Finance reform bills dead

By Kevin Dayton and Lynda Arakawa
Advertiser Capitol Bureau

State campaign finance reform died Friday evening with the help of three of the Legislature's most successful political fund-raisers who have been among those most likely to benefit from the system just the way it is.

•	To see the latest campaign spending information compiled by the state spending commission, visit www.state.hi.us/campaign/

Those three lawmakers are among the most effective fund-raisers in the Legislature, according to an Advertiser review of campaign-spending reports for the past four years.

Kawamoto raised more than $230,000 during that period, the most of any of the 76 members of the House and Senate. Kim raised almost $168,000 and Kanno raised more than $140,000, far more than most House and Senate lawmakers.

Scuttled for the year is proposed legislation that would have banned donations by corporations and unions and from companies that have contracts with the state, city or county governments.

A second bill would have launched a pilot project to test a new system for public financing of Honolulu City Council campaigns.

Kawamoto said the state campaign finance system "is not broken. This is the best system we've got in the world, an opportunity where people can express their own opinions to different candidates."

But Robert Watada, executive director of the state Campaign Spending Commission, said he has been pressing lawmakers since 1995 for many of the changes that died in the Senate Friday.

Watada opposed the public funding bill, but supported lowering the amount of allowable contributions by individuals, a ban on corporate and union contributions, and an end to contributions by companies that do business with the state and city.

Watada said he isn't surprised lawmakers keep killing those proposals because "it cuts right into the heart of their ability to raise money."

Businesses top contributors

Most contributions are from businesses seeking access to lawmakers or other officials, or to influence the outcome of action at the Legislature, Watada said.

Businesses focus their donations on the most powerful members of the House, who have authority over many areas. Advertiser library photo • Jan. 17, 2001

For instance, the largest sources of campaign contributions for Senate Labor Committee Chairman Bob Nakata, D-23rd (Kane'ohe-Kahuku), and House Labor and Public Employment Committee Chairman Terry Nui Yoshinaga, D-22nd (Mo'ili'ili-McCully-Pawa'a), were unions.

Likewise, the transportation industry, including shipping companies and airlines, was the largest source of contributions for former House Transportation Committee Chairman Ken Hiraki, D-25th (Downtown-Ala Moana).

In the Senate, a wide range of business groups gave generously to Sen. Ron Menor, D-18th (Waipi'o Gentry-Wahiawa), who had broad regulatory authority over a variety of industries as the former chairman of the House Consumer Protection and Commerce Committee, and as the current chairman of the Senate Commerce, Consumer Protection & Housing Committee.

Many of the same companies and business boosters have contributed substantially in previous years to Sens. Kanno and Brian Taniguchi, D-11th (McCully-Mo'ili'ili-Manoa), who were the co-chairs of the Senate Consumer Protection Committee last year.

In other words, donations tend to follow the power. This is particularly obvious in the House, where businesses focused their donations on the most powerful members who have broad authority over many areas.

Expect nothing in return

By far the most successful House fund-raisers were House Speaker Calvin Say, D-18th (Palolo-St. Louis-Kaimuki), House Finance Committee Chairman Dwight Takamine, D-1st (Hamakua-N. Kohala), and former House Speaker Joe Souki, D-8th (Waiehu-Ma'alaea-Napili).

To people familiar with the operations of the Legislature, that pattern of contributions is a no-brainer: Virtually every major piece of legislation that moves through the House requires the support of the speaker, the finance committee chairman or both.

Lawmakers sometimes argue their contributors are donating more to support the politicians themselves than to try to influence legislation. Kawamoto, for example, said he has been a successful fund-raiser in part because he is the oldest state senator at age 61, and many friends he grew up with or met at college contribute to his campaign.

They don't expect anything in return, he said.

"They like what I do and what I'm for," he said.

But that doesn't explain why campaign contributions so often flow to those in power — or evaporate when power is lost.

For example, Souki was an extremely successful fund-raiser in 1997 and 1998 when he was the House Speaker, raising more than $144,000 in those two years. But after Souki was replaced in late 1998, his contributions plummeted to less than $43,000 in 1999 and 2000.

Watada estimated that less than 10 percent of the population makes donations, and most contributions come from businesses. He said by far the largest contributors are companies that do business with the state, city or counties.

