Real Estate PAC Gets Mixed Results in Elections

Paul Vallone, Carlos Menchaca & Margaret Chin (Photos via Facbeook)

Jobs for New York spent $4.9 million in 22 City Council races, helping elect Paul Vallone (left) and Margaret Chin (right). But their money couldn’t sway voters in Brooklyn’s 38th District, where Carlos Menchaca (center) beat incumbent Sara Gonzalez. (Photos via candidates Facebook pages)

In New York’s first citywide election since the Supreme Court’s Citizens United decision in 2010 gave a green light to independent campaign spending, the city’s real estate industry dove into the primary headlong. Their bid to help elect industry-friendly members to the City Council racked up many wins, along with a few notable losses.

All told, Council races saw $6.1 million of outside independent spending by new political action committees. The biggest player by far was Jobs for New York, a group funded by some of the city’s major real estate companies, which was responsible for about 80 percent of the outside spending – flooding primary campaigns with $4.9 million.

The real estate PAC won more than three-quarters of the races where it backed candidates, records show. Filings with the city’s Campaign Finance Board, which started requiring the disclosure of independent spending in May 2012, show that Jobs for New York paid for mailings, robocalls, canvass organizing and tens of thousands of election day palm cards, those glossy handouts that end up littered on the subway steps for days after an election.

Candidates backed by the PAC prevailed in 17 of the 22 Democratic City Council primary races where Jobs for New York spent funds. Votes in one contentious race, the 36th District in Brooklyn’s Bedford-Stuyvesant, are still being tallied.

Records show that the PAC received $6.9 million from 129 different real estate entities and individuals. The bulk of the donations were from limited liability corporations, making their origins difficult to trace. But corporate record and address searches show that much of the money originated with many of the city’s most famous real estate names including Tishman Speyer, Rudin Management, Related Companies, Durst Corporation and Leonard Litwin’s Glenwood Management.

The PAC rode home winners in Tremont, Coney Island and Washington Heights among other neighborhoods. The PAC didn’t spend money supporting candidates for citywide office in the primary, but still has around $2 million remaining in its coffers.

Jobs for New York paid for fliers like this one against Carlos Menchaca, who challenged incumbent Sara Gonzalez, the PAC's pick for the 38th Council District in Brooklyn. (Photo from the NYC Campaign Finance Board)

Jobs for New York paid for fliers like this one against Carlos Menchaca, who challenged incumbent Sara Gonzalez, the PAC’s pick for the 38th Council District in Brooklyn. (Photo from the NYC Campaign Finance Board)

But the real estate group came up short in a race in the 38th Council District in Brooklyn’s Sunset Park where its favorite, three-term incumbent Sara Gonzalez, lost her bid for re-nomination. There, Jobs for New York spent $294,095 supporting Gonzalez with phone banks, mass mailings and ads in Chinese-language newspapers. They also spent $52,125 trashing her opponent, Carlos Menchaca, with fliers that cast him as an opportunistic outsider who recently moved from Texas.

“He’s just another political operative and bureaucrat seeking to advance his career for his own sake,” read one flier circulated by Jobs for New York. “Carlos Menchaca is from Texas,” says another flier, with a picture of a worn suitcase and a western-style hat. “He’s barely had time to unpack.”

“There was some really rough stuff in the content of some of the ads,” said Doug Muzzio, a professor of political science at Baruch College. “When your vital self interests are at stake, you react rather harshly.”

Menchaca raised around $90,000 for his campaign  (Gonzalez raised $117,671) and received $110,644 in support from union-based PACs that ran ads on his behalf – possibly swaying the balance. They accused Gonzalez, the only incumbent to lose a primary race this year, of being “missing in action.”

Manchaca won by 15 percent and became the first Mexican-American elected to office in New York.

In Manhattan’s Chinatown, Jobs for New York weighed in successfully on behalf of another incumbent, Councilwoman Margaret Chin.

It pumped $230,969 into Chin’s re-election campaign in the primary, a race she won by 17 points. The group also spent $50,736 attacking her opponent, Jenifer Rajkumar, with mailings that said she was a “fraud” and calling her charity a “shell game.”

Chin insisted she had nothing to do with the PAC but was unable to prevent its spending.

On September 16, she appeared at a rally denouncing the influence of independent spending in political elections. “I’m not for sale,” she said, according to Politicker.

In some races the efforts of Jobs for New York were offset by independent expenditures made by union PACs.

In District 27, which includes Jamaica, St. Albans and Hollis, Queens, Jobs for New York spent $261,533 helping Manuel Coughman compete in a contentious race with five other candidates. The PAC also spent $55,644 trashing his opponents. The race has yet to be called, but Coughman is currently in fourth place with 17 percent. The frontrunner is Daneek Miller, the president of the Amalgamated Transit Union Local 1056, who received $142,970 in support from various unions.

Jobs for New York didn’t spend any money attacking Miller. He believes that’s because his message was focused on issues important to the working class.

“We ran a campaign for the people by the people, and we prevailed,” Miller said. “So it obviously proves it doesn’t matter what you spend if you don’t have a message that resonates.”

But union money didn’t always make up the difference.

In the northern Queens communities of College Point and Whitestone, unions and Jobs for New York squared off in a race among five Democrats seeking to replace the incumbent, Republican Daniel Halloran, who is facing indictment in a bribery scandal. Unions spent $50,000 backing Austin Shafran, who raised an additional $102,047 in direct contributions.  Jobs for New York supported Paul Vallone with $324,789 in ads promoting his candidacy. The PAC spent about $45,000 in ads attacking his opponents. These included mailers linking Shafran to another disgraced politician, State Senator Malcolm Smith. In a close race, Vallone has been declared the winner by less than 200 votes.

Good government group Common Cause is pleased that Jobs for New York wasn’t able to win all of its campaigns, in spite of its huge war chest. “Thanks to the counter weight of the public matching system, City Council candidates were overwhelmingly able to communicate with voters,” said Susan Lerner, the group’s executive director, in a statement.

In all, the PAC spent $1.4 million in races where their preferred candidates ended up losing. “That’s a terrible rate of return on a big investment, but good news for voters,” said Lerner.

Jobs for New York did not respond to requests for comment. And the record raises questions about how much influence this type of outside money really has.

“You need money – but that isn’t the only thing you need,” said Muzzio. “It’s necessary but not a sufficient condition to win.”