Who's funding the Vision2 campaigns?

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I was interviewed midday Tuesday by Fox 23's Ian Silver about the fundraising gap between the proponents and opponents of Vision2.

The "vote yes" bunch reports donations of $562,952, and only $450 in contributions of $200 or less.

The opposition group Citizens for a Better Vision has had monetary contributions of $3,859.69, of which only $2,459.69 was in amounts of $200 or less, and has spent $2,977.44, mainly on signs and bumper stickers. Individuals have independently and directly spent money on things like buttons and Facebook ads. (For example, I paid for color copies of my "Better Vision for Tulsa" handout, so I could have something to distribute at the Leadership Tulsa luncheon.) Even with these independent expenditures, opposition spending that we know of is about $10,000.

A ratio of at least 50:1 is not at all surprising. Giving on previous tax proposals has been similarly lopsided. It can be explained by public choice theory -- concentrated benefits vs. diffuse costs. Those businesses who stand to make millions, perhaps hundreds of millions, of dollars if this tax passes have a strong incentive to invest tens of thousands of their own dollars in convincing the public to approve it. Because the tax is broad-based, there's no concentrated benefit if the tax fails, so no one has the same financial incentive to give tens of thousands of dollars to the "vote no" campaign. As I told Fox23's Silver:

The opposition, he said, is made up mostly of individuals digging into their own pockets, and using social media to spread the word.

"It's all grassroots," he said. "It's all individuals digging into their own savings, their own fun money to do something they think is important for the community."

Matt Galloway has put together a very helpful pie chart, grouping contributions to the Vision2 "vote yes" campaign by industry (click to embiggen):

Vision2 Follow the Money pie chart

The Fox23 report was well done, but I need to correct a couple of things:

The story makes a reference to the "Vision 2025 bond package." It may be a losing battle to insist upon the distinction between sales tax votes and general obligation bond issue votes, but "here I stand; I can do no other." The Vision 2025 election was a collection of four sales taxes, one of which never went into effect. The other three sales taxes, totaling 0.6%, went into effect on January 1, 2004, and will run until December 31, 2016. The Tulsa County Commission assigned the revenue stream to the Tulsa County Industrial Authority, then they put on their TCIA hats and borrowed money against these expected sales tax revenues by issuing revenue bonds, but the voters didn't directly vote to issue bonds. "Bond package" or "bond issue," in reference to an election, should be reserved to refer to "general obligation bond issues," in which voters authorize borrowing money for a specific project (bonds) to be repaid by an increase in property tax millage (the general obligation).

Silver says in the story:

Businesses like Bank of Oklahoma and Manhattan Construction Co. could make a lot of money off Vision2 projects, but the county will have to put all contracts for Vision2 projects out to bid. The county can't just award contracts to companies that donated the most.

If the Tulsa County Board of Commissioners are under such a restriction, there are ways around it. The Tulsa County Industrial Authority (whose board members are the three county commissioners) can waive competitive bidding on bond underwriting with the approval of two of the three commissioners. About a month after Vision 2025 was approved by the voters, the TCIA board granted sole-source contracts to two financial companies to handle bond underwriting, two law firms to provide bond attorney services, and the company that would handle program management for the tax package. Professional services, as I understand it, are also exempt from competitive bidding. (Can't find the reference right now.) And with the appropriate findings of an emergency, competitive bidding may even be waived on construction projects.

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This page contains a single entry by Michael Bates published on October 30, 2012 11:51 PM.

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