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PACs Skirting NJ's Anti-Corruption Laws

Monday, April 09, 2012

An examination by New Jersey's largest newspaper, The Star Ledger, has found that political action committees are managing to get around the state's new anti-corruption laws.

The PACs collect millions of dollars from businesses in New Jersey and then make campaign donations to elected officials — some of whom are in position to award contracts back to those businesses. The practice —  called "Pay to Play" —  was supposed to be outlawed.  But reporter Matt Friedman found local elected officials are using a loophole to skirt the law.

"Pay to Play" reform in New Jersey took effect in 2006 after some very high profile corruption cases. How is the reform  supposed to work?  

At the state level, New Jersey outlawed large contributions from contractors to political parties and to candidates for governor, and the idea was that anyone with a state contract can’t give to those places. And it left open a loophole that towns could award those contracts as long as they awarded in a “fair and open process.” Now that can mean anything.

So give us some examples of how political action committees are continuing to get around these reforms.

It’s happening at both the state and local level. The state, for instance, what I found is that state contractors, they have millions in state contracts with, say, the New Jersey Turnpike Authority or the Department of Transportation and so forth, they can’t give directly to,  say, the Democratic State Committee, but they can give to a number of PACs, called,  say,  Democracy in Motion, Women in Good Government, things like that.  Those PACs, in turn, can donate up to $25,000 to the Democratic State Committee. So you have an engineering firm, T&M Associates, which can’t donate directly to the Democratic State Committee but it’s donating to these PACs and these PACs,  in turn, are donating to the Democratic State Committee.

Listen to the full interview above.

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