March 28, 2016

What’s behind NM’s public campaign financing debacle

The New Mexico Legislature has been diverting money from a public election fund for years, contrary to the wording of the law that established the fund.

Some have blamed the budget situation for the recent necessity for an emergency grant to replenish the fund, but the situation dates back years.Roundhouse at night

Earlier this month, Secretary of State Brad Winter sent letters to candidates who opted for public financing to inform them that their public financing would be reduced, citing the “current economic climate” and a negative budget.

New Mexico’s limited public finance law—it only applies to Public Regulation Commission and judicial candidates—allows for a reduction in disbursements if there is a shortfall.

While the economy may have been to blame for a negative overall budget, a closer look revealed that the New Mexico legislature used funds designated for public financing to pad general election funds—and Gov. Susana Martinez approved this.

During a special meeting, the New Mexico Board of Finance voted unanimously to approve a $300,000 grant for emergency funding for the Secretary of State’s office for the public campaign financing.

Before the final vote, Department of Finance and Administration Secretary Tom Clifford offered an explanation for why the state’s public election fund could not afford to fully fund public financing for the handful of candidates who qualify. He said the account meant for candidate financing is often moved to instead fund other state operating expenses, often referred to as “sweeping.” This time, Clifford admitted, “We swept a little too much.”

Martinez, who chairs the board, asked whether the sweeping was done by the her office or the Legislature.

“It was a legislative budget but I think you signed it,” Clifford responded.

The budget passed by the Legislature only becomes law once the governor signs the bill.

Later during the board meeting, Martinez would move to approve the request, reasoning that the public campaign financing fund is often used to finance other aspects of the state budget.

Indeed, the Legislature included language in the most recent budget that calls for a transfer of $750,000 from the public campaign finance fund to pay for overall election expenses. The budget specifically mentions the statute that established the public election fund and discounts it in order to justify moving money.

The only problem: moving money from the fund appears to directly violate the statute that created the fund.

Limited public financing in New Mexico 

New Mexico established the public election fund in 2003, in time for the 2004 elections. Sponsored by the late Speaker of the House Ben Lujan and signed by Gov. Bill Richardson, the Voter Action Act initially only allowed those running for the Public Regulation Commission to qualify for public campaign money.

In 2007, the Legislature amended the act to include candidates for the State Court of Appeals and State Supreme Court. The expansion of public financing to judicial candidates was part of an ethics deal, former state Sen. Dede Feldman told NM Political Report in February.

Money from various state fees, taxes and unclaimed property fill the public election fund. In 2009, again under  Richardson, the Legislature approved a bill, sponsored by Sen. John Arthur Smith, D-Deming, that moved more than $1.7 million from the public election fund to the state’s general fund. For years the legislature approved budgets that included transfers of at least $1 million from the public election fund to cover other areas of the budget.

Each year since then, the budget took money from a fund that was set up solely for public campaign finance, even though the  statute expressly prohibits any other use.

The initial law on public financing was never amended to reflect the funding changes.

Moving money

Wording in the most recent state budget specifically mentions that money would be diverted from the public elections fund, contrary to language in the act that created the fund itself. When the act created the fund it also outlined, specifically, what the money can be used for.

According to statute, the fund is “solely” for financing qualified candidates, administration costs and “all other specified provisions of the Voter Action Act.” The law goes on to say that “Remaining balances at the end of a fiscal year shall remain in the election fund and not revert to the general fund.” The law does not mention any transfers to other funds in the state budget.

The $300,000 in grant money that Secretary of State Brad Winter requested last week is just a fraction of the $750,000 that was moved from the public election fund “notwithstanding” the Voter Action Act.

Taking money from the public election fund also seems to violate the New Mexico State Constitution. The section of the state constitution that outlines the process of amendments states, “No law shall be revised or amended, or the provisions thereof extended by reference to its title only; but each section thereof as revised, amended or extended shall be set out in full.”

Other issues

The Voter Action Act also specifies how the Secretary of State must file a report every other year to the Legislature on how much money is in the public election fund and what funds would be needed from the Legislature to meet demand. NM Political Report was unable to find documents, either from the Legislature or the Secretary of State’s office, on such reports filed by former Secretary of State Diana Duran to the Legislature.

Winter told NM Political Report he wasn’t sure what if anything was reported, but he did say predicting how much money is needed to publicly finance candidates is difficult.

“You never know how many candidates you’re going to have,” Winter said in reference to some years when judges retire, which means more candidates can seek public financing.

Winter added that it’s also hard to tell which candidates will decide to utilize public financing.

“How much money you need is a moving target,” Winter said.

NM Political Report reached out to Winter’s chief of staff regarding the required report to the Legislature in 2015. We will add his response when we receive it.