By Cecilia Chen, Director, Public Policy, Northern California Grantmakers
It is a truth universally acknowledged that corruption in politics is bad. Few will argue against stronger anti-corruption laws or more transparency on the flow of money through city hall.
An important policy has been making its way through San Francisco’s legislative process aimed at rooting out corruption and strengthening the city’s campaign finance and conflict of interest laws. The San Francisco Ethics Commission’s new ordinance would trigger reporting requirements on contributions made at the suggestion of a public official, called behested contributions. Though well-intentioned, the ordinance takes a sledge hammer to the problem – including charitable giving and philanthropic investments in its reach. As a result, the proposed ordinance went far beyond the influence of wealthy individuals and corporations in San Francisco politics, chilling philanthropic investments, public-private partnerships, and civic engagement.
To craft a more effective law that would shine light on potential corruption without discouraging critical philanthropic investments or civic engagement, NCG partnered with nonprofit advocates to push for targeted changes. NCG expressed concern in meetings, spoke at public hearings, and submitted letters to both the Board of Supervisors and Ethics Commission urging amendments. Read our comments to the Board of Supervisors and Ethics Commission below:
- February 1, 2018 letter to the San Francisco Board of Supervisors
- February 15, 2018 letter to the San Francisco Ethics Commission
While we believe in policies to target corruption and build public trust, NCG had serious concerns about the ordinance’s scope and its likely unintended consequence. Strong public-private partnerships hinge on robust, open dialogue between local government and philanthropy about the needs, priorities, and opportunities within a community. The proposed ordinance would have discouraged collaboration by subjecting foundations, their staff, trustees, and donors, who engage in policy advocacy, to broad reporting requirements for grantmaking decisions, including donor-advised funds, and tainting public-private partnerships as pay-to-play politics.
The ordinance would also have a chilling effect on civic engagement more broadly – painting virtually every interaction between city officials and members of the public as potentially corrupt. For example, a teacher who advocates on behalf of her school and subsequently donates to a local afterschool program at the suggestion of a school board member would be subject to the same reporting requirements as a businessperson who engages in quid pro quo with an official to get approval for a permit.
Community foundations would have been particularly affected by the proposed ordinance. Community foundations play key roles in public-private partnership and advocate politically for their communities. Under the ordinance, community foundations – including The San Francisco Foundation, East Bay Community Foundation, and Silicon Valley Community Foundation – would have been constrained in their ability to advocate and hold forthright, honest conversations with local officials on how to best leverage philanthropy dollars to address pressing issues, like affordable housing and homelessness.
Last month, together with our nonprofit partners, we succeeded in encouraging the Board of Supervisors and Ethics Commission to amend the ordinance. Importantly, the amendments address the most problematic parts of the ordinance that threaten to curtail philanthropic investments and chill civic engagement. With these changes in place, NCG feels confident that the ordinance will succeed in its goal of shining a light on corrupt practices without harming the partnerships that support San Francisco’s most vulnerable residents.
To take effect, the ordinance will need to be approved by both the Board of Supervisors and the Ethics Commission. If unhappy with the final policy, the Ethics Commission can still vote to place the ordinance before San Francisco voters in November. With final details still to be hashed out between the Board of Supervisors and Ethics Commission, NCG will continue to monitor the ordinance in the weeks to come.