Joint Opinion 16-29/16-50
September 8, 2016
Digest: (1) A candidate whose remaining unexpended campaign funds total $2,500 or less at the end of the window period may immediately treat those funds as de minimis without first attempting to return the funds pro rata to contributors.
(2) A candidate whose remaining unexpended campaign funds exceed $2,500 must make one reasonable, bona fide attempt to return all the funds pro rata to contributors. Any funds remaining following this effort may be treated as de minimis.
(3) De minimis campaign funds, as defined above, may be used after conclusion of the window period as follows, to the extent legally permitted:
(a) they may be expended for any lawful non-political purpose connected to judicial office, such as the purchase of judicial robes, office supplies, computer software or books; or
(b) they may be donated to the Catalyst Public Service Fellowship Program; or
(c) subject to any necessary administrative approvals, they may be used to purchase books or other reference materials to be donated to the courthouse law libraries.
(4) The Committee declines to address whether unexpended campaign funds may be donated to the Unified Court System, absent resolution of the legal and administrative policy issues involved.
Rules: Election Law §§ 14-130; 17-162; Judiciary Law §§ 212(1)(n); 212(2)(l); State Finance Law § 11; 22 NYCRR 100.0(Q); 100.5(A)(1)(c)-(d); 100.5(A)(1)(h); 100.5(A)(2); 100.5(A)(5)-(6); 101.1; Opinions 15-214; 14-148; 12-129(A)-(G); 12-95(A); 12-84/12-95(B)-(G); 10-80; 09-167; 08-151; 07-187; 07-137; 07-65; 06-162; 04-06; 99-38; 90-04; 87-02; NY State Bd Elections (Inf) Adv Ops 90-1; 86-5; 1975 Op NY State Bd Elections No. 17.
Two recently elected judges ask about disposition of their remaining unexpended campaign funds.1 The judge in Inquiry 16-29 has a final campaign account balance of approximately $4,000. The judge asks whether he/she may donate these funds to the newly created Catalyst Public Service Fellowship Program. As described, the Catalyst program provides stipends to students at law schools in New York State, so they can accept unpaid public service internships within the Unified Court System, or at the offices of prosecutors or indigent legal services organizations that appear exclusively in the New York State courts. It is overseen by the Center for Court Innovation and the not-for-profit Fund for New York City, and a retired Appellate Division Justice administers the fund on a pro bono basis. In Inquiry 16-50, a judge with approximately $2,000 in unexpended campaign funds asks if he/she may donate these funds to the Unified Court System “for the betterment of libraries within New York State Courthouses that are accessible by members of the judiciary, the bar and the public.” The judge also supplemented his/her inquiry to ask, in the alternative, whether he/she may contact the courthouse librarians, find out what specific books or reference materials they would like, purchase those specific items, and donate them to the law library.
A judge or non-judge candidate for elective judicial office may personally participate in his/her own campaign for judicial office during his/her window period, subject to certain limitations (see 22 NYCRR 100.0[Q] [defining “window period”]; 100.5[A][c]; 100.5[A]). For example, judicial candidates must not participate in any political campaign or any partisan political activity on behalf of other candidates (see 22 NYCRR 100.5[A][c]-[d]); must not solicit funds for, pay an assessment to, or contribute to a political organization or candidate (see 22 NYCRR 100.5[A][h]); and must not use or permit the use of campaign contributions for the private benefit of the candidate or others (see 22 NYCRR 100.5[A]).
I. Background: The Current Rules
A. De Minimis Funds and the “Pro Rata Return” Rule
A judicial candidate may use his/her campaign funds through the post-election window period to buy campaign advertisements and attend political events (see Opinion 99-38); to make generically useful purchases for his/her current campaign (see Opinion 14-148); to host a modest and reasonable victory reception (see Opinion 07-187) or, if defeated, an “extremely modest social event” to thank those who significantly volunteered on the campaign (see Opinion 12-129[A]-[G]); and even to attend events whether or not hosted by political organizations, provided the candidate’s “attendance is in furtherance of his/her campaign for judicial office” and the candidate “determines that he/she will receive fair value for the expenditure” (Opinion 12-84/12-95[B]-[G]).
Once the applicable window period ends, however, such expenditures are no longer appropriate because the candidate’s campaign activity must terminate. The candidate must therefore dispose of any remaining campaign funds and close his/her campaign account as soon as practicable following the end of the window period (see e.g. Opinion 14-148). If, on conclusion of the window period, the candidate’s remaining campaign funds are below $1,000, the task is quite easy: the funds are treated as de minimis and “may be expended for any lawful non-political purpose connected to judicial office, such as the purchase of office supplies, computer software or books” (see Opinion 12-95[A]). Judicial candidates who have $1,000 or more at the close of the window period, however, face the more difficult task of returning the funds to contributors pro rata.
