City of Oakland

Measure W Charter Amendment - Majority Approval Required

Title: measure amending the Oakland municipal code and city charter to: (1) establish resident public financing for candidate election campaigns; (2) increase transparency regarding independent spending in city elections; (3) further restrict former city officials from acting as lobbyists; and (4) provide additional resources to the public ethics commission for implementation

SUMMARY:

This measure would amend the Oakland Municipal Code to establish a program to allow Oakland residents to allocate public financing for candidates' campaigns for City of Oakland and Oakland School Board elections, increase transparency regarding independent spending in City elections, and further restrict former City officials from acting as lobbyists. This measure also would amend the City Charter to provide additional resources to the Oakland Public Ethics Commission for implementation of the new public financing program.

The measure would:

• repeal the existing Limited Public Financing Act (Oakland Municipal Code Chapter 3.13), which provides the City's current system for publicly financing candidate campaigns, and replace it with the Fair Elections Act, that would establish a new public financing program;

• make public financing available to candidates for any City or Oakland School Board elected office;

• allocate public financing by providing four "Democracy Dollars" vouchers to every eligible Oakland resident, who would be allowed to award their vouchers to participating candidates for redemption from the City at $25 per voucher;

• establish budget set-aside requirements to fund the program.

Like the Limited Public Financing Act, the Fair Elections Act would be administered by the Public Ethics Commission.

This measure would eliminate lower contribution limits for candidates who

decline the voluntary expenditure ceiling, providing all candidates the same contribution limits.

The measure would remove limits on contributions to independent (i.e., third-party) groups spending to influence voters in City elections. This measure also would expand disclosure requirements on campaign advertisements from such groups, requiring disclosure of their top three donors of $5,000 or more, and requiring the filing of additional disclosures with the Public Ethics Commission. In addition, the measure would require "paid for by" disclosures on all campaign and officeholder communications, as well as disclosures on social media accounts used for campaign purposes.

The measure would prohibit former City officials from acting as local government lobbyists after leaving office for two years instead of the current one-year prohibition.

The measure would amend the City Charter to increase minimum staffing for the Public Ethics Commission, funding a Democracy Dollars Program Manager and three full time positions to administer the new public financing program.

The Oakland Public Ethics Commission is responsible for oversight of various laws including the Campaign Reform Act, the Limited Public Financing Act, and the Lobbyist Registration Act. In 2014, Oakland voters approved a City Charter amendment that created a new section 603 to strengthen the Public Ethics Commission, which included provisions to set aside money for minimum staffing.

This measure would repeal the Limited Public Financing Act and replace it with the Fair Elections Act. The current public financing program is available only to candidates for City Council; and it caps public financing for an election at $500,000 and allocates the financing by reimbursing qualifying candidates. The new program would be available to candidates for City Council, Mayor, City Attorney, City Auditor, and School Board and would require that the City set aside a minimum of $4,000,000 for public financing, per election, unless the City faces extreme fiscal necessity. Residents of Oakland would receive "Democracy Dollars" vouchers and could assign the vouchers to qualified candidates of their choice. Candidates who receive vouchers would be able to redeem them from the City to receive public financing.

The measure would amend the Campaign Reform Act to, among other things, lower contribution limits for publicly financed candidates and heighten disclosure requirements for third-party campaign advertisements. Instead of requiring identification of the top two donors of $5,000 or more only on mass mailings and television advertisements, the measure would require identification of the top three donors on all third-party advertisements.

This measure would amend the City Charter to increase minimum staffing for the Public Ethics Commission. The measure also would extend the restriction on former City officials acting as local government lobbyists after leaving office from one year to two years.

The Oakland City Council placed this measure on the ballot. A "yes" vote supports the replacement of the Limited Public Financing Act ordinance with the Fair Elections Act ordinance and amendment of the Campaign Reform Act and Lobbyist Registration Act ordinances and Section 603 of the City Charter. A "no" vote opposes replacement of the Limited Public Financing Act with the Fair Elections Act and amendment of the Campaign Reform Act, Lobbyist Registration Act, and Section 603 of the City Charter. A majority vote (i.e., more than 50% of the votes cast) is required to pass the measure.

Summary

This measure, if approved by a majority of Oakland voters, would repeal the Limited Public Financing Act (LPFA), which has been in effect since 1999, and enacts the Fair Elections Act (Act) enabling resident allocation of public financing for elective office campaigns. It would also modify the Campaign Reform and Lobbyist Registration acts and fund the Public Ethics Commission (PEC) to implement the new Act. This Act would first apply to the 2024 elections.

The proposed measure would specifically create the. Democracy Dollars Program, consisting of vouchers (four $25 vouchers, totaling $100) to be distributed to eligible Oakland residents to support the campaigns of candidates for City Council, Mayor, City Auditor, City Attorney, and school board. The purpose is to expand participation for elective offices in Oakland. The Act would also extend the lobbying ban from one year to two years after a City official leaves government service to curb corruption and the appearance of corruption.

Financial Analysis

If the measure passes, and if the City Council adopts such an ordinance in the future, we estimate the City would incur approximately $700,000 in one-time start-up costs, approximately $1,600,000 in annual operating costs, and $3,845,000 in additional budget appropriation every two years to the Democracy Dollar Fund (Fund). These estimated costs are described below.

One-time start-up costs

We estimate the City will incur $700,000 in one-time start-up costs which include integrating the new system requirements into the existing campaign financial reporting system and establishing technical requirements.

Annual operating costs

We estimate the City will incur $1,600,000 in annual operating costs to administer the Act. This estimate includes $350,000 in annual non-staff-related administrative costs and $1,250,000 in additional staffing costs to hire four additional staff to administer the Act.

Biennial budget for the Fund

The legislation requires the City Council to appropriate $4 million every two years to fund the vouchers. This new program would replace the existing LPFA program currently