Court Fight Brews Over City Rules On Financing Political Campaigns

New York City's new campaign finance regulations, which limit the campaign contributions of lobbyists and many business owners by 90%, are headed to court on a First Amendment challenge.

The regulations significantly lower the maximum amount that can be contributed toward a campaign by people who do business with the city. That is a category that might include a secretary of a lobbyist or the owner of an asphalt corporation that has a contract with the city. Both are among the plaintiffs in the suit. Other plaintiffs include a former councilman and mayoral candidate, Thomas Ognibene; a deputy mayor in the Giuliani administration, Fran Reiter; the New York State Conservative Party, and the wife of a lobbyist.

Those who are classified as having business dealings with the city face contribution maximums that are generally less than 10% of what most citizens can contribute. A lobbyist can give a maximum of $400 to a mayoral candidate or $250 to a candidate for the council, compared with the $4,950 or $2,750 that most individuals can donate to candidates for those offices.

Because labor unions are not included as having business dealings with the city, the regulations have been criticized as favoring candidates who draw support from organized labor at the expense of candidates who get strong backing from businesses.

The Indiana lawyer who is bringing the suit, James Bopp Jr., said that by creating different caps for different individuals the city "is discriminating against potential contributors and citizens."

Mr. Bopp said that restricting the contributions of lobbyists was an especially clear violation of the First Amendment because it punished them for engaging in protected speech.

"Lobbyists are exercising a First Amendment right— they are petitioning the government," Mr. Bopp said. "They give up one right, which is to lobby or give up another right, which is to contribute." In the last two years, Mr. Bopp has successfully challenged both a state and federal campaign finance law before the United States Supreme Court. A lawyer at law firm of Davidoff Malito & Hutcher is serving as local counsel for the suit. A name partner at the firm, Sidney Davidoff, promised last June to bring suit, when the proposed legislation was introduced.

Champions of the regulations, including Mayor Bloomberg and the speaker of the City Council, Christine Quinn, defended the law yesterday.

Mr. Bloomberg noted that although he's not a constitutional lawyer, the campaign finance rules are part of "a very well-intentioned and well-drafted piece of legislation and certainly we should have that law. Whether the way they drafted it's constitutional, that's up to the courts."

Ms. Quinn said the legislation made the city's public finance system even stronger "by leveling the playing field for candidates, increasing fairness and due process, and removing the undue influence of big money," and said she is confident it would withstand "unfounded legal attacks by lobbyists."

Among the defendants in the suit is the chairman of the Campaign Finance Board, Frederick A.O. Schwarz Jr., who defended the law in an interview yesterday. "The idea of limiting people who do business with the city from giving big gifts is not unique at all," Mr. Schwarz said. "That's something the federal government started doing under Teddy Roosevelt."

The suit also claims that the regulations disproportionately harm minority candidates and violate the Voting Rights Act of 1965. The suit claims that "candidates supported by the Hispanic-American community will not have the financial resources to become candidates for office" because of the contribution restrictions. Mr. Bopp said that minority candidates often come from poorer neighborhoods and are forced to rely more heavily on the types of contributions that are limited under the restrictions.

The Civil Rights division at the Justice Department did give pre-clearance to the regulations last year, which the city was required to seek.

The suit was filed in federal district court in Manhattan. It has not yet been assigned to a judge.