DEVELOPERS GIVE BIG IN ELECTION

by James Keller

Andrew Younger paid his own way onto Halifax Regional Council.

He won his seat in District 6 ( East Dartmouth -The Lakes) without any donations: not from friends, not from neighbours and certainly not from businesses with an interest in council decisions.

“I wanted to be able to set a voting record without people saying I had taken donations and that's why I was voting that way,” says Younger, who mailed back about a dozen unsolicited donations.

He doesn't think any of his fellow councillors change the way they vote because of political contributions. But he thinks donations, especially from developers, look bad to the public.

“If people get angry with you over decisions you make, they're going to try to find reasons to attack you, and one thing they always pull out is campaign donations,” he says, using recent debate over a recently announced interchange through Shubie Park as an example.

“If you took $500 from a developer that this interchange was for, people could say you didn't work as hard because you took that money.”

In last October's municipal election, Younger was an exception to the rule.

The local development industry accounted for more than a quarter of donations to campaigns in that election, in some cases making up almost 80 per cent of candidates' contributions.

Documents filed in December show that businesses and individuals involved in development, construction and real estate gave more than $64,000. (Candidates must disclose contributions greater than $50.)

Almost half of that money went to Mayor Peter Kelly, whose $51,263 campaign received $26,000 from the industry.

While Nova Scotia 's Municipal Elections Act has no rules governing campaign donations other than disclosure, Kelly set his own limit of $2,000 per donor.

“That's more than enough from any individual or company or group, and we felt that was more than fair,” says Kelly.

All of the eight companies whose cash donations reached or exceeded Kelly's personal cap were from the development industry. Two of those, Maxim 2000 and Municipal Enterprises, each donated $2,500. Contributions of $2,000 came from Universal Property Management, Armco Capital, Southwest Properties, Cresco Homes, ACL Construction and United Gulf Developments.

An arm's-length finance team led by his official agent, Morton Kelly, handled Kelly's fundraising. The mayor says his team didn't distinguish between companies.

“We don't discriminate, first of all, whether it's a business or group or company or otherwise,” he says. “Everybody's treated equally.”

Failed mayoral candidate Victor Syperek was Kelly's only opponent to receive money from the development industry, which contributed $2,700 to his $25,900 campaign.

Many of Kelly's largest donors were the major contributors in the election.

Southwest Properties donated $8,000 in the election, which includes a $1,000 donation from Summer Wind Holdings, a related company with the same director and CEO. George Armoyan's group of companies, including Kimberly-Lloyd and Armco Capital, donated more than $10,000. The Municipal Group, which includes Municipal Enterprises, Dexter Construction and Envirosoil, donated $4,600.

The Municipal Group's vice president of finance, Merl Frownes, and Armco Capital's president, Gary Pearce, both declined to comment on their companies' donations. Pearce said Armco's board of directors didn't feel it was in their best interest to talk about the company's policies about municipal elections.

Southwest Properties has been contributing to municipal election campaigns for more than 50 years, says President Donald Clow.

“It's simply a recognition of the political process in this country,” says Clow. “It does take money to run a campaign.”

Southwest tries to “spread the money around,” says Clow, instead of giving to a single candidate. Southwest gave money to 17 candidates in the election and also donated to opposing candidates in two ridings. In Dartmouth Centre, Southwest gave $300 each to John Cunningham and Gloria McCluskey, who won a seat on council. In Halifax North End, Southwest gave $100 to Eva Moore and $200 to winning candidate Patrick Murphy.

Southwest doesn't have a formal policy to determine who it donates money to, says Clow.

“A lot of times it's just who asks, and sometimes it's people who have responsibilities in the constituencies in which you do business.”

Russell Walker ( Fairview-Clayton Park ) reported $4,200 in contributions. Nearly 80 per cent, or $3,350, of that came from the development industry, including Armco Capital, Southwest Properties, United Gulf Developments and Clayton Developments.

Walker 's official agent handled all of his fundraising, he says, and he didn't see the list of contributors until after the election.

“I stay out of that process,” he says.

Peter Aucoin, a political science professor at Dalhousie University , says it doesn't matter if candidates only see the lists after the election.

