Tracking the Money in the Democratic Primary

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Courtesy Kingston Creative.
Check out their insights on the 19th here.

Correction: Due to a miscalculation, the percentage of small-dollar contributions for each candidate has been revised down. Beals, not Clegg, has the second-highest percentage of small-dollar contributions, though the rest of small-dollar rankings are the same, even with the revised numbers.

Though the Democratic Primary for the 19th Congressional District is seven months away, the six candidates have raised more than $3.1 million, an unusually high amount that speaks to local — and national — attention on the race.

Six candidates are vying to see who will run against incumbent Republican John Faso next November: entrepreneur and veteran Pat Ryan, former deputy press secretary to New York Gov. Andrew Cuomo Gareth Rhodes, businessman Brian Flynn, attorney Antonio Delgado, attorney and church deacon David Clegg, and high school teacher and former diplomat Jeff Beals.

To see where all this money was coming from and what it meant, I slogged through candidates’ filings with the Federal Election Commission (FEC), as well as speaking to several candidates and interviewing Executive Director of the Campaign Finance Institute in Washington D.C. and University at Albany Professor Michael Malbin, a nationally recognized expert on campaign cash. Here are the main takeaways:

Two candidates have pledged not to take corporate money-

Both David Clegg and Jeff Beals have said they want to raise money from small donors.

“I’d like to run this race with support from the people from this district…with small donors,” Clegg said in an interview Saturday. “People want to see democracy enhanced, instead of a corporately influenced democracy which is unjustifiably swayed to ultra-rich and big corporations.”

Beals, who spoke about the need to get big money out of politics in an earlier TOHV interview, said Saturday his campaign was doing “grassroots fundraising” to build a “people’s campaign.”

“I want to enact Medicare for all, raise Social Security benefits, and lower prescription drug prices,” he said. “To do that, we have to face down corporations and special interest money,” he said.

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David Clegg Courtesy Clegg Campaign

But how much influence do corporations have on primary races?

Corporations can’t directly contribute money to campaigns, either during primaries or general elections.

There are three main ways for candidates to raise money for their campaigns, Malbin said.

“You raise from political (action) committees, or from individual contributions, or you finance yourself — there’s not much else you can do,” he said.

Political Action Committees (PACs) raise money with the intent of getting candidates elected who will promote their interests. The interests vary widely, from veterans’ issues to the interests of a particular industry or company. The most a PAC can contribute to a candidate in a primary is $5,000, according to FEC rules.

Individuals can contribute up to $2,700 to a candidate under FEC rules, and a candidate can either loan or contribute an unlimited amount of money to their campaign.

Candidates can also receive money from party committees, such as the Democratic National Committee, but none of the primary candidates have so far received money from these sources, according to FEC filings.

The main way corporations finance candidates is through Super PACs. Super PACs, unlike PACs, cannot contribute money to a campaign. What they CAN do is independently campaign for or against a candidate, though any collusion between a Super PAC and a candidate is illegal.

Super PACs raise money from corporations, organizations such a labor unions, and individuals. There is no limit to how much money these entities can give to Super PACs.

However, there is no indication Super PACs have involved themselves in the primary election thus far.

Candidates declaring they won’t take corporate money is “not a statement that will cost the candidates a great deal,” Malbin said, especially in the primaries. Corporation-backed Super PACs may well involve themselves in the general election in November, but the eventual democratic candidate would most likely not be backed by them. Only 15 percent of business-backed Super PAC money goes to non-incumbents, Malbin said, because these contributions are all about “maintaining [businesses’] ability to have access to and lobby officeholders.”

“So [pledging not to take corporate money] is an easy gesture,” Mabin said. “It doesn’t mean they won’t take money from executives who work for corporations.”

But again, an executive could only contribute $2,700 to a candidate during a primary.

Rhodes and Beals had the highest proportion of money coming from in-state-

Of the $293,649 Rhodes has received as of Sept. 30, 72 percent came from contributors from within New York, essentially the same as Beals, according to FEC filings. The four other candidates had between 53-55 percent of their money come from in-state.

Malbin declined to comment on any particular candidate’s in-state numbers, but said “the sources of their funds are a clear reflection of the national interest in the race.”

Several of the candidates are raising money through ActBlue, a conduit for contributing to democratic candidates online. The Massachusetts-based service allows people from anywhere in the U.S. to easily give money to candidates across the nation, and was used extensively by Zephyr Teachout, the college professor and anti-corruption advocate who unsuccessfully ran against John Faso in 2016.

