With Ohio Speaker of the House Larry Householder charged with racketeering for participating in a pay-to-play dark money scheme to bailout to nuclear power plants for FirstEnergy, state politicians have been quick to denounce Ohio’s lack of campaign finance transparency. In a statement yesterday, Ohio Secretary of State Frank LaRose announced House Bill 737, sponsored by Gayle Manning (R-North Ridgeville) and Jessica Miranda (D-Forest Park).
The goal of HB 737 is to make campaign contributions more transparent and more easily traced to their source. Some provisions include requiring ads to disclose their original source of money. This provision would have forced groups such as “Ohioans for Energy Security,” which advertised lies claiming that a petition to kill Householder’s bailout would result in a Chinese takeover of Ohio’s energy industry, to disclose that it was actually funded by FirstEnergy. It would also have required Householder’s PAC, Generation Now, to disclose its financial connections to FirstEnergy, which would trace back the money other candidates received from Householder.
Other key provisions include requiring campaigns to file reports more frequently and requiring them to report expenditures and donations directly to the Secretary of State’s office. The bill will also grant the Secretary of State greater subpoena power and allow him more power to impose fines or criminal penalties for noncompliance. You can read the full bill here, but keep in mind that it is still a working draft.
We at Reconstructing Dayton are happy to see a renewed focus on campaign finance transparency but it’s unfortunate that it took a major statewide scandal to bring attention to this issue. Some of the provisions, such as uncloaking the original sources of contributions, could be greatly beneficial to Ohio voters. However, we do believe that while corporate donors should not be granted anonymity, due to the threat of retaliation, individual donors should have the option to remain anonymous. We will comb through the text of the actual bill to see if this distinction is being made.
One major problem with the bill is that it still depends on campaigns and political organizations to self-report. While it improves our current opaque system that allows money to be funneled from one organization to the next, we have some suggestions that could greatly improve HB 737.
Reconstructing Dayton’s Recommendations
We believe a public service donation portal should be created and maintained by the Secretary of State that would take the donation process out of the hands of campaigns and political organizations. This would be open source (like CiviCRM) and rely on encrypted channels to allow donors to make their contributions directly to the portal, which would then disburse the funds to the campaign or political action committee. While small donations would still be allowed for fundraising events such as pancake breakfasts, if individual contributions exceed $100, then they need to be individually reported and submitted through the portal. This could all function in real time so no delay exists between a donation being granted and its public reporting . Individual donors would have to identify what sector they work in so that if a particular industry—such as energy or health care—is trying to buy a candidate this becomes obvious to law enforcement, journalists, and concerned citizens. We could see the number of donations and the amounts, so suspicious activity could be easily identified. Individual donors could still contribute to 501(c)4 organizations anonymously to protect them from retaliation, but corporate donors would have to disclose their identities.
There are several benefits to such a system. First, it would lead to greater transparency than HB 737 as it stands. It provides a key balance between the privacy rights of individual donors and the necessity to make corporate donations public. It would also help to prevent donors from being duped by scam PACs, which masquerade as political organizations but only exist to enrich their founders. Furthermore, it would eliminate costly barriers to get campaigns off the ground for non-traditional candidates. By circumventing other fundraising schemes that take a cut of donations, such as ActBlue, WinRed, or Anedot, a donor’s money actually goes where it’s intended. Building and maintaining such a system would cost less than a system of paperwork and investigations that merely functions as a game of corruption whack-a-mole. And, finally, local elections would be forced to file reports that are 100% ADA compliant, instead of the current hand filled out, scanned reports we now have via self-reporting.
As HB 737 still has a long way to go before becoming law, we encourage you to speak to your local representative and ask them to support measures that go beyond what’s currently in the bill. You can find your local representative here. At Reconstructing Dayton we support candidates who push for greater transparency in campaign finance reports. While HB 737 represents progress, the passage of this bill alone will not completely rid Ohio of dark money.
As a 501(c)4, Reconstructing Dayton is aware that these changes would directly affect us. Although we want our individual donors to have the option of anonymity because we challenge those in power, we also believe in being as transparent as possible.