Approximately a decade ago, the Committee recognized that, in an “unintended interpretation of our prior opinions,” some newly elected judges apparently wished to spend “significant amounts of unexpended funds for the purchase of numerous items, or items which the court system or municipality readily provide” (Opinion 06-162). As a result, the Committee emphasized that “[a] judicial candidate must make every reasonable effort to return unexpended campaign funds to contributors on a pro-rata basis” (id.). In Opinion 06-162, the Committee expressly rejected the more permissive approach to spending described in prior opinions, and advised that only “a small amount of unexpended campaign funds may be used for the purchase of items ... which are not otherwise provided by the court system or the municipality if they are necessary for the performance of judicial duties” (id.).
However, the Committee has also struggled with the practical difficulties, accounting and other expenses judicial candidates may face in trying to return unexpended campaign funds to contributors. In Opinion 06-162, the Committee advised:
Nevertheless, if the remaining unexpended funds are de minimis or otherwise so limited that, under the circumstances, returning the balance to contributors will be significantly impracticable, these funds may be used to purchase items which the court system or municipality does not otherwise provide for use in the judge’s performance of judicial duties. In determining whether it will be impracticable to return the unexpended campaign funds to donors, the judicial candidate may consider factors such as the total number of donors and the cost of returning the funds. Any items purchased with unused campaign funds, under these limited circumstances, become the property of the New York State Unified Court System.
While a judicial candidate may not streamline the pro rata return process by declining to issue checks below a certain amount (see Opinion 07-65), the Committee has recommended a judicial candidate should, to the extent possible, “take steps to minimize the risk of uncashed checks that will further delay the closing” of the campaign account (id.). Thus, for example, to the extent permitted by governing law, a candidate “may advise campaign contributors that if the checks are not cashed by a particular deadline,” the candidate will need to dispose of the remaining funds in accordance with applicable statutes, rules and opinions, and therefore “the funds will be unavailable if they attempt to cash the check beyond that date” (id.).
Finally, the Committee has advised that campaign funds remaining after one bona fide effort to return unexpended funds pro rata to all contributors may be used for any purpose consistent with prior opinions, except that funds remaining after the window period expires may not be used for victory parties or to attend political events (see Opinion 08-151).
In sum, at this time, the pro rata return rule means a judicial candidate with $1,000 or more remaining in unexpended campaign funds after his/her window period ends must make a bona fide effort to return those unexpended funds pro rata to all contributors.
B. The Prohibition on Charitable Use of Campaign Funds
Campaign contributions may not be used for the private benefit of the candidate or others (see 22 NYCRR 100.5[A]); and a candidate must not use or permit campaign or personal funds to be used to pay for any campaign-related goods or services where fair value is not received (see 22 NYCRR 100.5[A]). Interpreting these provisions, the Committee has consistently stated that judicial campaign funds may not be donated to charity (see Opinions 08-151; 07-137; 90-04; 87-02).2
The Committee notes, however, that its interpretation of Section 100.5(A)(5) of the Rules Governing Judicial Conduct to preclude judicial candidates from making charitable donations does not appear to reflect any statutory limitation in Election Law Sections 14-130 or 17-162.
To the contrary, the New York State Board of Elections has advised that use of campaign funds for bona fide charitable purposes is not a prohibited “personal use” for purposes of Section 14-130 (see NY State Bd Elections [Inf] Adv Ops 90-1; 86-5).
The Board of Elections has also stated that a judicial candidate may contribute to charities without violating the prohibition on “directly or indirectly, mak[ing] any contribution of money or other thing of value” (1975 Op NY State Bd Elections No. 17), now found in Section 17-162 of the Election Law. The Board of Elections concluded “from the placement and language of the statute,” the legislature intended “to prohibit political contributions by judicial candidates and not to restrict contributions by such candidates to bona fide charitable institutions” (1975 Op NY State Bd Elections No. 17). Consistent with this view, the Committee recently advised that a judge who earlier ran for a non-judicial elective office may dispose of his/her remaining unexpended non-judicial campaign funds by donating them to charity, provided doing so is lawful (see Opinion 15-214).
