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Monday, April 4, 2011

Hey, big spender: Who pays for municipal campaigns?

Every four years city councillors spend the equivalent of one third of their annual stipend hoping to be re-elected. Where do they get that money? Does it matter?

Spreadsheets are not my forte. I took a course in Excel a few years ago, got an A+, but unless you apply the knowledge regularly, it is likely to be short-lived. It’s not like riding a bicycle.

I got to do a little brushing up when I started to analyze the candidate financial reports from the 2010 municipal campaign. Last week, I analyzed the campaign spending; this week, it’s the source of the finances. 

Where does that money come from?

Again, I am limiting my analysis to those candidates who were successful in gaining a seat, exclusive of the mayoralty race which is city wide. In some future analyses, I will examine that race and some of the hotly contested ward races.

When all the data is entered into a spreadsheet, some interesting patterns can be observed.

The total that successful candidates spent on their campaigns was just under $191,000 with an average of $13,634 per campaign. In spending, Ward 13 Councillor Judy Bryant and Ward 8 Councillor Paul Hubert were within $1,000 of average. Ward 14 Councillor Sandy White and Ward 11 Councillor Denise Brown were over the average, spending slightly more. Councillors Armstrong, Swan, Baechler, VanMeerbergen and Usher were at least $3,000 below average and the remainder (Councillors Polhill, Orser, Matt Brown, Branscombe and Henderson) from $2,000 to $9,000 above the average.

Where do they get the money?

Candidates and Spouses

It may surprise some voters to learn that some of the money comes from the candidates themselves. This is particularly true of those who are not incumbents. The rules on municipal campaign spending allow candidates and their spouses to make unlimited donations to their campaigns. While a significant advantage to those with money to spend, this is often the source of the bulk of campaign donations for those who have not been previously been elected or those who do not have significant name recognition or organizational support.

But some incumbents also go this route, preferring to using their own money to active fundraising. 

One such candidate is Ward 2 Councillor Bill Armstrong who has generally eschewed fundraising. This election was no exception; almost 70% of his nearly $10,000 campaign was funded by himself.   Ward 5 Councillor Joni Baechler also covered 60% of her $5,000 campaign with her own money.   

But the heaviest contributor to her own campaign was Ward 6 Councillor Nancy Branscombe. She and  husband Ken Kalopsis covered over 85% of her $18,000 campaign from their personal resources, well above the average of $2,500. Councillors Matt Brown, Henderson, VanMeerbergen, Usher and White spent virtually no money on their own campaign and the remainder (Polhill, Swan, Denise Brown and Bryant) less than 10% of their overall spending came out of their own pockets.

Polhill’s is an interesting situation. He spent $2,200 of his own money but used much of it to store his signs for the next four years. It appears he is planning another run in 2014. Or perhaps they are a legacy for his children.

Small Donors

If you donate $100 or less to a municipal campaign, there is no requirement for the candidate to reveal the identity of the individual donor. Since there are no tax credits for municipal contributions and since one can remain anonymous, you would think that this would be a popular category.

Certainly, that was the major source of funding for both of my municipal campaigns. I depended heavily on contributions of $25, $50 and $100 to cover the bulk of my campaign expenses.

Not so among the successful candidates in 2010. Only Councillor Bryant had a significant number of donors in this category. Over half of her donations ($7,600) came from this source. Bryant had an early kick-off party at $25 per ticket which probably accounted for much of this. She certainly contributed more than her share to the overall average of $1,600 on this score, although White, Matt Brown and Branscombe (whose policy it was not to accept any outside contributions over $100) also were somewhat above average in small donations.

Corporate Donors

Now we’re talking real money. While Branscombe limited donations, individual or corporate, to $100 or less (with one exception of a donation of $120), most candidates accepted far more, often the maximum allowable of $750. On average over 40% of the total money raised for successful campaigns came from the corporate sector. VanMeerbergen covered 95% of his campaign expenses from his corporate sponsors, followed by Denise Brown (74%), Orser (71%), Henderson (62%), Polhill (62%) and Swan (57%). White received nearly $10,000 (44% of total money raised) from the corporate sector. Usher also received significant corporate donations (41%), a departure from what he filed in previous years when Shmuel Farhi was virtually his only developer donor. Only Armstrong and Baechler had no corporate donations while Matt Brown, 
Bryant and Hubert received one in five dollars from corporations.

In all, corporations injected nearly $90,000 into successful campaigns. Although there is a $750 limit to how much an individual or organization may donate to a single candidate, the limit for the overall contributions to candidates for council is$5000 and another $5000 for the school board races. Then, you can spend similar amounts in other municipalities. If you have a number of different businesses, holding companies or consulting firms, each of those is counted as a separate entity and, of course, you can still donate as an individual if you have the money.

To date, I have not completed an analysis of the total spending of all corporate entities although a cursory review suggests that most corporate donors sponsored more than one council candidate, both as corporations and as principals of the corporation. Some are numbered companies which makes it more difficult to tell which individuals are associated with them.

Individual Donations over $100

This was a significant source of funding for Baechler, Matt Brown, Hubert, and to a lesser extent, Polhill and Henderson. Again, this requires further analysis. While some donors were friends or relatives of the candidates, in many cases they were the principals of corporations and businesses. Same pocket, different chequebook. For example, Usher claimed only one individual donation over $100. This was from Shmuel Farhi. The same was true of other councillors and other donors. More on this later when I have been able to research it more thoroughly.


Unions donated $10,450 to political campaigns, just over 6% of all donations other than those by the candidate or his/her spouse. Matt Brown benefited most from union largesse, receiving money from his teachers’ union, Canadian Autoworkers Local 27, and the Labourers’ International Union Local 1059 for a total of $2,000. Next in line was White with donations from both Labourers and OPSEU, her social workers’ union. The Labourers represent the building trades and are closely aligned with the development industry. In addition to the foregoing, they funded Pohill, Orser, Hubert, Denise Brown and Henderson. CAW Local 27 funded Armstrong, Swan, Baechler, Usher and Bryant. Most candidates received $750 from one union or another.

So that’s the breakdown.

Does it matter who covers the cost of the campaign?

Just yesterday, Stephen Harper promised to eliminate public subsidies for election campaigns. It may be popular with the electorate who have been well indoctrinated to distrust and despise politicians. But doing so will mean a return to corporate sponsorship and government for and by the rich and powerful.

Currently, we have a council (with a few exceptions) whose number one priority is growth at almost any cost. 

Whose interests are being served? 

Will taxpayer subsidies to developers bring lasting good jobs to London? 

Will paving over more agricultural land give us a healthier, more dynamic and sustainable city? 

Will abandoning urban design guidelines make for a safer, more beautiful city?

There will be those who argue that corporations are just being good citizens by funding the political process and the candidates of their choice.

But they are the same corporations that come before council to ask for a favourable decision on bottled water, on the location of drive-throughs, on development in environmentally sensitive areas.

Follow the money.

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