CITIZENS UNION APPLAUDS FEDERAL COURT’S DECISION
UPHOLDING CITY'S EFFORTS to RESTRICT CAMPAIGN GIFTS FROM THOSE WHO DO BUSINESS WITH THE CITY
Statement By Dick Dadey, Executive Director

Citizens Union is pleased by today's resounding decision by United States District Judge Laura Taylor Swain, in which the Court strongly upheld the constitutionality of key provisions of the City's campaign finance law aimed at curbing the appearance of pay-to-play corruption with those who do business with the City. Judge Swain's ruling wholly rejected the claim that the City's restrictions on contributions by individuals who do business with the City violate the First Amendment. Today's decision provides much needed clarity to the City's campaign finance law and its enforcement by the City's Campaign Finance Board as the city enters an important local election cycle.

Judge Swain's decision, which represents a resounding vindication of the City's public policy rationale for restricting the size of contributions from those who do business with the city, including lobbyists and contractors, marks a milestone in the ongoing effort to maintain the integrity of the political process and curb the sometimes transactional appearance of certain campaign contributions and their possible corrosive effect on governing.

In upholding the challenged provisions of the campaign finance law, Judge Swain recognized the legitimacy of the City's interest in good government and its rationale in enacting these significant reforms - reforms that were originally called for by New Yorkers in a 1998 referendum. The interest of good government was to prevent corruption, actual or perceived, arising from excessive campaign contributions by those who do business with the City.

The decision also upheld the validity of the provision of the law that ends the use of public matching funds for contributions by those doing business with the City. The Court recognized that this provision was consistent with the anti-corruption goals of the public's interest and therefore is an appropriate restriction on the use of taxpayer dollars. Similarly, the Court upheld the restrictions on contributions from partnerships and LLCs, correctly recognizing that the government's interest in eliminating actual or apparent undue influence justified a ban on contributions by all business entities regardless of how they are internally structured. It also upheld the legislature's power to make judgments regarding the reforms that are most urgently needed.

This decision also validates the view that the City's campaign finance law is on the cutting edge of campaign finance regulations nationally. This case presented issues of first impression, and the ruling here is likely to have considerable significance in litigation down the road, because many other places look to the City's campaign finance law as a model for the nation.

With the support and assistance of it pro bono counsel, Proskauer Rose, Citizens Union filed an amicus brief along with its good government colleagues whose arguments were embraced throughout the Court's decision. Citizens Union, which has been heavily involved in the good government cause since the time of Tammany Hall, was in a unique position to provide the court with its historical perspective, and the court's citation to our amicus indicates that we have succeeded in our mission.

Citizens Union of the City of New York, a nonpartisan force for good government for more than 100 years, works to inform and engage New Yorkers, to ensure local and state government values its citizens, addresses critical issues, and operates in a fair, open, and fiscally sound manner.

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Peter J. W. Sherwin, Chair • Dick Dadey, Executive Director • info@citizensunion.org