Reforming Ottawa’s municipal election finances
In the 2003 municipal election for the City of Ottawa’s 22 council seats (Mayor plus 21 ward councillors) a remarkable thing happened: every incumbent running for re-election succeeded. The incumbent mayor and 15 incumbent ward councillors running were all re-elected, despite competition from 60 other candidates, despite endorsements for certain challengers from the two major newspapers and sundry interest groups. The only new councillors elected were from 6 “open” seats where no incumbent was a contestant.
A review of the 2003 municipal election in Ottawa indicates that there is an uneven playing field in municipal election campaigns, and the clear need for campaign financing reform.
Analysis of the
2003 Municipal Election in Ottawa
An analysis of the 2003 municipal election in Ottawa (see Analysis of 2003 Municipal Election, City of Ottawa[1]) shows that nearly $1 million was raised and spent in the 2003 municipal elections in Ottawa. It also reveals that the ability to raise and spend money to wage a campaign was a significant determinant in the success of candidates running for election.
Money is important to promote the campaign of a candidate and his or her ideas. It pays for signs, advertisements and brochures to let the electorate know who is running for what and why. The 2003 municipal election analysis shows that spending money is a winning strategy, as winners spent on average $27,735 on their campaigns ($18,373 when the mayoralty race is discounted), compared to losers who, on average, spent $8,691 on their campaigns ($8,407 when the mayoralty race is discounted).
In particular, of the 19 contested
municipal races in Ottawa in 2003 (there were 3 acclamations – all incumbents):
Indeed every incumbent won their contest, for a total of 16 incumbents retaining their seats out of 22 council positions (72.7%).
Contributions that finance municipal election campaigns come from 4 sources: individuals, corporations, unions, and the candidate and his/her spouse. Campaign contributions are limited to $750 per candidate (except for the candidate and his/her spouse for his/her own campaign); however, contributions of $100 or less are not recorded in election finances returns.
|
Total Contributions Ottawa 2003 |
Contributions $100 or less |
Individuals more than $100 |
Corporations more than $100 |
Unions more than $100 |
Contributions from self |
|
$938,990.72 |
$166,137.63 |
$370,225.45 |
$283,997.60 |
$ 1,597.50 |
$117,032.29 |
|
100% |
17.7% |
39.4% |
30.2% |
0.2% |
12.5% |
The election analysis indicates differences between incumbents and challengers in raising campaign funds: challengers were less able to raise as much money compared to their incumbent competitors, and challengers relied more on their own personal funds to finance their campaigns - $101,625 or 21.8% of their fundraising total (averaging $2,263 of those challengers who spent money on their campaigns).
Incumbents, however, didn’t face the same requirement, as their contributions from own funds amounted to only 3.2% of their overall fundraising: $15,407 in total from their own funds (averaging $963 an incumbent). Incumbents didn’t need to, because they had access to other sources of funds than did their challengers.
The necessity for challengers to contribute from personal funds in order to compete clearly inhibits the participation of Ottawa’s citizens as candidates in the municipal electoral process and consequently the debate of new ideas, which is fundamental to the concept of democratic choice.
Why do incumbents need to contribute less to their own campaigns? The evidence shows that incumbents are able to raise (and spend) significantly more funds than the challengers they face. One important factor is the effect that corporate contributions have in determining electoral success of incumbents. City Council’s incumbents, representing a little more than one-fifth of all the candidates for municipal office, snared nearly three-quarters of all funds contributed by corporations in Ottawa’s 2003 municipal elections – over $200,000, or over one-fifth of the total funds raised in Ottawa for that election. On average, incumbents received $12,901 from corporate contributions – over 40% of their total campaign revenues – whereas challengers who spent money received on average $1,847 from corporations, or 16.7% of their overall campaign revenues. Even when discounting the city-wide mayoralty race, incumbent city councillors received on average $8,668 from corporations (still over 40% of their total campaign revenues), compared to $1,773 on average to their challengers (16.5% of their campaign revenues). Surprisingly, unions play an insignificant role in campaign contributions in Ottawa.
