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Photo by Quinn Dombrowski
Albuquerque City Attorney Bob White is in charge of determining whether there have been infractions of the public financing system. This week could be a really busy one for him.
On Monday morning, the campaign of incumbent mayor Martin Chavez pointed out that one of his opponents, State Rep. Richard “R.J.” Berry, is paying himself rent using his public campaign funds. The rent is for Berry’s campaign headquarters, and the payment is to 12,000 Constitution LLC—a real estate holding company of which Berry is managing partner.
Hypothetically, this could mean that Berry is personally benefiting from public funds given to him to run his campaign, which isn’t allowed under the rules. Berry knows that, which is why he said 12,000 Constitution donated the rent money to three non-political charities.
In response to the charges from the Chavez campaign, Berry said the mayor has improperly received in-kind contributions from a law firm for his campaign headquarters.
Each camp said the other was full of hot air.
We called the city attorney for clarification, but he told us that the best he can do is explain the rules, given that he doesn’t have a formal complaint in front of him and doesn’t have data to dig through and evaluate.
Berry’s rent solution: Donate the money to charity
The Open and Ethical Elections code—which governs the public financing system—says that a candidate can’t use public funds for personal benefit. For example, a candidate could not pay his mortgage with it.
A campaign also cannot accept contributions of any kind from a business.
So if a candidate wants to rent office space for the duration of the campaign, from a company he owns, he can’t take it as a donation—because it’s from a company; Berry took care of this by paying his company rent of $450 per month for July, August and September.
But if he pays himself rent, then there’s the question of whether he’s personally benefited from public funds by becoming his own tenant.
Berry attempted to solve that issue by donating the money his company received in rent to charity. He sent the Independent letters from the The Roadrunner Food Bank, Animal Humane New Mexico and the Albuquerque Reads literacy program showing he had made donations to each in the amount of $450.
“Chavez should make sure his own campaign is following the law before he attacks ours for following the law and donating rent proceeds to charities,” said Berry campaign manager, Dana Feldman.
Does Berry benefit in some small way from those donations? Perhaps. He might be able to take tax deductions from the donations, and there’s also the goodwill generated from making the donations.
But there is otherwise no clear solution to how his campaign should go about renting space from a company he owns (aside from renting from a company he doesn’t own).
The Independent asked White how one would go about accounting for that under the public financing rules and got no clear answer.
“We’re trying as best we can to answer questions, but it’s very difficult,” White said. “We can’t make decisions for the campaigns. We can try to give guidance as best we can. We try to answer questions, play devil’s advocate, but they have to look at the law, take into consideration the conversations with us and determine how they are going to proceed.”
Chavez using space donated personally, not by attorney’s business
Martin Chavez’ campaign headquarters are located in space owned by Will Ferguson, a local attorney. Chavez’ financial reports show in-kind donations from Ferguson.
The Berry campaign said these donations were from a “law firm,” referring to Ferguson’s business, Will Ferguson and Associates, and referred to the rules, which state any in-kind donations made for over the amount of $250 have to be given by a measure finance committee.
“Absolutely false what Dana is saying,” Chavez spokesperson Joan Griffin said, referring to Berry’s campaign spokeswoman.
Griffin said Ferguson donated space he currently rents personally, not as part of his law practice.
City attorney Bob White said that if it is Will Ferguson himself making the donation and not his law firm, then there is no problem with the agreement.
And, White said, personal in-kind donations from individuals do not have to be from a measure finance committee.
“A measure finance committee is a group that spends the money itself rather than contributing directly to the campaign,” he said. “A pure contribution made to a campaign does not have to be in the form of an MFC.”
The public financing rules allow up to $32,800 from in-kind donations on top of the public funds distributed. Each contribution is limited to 5 percent of the salary of the office sought, which for the mayor’s race is about $5,000.
White told the Independent that if a formal complaint is lodged, that he would take into consideration all of the factors in a given situation, case by case, before determining if the intent of the Open and Ethical Elections Act had been broken.
