Once subsidized by taxpayers, major-party national conventions are now almost fully funded by uber-wealthy donors, massive corporations, labor unions and other influential big-money groups.
But exactly who is chipping in to cover the potentially record-breaking bill for Chicago’s Democratic National Convention next month? Voters won’t get a full accounting until two months after the balloons are cleaned up at the United Center.
A handful of major party backers confirmed to the Sun-Times that they’ve ponied up for the Democrats’ presidential election-year extravaganza, the four-day affair kicking off Aug. 19 that’s mostly funded through unlimited contributions to a non-profit host committee.
Leaders say they’re well on their way to raising up to $100 million for the DNC through that host committee, Development Now For Chicago, which, under federal law, isn’t constrained by donation limits or quarterly disclosure requirements that apply to typical political committees.
The non-profit is chaired by Michael Sacks, the CEO of financial services firm GCM Grosvenor, a close ally of former Mayor Rahm Emanuel and a prolific Democratic fundraiser.
Several confirmed donors declined to say how much they’ve given, host committee officials declined to say how much they’ve received — and none of those figures will be made public until mid-October, a few weeks before the election.
It’s a loophole in political financing law that party leaders have leapt through for decades at the expense of transparency, according to experts on money in politics.
“Disclosure rules help keep voters informed and keep corruption at bay,” said Alisa Kaplan, executive director of the nonpartisan research and advocacy group Reform for Illinois. “At least here we’ll eventually learn who donated and how much, but it will likely be too late for voters to really process it before Election Day. That’s why donors and parties want to keep this information secret for as long as possible.”
A Democratic National Convention spokesperson noted the Democratic National Convention Committee “regularly files financial disclosure reports pursuant to FEC regulations and will continue to do so accordingly.”
Corporate sponsors
And not all donors are avoiding the public eye ahead of the convention.
“As Chicago’s hometown airline, United is honored to engage in significant events in the city, like the Democratic National Convention at the United Center,” United Airlines spokesman Sam Coleman said in an email. “We’re also supporting the Republican convention in Milwaukee because both conventions presented an opportunity for our airline to increase our schedules in support of one of our nation’s oldest democratic traditions.”
Molson Coors spokesman Adam Collins said the beer giant has “a long history of donating to the nonpartisan, nonprofit convention host committees when a party convention is held in our hometowns, and we’re doing so in Milwaukee and Chicago this year.”
Peoples Gas spokesman David Schwartz said the utility’s unspecified donation to the Chicago committee “will help ensure the convention is a success and that Chicago will shine during this summer’s events.”
Dane Lisser, spokesperson for Chicago-based food processing company Archer Daniels Midland, said, “We believe that participation in the political process is an important element of our business.”
Company officials also confirmed host committee donations from Cboe Global Markets and CME Group.
Sources familiar with Chicago’s fundraising effort said the roster of more than a dozen other corporate donors includes BMO Harris, Clayco, McDonald’s, Microsoft, Pfizer and Lyft.
The ownership group of the United Center — the Wirtz and Reinsdorf families — kicked in $2 million, on top of their commitment to turning over the Near West Side arena to the host committee for two months to prepare and stage the marquee convention events, sources said.
“The privately funded United Center is proud to play a role in such an important historical event,” a spokesman for the United Center Joint Venture said.
Powerful labor unions are pumping in big dollars through their political committees, too, according to monthly and quarterly financial reports that they’re required to file with the Federal Election Commission and the Illinois State Board of Elections.
Filings show contributions totaling $2 million from the Laborers’ International Union of North America, $875,000 from the Service Employees International Union, $400,000 from the United Food and Commercial Workers International Union, $250,000 from the National Association of Letter Carriers and $125,000 from the American Federation of Teachers.
Most expensive convention ever?
Billionaire Gov. J.B. Pritzker, heir to the Hyatt hotel empire, hadn’t yet contributed as of early July, but he was expected to.
“Gov. Pritzker is excited to welcome the DNC to Chicago in August and has made clear from the beginning that the convention efforts have his full support,” according to his campaign communications director, Christina Amestoy. “That includes helping the Host Committee raise from donors across the country.”
Host committee communications director Natalie Edelstein said they’re “grateful for the broad coalition of partners coming together to support the city.”
Organizers have committed to raising at least $84.7 million to cover convention costs under an agreement with the city of Chicago.
The host committee hasn’t hit that number yet, but as of mid-July, they were past the roughly $70 million mark that their counterparts in Milwaukee set to host the GOP convention, sources close to the effort said.
The Democratic dollar-raising blitz will continue up until the convention kickoff in August, putting them within reach of the $100 million mark that could make it the most expensive convention ever.
Public financing
Conventions were largely underwritten by taxpayers until 2014, when then-President Barack Obama signed a law ending the public financing system that had been in place since the 1970s, according to the Congressional Research Service. Host committee funding for conventions has been the norm since the 1980s.
Taxpayers still cover $75 million through federal grants for convention security costs, including police overtime.
Additionally, the city of Chicago is expected to end up shouldering some unspecified costs, a figure that will likely land somewhere in the millions of dollars, according to John Roberson, Mayor Brandon Johnson’s chief operating officer.
That includes a variety of beautification and public works projects that fall under the city capital program budget: planting trees and flowers, fixing sidewalks near the United Center and McCormick Place, “sprucing up” the O’Hare Blue Line station and accelerating construction of the new Damen Green Line station, an $80 million project, Roberson said.
Everything else — from lights, sound and video production to delegate parties and staff payroll — is covered by donors willing to shell out cash for the party’s made-for-TV spectacle.
The big bucks mean big-time access. The perks package dangled by Chicago’s host committee promises two lower-level convention suites along with highly coveted credentials and hotel rooms for contributors of $5 million or more.
A $100,000 gift still gets you two credentials to the “Honored Guest Super Suite,” among other benefits, according to sponsorship levels circulated by the committee.
Transparency concerns
Under the federal convention financing law, the public won’t find out who paid what to Chicago’s host committee until 20 days before the Nov. 5 election.
While donors aren’t giving directly to candidates, the situation “presents the risk of making candidates feel indebted to donors who put on these luxurious events,” according to Shanna Ports, senior legal counsel for campaign finance at the Campaign Legal Center.
That’s exacerbated by the fact that, unlike traditional campaign committees, there’s no limit on the size of checks cut to the host committee, Ports said.
“There’s just no transparency going into a convention on who’s providing funding,” said Ports, who previously worked in the FEC’s enforcement division. “Real-time transparency is valuable. People should be able to understand who is wielding influence as events unfold.”
The concept of spending millions of public dollars on conventions and campaigns might not be politically popular, but Ports argued it “eliminates the opportunity for ultra-wealthy and special-interest donors to have any sort of special access or influence over candidates or political parties.”
Kaplan, from Reform For Illinois, said it would inform voters “exactly where money is coming from, so they can be more confident that money isn’t used to extract official favors from officials or candidates.”
