Unnamed potato tossed around

Should nonprofit groups receiving city funds be able to back political candidates, if they don’t use any of the city’s money to do so?

That political hot potato got tossed around quite a bit during a Tuesday (March 6) City Council discussion, but you’d never know from listening that the true subject was the Chico Chamber of Commerce. That name was never spoken.

“Who are we referring to?” a frustrated Councilman Steve Bertagna asked at one point. “Let’s cut to the chase.” But it wasn’t necessary: Every councilmember knew who the potato was, even if some in the audience were mystified.

The chamber receives some $120,000 annually from the city to provide visitor and tourism services and another $20,000 to put on the Chico Airfest. (The amount is about three-tenths of 1 percent of the total city budget, Jim Goodwin, the chamber CEO, said later.) It also actively takes positions on local elections, endorsing business-friendly (usually Republican) candidates and distributing campaign funds from its political-action committee.

It insists it keeps the funding streams separate, as city policy currently requires, and uses only chamber-raised money to do political advocacy, but some local progressives (who generally don’t agree with its endorsements) think it has a conflict of interest.

Some background: During a Nov. 8, 2006, meeting of the council’s Internal Affairs Committee to consider staff recommendations for standardizing and stabilizing the methods used for funding community organizations, the committee voted to recommend that the council prohibit them from doing any political activities. The effect would be to force the chamber to stop backing candidates or face the threat of a funding cut-off.

Interestingly, only two of the three committee members, Councilman Andy Holcombe (who’s now mayor) and Councilwoman Ann Schwab, were present and voted at the Nov. 8 meeting. The third member, former Councilman Dan Herbert, was absent, perhaps because just two days earlier he’d lost his bid for re-election despite being endorsed by the chamber.

On Tuesday, Councilmen Steve Bertagna and Larry Wahl both challenged the proposed policy change. “This has become a purely political thing designed to limit free speech,” Wahl said—again without mentioning whose free speech he was talking about.

Bertagna pointed out that firefighters and police officers get lots of money from the city, their whole salaries, in fact, and yet their unions are able to endorse and fund candidates. Why are only community organizations (meaning the chamber) going to be prohibited from doing that?

Holcombe suggested that he’d changed his mind somewhat about the policy. Now he wanted mostly to figure out ways to make it clear that no city funding was being used politically. In the end the council voted 5-2, with Wahl and Bertagna dissenting, to refer the matter to City Attorney Dave Frank for an opinion.

The council did approve most of the other changes in the method of funding community organizations, after listening to several speakers from the arts community. Henceforth, the application process will be simplified and organizations will be funded in two-year cycles and use outcome-based, rather than line-item, budgeting. That means they will focus more on setting goals and ways to measure success, rather than making sure they don’t overspend on pencils.

Historically, funding for community organizations has been somewhat arbitrary, with the city manager able to decrease the amount in tight budget years. Under a new plan approved by the council Tuesday, the city will stabilize funding by setting a baseline amount in 2008-10 and then adjusting future funding hikes to increases in the whole general fund budget. At the request of arts advocates, the council agreed to put off setting their baseline figure until updated financial figures are available in April.