Details of Francis' Loan

Published: Tuesday, March 4, 2008 4:01 PM PST

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Steve Francis has made this pledge one of the centerpieces of his mayoral campaign: He isn't taking any campaign contributions so that he can be clear of special interests.

But, by giving $100,000 of his money to his campaign in the form of a loan rather than a contribution, Francis has technically left open the possibility that he could fundraise after the election.

Here's how it works. Self-financed candidates like Francis can give money to their campaigns in one of two forms: through contributions or through loans. Contributions are just that -- contributions. But with loans, candidates can fundraise during and after elections to help themselves pay down that debt.

For example, City Attorney Mike Aguirre has solicited contributions while in office to help pay back the more than $500,000 he loaned his 2004 campaign.

Francis, according to his most recent campaign filings, contributed $50,000 to his campaign and loaned $100,000 in the final six months of 2007.

He said he has no plans to fundraise after the election in an attempt to pay down the $100,000 loan.

"We have no plan to fundraise. I'm not going to run a campaign where we say we're not going to accept money from special interests and go out and fundraise after the election. That would be disingenuous," Francis said.

He said the money was originally delivered in the form of a loan because his campaign in the fall considered allowing small donations -- between $50 and $75 -- from staff and community members, before ruling out any donations altogether. He said it was never contemplated that the campaign would accept money from developers, lobbyists or other "special interests."

In the end, the campaign decided it would've been too difficult to screen the donations for any potential connections to special interests, he said.

Soliciting contributions to help pay down these loans has been a hot topic at the Ethics Commission in recent years. That's because it's the one way that a sitting politician can solicit a legal campaign contribution that essentially goes right into his or her pocket.

For example, a politician can go out an seek $320 a person from anyone with business before the city, take that money and sock it away to shore up his or her personal finances after using personal funds to get elected.

Before 2005, candidates could solicit these funds for an unlimited time after being elected, and they could loan themselves unlimited amounts of cash. In an effort to restrict this type of fundraising, the Ethics Commission changed city laws to allow politicians only 180 days after an election to solicit the funds. Candidates are now only allowed to loan their campaigns $100,000 as well. The rest must come in the form of a contribution.

-- ANDREW DONOHUE