“If they see it when its over and they won, there's still the prospect of undue influence,” he says. “Undue influence occurs after there's a winner.”

Aucoin says even if donations don't affect politicians' decisions, they can create public distrust, especially when politicians vote on issues that affect the donors.

“They're certainly putting themselves where they're seen to be in a conflict of interest,” he says. “One of the major factors driving campaign finance reform is the question of public perception. You want to have a regime where the public has confidence in the integrity of the system.”

To avoid this perception, says Aucoin, campaign finance must be open to public scrutiny and elected officials should not be making decisions that affect donors.

“There are two key issues: is the transparency sufficient? And do people excuse themselves from decisions when people are major contributors?” he says.

No rules in the elections act prevent councillors from voting on developments involving donors to their campaigns, says Linda Grant, assistant returning officer in the last election.

“As a candidate, how do you define a conflict of interest?” she asks.

Once a councillor is elected, he or she must declare any direct or indirect monetary interest in matters that come before council, then withdraw from the discussion and refrain from voting. The rules are silent on campaign donations.

Walker 's constituents aren't concerned about who gave him money, he says.

“I don't have any residents phoning me — except the media trying to make it a story,” he says. “The list does not have anything to do with how I vote. There's developers on there I voted against.”

Second-time councillor Dawn Sloane (Halifax Downtown) accepted donations from business for the first time this year. In the 2000 election, she won her seat with money from friends and family and from her employment insurance payments.

Sloane reported $5,760 in contributions for the last election, with $100 from Armco Capital and $500 from Southwest Properties. She changed her policy, she says, because she was worried she didn't have the money to run a successful campaign.

“A lot of newer councilors — and I don't blame them — will try to do everything on their own, but how can someone fight someone who is getting a lot of money from someone else?” says Sloane. “If I would have used my conscience, I wouldn't have taken any of the money.”

She agrees with Younger that accepting donations from developers can look negative.

“If someone out in a different area receives a lot of money from someone, how do you know they're voting for the right reason?”

Some councillors won their seats without any donations of more than $50. Younger, Bill Karsten (Portland-Eastern Passage), Sheila Fougere (Connaugh-Quinpool), Brad Johns (Middle & Upper Sackville-Lucasville), Len Goucher ( Bedford ), and Gary Meade (Hammonds Plains-St. Margarets) reported receiving no donations. Debbie Hum's (Rockingham-Wentworth) reported donation of $393.30 was from herself.

Younger thinks there should be caps on campaign spending and on donations.

In Nova Scotia , election financing rules are outlined in the Municipal Elections Act. There are no limits on how much candidates can spend, nor are there any limits on donations.

Disclosure rules were introduced in the 2000 election so “the public doesn't perceive it as being hidden,” says Grant.

Elections officials don't follow up on disclosure statements, says Grant, and no candidate has been found to have broken the rules since they were established.

“They sign (the disclosure statement) to say that it is true, so singing it commits them to the truth,” says Grant. “We take it as a sworn document. We don't follow up on them or check on them.”

The new rules didn't affect how Southwest Properties donates in elections, says Clow.

“It didn't change — we've always tried to conduct ourselves with integrity, especially in a political process,” says Clow. “Honestly, there's no discussion of political favours.”

Systems without donation and spending limits can be problematic, says Aucoin.

“By not having spending limits, you create a real demand for money,” says Aucoin. “The more you have to raise money, the more you're likely to take it from everybody.”

New federal election donation caps were motivated by public perception, says Aucoin. In 2003, the federal government capped corporate and union donations at $1,000 and personal donations at $5,000.

Kelly doesn't think the public distrusts the current donation system in local elections.

“If everybody makes it clear that (donations are made) without expecting favours, if that's well-known up front, I think the public knows it's without bias and without favour,” says Kelly. “To me, the public is supreme in that process, and we're here to serve the public.”

Kelly also supports the idea of legislating caps on donations.

Since election rules are controlled by the province, says Kelly, he can't do anything on a local level to put in caps. After every election, the province forms a committee to evaluate the election act. He says donation caps have come up before, but the idea “hasn't gone anywhere.”

“Should the opportunity come up for further input,” says Kelly, “I will be there.”