Loopholes Abound in Colorado's Campaign Finance System

August 2006
I've written before about how Colorado's current campaign finance laws don't really work the way they were intended, which is to theoretically make campaigns less expensive and less beholden to big special interests. Colorado's current contribution limits are so low that they are unreasonable, and they've created a system where secretive political committees control the outcome of elections. Today we see another reason why Colorado's campaign finance laws need to readjusted: Too many loopholes. A government watchdog group is questioning several donations to the gubernatorial campaign of Republican Bob Beauprez because a couple of donors may have figured out a way to donate a lot more money than they are allowed to give as individuals. As The Denver Post reports:
Colorado Citizens for Ethics in Government is questioning whether two individuals used 25 limited-liability companies to end-run the state's $1,000 contribution limits for gubernatorial candidates. John Marshall, Beauprez's campaign manager, said: "We have complied with every campaign-finance law." Chantell Taylor, CCEG's director, said, "If an individual can simply create an LLC and then channel individual contributions in the name of that LLC, it's a huge loophole in campaign-finance laws." Her group asked Secretary of State Gigi Dennis' office to look into 16 LLCs that gave $16,000 to Beauprez and seem to be linked to Mark Campbell of Southwestern Investment Group. Campbell also gave the maximum personal contribution of $1,000, CCEG said... ...Taylor's group also asked Dennis to investigate nine LLCs owned by Eric Bush, president of Bush Development Inc., which gave $9,000. Bush also gave a personal donation of $2,000, which Taylor questioned.
Beauprez's campaign manager says that they did nothing wrong in accepting the donations, and he may very well be correct. It would be a royal pain in the rear to set up a bunch of LLCs so that you could donate more money to a political campaign, but Colorado's campaign finance laws may not prevent it from happening. As an individual, Campbell can only donate $1,000 to Beauprez's campaign. But through a bunch of LLCs, he can give thousands more. I'd rather that Colorado just raise the contribution limits to allow someone like Campbell to donate more money directly, which would make it easier for the public to see just who the big donors are to each campaign. The point of tracking campaign contributions is to put everything out in the open, and that doesn't happen in this case; unless you were paying close attention, you wouldn't have noticed that Beauprez accepted a bunch of contributions from LLCs on the same day. You also wouldn't have made the connection with Campbell unless you had the time or ability to do a little research. Campaign finance loopholes will always exist to some degree, so there's no point trying to figure out a way to plug every hole in the dike. The money is going to get to the candidate one way or the other, and we're chasing our tails if we're trying to put a stop to it. It would be much better, and much easier, if we just opened up the limits and made it easier - and more transparent - for bigger donors to write bigger checks. Even if we didn't like the big donations, at least we would know where they came from.