Panel edges toward consensus on campaign finance reform

A commission set up to advise the General Assembly how to reform its laws governing campaign financing edged closer to consensus on some key issues but has a lot of ground to cover at its final meeting scheduled for Sept. 27.

The Commission to Study Campaign Finance Law reached a clear consensus on some enforcement issues -- extending the statute of limitations for misdemeanor violations of campaign finance laws from two years to three and allowing the State Board of Elections to issue civil citations for some less severe violations without having to refer matters to the State Prosecutors' Office. The state prosecutor endorsed both changes.

Agreement came less easily on three other topics: how to attribute contributions from multiple business entities controlled or managed by the same people, ensuring that small gifts reported together as lump sums don't provide a loophole for concealing donors and the rules that should govern the creation and transfer of money within slates of candidates.

Chairman Bruce Marcus said the panel had reached an agreement that all forms of business entities should be treated the same -- whether traditional corporations, partnerships, limited liability corporations or some other formulation. Also agreed was that the rules have to address both ownership and management, recognizing that in some cases the persons deciding who to donate money to are not those with a controlling interest. What is known as the "LLC loophole" has allowed some business leaders -- notably developers and casino owners -- to channel vast sums of money to favored candidates while evading the normal limits of $4,000 to a single candidate and $10,000 in an election cycle.

While the commission achieved a rough agreement of the direction that it wants to go, some of the details were left up in the air until the next meeting. There appeared to be a consensus that the legislature should set the threshold for the percentage of ownership that would automatically be judged as having control, but there was significant support for setting that level at 80 percent to ensure enforceability.

There was broad agreement on the panel that something has to be done to limit the practice of aggregating donations of less than $51 and reporting them as "lump sums." In extreme cases, Maryland candidates have reported tens of thousands of dollars coming in that way -- potentially hiding significant contributors. How, exactly, the commission will recommend that the Assembly curb the practice was left in the air.

The least progress was made on the subject of slates, which in some cases can allow unlimited transfers of money between candidates on a certain team. In recent years, the most effective user of the flexibility slates allow has been Senate President Thomas V. Mike Miller, who has used slates of Democratic senators and challengers to direct money into tight races and maximize his majority.

Panel members appeared torn between an approach that would redefine the circumstances under which slates can be formed and a strategy that would curb unlimited transfers of money. Marcus said the commission agrees that the issue must be addressed, but with the hour set for adjournment nearing, the panel decided to defer decisions until the next meeting.

The commission's recommendations could be influential in the state's future conduct of elections -- or not. It is not unknown for the legislature to order up a commission study into which panel members put many hours of work, only to see its report rejected when lawmakers come back into session.

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