(Posted May 11, 2016) Some political junkies have posited during the past dozen years that U.S. Senator Debbie Stabenow ought to chuck it all in Washington, D.C., and come back to run for governor of Michigan.
Stabenow’s response has been pretty much, “Been there, done that,” and she’s happy where she is. In fact, she DID run for governor, 22 years ago, but it didn’t turn out so well. One of the reasons she had so much trouble in 1994, when she was a state senator seeking the Democratic Party’s nomination for the state’s top job, was that 1) She had to win a four-candidate primary for the nomination; 2) She then had to knock off an incumbent Republican governor (John Engler); and 3) It turned out to be a terrible year for Democrats, not only in Michigan but nationally, although she didn’t know that when she first launched her candidacy. After she lost the Democratic primary, she was tabbed by her party’s nominee, former U.S. Rep. Howard Wolpe, to be his Lt. Gov. runningmate. Their ticket got blown away in November by Engler.
One of the big challenges for all candidates in 1994, as it is today, was how to raise enough money to make a credible run. Right in the thick of it was the Michigan Chamber of Commerce’s campaign finance guru, Bob LaBrant. Bill Ballenger, publisher of The Ballenger Report, asked LaBrant how he coped with the looming 1994 campaign:
BALLENGER: OK, how did you approach this?
LaBRANT: For starters, I thought Debbie Stabenow would be a greater threat to Engler’s re-election if she could win her primary against Wolpe, former E. Lansing Mayor Larry Owen, and state Rep. Lynn Jondahl. I knew EMILY’s List would be important to her campaign. I contacted my friend Tim Sponsler in Washington, D.C., and asked him if he would request a declaratory ruling from the Michigan Secretary of State (at the time Democrat Richard Austin) for a business donor network that Tim and I had designed on the EMILY’s List model called Venture Capitol. Only an “interested person” is qualified to ask for a ruling under the Michigan Campaign Finance Act (MCFA). Sponsler and his proposed donor network qualified as an “interested person.” That was important to getting an answer out of SoS on the issue of “bundling,” which EMILY’s List depended on. EMILY’s List gave donations to pro-choice Democratic female candidates, like Stabenow.
BALLENGER: What specifically were you asking?
LABRANT: What I was seeking was a ruling as to whether contributions made by individuals that are transmitted to a candidate through a third party (like EMILY’s List or Venture Capitol) count as contributions by BOTH the individual and the third party. In 1993, an individual was limited by law to making a contribution in an election cycle of $3,400 to a gubernatorial candidate. If the third party that bundled and delivered those contributions (like EMILY’s List did) was an “independent committee” under the MCFA, wouldn’t that committee be limited to bundling only $34,000, the same amount as the contribution limit on a Political Action Commitee (PAC) in the same law? $34,000 may sound like a lot, but it’s not as much as tens or hundreds of thousands that amount that EMILY’s List could otherwise give the candidate.
BALLENGER: What happened next?
LaBRANT: EMILY’s List recognized the threat of Sponsler’s request and immediately submitted their own request to the Secretary of State. If their request, made by their attorney Judith Corley, received an unfavorable response from the Dept. of State, the law gave them standing to challenge the declaratory ruling in circuit court. It all came down to whether EMILY’s List “directed or controlled” the individual contribution. Under state law (MCL 169.231), a contribution made at the direction or control of a person is attributable to both entities for the purpose of contribution limits.
BALLENGER: How did you respond?
LaBRANT: I said that EMILY’s List, at the very least, “directs” the contributions of its members. I pointed out that that the dictionary definition of “direction” includes the “management, supervision or guidance of some action.” Corley claimed that EMILY’s List did not exercise direction or control. She said her Network members were free not to contribute, or to refrain from supporting a candidate on their list. However, in the public comment period on the request I put into the record the transcript of an interview in which Ann Lewis (sister of Barney Frank, a well-known Congressman from Massachusetts) said the following: “By requiring checks to be returned to EMILY’s List, they are able to track actions taken by their members. They can send follow-up letters to those who don’t contribute. Eventually, the member who chooses not to contribute to any candidates on EMILY’s List … will begin to receive follow-up letters and telephone calls that will ultimately pressure the member to finally make good on his/her pledge to make (a pair of) $100 contributions (one for the primary, another for the general election) to candidates endorsed on EMILY’s List.”
BALLENGER: Did you do anything more?
LaBRANT: I told the Department: “So much for freedom to choose.” I asserted that when EMILY’s List duns its members who have failed to contribute by sending follow-up letters and phone calls, EMILY’s List is indeed directing and controlling the individual’s decision to contribute, or trying to.
BALLENGER: How did it all come down?
LaBRANT: The Department did NOT establish a “bright line” rule, but it responded to Corley by saying that, if EMILY’s List did not engage in actions like follow-up mailings and phone calls, then the List could not be accused of “direction or control,” and they could continue to collect and deliver contributions its members chose to make to Michigan candidates. More importantly, the Department added that costs incurred in the process (like postage and business reply envelopes) and the costs of sorting and delivering contributions to candidates must be considered “in-kind” contributions to candidates and must be reported by the candidate committee and EMILY’s List. The limit on the amount of in-kind contributions made to a candidate depended on whether EMILY’s List was a political committee or an independent committee under the MCFA.
BALLENGER: What’s the moral of this story?
LaBRANT: The Sponsler and Corley declaratory rulings, both issued on Nov. 2, 1993, a year before the 1994 general election, and nine months before the Democratic primary, set the ground rules for bundling in Michigan. The ruling established that Michigan’s standards were significantly stricter than those established for federal elections by the Federal Elections Commission. They were also stricter than in any other state, as far as I can determine, and they remain so. I didn’t win a complete victory on this issue, by any means, but I have to believe the ruling we forced out of SoS by making the Sponsler request — and Corley’s reaction to it —complicated life for EMILY’s List, and for Stabenow, in their efforts to raise campaign money in Michigan in 1994. Still, EMILY’s List was able to play a significantly greater role six years later, in 2000, in Stabenow’s defeat of incumbent Republican U.S. Senator Spencer Abraham because under federal campaign finance rules she was not so restricted in getting donations from EMILY’s List.
BALLENGER: I know there’s more to this saga, so at this point we’ll say “to be continued”…