II. The Proposed Donations
With this backdrop, the Committee now considers the proposed donation to the Catalyst Public Service Fellowship Program (Inquiry 16-29). This particular not-for-profit entity has unparalleled strong ties to the Unified Court System. It is overseen by the Center for Court Innovation, “a unique public-private partnership that serves as the New York State Unified Court System’s independent research and development arm” (http://www.nycourts.gov/ip/cci), visited 3/18/2016). Moreover, the Catalyst program is designed to encourage public service not merely “generically” within the legal community, but specifically within the New York State courts, by providing law student interns to the prosecutors who practice in our courts, to the indigent legal services organization lawyers who appear in our courts, and to the judges who preside in our courts. Significantly — and unlike many other public service fellowship programs — it does not support internships in other states, in the federal system, or in government agencies that seldom appear in any court. In the Committee’s view, using unexpended judicial campaign funds in a manner that will enable law students to serve as interns for judges in the Unified Court System would not be an impermissible “private benefit” (see 22 NYCRR 100.5[A]), but, rather, a public benefit intertwined with judicial office which directly inures to the benefit of our state’s judicial system as a whole. With respect to the internships for prosecutorial and defense agencies, the Catalyst Public Service Fellowship Program funds interns for law offices on both sides of criminal trials in the New York State courts, which provides a similar public benefit.
Turning now to Inquiry 16-50, the Committee cannot comment on whether it is legally permissible to donate campaign funds outright to the Unified Court System and earmark them for a particular purpose such as improvement of the law libraries (see generally Judiciary Law § 212[l]; State Finance Law § 11; Judiciary Law § 212[n]). Nor can the Committee comment on whether, as a matter of policy, the Chief Administrative Judge is willing or able to accept unexpended campaign funds for any purpose. Thus, this question raises primarily legal and administrative issues which the Committee cannot address (see generally Judiciary Law § 212[l]; 22 NYCRR 101.1). Absent an opinion from the Office of Court Administration’s legal counsel or other formal indication that applicable law and administrative policy permits unexpended campaign funds to be donated to the Unified Court System and earmarked for specific purposes, the Committee must decline to answer the question asked as premature and hypothetical.
With respect to the alternative question in Inquiry 16-50, the Committee notes that non-monetary donations to the Unified Court System are treated very differently and raise entirely distinct considerations (see Judiciary Law § 212[n]). Assuming that it is legally permissible to do so, the Committee believes that using unexpended judicial campaign funds to purchase books or other reference materials that Unified Court System law librarians have specifically requested, and then donating those items to the Unified Court System for the betterment of law libraries “that are accessible by members of the judiciary, the bar and the public” would not be an impermissible “private benefit” (see 22 NYCRR 100.5[A]), but, rather, a public benefit intertwined with judicial office which directly inures to the benefit of our state’s judicial system as a whole. It is therefore ethically permissible, subject to any necessary administrative approvals (cf. Judiciary Law § 212[n]; Opinion 09-167). From an ethics perspective, the donation “may be accomplished by simply writing a letter to the district administrative judge identifying the donated item(s)” (Opinion 04-06), but this Committee cannot comment on any administrative or legal requirements.
A. Increasing the De Minimis Threshold
In considering Inquiry 16-50, where the judge has approximately $2,000 in remaining unexpended campaign funds, it has become clear that the $1,000 threshold set forth in Opinion 12-95(A) is unnecessarily restrictive. The Committee concludes the threshold should be increased to $2,500. Opinion 12-95(A) is therefore amended to reflect that a candidate whose remaining unexpended campaign funds on conclusion of the applicable window period total $2,500 or less may immediately treat those funds as de minimis without first attempting to return the funds pro rata to contributors.
B. Obligation Where Candidate Has More than De Minimis Funds
The Committee emphasizes that newly elected or re-elected judges should not consider themselves “entitled” to use or reserve a certain amount of campaign funds for the benefit of chambers (e.g. to purchase furniture, equipment, judicial robes, law books, and the like).
Instead, on conclusion of the applicable window period, a judicial candidate whose remaining unexpended campaign funds exceed $2,500 must, through one or more responsible persons, make one reasonable, bona fide attempt to return the funds pro rata to contributors. That is, a candidate who has more than $2,500 left must not use those funds for chambers-related purposes or make any donations described herein or otherwise treat the funds as de minimis without first making a reasonable, bona fide effort to return all the funds pro rata to contributors.
As before, any campaign funds remaining after the candidate has made one reasonable, bona fide effort to return them pro rata to contributors may be treated as de minimis (see Opinion 08-151).
Of course, on rare occasions, a candidate who has more than $2,500 left may fear it will be “significantly impracticable” to return those funds pro rata to contributors (Opinion 06-162). In that instance, the candidate may seek guidance from the Judicial Campaign Ethics Center (see www.nycourts.gov/ip/ jcec/contactus.shtml). The candidate must provide all relevant facts required by the Subcommittee, including, at a minimum, the total amount raised, the number of distinct contributors, the amount remaining, and the estimated cost of returning the funds. If the Subcommittee advises, in writing, that pro rata return would be significantly impracticable under the specific circumstances presented, then the candidate may safely treat such funds as de minimis.
