Common Cause Georgia Proposes Pay to Play Ordinance for the City of Atlanta
We at the Pay to Play Law Blog have received the following from Georgia Common Cause concerning their proposal for a Pay to Play ordinance for the City of Atlanta. We appreciate the submission and attach it herein in its entirety and unedited. The positions taken here are entirely those of Georgia Common Cause.
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While we salute Mayor Franklin for her leadership in establishing a more ethical climate in City government, one of the things we see as little changed from past administrations is well-connected insiders continuing to show up in disproportionate numbers of the chosen few who are selected for work contracted by the City of Atlanta, and by the Atlanta airport.
While we can’t – and don’t want to try to - change human nature, we do believe in taking steps to increase trust that those whom we elect and employ to administer our procurement policies will not allow personal preferences to steer contracts to less qualified companies, and that our tax dollars will not be wasted. One reform we can implement, if we want to raise the level of confidence in how our tax money is spent, is to separate the offering up of campaign contributions from the awarding of contracts. That is what Pay-to-play reform is all about.
Pay-to-play has been at the heart of numerous news stories around the country within the past year: Alaska Senator Ted Stevens, Illinois Governor, Rod Blagojevich, The withdrawal of New Mexico Gov. Bill Richardson’s Cabinet nomination, and the collapse of the mortgage giants after Congress – which reaped millions from Wall Street in campaign cash – deregulated the industry and ignored repeated warnings of disaster. In August, New Jersey Governor Jon Corzine issued an order freezing the development approval process in cities and towns whose mayors have refused to resign despite being charged in a federal corruption probe involving bribes paid to local officials to speed up development projects.
Atlanta has had its share of scandals around pay-to-play. The Ronnie Thornton airport runway dirt deal dominated the headlines a few years ago. Airport advertiser Billy Corey and his Airport Services company continue to this day their five year court battle over alleged cronyism in the awarding of the 2002 advertising contract to Clear Channel Communications and their DBE partner Barbara Fouch, a close friend of Former Mayor Maynard Jackson, who has had a piece of the airport advertising business since 1981.
Rather than wait for a local scandal to prompt us, why not take steps to discourage practices that can lead to scandals? Let’s work together to find a way to make it work in the City of Atlanta, then make it work elsewhere in the state as well. Let’s start the process.
How does Pay to play reform work?
Common Cause has offered a model ordinance for consideration in the current Atlanta Mayoral and Council races. Our proposal is not structured as a campaign finance law change, but as a new condition of contracting. It’s quite a simple concept. People can either contribute freely to the campaigns of candidates, or they can qualify to receive contract work with the City of Atlanta. They cannot do both. All companies submitting bids and continuing contracting arrangements with the City would be asked to certify that they had not contributed more than a minimal amount to candidates for Mayor of City Council in the previous 12 months. Enforcement would rest with the contracting office. Companies or individuals violating the statute would be disqualified from further business with the City. To see a summary of the proposed reforms for Atlanta, click here. To read the model ordinance, click here.
We believe it’s time to take Atlanta to the next level of ethical government. No more inferences that those who play should pay. Let’s create a system where we are making sure that City contracts go to the best cost-effective service provider, not the best-connected company.
Bill Bozarth
Common Cause Georgia
We are grateful to Georgia Common Cause for their submission, and invite any interested commentary on the topic. Our personal views on Georgia Common Cause’s proposal were originally posted here.
In addition to the concerns addressed in our previous post, the regulated community should take notice - and contemplate the impact - of the proposed amendment to the City of Atlanta Procurement and Contracting Code. To be sure, the specter of campaign contributions to procurement officials from those seeking city contracts can be unseemly; but so can the prospect of a system in which only individuals wealthy enough to self-fund their campaigns have the means to seek elected office. In our view, public disclosure of contributions and transparency far better balance the competing ideals of democracy and procurement fraud prevention than outright contribution bans.
Moreover, the proposed City of Atlanta Procurement and Contracting Code as offered imposes considerably greater restriction than simply offering one a choice between contributing “freely to the campaigns of candidates, or [qualifying] to receive contract work with the City of Atlanta” as advertised by Georgia Common Cause. Rather, the proposal proffered seeks to disqualify any person or entity from obtaining - or keeping - a city contract, if that person or entity has
made, directly or indirectly, any payment, gift or other contribution to or for the benefit
of any holder of elective office of the City of Atlanta or to any employee;
It is easy to contemplate how that language - crafted as broadly and vaguely as it is - could capture a great deal of seemingly innocent behavior with dire consequences. Imagine being the compliance office who has to tell your boss the CEO that her company’s life-blood contract with the City of Atlanta has been terminated for cause, and the company is liable to the City of Atlanta for all damages resulting from the termination, because the aggregate of all the contributions to a City of Atlanta politician by all of the company’s officers, directors, partners and salaried employees of the company exceeded $250, or because a competitor alleged that the company made a single “indirect” gift “for the benefit” of an employee of the City of Atlanta.
