THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Monday, November 11, 1996 TAG: 9611110028
SECTION: LOCAL PAGE: B1 EDITION: NORTH CAROLINA
SOURCE: ASSOCIATED PRESS
DATELINE: RALEIGH LENGTH: 78 lines
With the last of the votes barely counted, reformers are looking toward the next campaign season and how it will be financed.
Despite Watergate-era laws restricting the size of contributions to candidates, last week's election in North Carolina demonstrated how labor unions, corporations and special-interest groups use creative loopholes to funnel money to favorite candidates.
``This is the worst time since Watergate,'' said John Bonifaz, founder of the Boston-based National Voting Rights Institute, who was in North Carolina last week to build support for campaign finance reform.
``We couldn't have a more favorable climate nationally'' for reform, state Sen. Wib Gulley of Durham, a leader in the state's campaign reform movement, told The News & Observer of Raleigh. ``We've seen the complete collapse of any effort to control spending at the federal level. . . . The foreign money - the notion that people from other countries are financing campaigns - is the crowning blow.''
And the loopholes that plague federal campaigns are trickling down to the state level.
For North Carolinians, it was hard to avoid the barrage of AFL-CIO-financed television ads attacking Republican freshmen in Congress, Fred Heineman and David Funderburk.
Federal law limits individuals to contributions of no more than $1,000 per election for each candidate and no more than $5,000 for political action committees.
But the AFL-CIO spent at least $1.24 million on TV ads against Heineman and Funderburk. They were able to skirt the restriction because these advertising campaigns were ostensibly independent of the campaigns of Heineman's and Funderburk's challengers, and technically did not promote a candidate. They were ``issue ads,'' and therefore exempt from campaign restrictions.
The money was part of a $35 million campaign by the AFL-CIO to help Democrats regain control of Congress.
While the Democrats failed to win Congress, Democrat David Price defeated Heineman in the 4th District and Democrat Bobby Etheridge defeated Funderburk in the 2nd.
``I think it had an impact here,'' said Robert Wilkie, the state GOP political director. ``Funderburk and Heineman had two campaigns running against them. You had the Price and Etheridge campaigns and had a satellite campaign that really doubled the amount of money that the Democrats were able to put up against the two incumbents.''
The AFL-CIO's wasn't the only independent media campaign taking advantage of the loopholes. The National Rifle Association ran hard-hitting radio ads attacking Etheridge. And environmentalgroups ran ads criticizing Republican congressmen.
``It's gotten to be more loophole than law,'' said Pete McDowell, a spokesman for the N.C. Alliance for Democracy, a coalition seeking campaign finance reform.
Other fund-raising highlights:
The cost of getting elected continued to skyrocket. The gubernatorial race between Democrat James B. Hunt Jr. and Republican Robin Hayes cost at least $15.7 million while the Senate campaign between Jesse Helms and Harvey Gantt cost more than $13 million.
Campaign laws were reinterpreted to allow candidates to triple the money they could take from individual contributors. State law limits an individual to giving $4,000 to a state candidate each election. The Hunt campaign legally collected $12,000 from some individuals by counting the primary and primary runoffs as separate elections, even though Hunt did not have a primary or a runoff.
Soft money, contributions given to political parties rather than individual candidates, became an issue even in the battle for control of the General Assembly. Both parties set up committees to raise war chests for their legislative candidates.
The looseness in the rules governing political money has given new impetus to those pushing for changes in campaigns financing.
Gulley, the Durham Democrat, plans to introduce a bill next year that would set up a system of public financing for legislative and statewide candidates.
The measure, called the N.C. Clean Campaign Act, would give candidates the option of participating in a system of public financing.
KEYWORDS: CAMPAIGN FINANCE by CNB