City
of Toronto Experience
The
issue of the influence of corporate contributions (and union contributions) in
determining the success of municipal candidates was addressed by Toronto City
Council last year, following a review of municipal campaign finances in Toronto
by a City Council task force.
The
City of Toronto’s analysis of their municipal election determined that
corporate and union contributions to municipal candidates unbalanced the
electoral process and led to the perception of undue influence. As a result
Toronto City Council took the step of asking the Minister of Municipal Affairs
and Housing to reform the Municipal Elections Act to prohibit corporate and
union campaign contributions to municipal election candidates in the City of
Toronto.
Toronto Councillor
Michael Walker, the proponent of this initiative, provides the following
perspective on the origin of Toronto City Council’s position*: “Elections
are fundamental to democracy. So too are the processes that regulate the
financing of those elections. It is clearly good
public policy to encourage the involvement by the citizenry in the election
of their representatives, this being a practical expression of public
support for the principle of representative democracy. When such
involvement is financial, it can serve to facilitate candidacies, support
the debate of issues, widen interest in elections generally, and defray
system-wide costs. However, it is plain
that money is an important currency of politics. As a result, it is
essential to ensure that financial involvement in electioneering is subject
to clear and transparent rules for the giving and receiving of money and
other value, and that these do not permit or facilitate any perception of
impropriety or favoritism. It is fair to ask
whether the current regime for election financing measures up to such a
standard. It is reasonable to conclude that it does not.” *A Proposal for a Toronto Election Finance Review
Task Force, April 22, 2002
This action by Toronto City Council is consistent with the adoption by the Parliament of Canada of legislation to prohibit corporate and union contributions to federal election candidates and federal parties, prior to the last federal election. This in turn was modeled on similar legislation already in existence in the provinces of Manitoba and Quebec prohibiting corporate and union contributions to their provincial election candidates and provincial parties.
The
analysis for the 2003 municipal election in Ottawa leads to similar
conclusions.
Undue Influence of Corporate Contributions
In
Toronto the analysis of their municipal election by a City of Toronto Council
task force revealed that corporations dominated municipal election
contributions. In the 2003 Ottawa municipal election corporate donations were
clearly focussed on incumbent candidates and were successful in contributing to
their re-election. Indeed, 8 incumbent councillors received over half of their
campaign contributions from corporations, and a majority of the newly-elected
Ottawa City Council (all incumbents) received over 40% of their campaign funds
from corporate contributions (see table below).
The
ability of one sector of the community through financial contributions to
influence so greatly the outcome of a democratic process that is based on
one-person/one-vote cannot be seen as consistent with the principles of
democratic representative government. The inability of challengers to compete
on a level playing field means that new ideas are not able to be adequately
presented to the electorate, and inhibits the electorate’s ability to make
informed choices through the ballot. Further, the uneven playing field means
that challengers must draw more on their own resources in order to compete,
which further restricts the ability of citizens to present themselves and their
ideas to the electorate, again restricting the electorate’s ability to make
informed choices through the ballot.
