Democratic candidate Dana Balter's decision to accept a salary from her campaign has emerged as an issue in the 24th Congressional District race.Â
When Republican U.S. Rep. John Katko released his second television commercial in July, the campaign referred to Balter as a "professional candidate." While there wasn't a direct explanation for that label in the ad, the campaign detailed in a press release that it was about Balter's salary.Â
Balter confirmed in April that she would be on the campaign payroll. Her most recent campaign finance filings show she has been paid every two weeks beginning April 20, with the payments totaling $6,213.71. The salary, which must be prorated, is based on her earned income in the year before she became a candidate for Congress in the 2020 election cycle. For Balter, who announced her candidacy in April 2019, that's 2018 — the year of her first run for Congress and when she also accepted a salary from her campaign.Â
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But Republican criticism of the salary payments isn't limited to the ad. In a filing submitted to the Federal Election Commission, Josephine Thomas, a Syracuse-area Republican who is supporting Katko's reelection, alleges that Balter's salary "exceeds the amount permitted by law and constitutes a prohibited personal use of campaign funds."Â
Thomas's argument is based on a different interpretation of the FEC's rule. The commission, which adopted the rule in 2002, allows candidates to accept a pro-rata salary that doesn't exceed the minimum annual salary for a member of Congress ($174,000) or the candidate's earned income in "the year prior to becoming a candidate," whichever is less. The salary must be paid by the candidate's principal campaign committee — for Balter, that's "Friends of Dana Balter" — and the first payment can be made "no sooner than the filing deadline" for the primary election. For New York candidates, the deadline this year was moved to late March because of the COVID-19 pandemic.Â
Dana Balter has six paid employees on her campaign payroll. A seventh was added in early Apr…
Balter, who recently amended her 2019 financial disclosure submitted to the House of Representatives, said she earned $35,193 in 2018 — the income total she used to determine her campaign salary. But Thomas contends that Balter should be using a different figure — $3,000, which was listed as her 2019 earned income on the 2020 disclosure filed in May.Â
Thomas wrote that in two other matters the FEC "has read the regulation's reference to 'the year prior to becoming a candidate' to mean the year prior to the election despite the candidate filing their statement of candidacy in that same year." But according to The Citizen's review of the matters involving congressional candidates in Iowa and Oklahoma, the FEC didn't make that interpretation. The candidates, not the FEC, used the year before the election to determine the salaries they were paid by their campaigns, although the violations in both matters — which Thomas acknowledges — were unrelated to that part of the rule.Â
In one case, the FEC's general counsel's report in the matter involving James Mowrer, a 2014 congressional candidate from Iowa, mentions that Mowrer used his 2013 earned income to determine his campaign salary for the following year's election. In a footnote, the report explains that "Although Mowrer filed his Statement of Candidacy on July 1, 2013, Respondents present Mowrer's 2013 wages as the relevant pre-candidacy salary."Â
An FEC spokesperson did not comment on Thomas's complaint, citing a provision that requires confidentiality "on enforcement complaints that are before the agency." The commission provided general information about the candidate salary rule and referred The Citizen to an explanation of the rule, which states that "no candidate may receive a salary from campaign funds in excess of what he or she received as earned income in the year prior to becoming a candidate." The regulation, the FEC's explanation reads, "will help ensure that campaign salaries are not used to enrich candidates, but instead used to compensate candidates for lost income that is forgone due to becoming a candidate."Â
Michael Toner, an attorney who was the commission's chairman when the rule was adopted, wrote in an email to The Citizen that his "reading of the FEC regulations and my general recollections of the FEC's adoption of the candidate salary rule is that the candidate's 2018 income would be used; i.e., the income the candidate earned during the calendar the year before the individual became a candidate."Â
Adav Noti, senior director of trial litigation and chief of staff of the Campaign Legal Center, provided a similar interpretation. He believes there is flexibility in the rules that allow candidates to either use their earned income in the calendar year before the election or the 12 months before an individual becomes a candidate to determine their campaign salary.Â
But Noti also differed with the chief argument in Thomas's complaint — that because Balter is a candidate in the 2020 election her campaign salary should be based on her 2019 income.Â
"First of all, it's not what the rule says," Noti explained. "The rule says the year before candidacy, not the year of candidacy. Also, just as a logical matter that doesn't really make sense given that the whole point is to recognize that people who aren't independently wealthy just give up their salaries to run for office. And so if you have a candidate who is taking a leave of absence from their job or is self-employed and is not operating their business during their candidacy, it wouldn't make any sense to count that period, that lack of income, against the amount of the salary they intend to draw. That would undermine the entire purpose of the rule."Â
2018, 2019 and disclosures
While it's become an issue in the 2020 race, this isn't the first time Balter has accepted a salary from her campaign.Â
FEC records show Balter was paid $12,461.68 from July 13 to Nov. 16, 2018, during her first run for Congress. The nine payments — five for $1,384.64 and four for $1,384.62 — were disclosed in her campaign finance filings and within the time period, she could accept a salary. But unlike this year, it wasn't raised as a campaign issue in 2018.Â
Katko's campaign did not respond to a question about why Balter's decision to receive a campaign salary wasn't a concern two years ago. Balter said in an interview that she thinks the electoral landscape is the reason it's being discussed in this campaign.Â
