San Francisco looks to restrict fundraising practice favored by Los Angeles mayor

The San Francisco Ethics Commission is exploring strict new limits on behested payments, the thorny fundraising practice that politicians use to raise money for pet causes, sometimes approaching individuals and companies that do business with government.

The proposal would bar public officials from asking any person or group to donate to a civic or charitable cause — if the person or group has business before that official.

KPCC recently reported on the more than $31 million in civic and charitable donations requested and raised by Los Angeles Mayor Eric Garcetti. Some of them sparked conflict of interest concerns among ethics experts.

The San Francisco commission proposal to restrict such payments aims to reduce corruption and conflicts of interest. The commission could penalize officials $5,000 for each violation, although there would be no penalty for the donor.

Staff at the San Francisco Ethics Commission and the state Fair Political Practices Commission said they are unaware of such strong regulations anywhere else in California, including Los Angeles. 

In an August memo, the San Francisco commission staff wrote that behested payments "are a common method for skirting contribution limits." Unlike campaign contributions, there's no ceiling on behested payments and donors can give as much as they want. The obscure practice has come under fire as a means of influence buying and currying favor with officials.

Since his election in 2013, Garcetti has set a city record in behested payments. Many have been to a nonprofit that bears his title, the Mayor's Fund for Los Angeles, and several donors do business with the city.

Those are exactly the type of donations regulators in San Francisco are trying to ban, said Peter Keane, chair of the San Francisco Ethics Commission.

"It's something that's indirect but has the same level of soft corruption to it that bribery has," Keane told KPCC. He's wary of donations even to charitable causes. "In that situation, the elected official can take credit for it, and does take credit for it."

Keane said that several behested payments in San Francisco have raised red flags, including those by tech companies such as Uber and Airbnb, that stand to profit from decisions made by City Hall. As in Los Angeles, the influence of developers is keenly felt in San Francisco politics, and he hopes to limit that.

To become law, San Francisco's Board of Supervisors would have to approve any proposed ordinance dealing with behested payments. That could be a tough sell, as it would limit the supervisors' own fundraising abilities.

More likely, Keane said, the ethics commission could put the changes on the June 2018 ballot, and ask voters to decide the measure's fate. To do that, San Francisco's five-member ethics commission will need a supermajority of four votes. Keane said there are currently three votes in favor of the proposed ordinance.

If that measure becomes law, it will go far beyond the reporting requirements in Los Angeles, where behested payments remain largely unregulated.

"I support anything that makes it tougher for elected officials from soliciting contributions or gifts," said Bob Stern, a former California Fair Political Practices Commission general counsel who helped write the state's 1974 Political Reform Act. Stern is backing the San Francisco ordinance.

Stern has said Mayor Garcetti appears to be have had greater success in raising behested payments than any other politician in California history. Based on KPCC's analysis of public records, it's clear Garcetti's behested payments have outpaced those of any statewide elected official in recent years.

The relationships Garcetti has forged with wealthy donors could come in handy, should the popular mayor decide to run for governor or president, as has been speculated.

The most recent behested payment reported by Garcetti was a $10,000 donation to the Mayor's Fund for Los Angeles by the Panda Restaurant Group, which operates Panda Express and other chains.