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How Bruce Rauner used a legal loophole to get a $2.5 million campaign donation

The GOP nominee for governor was allowed to accept a huge gift from billionaire Kenneth Griffin.

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In 2009, just months after Governor Rod Blagojevich was impeached, the General Assembly rewrote the state's campaign finance laws in order to end what was widely known as the "wild west" era of unregulated political contributions, when money was thrown around like confetti.

"The people of Illinois have demanded reform," new governor Pat Quinn said at a press conference upon signing the legislation. "It is a crucial and important move in the right direction."

Yet five years later the richest man in the state was able to donate $2,500,000 to a friend who happens to be one of the wealthiest people ever to run for statewide office.

That's not a typo with extra zeros. Last week hedge fund manager Kenneth Griffin gave a single $2.5 million donation to Bruce Rauner, the Republican nominee for governor. The gift is on top of the $500,000 Griffin gave Rauner earlier this spring and another $505,000 he pitched in before the March primary. Griffin has also let Rauner use his private jet, a gift worth tens of thousands of additional dollars.

Ironically, the latest donation has left Quinn—Rauner's opponent—lambasting the return of the wild west financing that the law was supposed to eradicate.

As Griffin and Rauner have demonstrated, the state's campaign finance laws allow wealthy candidates and their friends to buy their way out of the rules that were supposed to put a lid on money in politics. It's called the millionaire's amendment, and it's a loophole big enough that you can drive a truck loaded with $100 bills through it.

"It makes it very easy for the self-funders to completely eliminate the system of limits," says David Melton, executive director of the Illinois Campaign for Political Reform, a campaign finance watchdog.

The bill that Quinn signed into law on December 9, 2009, did a number of things to improve the campaign donation system, such as forcing candidates to disclose the contributions they receive in real time rather than waiting weeks or months.

It also attempted to put limits on funding where previously there were none. Specifically, the law caps donations at $5,300 for individuals, $10,500 for unions or corporations, and $52,600 for political action committees during each primary or general election.

But the rules essentially say that there are no rules when a candidate gives at least $250,000 to his or her own campaign. In that event, according to the law, "all candidates for that office shall be permitted to accept contributions in excess of any contribution limit imposed."

Lawmakers say they had little choice but to add the amendment to the legislation. Federal court rulings had already established that limits on self-funding were a violation of free speech, so the new law attempted to level the playing field by lifting fund-raising restrictions on the opponents of rich office seekers.

"It's like the all-bets-are-off provision," says Alderman Will Burns, who was a state representative when the bill was passed in 2009. "It was a way to make sure there was some kind of parity if a wealthy candidate is pumping millions of his own money into his campaign."

Rauner, who made a fortune from his years running a private equity firm, was able to capitalize on the millionaire's amendment. He neutralized the donation limits by giving his gubernatorial campaign a total of $749,000 by last November, and by the time of the March primary he had spent more than $6 million on the race. Rauner's total contributions to his campaign now exceed $6.5 million.

That freed him up to accept the $2.5 million from Griffin, who runs Citadel, one of the country's largest hedge funds. And other wealthy supporters have also been able to show their generosity. Among them is businessman Richard Uihlein, who's given to Tea Party candidates and other conservative causes nationwide. Uihlein has contributed more than $600,000 to Rauner's campaign.

This was not what lawmakers had in mind. "I don't think anyone anticipated a $2.5 million campaign contribution," says state senator Don Harmon, the chief sponsor of the legislation.

To be sure, Rauner's self-contributions have allowed Quinn to raise more money. Since March 2013 the governor has received more than $500,000 from his leading individual donor, millionaire Fred Eychaner, one of the top Democratic contributors in the country. Quinn has also collected millions of dollars from unions, including $1.5 million from SEIU alone.

Yet no one expects Quinn to be able to keep up with Rauner, who's hauled in more than $8.3 million since the March 18 primary. Quinn has raised about $1.6 million during that time, though he started with more money in the bank after an easy primary win.

"Some people have richer friends than other people," says Harmon. "But I don't know if there's a more creative way to level the playing field. The fact of the matter is, no matter how much money Bruce Rauner raises from other people, I presume he could be contributing it himself."

The law affects more than statewide races. Money will certainly loom large in the upcoming campaign for mayor. While the law also limits donations to local campaigns, the restrictions are off if any candidate gives himself or herself more than $100,000.

At the moment, none of the prospective mayoral candidates has done so—and there's no reason for Mayor Rahm Emanuel to take the first step. He's raised more than $4.5 million from other donors since last July.

In contrast, Cook County Board president Toni Preckwinkle—Emanuel's toughest potential challenger, though she hasn't indicated whether she'll run—brought in about $600,000.

Of course, if Preckwinkle does run—and if she were to kick in $100,000 of her own money—then the limits would be lifted for all mayoral candidates, including Emanuel.

The mayor could then call on some of his many wealthy friends, including Griffin, who along with his wife gave Emanuel $200,000 during his last bid for mayor.

Or Donald Trump, who donated $50,000 to Emanuel in 2010.

There's a small chance these rules will be changed once the governor's race is over. As part of the 2009 law, the state created a task force whose 11 members are supposed to get together in the next year to review the consequences of how the reform law worked.

But given how the Supreme Court has knocked down restrictions on political spending, lawmakers aren't sure what they can do. As Harmon puts it: "Every time we try to close the door, a window somewhere else in the house gets cracked."

On the upside, thanks to the state's real-time disclosure rules, the public gets to see money influence politics as it's happening.

This story has been changed to update campaign contribution data that was initially inaccurate in records posted by the Illinois State Board of Elections.

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