Governor Deval Patrick has set up a novel political fund-raising system that allows him to skirt the state's campaign finance law by channeling big contributions through the state Democratic Party, which, in turn, has paid off hundreds of thousands of dollars of the governor's political expenses.
Under the unique arrangement, Patrick, who ran for election sharply criticizing the "politics of money and connections," is raising contributions far in excess of the individual limit of $500 for a political candidate. Now, in many cases he is getting as much as $5,500 from individual lobbyists, corporate executives, developers, and other supporters.
The money goes into a special pot of money called the Seventy-First Fund (after Patrick's standing as the 71st governor) which, under a written agreement between the Patrick campaign and the Democratic Party, serves as a conduit to divide up contributions.
Each donation is split between Patrick's own campaign committee, which receives the maximum allowed individual contribution of $500, and the state Democratic Party, which receives $5,000, the most an individual can contribute to a political party.
The party then uses most of the receipts to pay off the Patrick's campaign committee's bills; in 2007, the party paid $339,000 of governor's expenses, including bills for his media consultant, banquet halls, a ball room and buffets, website development, and more.
"They are gaming the system," said M.A. Swedlund, the co-chairwoman of Mass Voters for Fair Elections, a group that advocated for public financing elections. Swedlund, who supported Patrick's campaign last year, said she is disappointed in Patrick's new fund-raising techniques but not surprised. "It is taking fund-raising to another level," she said.
The setup is a hybrid blend of old and new techniques. Party money has been used to assist individual candidates up for election in the past, but Patrick is adding a new dimension as a sitting governor by using an additional fund to leverage sizable contributions from individuals, and then aggressively tapping party coffers to pay off his political bills.
The system has been deemed legal by state campaign finance regulators. But advocates of campaign finance reform and other analysts say Patrick and the Democratic Party are using loopholes that vastly increase the potential influence of special-interest campaign money on the governor.
"It is a bit unsavory because the money is getting channeled and washed through the party," said Jeffrey Berry, a political science professor at Tufts University. He said the operation demonstrates that the state finance campaign laws need to be revamped.
But Patrick's political aides and party officials defended the new system as playing within the existing rules.
Liz Morningstar, executive director of the Deval Patrick Committee, in a statement released by the campaign, did not respond to questions about the apparent circumvention of the state's $500 limit on individual campaign contributions. She said the fund-raising system is one of several tools at Patrick's disposal "to strengthen and grow the Democratic Party in Massachusetts."
"This program is just one of the ways we're establishing a strong Democratic infrastructure in every precinct across Massachusetts," she said in the statement.
John Walsh, the Democratic Party chairman, disputed any suggestion that using the Seventy-First Fund in this manner contradicts Patrick's promise to dispense with special-interest politics on Beacon Hill or circumvent individual campaign limits of $500.
"Those donors are people that the governor has asked to support the party, and the party is carrying out its mission of building its grassroots and supporting its elected officials," Walsh said. "We are doing it within the rules, and the rules in fact are designed to give the party that role."
Common Cause of Massachusetts, a watchdog group, found nothing about Patrick's strategy that prompted alarm, said its executive director, Pam Wilmot.
The way was cleared for the system four years ago, when state campaign regulators rewrote regulations that allowed governors and other elected officials to create special political funds to raise money for their political parties. Former governor Mitt Romney never set up the sort of operation that Patrick and his aides have created.
Patrick's aides created the Seventy-First Fund in March. Over the past seven months, Patrick raised $478,000 for the fund. If the party had not paid $339,000 to pay off Patrick's campaign committee bills, his committee's year-end balance in 2007 would have been $25,736, a relatively small amount for a sitting governor. Instead, he is currently sitting on a war chest of $365,000.
A review of campaign finance records shed light on how the party, with the donations from the Seventy-First Fund, supported the Deval Patrick Committee. It paid $18,000 to the committee's public relations consultant, Steve Crawford. It paid the $27,194 tab at the Fairmont Copley Plaza for a political bash last month. Other bills included fund-raising events the committee held last year.
The tools that Patrick is using to create the Seventy-First Fund and get around limits on individual campaign contributions have developed gradually. They had their roots in 1994, when the state passed reforms aimed at curbing the influence of wealthy donors and special interests on the political process with a $500 ceiling on annual donations - dropping it from $1,000 to one of the lowest limits in the country. Lobbyists are restricted to $200.
A special section in that 1994 law allowed for parties to create special political committees or funds that could raise money that would then go into the party accounts. Initially, the Office of Campaign and Political Finance restricted the donations to those funds to $500 per person.
But a suit by a Democratic legal team in 2003 prompted the office to change the regulations so that such funds could accept as much as $5,500. With the Seventy-First Fund, Patrick expanded that even further by setting up a written agreement between his campaign and the party that allows him to operate the fund.
