In a compromise that could help candidates for governor in 2010 with fundraising, state House and Senate negotiators agreed yesterday to relax a limit on Mainland political contributions.

State candidates can raise no more than 20 percent of campaign money from the Mainland during each campaign-finance reporting period under existing state law. Under the agreement, the new limit would be 30 percent and would apply to donations over an election cycle.

Lawmakers also agreed to narrow a provision of the law prohibiting political contributions from state and county contractors to only non-bid contractors. The law is intended to discourage so-called "pay to play" exchanges of campaign donations for state or county contracts.

Some lawmakers wanted to repeal the Mainland contributions limit, while others urged for a 50 percent restriction, so the agreement was a compromise. The bill now goes to the full House and Senate for final votes.

Advisers to U.S. Rep. Neil Abercrombie, a Democratic candidate for governor in 2010, and Lt. Gov. James "Duke" Aiona, a Republican candidate, have cited the Mainland limit as a potential chilling effect on fundraising for what could be a $3 million to $6 million campaign.

Majority Democrats acknowledged yesterday that repealing the limit would likely have been perceived as helping Abercrombie, who has Mainland fundraising connections from his two decades in Congress.

The limit was passed in 2005 — and took effect in January 2006 — to reduce the influence of Mainland interests on state development, economic and social policies. But it was also meant to curtail Gov. Linda Lingle's ability to raise money from Republican donors on the Mainland.

"My concern is that we don't want to look like we're accommodating any particular political candidate, so the modest increase didn't seem to be too much," said state House Majority Leader Blake Oshiro, D-33rd ('Aiea, Halawa Valley, 'Aiea Heights), who said lawmakers also had concerns about whether the law is constitutional.

State Sen. Brian Taniguchi, D-10th (Manoa, McCully), one of the lead negotiators on the bill, said lawmakers were not intentionally trying to help Abercrombie or any particular candidate.

"There is still some concern that you don't want interests from outside the state to come in and spend a lot of money," he said. "So we didn't want to make it unlimited and take that restriction off. I thought we were going to go with 50 percent, but we made it 30 percent."

State Rep. Jon Riki Karamatsu, D-41st (Waipahu, Village Park, Waikele), one of the lead negotiators, said he personally believes the limit would be struck down by the courts if challenged.

In December, Barbara Wong, the executive director of the state Campaign Spending Commission, recommended that the commission urge lawmakers to repeal the restriction because of constitutional concerns. Wong described the law as "over-broad and under-inclusive" because it prevents people with Hawai'i ties on the Mainland from making full donations to candidates and treats Mainland donors differently from local donors.

The commission declined to recommend a repeal, but, earlier this session, Karamatsu's House Judiciary Committee backed a repeal. The limit was later restored by the state House Finance Committee.

"We still have concerns. However, we let the Legislature address that and we don't have a problem with the increase in the cap," Wong said.