|
Mayoralty
candidate elected: (*
denotes incumbent) |
Corporate
contributions ranked by share of campaign contributions |
|
Bob
CHIARELLI* |
43.4% |
|
# |
Ward
Candidate elected: All
wards (*
denotes incumbent) |
Corporate
contributions ranked by share of all contributions |
|
1 |
Gord
HUNTER* (Ward 9) |
66.9% |
|
2 |
Rick
CHIARELLI* (Ward 8) |
63.0% |
|
3 |
Shawn
LITTLE* (Ward 15) |
62.3% |
|
4 |
Jan
HARDER* (Ward 3) |
61.0% |
|
5 |
Doug
THOMPSON* (Ward 20) |
58.0% |
|
6 |
Herb
KRELING* (Ward 1) |
54.1% |
|
7 |
Michel BELLEMARE* (Ward 11) |
53.1% |
|
8 |
Janet
STAVINGA* (Ward 6) |
52.7% |
|
9 |
Jacques LEGENDRE* (Ward 13) |
45.1% |
|
10 |
Rainer
BLOESS* (Ward 2) |
42.8% |
|
11 |
Diane
DEANS* (Ward 10) |
41.5% |
|
12 |
Georges
BEDARD (Ward 12) |
39.7% |
|
13 |
Rob
JELLETT (Ward 19) |
37.6% |
|
14 |
Eli
EL-CHANTIRY (Ward 5) |
32.1% |
|
15 |
Peter
HUME* (Ward 18) |
28.4% |
|
16 |
Maria
McRAE (Ward 16) |
16.3% |
|
17 |
Alex
CULLEN* (Ward 7) |
4.0% |
|
18 |
Peggy
FELTMATE (Ward 4) |
1.2% |
|
19 |
Clive
DOUCET* (Ward 17) |
0% |
|
20 |
Glenn
BROOKS* (Ward 21) |
0% |
|
21 |
Diane
HOLMES (Ward 14) |
0% |
Equity Considerations Relating to Corporate Contributions
One
characteristic of the current system of municipal campaign contributions is
that it permits some citizens to contribute to the legal maximum twice to a
particular candidate, whereas others (the overwhelming bulk of the electorate)
can only do so once.
A
review of both individual and corporate campaign contributions of more than
$100 that were reported in the election finances returns from Ottawa’s 2003
municipal election indicates a number of instances where both a business and
the family of the business owner/management provided financial contributions to
the same candidate(s).
A
Special Class of People: The R.W. Tomlinson Group
of Companies has been active in Ottawa since 1952, providing heavy
construction, asphalt and aggregate supply, custom mining and environmental
services. From 2001 to 2003 they successfully bid on 63 contracts with the
City of Ottawa, worth some $7.5 million. It is a family business. William Tomlinson has
worked for R.W. Tomlinson since 1962, joining the company that his father
founded. He is the Chief Executive Officer of the Tomlinson Group of
Companies, and lives on River Road in Manotick. Ron Tomlinson has worked
for R.W. Tomlinson since 1985, and is President of the Tomlinson Group of
Companies, as well as President of the National Capital Heavy Construction
Association. He also lives in Manotick. Cindy Tomlinson Keon joined
the family business in 2000 as Corporate Counsel to the Tomlinson Group of
Companies. She lives on Queenscourt Crescent, in Manotick. During
the 2003 municipal election, the Tomlinson Group of Companies contributed
to Councillors Rick Chiarelli (Baseline Ward), Diane Deans
(Gloucester-Southgate) and Gord Hunter (Knoxdale-Merivale) re-election
campaigns. So did William Tomlinson, Ron Tomlinson, and Cindy Tomlinson
Keon. As a result, these people are
special, as they belong to a small but select class of people able to
direct both personal and corporate contributions to their preferred
candidates – something that most ordinary voters are unable to do.
The
basic principle in democratic representative government is one-person/one-vote.
While it is up to each individual to choose to support (or not) a municipal
candidate through a financial contribution (subject to legislative limits),
there is no apparent justification that supports one individual to be able to
contribute twice (or more, depending on the corporate structure) to a municipal
candidate by virtue of owning or managing a corporation. While it is true that
corporations do pay municipal property taxes, these are set by municipal
councils elected by the general electorate – there are no additional voting
classes based on company proprietorship or union membership. Indeed, there are
separate property tax classes for farms, managed forests, pipelines,
multi-residential properties, as well as for industrial and commercial
properties, and for residential properties. However, the electoral franchise
municipally does not rest on these property classes – it is based on residents
of the municipality aged 18 and older on election day. Further, the provision
in the Municipal Elections Act for corporate (and union) contributions to
municipal candidates provides for one class of people – owners and/or managers
of corporations (as well as unions) – an advantage not enjoyed by the general
electorate: the ability to contribute an important commodity for electoral
success – money to certain municipal candidates.