One can envision that birthday parties for City of Atlanta employees would be lonely places indeed.
Stefan Passantino, Esq.
Partner, McKenna Long & Aldridge LLP
The provision in the Pay to Play ordinance porposed by common Cause/Georgiat aggregates the contributions of a corporation to a elected official of the City of Atlanta, with those of its officers, directors and employees for purposes of the $250 limit.
Aggregation of contributions is essential to any meaningful reform in order to prevent a company from buying influence with city government by "bundling" the contributions of its officers directors, sahreholders and employees. Bundling is a common pratice. A corporate CEO or lobbyist can collect individual checks from other officers, directors, shareholders, and employeees and bundling those contributions together and delivering them personally to candidates either directly or though lawyer-lobbyist.
Very few corporations or other for-profit business enterprises make significant expenditures to candidates in the City of Atlanta for altruistic reasons or out of civic pride or a general interest in good government.
The fact is that a major portion of the contributions received by candidates for Mayor and the Atlanta City Council (including many who have no opposition for reelection) in the 2009 elections and in priopr city elections have come from companies and individuals who are either reale estate developers (or thier lawyers) who are seeking favorable consideration in rezoing of property within the city, or airport concessionaires and other businesses that are doing business with the city.
Many believe, myslef included, that the major purpose of these large contributins is to buy influence with city elected officials or administrators.
In some cases,the motive behind those contributions may be purely defensive--the widley-held belief that if the corporation or its officers or lawyers, do not make large contributions to influential elected officials, they will not get a fair hearing at city hall, and that they will not be faily considered for lucrative city contracts will instead be awarded to competitiors who do make such contributions.
In many other cases, the large contribution are intended to buy influence at city hall and insure that the contributors receive favorable consideration of of their rezoning applications or their bids for city contracts.
Although bribery of a public official is a crime, large contributors and their lawyer-lobbyist are sophisticated enough to avoid creating a paper trail that would allow a prosecutor to prove a direct quid pro qou connection between a contribution and a rezoning decision or a subjecteve award of a lucrative city contract (or lenienent non-enforcement of the terms of the contract against a vendor or concessionaire).
The Play to Pay ordinace is modeled after legislation that exists in other states and cities. Unlike some other approaches, the proposed legislation does not prohibt corporations or their officers, directors or employees from contributing to candidates for elective city offices up to the maximum amounts permitted by state law.
It does, however, require corporations and other businesses who want to do business with the city to make a choice: they can either make large contributions to candidates for elected city offices up to the amounts permitted by state law, but if they make such contributions exceeding $250 in the aggregate within one year they will be ineligible to bid for or be awared a city contract.
The $250 amount far exceeds the average amounts contributed in city elections by ordinary citizens that are not city contractors or reala estate developers.
The one year period was selected to allow enough time to elapse between the submission of a bid or the award of a contract by the city and any prior contribitions in excess of the $250 limit to insure that there is no connection between an earlier contribution and any later decision by the city grant a rezoinign application or award a contract to a company that may have contributed a larger amount in some previous election.
For those who say that registration of lobbyist and exisitng laws requiring disclosure of campaing contributions are sufficient to prevent fraud and corruption in city contract, I invite you to look at Money Watch, on the Common Cause/Georgia web site that lists sources and amounts of political contributions recieved by candidates for Mayor and the Atlanta City Council in the 2009 elections.
As one who has been entrusted by the States of Georgia and Missouri to investigate and enforce such statutes, I can tell you from first-hand experience that pay-to-play legislation is a slippery slope.
Pay-to-play legislation can give a false sense of security to the public that the prohibited practice of pay-to-play is not happening. Sometimes members of the public blindly place faith within a regulatory agency to ensure any activity strictly prohibited by law is not occurring. However, the reality is most agencies do not have the resources to monitor an over encompassing prohibition on a large scale, such as pay-to-play. Many agencies are forced to utilize their resources in manners to be reactive and do not have the ability to be proactive. In order for pay-to-play laws to be effective it would require the agency to be proactive and unless substantial resources are allocated specifically to the endeavor then the prohibition would be extremely difficult to enforce.
Practically speaking it would be more beneficial to require complete disclosure and transparency than attempting to enact a prohibitive measure. As most states already impose restrictive measures via contribution limits it would seem more advantageous to specially indentify individuals who are involved in attempting to gain contracts, or who have contracts, and contribute to candidates or committees rather than simply prohibiting making a contribution. Full disclosure allows all transactions to be vetted to the public for their scrutiny.
Rick Thompson