Secretary of state narrows campaign donations

Regulation will restrict local candidates from receiving cash from state-level races

Secretary of State Maggie Toulouse Oliver is tightening the fundraising rules for school board and city council candidates across the state, saying they can no longer receive donations from the campaigns of state-level candidates.

New Mexico’s top election official says candidates for state offices, such as House and Senate seats, governor and attorney general, are now prohibited from contributing funds from their own campaigns to people running for local offices. The policy, coming about one year before a mayoral election in Santa Fe, is not a change in state law but a new interpretation of existing law.

Advocates for campaign finance reform argue that Toulouse Oliver’s stance could help curb the shuffle of money between different campaigns, a practice some have likened to a shell game.

But like so many of New Mexico’s election rules, it is based on a tangled and complicated set of laws. Some observers suspect this particular policy might stem from a mistake in writing the state’s statutes. And Toulouse Oliver’s office is likely to revisit the rule as part of a broader review of campaign finance regulations ahead of the 2018 election.

The issue centers on two sections of the Campaign Reporting Act. One section of the act allows campaigns to donate money to other candidates “seeking election to public office.” But another section defining the word “election” specifically excludes municipal and school board candidates.

Under the new policy, Deputy Secretary of State John Blair said, candidates for state office can still give money to local candidates using their own personal finances, just not cash from their campaign accounts.

Douglas Carver, executive director of New Mexico Ethics Watch, said the new

policy is reasonable — “People donate to a candidate because they want to support a candidate for a particular office,” he said — but he questioned whether the restrictions in the Campaign Reporting Act were intentional, since they appear in just one section and apply to some candidates but not others.

State-level candidates, such as party leaders and contenders for legislative seats considered safe for a victory, often have been major donors to other candidates in their own party, particularly those vying for other state offices. But campaign finance reports from the last six months do not show a flood of cash from statelevel campaigns to local races.

Blair said the race for mayor in Albuquerque, which has drawn at least 15 contenders, prompted a close look at the Campaign Reporting Act and the new policy. A few donations to candidates in that election stand out.

For example, the campaign committee of Democratic New Mexico Attorney General Hector Balderas gave Albuquerque mayoral candidate Brian Colón, a former state Democratic Party chairman and 2010 lieutenant governor nominee, a total of $5,150 between October and January, according to data compiled by the Secretary of State’s Office.

The campaign of former Republican state Rep. Paul Pacheco of Albuquerque gave another mayoral candidate, Albuquerque City Councilor Dan Lewis, $1,000 in December after Pacheco lost his re-election bid. And former Republican Rep. Nora Espinoza’s campaign gave Lewis a donation for the same sum on the same day. Espinoza, of Roswell, had given up her seat in the state House of Representatives to make an unsuccessful run for secretary of state.

The policy is not retroactive, Blair said. But he added that the Secretary of State’s Office is contacting campaigns to inform them of the new rule and ask candidates to return donations.

Carver said donors might think twice about contributing to a candidate if they knew their money could end up supporting someone else.

“You have to wonder if it makes a mockery of our campaign finance laws,” he said.

Courts and other officials have said little about the rule.

A spokesman for the Attorney General’s Office said Toulouse Oliver had not asked for a legal opinion from its staff.

But a 2009 advisory letter from the Attorney General’s Office seems to contradict the secretary of state’s new policy, stating, “a common sense reading of the law is that a donation to a candidate for any public office — federal, state or local is permissible.”

The letter points to a 1995 federal appeals court decision involving then-U.S. Rep. Bill Richardson’s campaign finances. The letter says the decision struck down a ban on using federal funds for state campaigns. The decision does not mention local elections, however.

Carver suggested the policy could raise questions about the First Amendment. It also could be revisited. The policy comes just a few months after Toulouse Oliver took office pledging stronger enforcement of New Mexico’s campaign finance laws.

Campaign finance reform measures sputtered in the Legislature this year or — if passed — met with the governor’s veto pen.

Though Toulouse Oliver backed campaign finance reform during the legislative session, the Democrat also had said during her campaign last year that she would use the authority of the Secretary of State’s Office to craft and implement certain reforms through a public rulemaking process rather than through the Legislature.

Other states have used regulations rather than legislation to limit how campaigns can spend donations and clarify what information candidates must report about expenses as well as donors. New Mexico does not have any such regulations, however, leaving candidates to navigate sometimes vague laws.

Blair said last week the Secretary of State’s Office will launch a rule-making process to put new policies into place ahead of the 2018 election.