City's new campaign law called a winner

In sheer dollars, it's been a Philadelphia mayoral race unlike any other.

The city's new campaign law stanched the flow of money from seekers of city contracts - donors with "CEO" or "president" by their names. More cash rolled in from ordinary citizens making modest donations - most notably to the man who won Tuesday's Democratic primary, Michael Nutter.

And more pitches came from the candidates themselves - instead of the "askers," that class of well-connected surrogates who in the past used their influence to reel in six-figure contributions, sometimes in return for access to a mayor.

All in all, Philadelphia's new campaign-money rules weathered their first big test.

A record was still broken: With Tom Knox throwing in $10 million of his own money, he and Nutter and the rest of the five-way field raised a total of $23 million in pursuit of Philadelphia's top office.

And the rules didn't prevent money seeping in from independent "527" groups which, under the federal tax code, can spend unlimited sums to influence the race without immediately revealing their donors.

Those groups, which funded several TV attack ads, are being scrutinized by the city's independent Board of Ethics, created last year. Shane Creamer Jr., the board's interim chief, labeled 527s a "disruptive force" that made it harder to keep campaign spending transparent.

One goal of the new law, to boost public confidence in the process and thus get more voters voting, didn't appear to happen. Just shy of 300,000 Democrats voted Tuesday - about the same as in the last contested primary, in 1999, when there were no fund-raising caps.

Nonetheless, public-interest groups give the law high grades for starting to disinfect the pay-to-play climate that led to its passage four years ago.

"Overall, it was an exceptionally good result for campaign finance limits, and dramatically changed the nature of the campaign," said Zack Stalberg, president of the Committee of Seventy, the city's preeminent election watchdog organization.

He and others credit the caps with spurring the candidates to talk issues at forum after forum across the city. "Because they could not easily raise big gobs of money, they had to show up at these forums and participate and talk to real voters for the first time in probably half a century," Stalberg said.

He said the 2003 law still needed tinkering - especially to give candidates a fighting chance against self-financed rivals such as Knox.

Under the law, individual donors can give up to $2,500 to a campaign; political action committees, up to $10,000. The law's "millionaire clause" triggered a doubling of these caps after Knox put millions into the race. But City Council members say they want to revisit this clause, which they say doesn't go far enough, now that the primary is over.

The traditional big-donor community - lawyers, developers, architects, engineers - expressed frustration with the rules for another reason.

A different section of city law, approved in 2005, prohibits most law firms and other professional-services businesses from receiving no-bid city contracts worth more than $25,000 if they donate $10,000 or more that year to a candidate for city office. Contributions from a business' officers, directors, shareholders or partners count toward that $10,000 limit.

"It just went too far," said lawyer Alan Kessler, a top Democratic fund-raiser for Gov. Rendell and Mayor Street. "Firms and developers were so spooked by it, they said, 'We're not contributing.' " That left rivals unable to compete with a multimillion-dollar TV ad blitz, Kessler said.

Leonard Klehr, the lawyer who was Street's campaign-finance chairman, said the "draconian" rules left firms confused and afraid of violations, so they stayed on the sidelines.

Klehr said that made it harder for candidates to buy TV time and get their message out. Though some people view campaign giving as "a sin," he said, others consider it "the height of free speech."

Still, Kessler's firm, Wolf Block, spread $70,000 among the five mayoral rivals. Lawyers in Klehr's office gave a total of $102,000, most of it to Chaka Fattah's campaign, records show.

Nutter, who authored the limits on contributions from city contractors, said Friday he had no interest in seeing them changed: "They accomplish the purpose for which they were written, which was to eliminate the massive amounts of contributions that some individuals or companies were making in previous elections, blotting out the voices of many in the process."

The 2003 caps on donations may have also pushed out "askers" who raised money on a candidate's behalf, said a longtime Democratic donor, Philadelphia lawyer Daniel Berger. It was in this asker role that a confidant of Street's, Ronald A. White, was indicted - in effect, for peddling access to the mayor. (White died in 2004 while the charges were pending.)

This year, with more calls needed and six-figure donations prohibited, "There weren't as many people making calls," Berger said last week.

The Knox money, along with the lack of state limits on individual giving, prompted a hearing on Wednesday in Harrisburg on various campaign-money proposals, including public financing to level the playing field. State Sen. Anthony Williams (D., Phila.) is sponsoring a bill that would reinforce Philadelphia's authority to enact its own caps.

In April, Commonwealth Court upheld the city's right to do so. Fattah, though he lost his mayoral bid, said he would press on in his appeal of that ruling, which the state Supreme Court is expected to take up soon.

The ruling was seen as a blow to the mayoral hopes of both Fattah and Bob Brady, who as veteran congressmen would ordinarily have access to deep-pocketed Washington lobbyists and political action committees at fund-raising time. "When the law was not overturned," Democratic consultant Larry Ceisler said, Brady and Fattah "were stuck in a campaign ocean, in a little canoe without a paddle."

Meanwhile, Nutter was raising $3.9 million - in part through small donations. An Inquirer analysis of campaign reports through April 30 shows that 3,179 donors gave Nutter $250 or less. None of his rivals came close in this category.

That should put Nutter in "the fund-raising hall of fame," said Sam Katz, the two-time former Republican mayoral candidate. "When Ed Rendell or John Street or I ran, we could make a phone call to somebody and get $50,000 or $100,000. Michael was making calls to get $250."