Mark Farrell's Creative Campaign Financing

Mark Farrell's Creative Campaign Financing

Jun 27, 2024

Lincoln Mitchell

Tom Ammiano served on the San Francisco Board of Education from 1990 to 1994, the Board of Supervisors from 1994 to 2008, and the California Assembly from 2008 to 2014. He is a member of the Phoenix Project’s Advisory Board.

San Francisco mayoral candidate Mark Farrell has found ways that are innovative, if not altogether ethical, to bring large amounts of conservative money into his campaign.

It has long been true that San Francisco is an overwhelmingly Democratic city, but it has also long been meaningless to say that. Although it is the truth that you have to be a Democrat to win an election in San Francisco, a very broad range of political views are captured by that term. We see that in the current mayoral contest where Aaron Peskin, for example, is running as a liberal or progressive, and Mark Farrell looks a lot more like a law and order Republican, but both candidates are Democrats.

This is additionally complicated because in San Francisco's open primary system, while it is near impossible for a Republican to get elected mayor, something that last happened in 1959, Republican voters can be kingmakers. Whichever candidate can consolidate the Republican vote starts out with somewhere between 5% and 10% of the electorate in his or her back pocket, and that is no small thing in an election like this year’s mayoral race which looks to be extremely competitive.

The most likely candidate to do that this year is Farrell, although Daniel Lurie will get some Republican support as well. On the other hand, it is unlikely that Peskin, a progressive Democrat who has staked his candidacy on supporting tenants, fighting to keep neighborhoods affordable, and a more holistic approach to ending homelessness, or Asha Safai who is also running as a progressive, are going to do very well with those Republican voters. The incumbent, London Breed, may win some Republican votes, but is unlikely to win many.

On some level this is good as Republicans in San Francisco should have a say in who their mayor or supervisor are, and nonpartisan elections allow them to do that. However, it is also important to have transparency. Voters have a right to know who is running as a real Democrat and who is running representing, to paraphrase Howard Dean, the Republican wing of the Democratic Party. In this year's mayoral election it is increasingly clear that Farrell is the latter kind of candidate.

This has become particularly evident in a recent campaign finance filing that shows that Republican donor William Oberndorf, who has supported far right politicians including Ted Cruz, Doug Burgum and Tim Scott in the past, has funneled a lot of money to Farrell's campaign. This is significant for a couple of reasons. First, it's solidifying Farrell’s position as the de facto Republican in the race, but it also raises some ethical and legal questions around Farrell.

If you have been paying a lot of attention to the race you might be thinking of another ethically questionable decision by Farrell in the last week or so when in his official filing for mayor he described himself as a small business owner. In San Francisco, small business owner evokes the image of somebody who runs a beloved neighborhood store, café, restaurant or small professional services firm, not, a venture capitalist like Farrell.

Back to Oberndorf whose money has flowed into Farrell’s campaign in a way that is unethical and sleazy, and potentially in violation of campaign finance law. During the first half of this month, Oberndorf funneled close to $50,000 into Farrell’s campaign. A relevant point here is that San Francisco’s campaign finance law limits individual contributions to $500.

Oberndorf made this contribution by exploiting, and that is a kind way to put it, a loophole in the law that allows for shared expenditures. Shared expenditures could be something like two candidates doing a joint fundraising event in which one reimbursed the other for catering, renting the room and related expenditures, producing campaign literature promoting several candidates and the like.

The Oberndorf-Farrell connection is a bit different. Oberndorf, who is also a major funder of the conservative advocacy group Neighbors for a Better San Francisco, has contributed $45,000 to Farrell’s ballot measure campaign to reduce commissions, including civilian oversight of the police, and other conservative reforms.

That contribution is legal, as contribution limits do not apply to ballot initiatives. However, the Farrell ballot initiative then paid Farrell’s campaign $55,000 for “shared expenditures” described as “payroll” “contractor” and “office”. Payroll constituted fully $50,000 and suggests that Farrell’s campaign staff is being reimbursed for time spent away from the campaign working on…Farrell’s initiative campaign. The reason this may sound confusing is that the distinction between Farrell’s campaign and Farrell’s initiative campaign is one without a difference.

The bottom line is that money, much of it sourced from Oberndorf and likely other Republican donors, far in excess of campaign finance limits, found its way to Farrell’s campaign to pay his staff. The extent to which this is legal may be probed by others later, but the unethical nature of this behavior is hard to miss. Ironically, Farrell was fined $191,000, later reduced to $25,000, in his first bid for Supervisor in 2010 for illegally coordinating with an independent expenditure. That is not exactly what he is doing with his initiative campaign this year, but it is very close.

There is an irony of sorts that the guy pounding his chest the hardest about the need to be tough on crime is dancing in the grey area where unethical conduct sometimes meet illegality. It is also increasingly evident that the conservative candidate, despite his rhetoric about crime, is unlikely to be able to clean up a City Hall that has wrestled with corruption problems for some time now.

Republican money of the kind that has made its way to Farrell’s campaign has already begun to reshape politics and governance in San Francisco. This latest Oberndorf-initiative-Farrell campaign dance may be particularly brazen, but it is part of an increasingly concerning pattern in San Francisco. Real San Francisco Democrats, the kind who don’t want wealthy Republicans choosing their elected officials and who don’t call for failed GOP policy solutions, should keep this in mind when they vote in November.

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Lincoln Mitchell is a native San Franciscan and long-time observer of the city’s political scene. This article was originally published on his Substack Kibitzing with Lincoln.


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