"I think the reason that he's talking about it now and didn't talk about it then is he's running scared now," Balter said. "He sees the writing on the wall. He sees the same polling that we see that shows that I'm winning this race." (Democratic polling released in June showed that Balter is either leading or running even with Katko in the 24th district.)Â
But there have been questions raised before about Balter's campaign salary. In August 2019, the FEC notified her campaign that she violated its rules by accepting a salary too early in the election cycle. Her second-quarter filing that year showed she accepted $6,719.76 in salary payments beginning on April 19 — three days after she launched her second campaign for Congress.Â
Balter continued to receive salary payments into the third quarter of 2019, but came off the payroll after being notified of the FEC violation. She returned more than $11,000 to her campaign and described it as "an honest mistake."Â
Democratic congressional candidate Dana Balter returned more than $11,000 in salary payments…
In April, she was added to the campaign payroll. This time, it was permissible because it was after the filing deadline for the primary election in New York. FEC records show that between April 20 and June 19 she received five salary payments totaling $6,213.71.Â
Thomas's complaint, which was filed four days after Katko's campaign released the ad referring to Balter as a "professional politician," also critiqued Balter's financial disclosures. Congressional candidates must file the disclosures each year they are a candidate.Â
Balter's first disclosure was filed in August 2019. She reported earned income of $35,193 and $32,556 in the "preceding year," which was 2018. But her 2020 disclosure listed earned income of $3,000 in 2019, which conflicts with the total she reported one year ago.Â
Balter said she filed an amendment to the 2019 disclosure, which is online. The amendment, which covers the period from January 2018 through May 15, 2019, reveals that Balter was paid $35,193 in 2018. She reported no earned income in the first four-and-a-half months of 2019.Â
"I think the important point, really, is that this was a case of overreporting rather than underreporting," she said. "I provided more years of income information than was required. Now, I have adjusted it. I filed those amendments because apparently the candidates are required to disclose one year of income. I accidentally disclosed two years. While it's a technical mistake that we fixed, I don't think it really is a problem. Being more transparent than you need to be is probably OK."Â
2020
Balter isn't the only candidate to accept a salary. The FEC rule is being utilized by congressional candidates across the country.Â
Beth Van Duyne, a Republican running for Congress in Texas, is on her campaign's payroll. In 2018, several notable candidates — including Alexandria Ocasio-Cortez — were paid by their campaigns.Â
But in New York's 24th district race, Balter's decision to receive a salary from her campaign is being used against her.Â
"Dana Balter has already been caught once illegally paying herself with campaign funds, and there's now a second campaign filed against her with the FEC," said Tom Haag, Katko's campaign manager. "Taking a salary is incredibly controversial and legally very uncertain, which is why most individuals running for public office don't do it. Dana Balter seems determined to pay herself with campaign donations despite these serious questions outstanding."Â
Balter told The Citizen that she thinks "it's a shame" Katko and his campaign are criticizing her for accepting a campaign salary. The rule, she explained, was created to "help strengthen our democracy and help all of the people who live in this country."Â
She continued, "The idea behind it is that in order to be well represented by people who are going to make policy and laws that benefit you, you need to be represented by people who understand your experiences, who understand the challenges you're facing and that's why they created this law so that regular folks who experience the challenges of working families, who know what it's like to struggle to make ends meet, or have massive health care challenges, or who have whole different sets of experience — like being a teacher, or being a nurse or being a firefighter — that can be a really valuable perspective in the policymaking process."Â
One of the reasons that candidates usually don't accept a campaign salary is because of the stigma associated with the practice and the likelihood that they will face criticism from their opponent.Â
Noti explained that the perceived political downside can not only discourage candidates from taking a salary, but it can also discourage people, especially those in the middle class, from running for office. The consequence of that, he says, is having a government that's "populated entirely by the wealthy."Â
"It's already hard enough for middle-class people to run for office because of the intense fundraising demands and the need to essentially know a lot of rich people to bankroll their campaign," he said. "But if you layer on top of that the individual candidates' inability to earn income while they run, I don't know how you're going to have regular people running for office if you discourage them from legally drawing a salary the way everybody else gets to draw a salary from their job."Â
There are usually several people on a campaign's payroll. A congressional campaign usually has a paid campaign manager, a field director, field staff, a finance director and a communications director. Outside consultants are paid for various roles with the campaign, whether it's advising on campaign finance matters or for media strategy.Â
Noti believes it should be recognized that not only are those individuals working for the campaign, but so is the candidate.Â
"There are very strict rules about the amounts (candidates) can be paid and when they can be paid. It's very, very tightly regulated," he said. "All the money that comes in to pay those salaries is fully disclosed and subject to contribution limits. It is a system designated to allow people who aren't rich to run for Congress. And the country would be better off if it had more people who weren't rich running for Congress."Â
Politics reporter Robert Harding can be reached at (315) 282-2220 or robert.harding@lee.net. Follow him on Twitter @robertharding.