D.C. will once again try to tighten its campaign finance rules to prevent donors from "bundling" checks through related corporate entities.
The process of developers and other businesses making multiple contributions to individual candidates through limited liability corporations is so common that it has its own name—the LLC loophole. It's legal, but as many critics point out, it allows a donor to exceed contribution limits. (The loophole was highlighted in WAMU's "Deals for Developers" investigative report.)
After an unsuccessful attempt last year, Mayor Vince Gray says that he will once again try to close this loophole. Gray said on Wednesday that his campaign finance reform bill will once again be pushed to the Council, after failing to gain traction during the previous legislative session. The bill would also limit when contractors can give money to candidates—if they have over $250,000 in city business, they wouldn't be allowed to—and set more stringent disclosure rules.
Ariel Levinson-Waldman with the D.C. Attorney General's office explained at a press conference that the bill would stop LLC bundling by implementing new limits on how many affiliated LLCs can give to one candidate.
"Anybody, person, corporation, business LLC, LP, name your corporate entity—anybody who is affiliated with another entity will be counted together for aggregation rules, so that you can't evade, and that's really been the problem in the past," he explained.
But for the bill to become law, it needs to be passed by the Council and the incumbent lawmakers who often rely on these donations during election season.