C. Use of De Minimis Remaining Unexpended Campaign Funds
Mindful of the difficulties judicial candidates often face in disposing of unexpended campaign funds at the conclusion of their window period, the Committee now carves out a narrow exception to the prohibition on outright donation of judicial campaign funds.
Once the candidate’s remaining campaign funds reach a level that may be treated as de minimis as set forth in III.A or III.B above, such funds may, to the extent legally permitted, be either:
(a) expended for any non-political purpose connected to judicial office, such as the purchase of judicial robes, office supplies, computer software or books, as permitted by prior opinions; or
(b) donated to the Catalyst Public Service Fellowship Program; or
(c) subject to any necessary administrative approvals, used to purchase books or other reference materials to be donated to the courthouse law libraries.
As before, “even de minimis remaining campaign funds may not be used for the private benefit of the candidate or others. Thus, they must not be donated to charity or transferred or donated to any political organization or candidate, and they may neither be used to pay outstanding debts from prior election campaigns nor retained for use in subsequent campaigns” (Opinion 12-95[A] note 1[citations omitted]). The Committee notes that the ban on donating funds to charity remains; the only difference now is a single, narrow exception permitting such funds to be donated to the Catalyst program for the reasons set forth herein.
Judicial candidates must bear in mind that the underlying reason why they are permitted to raise campaign funds at all is so they can participate in their own campaign for elective judicial office. It would, of course, be inappropriate for a judicial candidate to raise campaign funds with the specific intention of making a donation to the Catalyst program. It would likewise be inappropriate for the candidate to suggest, or permit his/her campaign committee to suggest, as a motive to prospective donors, the possibility that excess funds would be donated to the Catalyst program.
Here, the judge in Inquiry 16-29 has more than $2,500 remaining in his/her campaign account at the end of his/her window period, and has apparently not yet attempted to return the funds pro rata to contributors. Because these funds are more than de minimis in nature, the judge must make one reasonable, bona fide effort to return the funds pro rata to contributors (see section III.B, supra). Only after the effort has been made may the judge treat any remaining funds as de minimis and use them as set forth herein (see section III.C, supra).
The judge in Inquiry 16-50 has $2,500 or less in his/her campaign account at the end of the applicable window period. Therefore, he/she need not make any effort to return the funds pro rata to contributors, but may immediately treat such funds as de minimis. Accordingly, this judge may, to the extent legally permitted, donate his/her remaining unexpended campaign funds to the Catalyst Public Service Fellowship Program; use them to purchase books or other reference materials courthouse law librarians have requested, subject to any necessary administrative approvals; or use them for other lawful, non-political purposes related to judicial office as set forth above and in prior opinions (see section III.C, supra).
Once the funds are disposed of, the inquiring judges should, as usual, close their campaign accounts promptly to avoid any possible appearance they are engaging in political activity beyond the applicable window period.
E. Amending Prior Opinions
Opinions 08-151, 07-137, 90-04, 87-02, and other opinions forbidding any charitable donation whatsoever of campaign funds, are hereby amended consistent with this opinion. Thus, on conclusion of the window period, once the candidate’s remaining campaign funds are eligible to be treated as “de minimis” as described herein, such funds may, in the candidate’s discretion and to the extent legally permitted, be donated to the Catalyst Public Service Fellowship Program and/or used to purchase specific books or reference items requested by Unified Court System law librarians, which will then be donated to the Unified Court System, subject to any necessary administrative approvals.
Opinion 12-95(A) and other opinions discussing disposition of “de minimis” levels of unexpended campaign funds on conclusion of the applicable window period are hereby amended consistent with this opinion. If the total unexpended campaign funds remaining at the conclusion of the window period are $2,500 or less, they need not be returned to contributors on a pro rata basis but may be immediately treated as “de minimis” as described herein.
1 At the Committee’s instruction, the judges have been awaiting issuance of the present opinion before disposing of their remaining campaign funds.
2 Nonetheless, subject to the fair value rule (see 22 NYCRR 100.5[A]), a judicial candidate may use campaign funds during the window period to purchase campaign-related advertising in furtherance of his/her campaign by, for example, sponsoring a softball team (see Opinion 10-80) or paying for his/her name and a gavel to be printed on a T-shirt that will be distributed to participants in a charitable event (see Opinion 07-137). Likewise, a judicial candidate may use campaign funds to attend charitable events during the window period, provided the candidate’s “attendance is in furtherance of his/her campaign for judicial office” and the candidate “determines that he/she will receive fair value for the expenditure” (Opinion 12-84/12-95[B]-[G]).