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New Jersey Statehouse. (Photo: Kevin Sanders for the New Jersey Globe)

Contractor donations to party organizations dropped sharply after 2008 executive order

Changes to pay-to-play law drove giving to dark money groups, ELEC says

By Nikita Biryukov, January 19 2021 10:40 am

Public contractor contributions to state parties and legislative leadership PACs fell drastically in the decade following a 2008 executive order that expanded pay-to-play restrictions, the New Jersey Election Law Enforcement Commission said.

Between 1999 and 2008, public contractors gave more than $23 million to the state’s “Big Six” committees, a group that includes the Republican and Democratic State Committees, as well as partisan leadership PACs in both legislative chambers.

Between 2009 and 2019, that figure dropped to less than $1.4 million, a staggering decrease of about 94%. Average annual contributions dropped from about $2.3 million in the earlier decade to $123,472 in the more recent one.

“Those who wanted to see contractor contributions dry up will be glad to know that, at least with the Big Six committees, pay-to-play laws worked,” ELEC Executive Director Jeff Brindle said. “The downside is it has made it much harder for party officials to raise money, and that has weakened party committees.”

The drop was even sharper for the state’s top contractors. Decotiis, Fitzpatrick, Cole and Giblin, a law firm frequently embroiled in the state’s politics, gave $834,337 to the Big Six committees between 1999 and 2008. It gave nothing in the following decade.

Contributions from Lowenstein Sandler, another politically-connected law firm, dove from 637,825 in the earlier decade to just $435 between 2009 and 2019.

Parker McCay, a law firm headed by Philip Norcross, the brother of Rep. Donald Norcross (D-Camden) and South Jersey powerbroker George Norcross, also stopped giving to the party organizations after 2008 after donating $520,500 in the decade preceding Gov. Jon Corzine’s executive order.

Overall, donations from the 10 most generous contractors tumbled by more than 99% in the decade following the order, falling from just over $5.7 million to $6,098.

“Our analysis seems to confirm my long-held belief that state laws against pay-to-play may be one of the root causes for a downturn in political party fund-raising,” Brindle said.

Though contributions from contractors dropped sharply after 2008, total fundraising for the Big Six committees saw a less precipitous decline. In the decade preceding the executive order, the groups raised about $150 million. In the decade after, they brought in about $94.3 million, a drop of roughly 37%.

Corzine’s order expanded definitions in the state’s pay to play law to include bidders’ family members and lower limits on contributions to gubernatorial candidates, legislative leadership PACs and political parties at the state, local and county levels.

The report redoubles ELEC’s longstanding concerns about the decline of party organizations. Donations that previously went to such groups now largely go to PACs and non-profits with laxer disclosure requirements.

“Contractors now can get around the original intent of the law by simply cutting huge checks to those independent committees along with traditional political action committee,” Brindle said. “To make matters worse, many independent groups are ‘dark money’ committees, which hide the source of their funding.”

They’re urging changes to the law that would lower contribution limits from contractors to organizations and reducing those for PACs, from $7,200 to $1,000.

“If a party committee accepts a big check from a contractor, at least the public will know it,” Brindle said. “Party officials then can be held directly accountable if they exert undue influence over a contract. It actually would make it easier to expose corruption.”

Conversely, Brindle said, a lack of meaningful disclosure requirements for PACs, super PACS and other independent groups enables corruption by obfuscating political contributions.

Officials at ELEC have been sounding that horn for years without any major movement in the statehouse.

“Political parties are one of the mainstays of democracy. We need to reinvigorate them, not starve them of funds,” he said. “Parties historically have served as training grounds for political leadership. While parties sometimes must be adversarial, they also can help build bipartisan relationships that can promote compromise and ease the political polarization that is plaguing us today.”

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