In New York, independent expenditure committees that support political candidates can raise unrestricted dollars — but are barred from coordinating their spending with campaigns they back.
New Start NYC, which supports mayoral hopeful Shaun Donovan and has been funded almost entirely by the candidate’s wealthy father to the tune of $3 million, has insisted it does not coordinate efforts in any way with the candidate’s campaign.
The city Campaign Finance Board last week said it found no evidence of improper activity and cleared Donovan’s campaign to receive nearly $1.5 million in public matching funds. But documents obtained by THE CITY present a far more complex picture.
In an affidavit filed with the city Campaign Finance Board, Michael Donovan acknowledged he’s discussed whom to raise money from with his son’s campaign finance director. The elder Donovan also said he got a preview of the multi-million dollar TV ad campaign funded by New Start NYC.
Meanwhile, both New Start and the Donovan campaign are being advised by former colleagues who were longtime advisors of Mayor Bill de Blasio. New Start hired Nick Baldick of Hilltop Public Solutions, while the Donovan campaign enlisted Bill Hyers, a former top director at Hilltop.
And New Start’s treasurer is Brittany Wise, who was a key fundraiser for the 2013 de Blasio mayoral campaign run by Hyers.
Stringer Cites ‘Spirit’ of Rules
These connections surfaced after mayoral candidate Scott Stringer, the city comptroller, filed a complaint with the Campaign Finance Board April 6 charging that New Start was illegally coordinating with Donovan’s campaign. The move held up the release of the matching funds for a week.
State election law says that if a candidate’s immediate family member “established, directed, or managed” an independent expenditure committee, the committee’s spending is considered to be “made for the benefit of that candidate” and thus prohibited.
Laurence Laufer, an elections law attorney hired by Stringer’s campaign, argued to the CFB that by making huge donations to New Start, Michael Donovan “established (New Start)’s ability to make expenditures of $1 million or more to benefit the candidate, his son, Shaun Donovan.”
Records show Michael Donovan — a principal of a advertising-software firm, Mediaocean — has provided New Start with most of its revenue, $3 million of $3.1 million so far, and has bundled $17,750 in campaign contributions for his son.
The complaint briefly held up the Donovan campaign’s request for matching funds, which would be barred if coordination was established. On Thursday, the Campaign Finance Board dismissed Stringer’s complaint, declaring there was no proof of coordination between New Start and the Donovan campaign.
The board’s chair, Frederick Schaffer, however, said the rules may need to be changed on defining what counts as coordination between these groups and campaigns given the increasing numbers of single-candidate independent expenditure committees.
The CFB’s decision freed up more than $1.4 million in public matching funds for Donovan, the former head of the U.S. Department of Housing and Urban Development during the Obama administration. As of this week, Donovan had $2.1 million in his campaign account.
Stringer’s campaign spokesperson, Tyrone Stevens, said Monday, “The establishment and funding of a multi-million-dollar Super PAC by a candidate’s immediate family certainly violates the spirit of New York City’s campaign finance system. We trust the Campaign Finance Board will keep a close eye on this situation.”
Donovan’s campaign declined to answer a list of specific questions from THE CITY, instead providing a brief statement late Monday: ”This has already been definitively put to rest. No member of our team has coordinated with any Independent Expense [group] in this race. That is why we have been completely transparent, providing sworn affidavits from all staff and consultants, which put this matter to rest at a CFB hearing last week.”
Details of the activity by New Start and the Donovan campaign are spelled out in statements of the stakeholders — including the candidate himself — that were filed in the Campaign Finance Board case. THE CITY obtained the statements via the Freedom of Information Law.
In his affidavit, Donvan’s father noted, “When I talk to my son, we talk about his kids (my grandchildren) and how he feels, as well as other family members.”
“I have not made and am not aware of any communications by any person concerning coordination between New Start NYC and New Yorkers for Donovan,” he said.
Michael Donovan acknowledged that he’s had communications with both his son’s campaign and the independent committee.
In his affidavit, Michael Donovan said that he “spoke sporadically and occasionally” with the Donovan campaign’s finance director, Ioanna Niejelow, “about who might make contributions to New Yorkers for Donovan.”
Records show Michael Donovan acted as an “intermediary” for his son’s campaign early last year, collecting 51 checks for a total of $17,750 in contributions. That includes his $5,100 donation — the maximum allowed under the law.
In the affidavit, Michael Donovan said he “did not ever talk with (Niejelow) about the strategy or message of the campaign,” adding, “I do not believe that I have communicated with any other person on my son’s campaign.”
Meanwhile, Donovan’s father also said he participated in two Zoom meetings with New Start’s managers.
In one with Baldick and Wise, Michael Donovan said he was “informed that New Start NYC would spend money on TV ads in support of my son’s campaign.” In the second meeting, he recounted being given a preview of those ads “after they were created.”
He added, “I did not make any suggestions concerning New Start NYC’s communications or expenditures.”
Never Asked for Help
In his affidavit, Shaun Donovan said his conversations with his father prior to kicking off his campaign were “about whether I should run for mayor and the impact such a run would have on my family.”
He said that in speaking with his father both before and during the campaign, “I never suggested, requested, authorized, cooperated with or in any other way fostered the idea of New Start or my father’s contributing to that committee.”
Donovan said he only learned of the existence of New Start and his father’s contribution to it in media reports, after which his father “made reference” to the news stories in a conversation. “I deliberately did not discuss this with him beyond acknowledging what he had told me,” Donovan added.
A key issue in Stringer’s complaint was the timing of TV ads. Donovan’s campaign, through Hyers’ firm, Win Creative LLC, began $660,000 in media buys Feb. 5 through March 29. New Start began $2.7 million in media buys about a week later on April 6. They’re supposed to continue through May 3.
New Start first registered with the state Board of Elections on Feb. 3, and its first donation — $20,000 from philanthropist Christy Mack — arrived Feb. 22. The very next day, Michael Donovan upped the stakes with a $1 million donation to New Start. He has subsequently added another $2 million to New Start’s pot.
As THE CITY reported last week, David Rockefeller Jr. is among the donors to both the independent expenditure committee and Shaun Donovan’s campaign.
GFP Real Estate Chair Jeffrey Gural also gave to both the committee and the campaign. “His father and I are on the board of the Statue of Liberty and he’s obviously qualified,” said Gural told THE CITY last week. “So I did him a favor.”
‘Carefully Followed Guidelines’
Michael Donovan said he began making the donations to New Start after Wise “introduced herself to me” in February.
He said she provided him with legal advice on “permissible and prohibited actions of family members of candidates to ensure there is no prohibited coordination between a campaign and an independent expenditure committee.”
“I have carefully followed those guidelines,” he added.
Neither Baldick nor Hyers responded to questions from THE CITY.
Wise did not respond to THE CITY’s questions, instead issuing a brief statement, “New Start NYC is an Independent Expenditure Committee, acting in full compliance with the New York City Campaign Financial Board rules, which means that there has not been, nor will there be, any coordination between New Start NYC and the Donovan campaign or their consultants.”
She added, “The New York City Campaign Finance Board agrees, as evidenced by their decision last week.”