Thomas Kent appeared as an
expert witness from Queen’s University before the Parliamentary Committee examining
Bill C-24 - federal election legislation which proposed to prohibit
corporate and union contributions to federal candidates and parties, that
was adopted in 2003. He said: “Democracy means more than universal suffrage, one vote per person
… It means that everyone has the same freedom as the next person to promote
the candidate or party or policy he or she likes. That democratic equality
of opportunity is mocked – and I use “mocked” deliberately – if
organizations can fund parties and candidates. We then have a privileged
minority of people who, solely because they’re executives of corporations
or unions, can back their political preferences not only with their own
money, not only with their votes, not only with their own powers of
persuasion, but also with the resources of organizations that are
established for other purposes …” Standing Committee on Procedure & House Affairs, No.
35, 2nd Session, 37th Parliament
Therefore,
based on the principle of equity, as each person has only one vote to cast on
municipal election day and has the ability to contribute to the municipal
candidate of his or her choice, corporations and unions should be prohibited
from making municipal campaign contributions.
The Propriety of Contributions from Corporations Doing
Business with City Hall
Another
consideration deals with the perception of propriety that arises when
corporations doing business with City Hall or who are direct beneficiaries of
City Council decisions (i.e. land development) contribute to municipal election
candidates, particularly when the preponderance of their contributions goes
towards one particular class of candidates - incumbents.
A review of the 2003 municipal election finances returns in Ottawa reveals:
·
8 construction companies contributed
to municipal candidates in Ottawa, 74% of
which went to incumbents. These construction companies received over $150
million in construction contracts from the City of Ottawa from 2001 to 2003.
·
8 engineering, planning and/or
consulting firms contributed to municipal candidates in Ottawa, 76% of which
went to incumbents.
· 20 land development corporations contributed to municipal candidates in Ottawa, providing over one-fifth (22%) of all corporate contributions to candidates in the 2003 municipal election. Developers rely on planning decisions by City Council to enable their projects to go ahead. Nearly three-quarters (74%) of their
contributions
went to incumbents.
· Other companies contributing heavily to incumbents included those in the taxi industry (which relies on municipal licenses), waste collection, and advertising (involving city right-of-ways to place their products).
Canadian Waste Services
provides garbage collection services to the City of Ottawa, an essential
service. From 2001 to 2003 it won 11 contracts from the City of Ottawa,
worth over $18 million. Canadian Waste Services
was also quite generous as a contributor to municipal campaigns, providing
contributions to 18 candidates in Ottawa’s 2003 municipal election (the
most by a single corporate contributor), 12 of whom were elected, 10 of
whom were incumbents.
The Generosity of
Canadian Waste Services
Businesses are not philanthropic enterprises: they contribute based on their self-interest or, at best, as a form of investment. Their contributions are not distributed evenly among candidates – the evidence shows they favour incumbents. Indeed as a result many incumbents rely heavily on corporate contributions to enable their election (8 incumbents re-elected in 2003 received over half of their campaign contributions from corporations; nearly 75% of all corporate contributions went to incumbents). All of this raises questions about the relationship between incumbent councillors and their corporate donors – how close is the relationship, why corporations focus their contributions on incumbents, the objectivity of the recipients, etc. This leads to perceptions, whether true or not, that something is being given for something. This impairs the legitimacy of the electoral process in the eyes of the electorate, leading to cynicism among voters and contributing to lower voter turnouts.
Removing the ability of corporations (and unions) to make campaign contributions to municipal candidates would eliminate this perception, and improve the sense of integrity in the municipal election process and result.
That the
City of Ottawa request the Minister of Municipal Affairs and Housing to enact
legislation amending the Municipal Elections Act, 1996 to permit municipalities
to prohibit corporate and trade union contributions to candidates for municipal
councils, to be effective for the 2006 municipal elections;