"The way the limits are set up, very few people give, but they give a lot," Watada said. "Whether we're talking about the Legislature or the other races, the finance system allows for a small group of people to control too much."

The bill banning corporate and union contributions was approved unanimously in the House, but never even allowed a public hearing in the Senate.

House Majority Whip Brian Schatz, an outspoken advocate for campaign finance reform, said Say deserves much of the credit for advancing the bill.

"I think there's a feeling that democracy is getting undermined, and that's why the House has taken such a strong position on this issue," said Schatz, D-24th (Makiki-Tantalus).

Still, Schatz and several other House leaders said they were not surprised the campaign finance bills died in the Senate.

"I think there was a lot of concern about how that would affect people's individual situations," Schatz said.

Kanno, first elected to the Senate in 1992, said he wanted to hear the bill and referred other questions to Kawamoto. Kawamoto, a senator since 1992, said only that "I guess the chairs didn't want to hear the bill."

The measure was referred jointly to Kanno's Judiciary Committee, Kawamoto's Transportation, Military Affairs and Government Operations Committee, and Kim's Tourism and Intergovernmental Affairs Committee. All three chairpersons would have to agree before the bill could even be allowed a public hearing. That never happened.

Kim, who established a track record on the Honolulu City Council as an extremely successful fund-raiser under the current law, said she didn't know why the bill wasn't heard.

"I agreed to have it be heard, but ... not all the chairs agreed that it should be heard," she said. "I don't necessarily say that I agreed with (the bill), but I was willing (to) have a discussion on it."

Kawamoto argued the bill's ban on union and corporate donations and contributions by contractors who do business with the state and city may be unconstitutional.

"I feel that you're treading on First Amendment rights as far as expression is concerned," he said. "The question is, do we curtail, do we reform this for the people that don't contribute, or do we reform it for the people that want to express their opinion through monetary donations?"

Finance bill backers angered

Contributions out of corporate or union treasuries are allowed under state law but banned under federal law in federal races. Corporate executives and union members can donate to federal candidates out of their own pockets, however.

State law limits contributions by individuals to no more than $2,000 in a two-year race such as those for the House, and $4,000 for four-year races such as Senate contests. Watada argues those limits were set too high, and the bill killed Friday would have cut those limits in half.

By contrast, under federal law, the most an individual can contribute to any candidate is $1,000.

Supporters of the public financing bill were angered when the three committee chairpersons allowed the bill to die Friday without a public vote. The measure would have allowed candidates to receive up to $80,000 in public money to run for Honolulu City Council. To qualify for public financing, candidates would have to collect $2 contributions from 250 voters.

Supporters said the measure would give candidates a realistic shot at winning a council seat without taking money from "special interest" campaign contributors.

The public financing bill was approved by the House in a 48-2 vote. The Senate committees held a public hearing on the same measure Friday, and then agreed to defer action indefinitely, knowing that at midnight the pilot project bill would die.

"That was dirty," said Laure Dillon, a supporter of the bill and president of Hawai'i Clean Elections, a lobbying organization that pressed for public financing of campaigns for the last several years. "They should have taken a vote. It's the honest thing to do.

"They're their own best example of why we need campaign finance reforms."

Kawamoto said the committee was divided over the bill. He said some members didn't like the bill and didn't want to take a public vote for fear the vote would become "a campaign issue."

Dillon said preferential deals are cut to large contributors and that contributors generally enjoy more access to politicians over those who have not given any money.

"I've been staff here (at the Legislature)," she told senators. "I know who has gotten into the office and who hasn't."

Nikki Love, executive director of the Hawai'i Elections Project, a non-profit organization dedicated to campaign reform education and research, said campaign finance reform is necessary to eliminate the public perception that politicians are only beholden to special interests that make large contributions.

"When I urge my peers to get involved, to participate in politics, or even simply just to vote, they tell me, 'What's the point? It's all corrupt anyway,'" she said. "Their perception — whether it is true or not — is that politics is rotten to the core. They believe that voicing their opinion in the polling booth is easily drowned out by the bigger and stronger voice of campaign money."

As for arguments the public is cynical about the campaign contribution process or is unhappy with it, Kawamoto replied: "In their eyes, they think that. In my community, we don't have those kinds of problems."

Kim pointed out that while contributions may sway some politicians, many who are influenced by a certain interest come from those sectors. She said she has remained independent and has voted both for and against the interests of contributors.