Changes Ahead For Unions Under Oregon’s New Campaign Finance Law

For the first time, state elections will have donor limits when HB 4024 is enacted in 2027.

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For a century and a half, labor unions in Oregon were as powerful as any in the country, with no restrictions on what they could spend in elections.

Then in the waning hours of the 2024 legislative session, a bill passed representing the state’s first comprehensive campaign finance reform — an effort labor groups supported.

More dust will need to settle before it’s known exactly how elections will work for the unions that represent tens of thousands of state employees, teachers, nurses and craft workers. But it will include a system of polling members and a statewide donor disclosure system. And to most unions, like most people involved, it won’t be as bad as it could have been.

“It will be a huge shift for us,” said Lamar Wise, policy director for Oregon AFSCME. “This was true compromise legislation. We each had to give up something. And this is where we landed in terms of getting big money out of politics and focusing on what truly matters to the citizens of Oregon … We all want to get dark money out.”

Money has always been part of American politics though election spending has increased steadily since the 1990s, fueled in part by legal decisions, notably 2010’s Citizens United v. Federal Election Commission. That ruling led to greater corporate participation in elections via political action committees and increased prominence of so-called dark money — campaign funding whose donor is unknown. The 2020 national election cycle was by far the costliest on record at $14 billion.

Advocates for campaign finance reform say high-dollar donors distort popular opinion in favor of special interests and wealthy elites. Until last month, Oregon belonged to a small group of states with no campaign finance law. Now only four remain.

Since Citizens United, dark money has impacted elections in Oregon through super PACs funded by labor unions, which often support Democrats, and business groups and wealthy individuals, which tend to back Republicans. Oregon’s richest person, Nike founder Phil Knight, is regularly its biggest single political donor. In the 2022 gubernatorial election, he contributed far more than anyone else: $4 million to opponents of the eventual winner, Democrat Tina Kotek. On the other side, unions gave Kotek around $6 million.

In 2020, the state supreme court reversed a ruling that restrictions on campaign spending qualified as violations of free speech. Later that year, voters amended the state Constitution to allow campaign funding limits. But over the next three years, disparate interests in Salem found little common ground to pass substantive reform.

Then earlier this year, a coalition of good-government groups — among them Honest Elections Oregon, Common Cause Oregon and the League of Women Voters of Oregon — developed a voter initiative that would have set strict contribution limits and donor transparency rules. IP 9 garnered more than 100,000 signatures and appeared headed for the November ballot, but it inspired a rival response.

Unions developed a voter initiative of their own featuring looser provisions: near-unlimited contribution levels and fewer requirements to identify donors. Business association signed on in an unlikely alliance.

Faced with the possibility of a drawn-out and costly fight, lawmakers arrived in Salem for the five-week session aware it was perhaps their last chance at substantive campaign finance reform.

“We ended up, over a crazy couple of weeks, negotiating, negotiating, negotiating until we got to a place where we thought the bill was worth supporting, versus having a contentious ballot fight against different bills,” said Jason Kafoury of Honest Elections Oregon.

HB 4024 went through eight negotiated drafts before it passed with broad support — 52-5 in the House of Representatives and 22-6 in the Senate — and was sent to the governor’s desk for a signature.

The new law does several things, notably:

  • Sets new contribution levels and caps the individual level at $3,300, which is around the federal requirement.
  • Establishes in Oregon a new entity that doesn’t exist in other states, a small donor committee. Only Colorado has a similar concept. These committees will allow unions to group political donations of $250 or less. They’ll be allowed to donate far more than individuals.
  • Creates a statewide reporting system that would require some disclosure of dark money donors who support candidates without their knowledge.

Under the new law, unions still have lots of options, according to Dan Meek, an advocate for campaign finance reform in Oregon since the late 1990s. They can form a multi-candidate committee and collect 100 contributions up to $5,000. They can form a small donor committee, poll members about their level of support and group those contributions. And they can qualify as a member organization and donate up to $26,400 to a statewide candidate and $13,200 to other candidates.

“They can make sizable contributions in a variety of ways, and so can businesses,” said Meek, an attorney who helped negotiate dozens of changes to HB 4024 during the short session.

Wise, of AFSCME, said the organization doesn’t have a set strategy for political donations though it supports candidates and causes that support the union’s values. Contributions vary from $1,000 to $50,000 depending on factors like whether it’s a tough or a statewide race, and what’s in the budget. “It really ebbs and flows.”

“We look at, Will this advance and better the lives of the workers who reside in Oregon? Does it ensure economic justice in the lives of Oregon residents? Does it provide a way to feed families, or to help them earn a living? Does it support housing or addiction and mental health treatment? That’s really our guiding star.”

Wise said his group is waiting to see how HB 4024 comes together and formal tweaks have not been discussed. He expects AFSCME will develop new ways to poll its 38,000 members on various causes.

“It will be a lot of work on our part but we think it will be worth it in terms of finding a unified voice,” Wise said.

There is time to adapt or attempt to change the law — HB 4024 goes into effect in 2027 at the request of the Secretary of State’s office. The reasoning being that with an election season in Oregon lasting two years, it wouldn’t be fair to institute new rules in the middle of an election season. In the meantime, House Speaker Julie Fahey has discussed convening a work group to go over implementation and proposed fixes.

But the matter is unlikely to end after 2027.

“It’s a never-ending battle to try and rein in powerful people who want to influence politics,” Kafoury said. “So I would say that passing the Legislature is a good start, but we have a lot more work to do.”

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