut $112,016, or 12 percent under Senate Bill 104. Eight of the 19 candidates on the ballot exceeded the $60,000 limit, led by 70th District Republican MaryAnn Lippert, who spent $112,519.

 

Candidate Party District Total Spending Overage
MaryAnn Lippert R 70 $112,519 $52,519
Judy Krawczyk R 88 $85,404 $25,404
Amy Sue Vruwink D 70 $68,249 $8,249
Jeff Fitzgerald R 39 $66,926 $6,926
Dan Meyer R 34 $65,157 $5,157
Jennifer Shilling D 95 $65,132 $5,132
Steven Peggs D 88 $63,954 $3,954
Garey Bies R 1 $64,675 $4,675
TOTAL $112,016

Technically, the most expensive Assembly race was in the 32nd District where Jensen and Democratic opponent Chad VanDierendonck spent $328,473 in 1999-2000. However, as mentioned earlier, Jensen spent the bulk of his $318,361 on fundraising with an eye on the governor’s office, not his Assembly race where his opponent spent $10,112.

The most expensive competitive Assembly race was the 70th District open seat contest where GOP victor MaryAnn Lippert and Democrat Amy Sue Vruwink spent a total of $180,768. Under Senate Bill 104, spending in the race would have been cut 34 percent. Lippert’s spending would have been reduced by $52,519 and Vruwink’s by $8,249 to comply with the $60,000-per candidate spending limit.

FUNDRAISING

Fundraising would be considerably reduced through a prohibition on accepting PAC contributions to qualify for a grant, the elimination of legislative campaign committees and limits on conduit contributions and fundraising restrictions on legislators during budget sessions regardless of whether the candidate seeks a grant.

The chief aim of fundraising restrictions is to reduce special interest money and influence on legislative decision-making.

However, another benefit of fundraising restrictions is that it reduces the daunting cash advantage fueled by special interests that incumbents have over challengers. Early in the 2000 election year, incumbents had built up war chests that had a $14 to $1 advantage over challengers, yet continued to raise money at a $6 to $1 clip right up to the November elections.

Fundraising and the 2001-2003 State Budget

State Budget Fundraising And The 2001-03 State Budget Legislators raised an incredible $1.6 million in individual and committee contributions during the first half of 2001 when they were considering the 2001-03 state budget. The figure nearly doubles the amount of funds raised by legislators during the comparable first half of 1999 when they were working on the 1999-2001 budget.

Coinciding with the big bump in fundraising during legislative work on the budget was an increase in the number of breaks and benefits for special interests that legislators approved in the latest budget. The WDC previously identified at least $819 million worth, equivalent to $211 for each Wisconsin taxpayer.

Senate Bill 104 would have provided a significant disconnect between budget work and legislative fundraising. Legislative fundraising would have been prohibited from Feb. 20 when the budget bill was introduced through June 30, cutting the $1.8 million legislators and legislative campaign committees to $182,722, a 90 percent reduction. This $182,722 reflects the amount legislators accepted between Jan. 1 and Feb. 19, 2001.

Chart 3: Jan-June 2001 Fundraising

Fundraising and the 1999-2000 Election Cycle

Fundraising In The 1999-2000 Election Cycle Fundraising by general election legislative candidates and the legislative campaign committees in the 1999-2000 election cycle totaled $10.1 million - about $8.9 million by the candidates and $1.2 million by the LCCs.

Under Senate Bill 104, the influence of big money during budget consideration in 1999 and the 2000 election would have been substantially crippled. Candidate fundraising would have been cut 59 percent, or $6 million, to $4.1 million. And, this reduction does not include an additional $1 million in individual and committee contributions that legislators accepted during budget consideration that would have been delayed - and possibly not donated - under Senate Bill 104.

Chart 4: Two Year Fundraising

Senate Bill 104 would have reduced the $10.1 million raised in 1999-2000 election cycle in four ways:

  • First, legislative campaign committees would not have raised $1,184,726 because they would not have existed.
  • Second, there would have been a reduction in conduit contributions of at least $763,438, or 44 percent of the $1.73 million in large individual conduit contributions made during the cycle. This figure represents excessive large individual conduit contributions to legislative candidates because Senate Bill 104 applies PAC contribution limits to conduits, namely $500 per Assembly candidate and $1,000 per Senate candidate. This figure does not include additional overages from small individual conduit contributions.
  • Third, total participation in the public grant system would have required legislative candidates to reject the $639,850 in special interest PAC contributions they accepted during the two-year cycle.
  • These three reductions worth $2.6 million reduce the actual $10.1 million in 1999-2000 fundraising by general ballot legislative candidates by 26 percent, to $7.5 million.

  • The fourth and largest reduction comes from the promise that each candidate who participates in the system will receive a public grant of 45 percent of the spending limit, allowing them to raise at least 45 percent less than they would have since they would be prohibited from spending more than the limit. That assumption reduces the predicted total fundraising to $4.1 million under Senate Bill 104.

Press Release