The recent passage of the State Senate’s campaign reform bill has people talking about what it could mean for local politics. The bill would make it illegal for campaign donors to get government contracts with the state, county or city in which they donated, a practice referred to as “pay to play.”
Businesses and professionals such as engineers and law firms who held contracts of $17,500 or more would be prohibited from donating to candidates, office holders, party committees and Senate and Assembly leadership committees.
The bill would also bar individual professionals from submitting bids or negotiating contracts if, in the previous year, they had given $400 to any candidate or committee in that municipality. Businesses that gave $5,000 to candidates and committees in the past year would likewise be disqualified from bidding for contracts.
The idea is to cut down on the appearance that a business might have contributed in order to get contracts, and to lessen pressure on contractors to contribute.
Now that the bill has passed in the Senate, it goes to the Assembly, but the latter body doesn’t have the item on the agenda until fall. And the Assembly has proposed a law that only includes the state and county level of government.
Gov. James E. McGreevey said that he will seek alternative legislation to beef up the Senate’s bill by addressing potential conflicts among lawmakers and their private sector clients. McGreevey said in the State of the State address that he would veto any bill that does not include local contracts. However, some contend that the governor’s promise of a new all-inclusive bill may be nothing more than a stalling tactic.
It’s the system
To see how such a law might affect campaign fundraising in Hoboken, one wouldn’t have to look any further than the fundraising documentation from the current or past administrations.
It’s important to note that raising money from contractors has become common and is not illegal. It is only illegal if the company is asked to donate in exchange for a contract. Some companies may simply appreciate the direction an administration is taking.
Donations from city contractors and developers have been a source of campaign income for Mayor David Roberts, former Mayor Anthony Russo, and former mayors Pat Pasculli and Tom Vezetti. It’s also common in other municipalities and counties.
Fundraising for the ruling administration traditionally starts with the Hoboken Democratic Party, which for the past couple of decades has contributed heavily to incumbent mayors.
During the administration of former mayor Anthony Russo, the party was chaired by Russo’s wife, Michele. Her brother, George DeStefano, was its treasurer.
In the April 27, 2001 campaign fundraising report before the 2001 mayoral election, Russo had a war chest of $534,078, with the Hoboken Democratic Party being by far the biggest contributor. The party contributed more than $132,000.
Many of the contributors to the party had contracts with, were employed by, or were developers with large projects pending before the city’s boards.
When Mayor David Roberts came into office, the leadership of the Hoboken Democratic Party shifted, and Roberts became the body’s chairman, with city Business Administrator Robert Drasheff as its treasurer.
According to the latest campaign finance report, submitted to the state on Jan. 16, 2003, the Hoboken Democratic Party has approximately $161,000 in its coffers. Some of the money has been donated to groups like the Weehawken Elks, the Academy of the Sacred Heart, and the American Heart Association. But the rest can go to political events. In fact, the party has already begun its financial support of Roberts’ Hoboken United City Council Candidates, either via donations to Roberts’ “Friends of Mayor Roberts” Political Action Committee, or by directly paying consultants for mailings, ads and candidate parties. For example, the Hoboken Democratic Party paid $5,000 for a Roberts “political newsletter” to a local graphic designer on Dec. 13, 2002. The party paid $1,500 in December for a 4th Ward Christmas Party hosted by Roberts candidate Chris Campos.
Some of the groups that have contributed to the Hoboken Democratic Party are Dennis Enright ($2,000) of NW Financial Group, the company that got the contract to assist the reissuing of the dissolved Hoboken Parking Authority’s bonds; David Milkowski ($2,000), a partner at Ernst and Young, the city’s current auditors; Paul Capazzi ($3,000), of Rivardo, Schnizer and Capazzi, the Board of Education’s architects; Howard Birdsall ($3,000), of Birdsall Engineering, the Planning Board’s engineer; Harold Raveche ($1,000) president of Stevens Institute of Technology; Anthony Cimino ($2,000) executive vice-president of Schoor DePalma, the engineering firm for future projects at the Board of Education; Dean Marchetto, the architect of various local projects; and Henry Arnold ($1,000) of Arnold and Associates, the firm that designed Pier A and is currently designing Jackson Square Park.
Some of these contributors have been contributing to many different Hoboken campaigns for many years. All of the above contributed between last July and this January, some during a time when it was unknown whether some of Roberts’ councilpeople would split from him.
Drasheff said Thursday that just because there are campaign contributions from persons holding contracts in Hoboken, it doesn’t mean that there is intrinsically a cause-and-effect relationship.
“Hoboken is in a very unique situation, because it’s a small town where neighbors have known each other for a long time,” Drasheff said. “The vast majority of people contribute because of friendship or a shared belief in common political ideology, rather than for the purpose of doing business.”
He added that if there is major campaign reform, the only way that he believes it can truly work is if it spans every level of government – state, county and municipal.
“To leave out one component would really skew the law,” he said.
Councilman Tony Soares, who says he has been an advocate of a “pay to play” ban and who is running against Roberts’ candidates in the May election, said Tuesday that “pay to play” has been a problem in Hoboken.
“Hoboken is a glaring example of pay to play at its best,” said Soares. “It’s a rampant problem here and across the state that needs to be fixed. If a developer contributes $5,000 and a resident only can afford to contribute $50, who do you think is going to get their phone answered first?”
Campaign finance reports for Soares’ slate and the other slate in the election have not yet been turned in because they only officially formed their organizations recently. The next round of disclosure forms is due April 15.