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Unpaid Loan Loophole Lets Corporations Sail Past Campaign Contribution Caps


Unpaid Loan Loophole Lets Corporations Sail Past Campaign Contribution Caps

Aug 31, 2023 | 9:05 am ET
By Sam Mellins/New York Focus
In Monroe County, primary candidates for the county legislature are allowed to accept a maximum of $1,000 — well below what some candidates received. | Photo: Evilarry via Wikimedia Commons | Illustration: Maia Hibbett

In Monroe County, primary candidates for the county legislature are allowed to accept a maximum of $1,000 — well below what some candidates received. | Photo: Evilarry via Wikimedia Commons | Illustration: Maia Hibbett

When William Burgess squeaked out his primary win for a Democratic nomination to the Monroe County legislature, his campaign was in debt.

Burgess triumphed by just 28 votes out of more than 800 cast, and he owed more than $4,500 to a local political advertising firm. A career social worker turned politician, according to his campaign website, he’d received an $11,564 loan in June, and he paid the first $7,000 off the same day. He hadn’t paid the rest back by the time of the June 27 election, state Board of Elections records show.

According to New York election law, loans that aren’t paid before an election count as contributions — and are theoretically subject to the same limits. In Monroe County, home of Rochester, the maximum contribution county legislator candidates are allowed to accept for their primaries is $1,000 — well below what Burgess received.

Burgess’s lender-turned-donor is political advertising firm Tuesday Digital, which was co-founded by Monroe County native Stephen DeVay. An it professional, DeVay became chair of the Monroe County Democratic Party in 2022 after pledging that he would “step back” from his role with Tuesday Digital to avoid potential conflicts of interest.

The company is still registered to DeVay’s home address, according to the New York Department of State, and numerous payments from candidates still use that address in filings with the Board of Elections. Neither DeVay nor Tuesday Digital responded to New York Focus’s request for comment.

Beyond the loans to Burgess, Board of Elections records show that Tuesday Digital extended thousands of dollars in credit to Paul Conrow, a Rochester teacher who unsuccessfully tried to unseat local progressive stalwart City Council Vice President Mary Lupien. Running for county legislature, Santos Cruz also received thousands in credit and won his primary against progressive tenant activist Oscar Brewer. Tuesday Digital’s contributions in the form of loans to Burgess, Conrow, and Cruz appear to have exceeded the state limit on contributions to candidates from a corporation — capped at a total of $5,000 per year across all candidates throughout New York State.

Burgess, Conrow, and Cruz did not respond to requests for comment.

It isn’t unusual for corporations to violate contribution limits. When they do, New York’s Board of Elections rarely imposes consequences. Numerous companies have violated the $5,000 limit without facing any legal disciplinary action from a board that has allowed thousands of corporations to break disclosure laws scot-free.

Campaigns have also frequently failed in their obligations to disclose the individuals behind donations from corporations, something that Governor Kathy Hochul’s campaign began doing only after reporting from New York Focus highlighted her failure to comply with this part of campaign finance law.

One local actor in Monroe County politics is attempting to spur the Board of Elections to investigate whether campaign finance laws were violated. Rachel Barnhart, a sitting county legislator, submitted two complaints to New York’s Board of Elections outlining the violations of contribution limits and other alleged malfeasance.

“This could be an innocent mistake, but even if it’s an innocent mistake, the end result is you messed around with elections,” Barnhart told New York Focus.

In her own primary, Barnhart defeated another candidate who worked with Tuesday Digital, but that candidate, Allan Richards, didn’t receive loans from the firm.

The Board of Elections acknowledged the complaints, but hasn’t responded further, Barnhart said. The board did not respond to New York Focus’s request for comment.

In their post primary disclosures, Conrow and Cruz reported debts to Tuesday Digital of $7,344 and $9,772, respectively. Since they weren’t repaid by the time of the election, those debts also appear to count as contributions.

Combined with the effective contribution to Burgess, Tuesday Digital contributed over $21,000 leading up to the June primary — about a quarter of what the three candidates received in total, and over four times the annual corporate contribution limit for candidates.

While it’s not clear what DeVay’s present relationship with Tuesday Digital is, one other member of the county party leadership clearly performed work for candidates in the Democratic primary. The party’s executive vice-chair, Anthony Plonczynski-Figueroa, was paid over $1,200 total by a candidate for a judgeship and a candidate for a county legislature seat, campaign filings show. Emails obtained by New York Focus also show him consulting on the design of campaign materials for another judicial candidate, though public records don’t indicate that he was paid for that work.