Are developer dollars funding Chapel Hill council campaigns? We reviewed the reports.

Update: The amount of money donated this year to the Chapel Hill Leadership political action committee and how much it spent on the 2019 Chapel Hill election was added to the story on Oct. 1..

While fundraising hasn’t reached the levels of the pivotal 2015 election, questions about development money continue to shadow this year’s Town Council candidates.

The Chapel Hill Alliance for a Livable Town, which formed in 2015 to counter perceived developer influence, hopes to continue a change driven largely by concerns about the town’s pace and style of construction. So far, seven CHALT-endorsed candidates, including Mayor Pam Hemminger, have been elected to the nine-member council.

Tom Henkel, who heads the Chapel Hill Leadership Political Action Committee — CHALT’s fundraising arm — noted the issue in a recent newsletter, writing that “for a long time, the Town Manager and staff, in alliance with those who profit from growth, have pushed a growth agenda that discounts all other community values.”

This year, CHALT endorsed Hemminger and four council candidates — incumbents Jessica Anderson and Nancy Oates, and challengers Amy Ryan and Renuka Soll — setting the stage to complete the five-year council turnover.

A Chapel Hill Leadership PAC pre-election report shows the group received $5,815 in contributions and spent $4,208. Nineteen $100-plus contributions included $1,005 from CHALT co-founder Julie McClintock, $1,000 from her husband John Morris, and $250 each from three Chapel Hill physicians.

Chapel Hill Leadership spent roughly 95% on advertising, flyers and mailers. A state elections letter notes the group did not spend any money directly on candidates.

However, CHALT’s momentum could be stalled by a competing slate supported by the nonprofit group NEXT Chapel Hill and Carrboro. The NEXT public advocacy arm, NEXT Chapel Hill-Carrboro Action Fund, endorsed incumbent council member Michael Parker and challengers Tai Huynh and Sue Hunter.

Parker, Huynh and Hunter also were endorsed by Indy Week and the N.C. Sierra Club. Anderson and Ryan were the only CHALT-backed candidates endorsed by the Indy and Sierra Club, respectively.

Campaign reports filed

Parker and Hunter, a former NEXT Action Fund treasurer, led the field in campaign fundraising this year, according to reports filed Oct. 28 with the N.C. State Board of Elections. Local campaign finance rules limit candidates to a maximum individual donation of $361.

Parker reported raising $16,825 — 51% from donations of $100 or more — and spending $8,612.

Hunter was close behind, raising $15,092 — 62% from donations of $100 or more — and spending $11,414, her report showed. But unlike the 2015 candidates, neither reported big-money donations from out-of-town developers and real estate interests.

Parker’s report shows he collected $1,661 from the N.C. Home Builders Association political action committee and nine local real estate and development officials. Hunter reported receiving a total of $200 from two people: UNC real estate official Gordon Merklein and former town planner and project consultant Roger Waldon.

Of the five remaining candidates, only one reported receiving money from development and real estate officials.

Soll and Anderson raised $9,942 and $8,716, respectively, and spent most of what they received, reports show. Oates, who had raised $8,359 and spent $6,869 by Oct. 1 submitted her pre-election report to the state on time, but there was a problem with the numbers. She said Thursday she is working with state officials to rectify the situation.

Ryan’s pre-election report was not available Thursday. Her Oct. 1 report showed she had spent just over half of the $5,220 she had raised.

Huynh’s report showed he benefited most from developer money, raising $9,428, including $2,104 from three people affiliated with Chapel Hill-based East West Partners and three out-of-state donors with real estate connections. He reported spending $7,692.

In the last few days, Huynh estimated he had raised another $1,500 to $2,000, mostly from an on-campus drive for student support. As a college student running on a shoestring budget he will accept money from anyone who supports his platform, he said.

“At the end of the day, $361 is never going to sway the way I vote or change any of the things I’m going to do on council,” Huynh said.

He noted the diverse group supporting his campaign, from students to civil rights leaders, business owners and elected officials.

“If anything, I think that shows our campaign is able to bring a diversity of support that no other candidate is able to bring together,” Huynh said. “I think there are bad developers out there and bad people out there, but that shouldn’t paint the picture of every single person in that category.”

Questions about the money

Hunter appears to be getting the most public heat about developer money.

The concerns stem from the 2015 race, when council member Donna Bell received $11,638 in donations from development and real estate officials but did not report them until five months after the election. Bell said at the time that the checks arrived too late to be included in her pre-election report.

She also cited CHALT’s role in that election with putting a bigger focus on fundraising. East West Partners developer Roger Perry, who collected the donations for Bell’s campaign, said he raised the possibility that fall of forming a political action committee to counter CHALT efforts but was rebuffed.

Bell, who will step down from the council in December, closed out her campaign in May 2018, allocating the money that remained to county and state candidates, the Chapel Hill-Carrboro NAACP and NEXT Chapel Hill-Carrboro.

It’s the $2,232 paid to NEXT Chapel Hill-Carrboro — a 501(c)(3) nonprofit formed to advocate for sustainable communities and promote housing and transportation options — that critics say is evidence of Hunter’s big-money business influence.

They note that Hunter was a NEXT Chapel Hill-Carrboro board member and also incorporated the NEXT Action Fund as a 501(c)(4) nonprofit, using her address as the group’s principal office.

The concern, said Chapel Hill resident Scott Madry, is whether voters will learn again after the election about big-money donations by developers wanting to build more tall apartment buildings.

“The NEXT guys say they’re for public housing and they’re for the environment, but who in Chapel Hill is not in favor of the environment?” Madry said. “I think ... the real question for the election is where’s the big developer money going to get candidates that will vote for the things that bring them a lot of money.”

NEXT Chapel Hill-Carrboro

Hunter left the NEXT Action Fund board in April; her seat is still open, said Molly DeMarco, who serves on the three-member boards for NEXT Chapel Hill-Carrboro and NEXT Action Fund. Hunter was asked to help with the 501(c)(4) because of her professional experience ensuring compliance with regulations, DeMarco said.

Filing as a 501(c)(4) allows NEXT Action Fund, unlike a traditional 501(c)(3) nonprofit, to support political campaigns and candidates without losing its tax-exempt status. The only caveat is that NEXT Action Fund cannot spend 50% or more of its money on politics.

NEXT Chapel Hill-Carrboro formed the NEXT Action Fund to directly influence local policy changes and generate civic engagement, DeMarco said. NEXT Chapel Hill-Carrboro has held several educational events since being founded in 2016, including downtown walking tours and a Sustainable Communities Series in the spring.

Bell’s donation to NEXT Chapel Hill-Carrboro continues to help pay for meeting space, refreshments and other costs related to those events, DeMarco said. The only election-related expense anticipated is $35 to pay a part-time staff coordinator, she said.

Hunter, who has seen speculation about her campaign posted on social media, said she’s keeping her focus “on working together and on positive change in our community.”

“These accusations are baseless and it’s frustrating, because my focus is on running a positive, grassroots campaign,” Hunter said. “It’s unfortunate that people want to take issue with that and try to undermine it by putting false information online.”

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Tammy Grubb has written about Orange County’s politics, people and government since 2010. She is a UNC-Chapel Hill alumna and has lived and worked in the Triangle for over 25 years.