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North Carolina

State Leads Trend Toward Publicly Financed Campaigns

More candidates are discovering the benefits of not relying on special interests

North Carolina State Page Octoboer 2010

North Carolina Insurance Commissioner Wayne Goodwin, left, supports publicly financed elections; state Sen. Phil Berger, right, opposes them. — Photos by D.L. Anderson

As a state representative, Wayne Goodwin pushed the General Assembly to publicly fund elections. He used the program himself two years ago while running for North Carolina insurance commissioner, and now he's sold on the idea.

"It allowed me to spend 100 percent of my time meeting with voters … I think that's a good thing for voter and candidate alike," said Goodwin.

Goodwin, a Democrat, and his Republican opponent, John Odom, both used the fledgling public finance program, which allowed them to meet and talk about the issues 22 times rather than go out and raise funds. Two other nonjudicial statewide candidates that year also used the program; one won and one lost.

Five appellate court candidates in the Nov. 2 elections had qualified to receive public funds, as of Aug. 31.

North Carolina is one of only eight states to adopt voter-owned elections, also known as publicly funded elections. Opponents prefer to call these taxpayer-funded elections.

Candidates can receive grants for their general election campaigns provided they:

  • agree to a spending limit;
  • stop fundraising after joining the program; and
  • do not accept large donations from individuals, out-of-state donors and political committees.

The program began in 2004 for statewide appellate court races. It was expanded for three other statewide elective offices in 2008: superintendent of public instruction, insurance commissioner and state auditor.

A commission is studying expanding the program to cover the state's treasurer, attorney general, secretary of state, and the commissioners of labor and agriculture. Supporters are hoping the idea becomes law in time for the 2012 elections.

The publicly funded elections are designed to keep special interest and out-of-state money out of campaigns. Candidates qualify by raising a set amount of money — $30,000 in the insurance commissioner race — in small donations from hundreds of voters. Grant amounts vary depending on the average cost of the last three elections for each race. Goodwin's grant was $380,500. Candidates might also receive varying amounts of "rescue" funds.

"Where that rescue option is most likely to be triggered is if there is a third party independent expenditure that is so large it has the potential for putting publicly financed candidates at a grave disadvantage," Goodwin said.

The judicial program is funded largely by a $50 surcharge on the annual dues that attorneys pay to the North Carolina State Bar. The three other statewide campaigns are funded with an appropriation from the General Assembly, although the study commission is also looking at fees paid by state-regulated professions.

Individuals can contribute to publicly financed elections with a $3 checkoff on their state income taxes.

State Senate Minority Leader Phil Berger, a Republican from Eden, agrees the existing campaign finance system has problems. But he argues that more transparency in the way candidates raise and spend money is a better solution.

"Any taxpayer-funded campaign act is one that, by definition, is going to use tax dollars," Berger said. "Saying it's an assessment against attorneys or insurance agents or folks that handle investments for the treasurer, that's a tax on a small segment of the population. You're forcing a taxpayer or citizen to pay money that will ultimately go toward candidates they don't support."

Proponents argue that even if the funds all came out of the state general fund, it would be less than one-tenth of 1 percent of the budget, and it would be more than offset by cutting down on special interest legislation and tax loopholes that result from the current campaign finance system.

Bill Wilson, AARP North Carolina's advocacy director, said the benefits outweigh opposition to using tax money. "What people come to realize is that it takes special-interest money out of these races so people don't feel beholden to special interests," he said.

Candidates are slowly realizing how much time they spend raising money rather than talking about issues, Wilson said.

"Over time, as the demands for money become greater and greater, it's just going to get more attention and support."

Sue Price Johnson is a freelance journalist based in Raleigh, N.C.

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