Loosened fundraising rules unleashing big cash for 2018 Maryland elections

Erin Cox
Contact ReporterThe Baltimore Sun

Maryland candidates have begun to hustle for dollars ahead of next year’s election, freed from a key obstacle that once hindered their ability to raise cash.

The 2018 election cycle, which includes races for governor, attorney general, General Assembly and several county executives, is the first full cycle since a Supreme Court ruling lifted the cap on the total amount donors may contribute to candidates.

That 2014 ruling and a 2010 high court ruling on political action committees, analysts say, could unleash campaign spending up and down the ballot unlike anything Maryland has seen.

“It really opened the floodgates,” said Jared DeMarinis, director of candidacy and campaign finance at the Maryland State Board of Elections.

With the election still more than a year away, dozens of local donors already have contributed more money to candidates than was allowed in previous cycles, The Baltimore Sun has found. The limit for the 2014 cycle was $10,000.

In the current cycle, 50 donors had given more than $50,000 to candidates and PACs through 2016, the most recent year for which data is available.

“We’re already detecting those little seismic shifts in our campaign finance system,” said Jennifer Bevan-Dangel, executive director of the political watchdog Common Cause Maryland. “We expect those shakes to turn into an earthquake.”

Donors may give no more then $6,000 to a single candidate during the four-year election cycle. But there’s no longer a limit on the total amount a donor may make to all candidates. And there’s no limit on how much donors may give to political action committees.

Annapolis lobbyist Gerry Evans, for example, already has given a total of $29,800 to 55 candidates in the General Assembly, local races and the governor’s contest in 2015 and 2016.

“It’s made things much more challenging, much more demanding,” Evans said. Now there’s no built-in excuse that he’s spreading out his money.

“Legislators know there’s no aggregate limit,” he said. “Before, we had kind of a safe harbor. We’d say, ‘Hey, I’m sorry. I’ve reached the cap.’”

The Supreme Court ruled in 2014 that aggregate contribution caps were an unconstitutional infringement on free speech. Maryland election officials announced they would no longer enforce the $10,000 limit for the 2014 election cycle or the $24,000 limit for 2018.

The ruling lifted the cap in the 10 states that had them. But the shift is most dramatic in Maryland, because the state had the lowest aggregate cap in the country.

Now donors may give to as many candidates and committees as they want. A supporter of Republican Gov. Larry Hogan, for example, could give $6,000 each to the governor, to the lieutenant governor, to any PACs supporting the governor, to any PACs opposing any of his opponents, to the Maryland Republican Party, to the 24 Republican central committees in the state and to any of the Republican candidates Hogan has endorsed.

And to hedge the bets, the donor could also give to all their Democratic counterparts.

An analysis by Common Cause suggests the change is already driving up the cost of elections. The group said last month that Baltimore City Council races in 2016 cost 50 percent more than they did five years earlier.

“The loss of aggregate limits is opening doors to donors,” said Bevan-Dangel. “It will allow super-wealthy individuals to creatively flood the candidates they do or do not like.”

Annapolis lobbyist Bruce Bereano has long tracked state and county level fundraisers. He says public officials are having more events this cycle, and most have higher ticket prices than ever before.

He doesn’t know whether that’s a direct result of the end of aggregate limits. But it’s had an impact on how he doles out money.

“I have made more contributions than I otherwise would have,” he said.

Bereano says citizens are the primary beneficiaries of the Supreme Court ruling.

“Those that want to be politically active, if they can afford it, can do it as much as they want,” he said. “Clearly, the elimination of aggregate limits has impacted and changed political fundraising in Maryland — it really has — and it was supposed to.”

The cap has been lifted at a moment when several factors could draw national money to Maryland.

Democrats, who have governors in just 15 of the 50 states, see a chance for a 16th in blue Maryland. Polls consistently show that Hogan enjoys the support of a majority of Marylanders, but Democrats outnumber Republicans in Maryland by two to one.

“There are plenty of psychological benefits to knocking off someone like Hogan,” said Todd Eberly, a political scientist at St. Mary’s College. “Of course, the Democratic Party will look for that trophy.”

The winner of the 2018 election will oversee statewide redistricting in 2021, the process that will determine how many members of each party the state will send to Congress.

After two cycles of redistricting controlled by Democrats, the state’s House delegation includes seven Democrats and one Republican. Before the redistricting of 2001, it was an even four-four split.

If Republicans won in 2018, Eberly says, they could easily redraw the political map to regain at least a couple of House seats.

Hogan says he hasn’t noticed whether the lifting of the cap has affected his fundraising. But he noted he’s helped to raise $18 million across several accounts. (His campaign later said he was also referring to money he raised for the Republican Governors Association.)

But people who raised money for Hogan before his upset win in the 2014 cycle said the aggregate limit was a big problem then. His campaign relied on public financing and donations from the party.

“It hurt us, big time,” said Joe Cluster, who was executive director of the Maryland Republican Party at the time. “It was a cop-out for some donors."

Cluster says donors would give Democrats the maximum contribution allowed, and then tell him they couldn’t help the state's minority party because they hit the cap.

“We couldn’t get a dime from them,” he said.

Now, Cluster said, “people can give more money. They’re just not limited. I’m sure there’s more money coming in. I’m sure we’ll be able to raise more money than we ever have before.”

Former Attorney General Douglas F. Gansler, a Democrat who has run for governor, attorney general and Montgomery County state’s attorney, says aggregate limits impacted his local races far more than his statewide ones.

The candidates at the top of the ticket tended to sop up the most cash, making it harder for people running for lower offices to raise money. He says that’s unlikely to happen now that there is no cap.

“The limits hurt down-ballot candidates, because the reality is the top-of-the-ballot candidates need to raise more money, those are more expensive races,” he said.

Several professional fundraisers and candidates for General Assembly and local races say they haven’t yet noticed a lot more big donations, but the fundraising season is just now ramping up.

House Minority Leader Nic Kipke, who raises money to help elect fellow Republicans to the House of Delegates, says he hasn’t yet seen much change in the behavior of donors because many of the people who contribute to his cause are private citizens who would have not given the maximum amount anyway.

But he expects to see impacts somewhere in the cycle.

“There must be some increased contributions,” he said.

Rachael Rice has raised money for General Assembly and county-level Democrats since 2001. Clients include Senate President Thomas V. Mike Miller, Prince George’s County Executive Rushern Baker, and dozens of current and former senators and delegates.

She says the end of the cap has made her job easier: She no longer has to explain aggregate limits to donors.

Rice says she’s seeing more events with higher ticket prices this cycle, but is unsure whether that had to do with the higher cost of campaigns or the end of aggregate limits.

“It’s a less presumptuous thing to ask for $2,500 when everyone else is doing it, and the contribution won’t count against a donor’s giving elsewhere,” she said.

Baltimore Sun reporter Jin Kim contributed to this article.

ecox@baltsun.com

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