D.C. Council members debate ethics provisions earlier this month.
As the D.C. Council rushes to pass an ethics overhaul bill before the end of the year, the issue of corporate campaign contributions remains in the spotlight.
Some call it the "LLC Loophole;" others call it "bundling." It refers to the practice of business owners, usually developers, using subsidiary companies like Limited Liability Companies to make multiple campaign donations, and according to critics, skirt campaign contribution limits.
During the hearing over the new ethics bill last month, the city's campaign finance director Cecily-Collier Montgomery told council members it's an issue they try to monitor.
"What raises a red flag for the auditor is where she may see a contribution coming from corporations that share the same address," said Montgomery.
A review of the latest campaign finance records for the five council members up for reelection next year finds more than a few red flags.
There were 75 cases of contributions coming from multiple corporate entities that share the same address. In many examples, it was just two companies. In a few there were as many as 8, 10, even 12 companies all listing the same address that contributed to a council member's campaign committee.
But in practically every case, the contribution was for the maximum limit: $1,000 for an at-large council seat, and $500 for a specific ward's seat. That's notable, because a person controlling all these companies could theoretically donate 8, 10, or 12 times the contribution limit to a single candidate.
D.C. Council member Tommy Wells has proposed reining in this practice, but when he tried adding an amendment to that effect to the ethics bill, he couldn't muster a single yes vote from his colleagues.
"I really don't believe the majority of my colleagues realize there is a crisis in confidence and I think they are doing their best to not change the political world for themselves," says Wells.
These multiple corporate contributions are also tough to track, because there are no individuals' names attached to the donations. The only way to connect an individual to the corporate entity is if a person is also listed at the same address.
And the addresses aren't a foolproof method of tracking bundled contributions. Many times the subsidiaries are listed at different addresses, making the money trail hard to follow.
All told, the donations for the council members' 2011-2012 campaign under the corporations with matching addresses total nearly $115,000. Corporate Campaign Contributions to D.C. Council Members (Source: Office of Campaign Finance)