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Can Candidates Give Gift Cards to Campaign Volunteers?

In the critical days leading up to Republican Gov. Bruce Rauner's election last fall, his campaign handed out thousands of $25, $50 and $75 gift cards to people helping get the vote out for him.

By Rick Pearson

In the critical days leading up to Republican Gov. Bruce Rauner's election last fall, his campaign handed out thousands of $25, $50 and $75 gift cards to people helping get the vote out for him.

The Rauner campaign's use of the Visa prepaid cards was a new and unusual way to reward campaign workers. But it also raises questions about transparency, including what needs to be disclosed under campaign finance law and whether someone is still a volunteer when they get paid.

The Rauner campaign had never directly revealed buying the gift cards until July 13 -- more than eight months after the election. In a campaign finance report filed with the State Board of Elections, Rauner's nearly $20 million political fund got back $54,713 in April and May through what it listed as the "liquidation of previously purchased asset -- redemption of gift cards."

But the Rauner campaign has not disclosed who got the prepaid gift cards, including anyone who may have received multiple cards worth $150 or more -- the threshold in state campaign finance law for reporting compensation to workers.

That creates "a lack of transparency in terms of the spirit of what the campaign finance law is," said Kent Redfield, a campaign finance expert and retired political science professor at the University of Illinois at Springfield. "You should be able to figure out what people spent money on and where the money went."

Larry Noble, a former general counsel for the Federal Election Commission, said he had never heard of campaigns distributing that many debit cards to workers and said it "definitely is odd." Many campaigns reward volunteers with doughnuts, coffee or pizza -- not gift cards.

"If they're giving them a debit card with value on it, that's payment to these people. You can't get around it," said Noble, now senior counsel at the Washington-based Campaign Legal Center, a nonpartisan, nonprofit group involved in campaign finance legal issues.

The Rauner campaign said it followed state election law.

"The campaign reported the gift cards correctly," Sarah Clamp, a spokeswoman for Rauner's campaign, said in an email statement. "The campaign is only responsible for reporting when the campaign makes an expenditure and did this by reporting the purchase of gift cards."

In its January report to state elections officials, the Rauner campaign listed an expenditure of $257,604 to IDT Payment Services of Newark, N.J., for "GOTV Labor." That's the acronym for get-out-the-vote efforts. No other description was given, and no mention of gift cards was made. Later, in this month's finance report, the Rauner campaign made its first mention that gift cards had been purchased.

Asked about the gift cards by the Chicago Tribune, the Rauner campaign said in an email that it bought 5,145 of them in denominations of $25, $50 and $75. A source close to Rauner's 2014 bid said the campaign office was "awash" in the debit cards, some of which were then passed along to township and county GOP operations. The cards were distributed to people who worked on phone banks as well as those who walked streets to canvass for votes, the campaign said.

If someone worked multiple days, they would receive multiple cards, said the campaign source, who was not authorized to speak publicly. But getting cards worth $150 or more would appear to trigger the disclosure rule.

State election law requires the reporting of "the full name and mailing address of each person to whom an expenditure for personal services, salaries, and reimbursed expenses in excess of $150 has been made and that is not otherwise reported, including the amount, date, and purpose of the expenditure."

In addition, the law requires the reporting of "the full name and mailing address of each person to whom expenditures have been made by the committee or candidate within the reporting period in an aggregate amount or value in excess of $150" and "the amount, date and purpose of each of those expenditures."

Rauner's campaign said it considered the cache of gift cards to be "property," and as a result the transfer of cards to workers did not have to be individually reported.

But Noble, the former FEC lawyer, said he doubted that explanation shields the campaign from disclosing who got the cards if workers got more than $150 worth.

"The idea of it being property, I don't think that flies. Even if it was something other than a debit card, even a plant, or they gave each person $75 of food for their home, it's still something of value. These are debit cards. These are as good as cash," Noble said.

The Rauner campaign did not respond when asked if anyone received $150 or more in gift cards but said it could not list individuals who got the prepaid debit cards for technological reasons. Since the campaign previously reported spending money to buy the cards, listing the people who received them would be double-reporting the same expense, the campaign said.

But Noble and other finance experts said the campaign should not have reported the quarter-million-dollar bulk purchase of the cards since it was the equivalent of giving people money out of a campaign bank account. Instead, it should have just reported who got the cards.

Noble likened it to rules that require campaigns to itemize the specifics of what they purchased using credit cards rather than just list a bulk payment made to a credit-card company.

Redfield, the Illinois campaign finance expert, said he thinks the State Board of Elections should seek more details from the Rauner campaign about where the debit cards ended up.

"It does seem like something that wouldn't be surprising if (the Rauner campaign) got a request for more information from the State Board of Elections. (The Rauner campaign report) really doesn't give you any sense of the where and the who and the how many and how much," Redfield said.

"I think both the letter and the spirit of the law is clear," he said. "If you want the public to have confidence in the political process, you have to have maximized transparency, which is what the law intends. Without that, it just becomes 'trust-me' ... but 'trust-me' is not an ethics policy or a reasonable scheme for providing transparency in terms of how one both raises and spends campaign funds."

State Board of Elections officials would only say they were aware of the debit card issue involving Rauner's campaign filings.

The Rauner campaign previously has run afoul of disclosure rules. In January 2014, it listed payments to campaign staff in bulk through a third-party payroll vendor. The campaign later agreed to specify individual payments to its campaign workers after state elections officials weighed in.

(c)2015 the Chicago Tribune

Caroline Cournoyer is GOVERNING's senior web editor.
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