New Study Sponsored by Good Government Watchdog Investigates Explosion of Payments Made at “Behest” of California Elected Officials

David Kersten
David Kersten is president of the Kersten Institute for Governance and Public Policy (www.kersteninstitute.org). Kersten is also an adjunct professor of public finance and economics at the University of San Francisco.

Most people, including many Capitol insiders, may not even know what a “behest payment” is. 

But this is definitely a case where what you don’t know can hurt you because there has been nothing show of an explosion in so-called “behest payment” by elected officials in California, making this one of the most popular new avenues of government influence peddling at all levels of government in both California and the United States.

A Sacramento-based watchdog group called the Center for Ethics, Transparency, and Accountability (CETA) has released a new report on this issue titled “California Shakedown: An Investigation of Behested Payments to Elected Officials in California.”  

The report was commissioned by CETA, but was authored by this analyst and the Kersten Institute for Governance and Public Policy, a small Bay-Area based think tank and policy research organization.  

Based on a series of highly publicized case studies in Sacramento County as well as statewide, CETA asked the Kersten Institute to take an in-depth look at an emerging campaign finance issue whereby publicly elected officials steer contributions from individuals, corporations, unions, and other organizations to the nonprofit or charitable cause of their choice (commonly referred to as “behest payments”).

In some cases, the organizations that received the “behest payments” use the special interest money to conduct activities that directly benefit the elected of official who steered the “behest payment,” either personally or professionally, or both.  

Moreover, these so-called “behest payments” are essentially an end-run around state and local limitations on campaign finance contributions to candidate committees directly controlled by elected officials.  

Interestingly, one of the earliest highly publicized cases emerged from the City of Sacramento in 2010-13 regarding the perceived unethical behavior of large “charitable” contributions made by Wal-Mart and other special interests with business before the city to then Mayor Kevin Johnson and City Councilman Jay Schenirer.  

“Kevin Johnson raised eyebrows with his big-dollar behests—a total of nearly $6.5 million in 2012 and another $1.3 million in 2013.  He was also fined, twice, by the state political watchdog (FPPC) for flouting rules on behests—payments from corporations, well-off individuals and foundations made at the behest of elected officials,” states a January 3, 2018 Sacramento Bee report.  

In 2012-13, Mayor Johnson and Councilmember Jay Schenirer and other Sacramento City Councilmembers came under close scrutiny for accepting big dollars in behest payments from Wal-Mart while considering relaxing restrictions on big-box stores in the City of Sacramento, a move which would greatly benefit Wal-Mart and other big-box retailers, states the CETA report.  

At that time, “the Mayor and the City Council [Sacramento] have reported more behest contributions than all members of the [California] State Senate and Assembly combined,” according to a Sacramento Bee of analysis of data compiled by both the city and the state’s Fair Political Practices Commission.  

“Both then Mayor Johnson and Councilman Schenirer denied that the big money contributions had any influence on their decision to support Wal-Mart, but serious questions remain given at least the appearance of significant ethical questions, according to several media reports,” states the CETA report.   

In this high-profile City of Sacramento case, which is detailed in the report, both Mayor Johnson and Councilman Schenirer took action benefiting Wal-Mart after accepting large “behest payments,” and in the case of Schenirer, even reversed their initial position and campaign promises opposing the relaxing of a city ordinance prohibiting the expansion of big box retailers in the City of Sacramento, according to the CETA report.  

“But it appears that this Johnson and Schenirer case, as well as the Sacramento City case was the “canary in the coal mine” with regard to behest payments in the State of California and actually represented one of the best documented early case studies on the issue,” states the CETA report.  

In 2011, the California Fair Political Practices Commission (FPPC) started tracking good data on behest payments for state elected officials.  This data documents an explosion in behest payments since 2011, which continues to this day in mid-2019, states the CETA report.   

In 2011, total “behest payments” reported to California elected officials were less than $5 million.  But by 2018, the latest year for which full-year data is available, “behest payments” totaled roughly $20 million to California state candidates including statewide offices, the Senate and Assembly and the Public Utilities Commission.   

The new CETA report documents the increases in “behest payments” and provides a number of examples of state and local politicians who received millions of dollars in  “behest payments” including then Governor Jerry Brown (D), then Attorney General Kamala Harris (D), then Lt. Governor and now Governor Gavin Newsom (D), as well as members of both parties in the California Legislature.  

For 2011-18 Governor Jerry Brown (D), received $35.5 million in “behest payments” to hundreds of organizations including the Oakland School for the Arts, the Oakland Military Institute and the Governor’s 2011 Inaugural Committee.  A $1 million contribution was given by Kaiser Permanented to fund the Global Climate Action Summit under the care of the UN Foundation. Another $1 million contribution was given by Schwab Charitable Trust to the Global Climate Action Summit, according to the CETA report.  

The list of “behest payments” goes on with Gavin Newsom receiving $10.7 million for 2011-19, Tony Atkins receiving $1.2 million for 2011-18, and the much-publicized case of Lt. Governor Eleni Kounalakis receiving $553,500 in behest payments during her relatively short tenure. 

The CETA report concludes by discussion policy solutions which have been enacted at the local levels of government in California in places like the City of Sacramento, the City of San Francisco and the City of Los Angeles.   

For example, in early 2017, the Sacramento City Council passed a package of transparency provisions regarding the “behest payment” issue, which at least one analysis found to have led to a reduction in “behest payments.”  

Specifically, the Sacramento City ordinance requires that an elected city official announce publicly in a Council meeting the identity, amount and source of the behest payment prior to voting on related business before the council.  

The CETA report concludes by calling for more study of the issue and recommending “at a minimum, comprehensive and strong public disclosure measures are needed and it appears that the Sacramento ordinance requiring the oral disclosure of the identity, source and amount of such payments at the time of voting on business before a public agency is reasonable.  However, if that same elected official is still willing to collect the money and take the vote to the benefit of the special interest, legally under state and local law, that raises the question of whether such payments in excess of the local and state campaign finance contributions limits should be allowed at all?”

A PDF of the full report is available on CETA’s website at:  http://www.cetadot.com/

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