Rhodes had the highest proportion of small-dollar donations

Twenty percent of Rhodes’ money came from donations of $200 or less*, according to FEC data. Beals was close behind, with 18 percent of his money coming from these small-dollar donations.

On the other end of the spectrum, only 8 percent of Ryan’s money came from these small donations, and only 7 percent of Flynn’s money.

Delgado raised more than $100,000 from employees of his law/lobbying firm-

Delgado worked for Akin Gump, an international law and lobbying firm, before taking a leave of absence in late summer to focus on his campaign, he said Sunday.

Akin Gump has 20 offices across the globe, and five members of the firm’s Public Law and Policy Practice were named top lobbyists in the “Hired Guns” category of The Hill’s annual survey — more than any organization, according to an Akin Gump press release.

Delgado focused on litigation at the firm, particularly bankruptcy litigation and “complex commercial litigation,” according to his professional profile on the Akin Gump website.

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Antonio Delgado Courtesy Delgado Campaign

As was stated before, corporations or companies cannot give money directly to candidates, but members of the firm gave Delgado’s campaign $107,550 — more than 10 percent of the money he has raised.

When asked if this was a potential conflict of interest. Delgado replied, “absolutely not.”

“Who’s giving me money are individuals who I’ve had really good relationships with over the years, people I consider friends and colleagues, people (who) know me personally and who believe in the very things that I want to fight for, particularly when it comes to fighting for working families and middle-class families,” he said.

Raising money from colleagues is not at all unusual, Mabin said.

“First of all, there’s 900,000 other dollars, and second, it’s not unusual for lawyers to start off with a significant amount of support from [their] partners or co-workers,” he said.

The top two employers for donors to New York Democratic Senator Kristin Gillibrand’s campaign were the two law firms she worked for before running for Congress, Malbin added.

Several candidates are using their own money-

Brian Flynn loaned $650,000 to his campaign, as well as giving it $35,400 directly. This makes up the majority of the cash the campaign is working with, as he has raised $394,651 through individual contributions, according to FEC filings.

David Clegg loaned his campaign $110,000 and gave it more than $11,000 directly, more than half of his campaign’s funds, according to FEC filings.

“I am fortunate enough to be able to contribute to my campaign enough…so that we can be competitive in the race,” Clegg said Sunday.

Beals loaned $56,000 to his campaign, according to FEC filings, a little less than half of the funding for the campaign.

Delgado has raised the most money

Other than Brian Flynn, Delgado was the only candidate to raise money prior to April, the first filing date with the FEC. He has raised more than twice the amount of money than any other candidate — $1,046,739 as of the end of September — and almost 18 times the money raised by Beals.

Delgado said it was “work ethic” that resulted in so many contributions.

“It’s actually being dedicated and spending a lot of time doing the work, getting on the phone, connecting with people, making yourself vulnerable and humbling yourself and asking for support day in day out,” he said.

Lacey Delgado, the candidate’s wife, is “very much part” of the fundraising process, Delgado said, and her family’s roots in the district helped contributions flow in.

However, large amounts of money far from guarantees victory, Malbin said, pointing to the 2016 Republican Presidential Primary, where Jeb Bush vastly out-raised Donald Trump, but didn’t win the nomination.

The most important thing in a primary is having a candidate people have positive associations with who presents a message voters connect to, he said.

However, money can be more important in a primary than a general election, Malbin said, because there’s less free publicity through the media and therefore candidates must spend more on advertising.

Either way, there is seven months left before the primaries, and a lot can change. Keep up to date, voters.

*A Note on the Numbers-Many people use OpenSecrets.org, the website of the Center for Responsive Politics, to do their campaign-money tracing. OpenSecrets gets its information from the FEC. I went directly to the FEC data, because I found the information on OpenSecrets lacking in many regards, and therefore my numbers vary from those of OpenSecrets. For instance, OpenSecrets calculates the amount of money raised through small-dollar donations by simply taking the amount of money not itemized, since candidates are not required to itemized contributions of less than $200 with the FEC. However, many of the candidates in the 19th itemized contributions of less than $200, so the percentage of small-dollar donations OpenSecrets says each candidate received is much lower than the amount they actually received. Any questions about the numbers? Email me.

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