ANALYSIS: The Money, and Where It's Coming From

Campaign finance reports released by the city last week show a wide spectrum of fundraising approaches, and has sparked some sniping among the candidates.

The reports are hosted on the city's new content management system, and offer a sleek, clean and user-friendly view of contributions, expenditures and other finance information.

Patch sat down and went over the numbers with a fine-toothed comb. Here's what we found.

By the numbers

On Sept. 21, the first round of campaign finance reports showed Ryan Spiegel had the highest dollar amount of contributions—$7,016. He also had the largest number of contributions of any candidate, coming in at 50, if you count the two in-kind contributions by himself and his wife.

He reported $1,994 in expenditures, the vast majority of which ($1,158) was spent on stickers, yard signs and shirts.

Tom Rowse reported the second-highest dollar amount of contributions, with $2,642. He had exactly half Spiegel's number of contributions, with 25, including in-kind donations and carry-over donations, such as shirts from his previous run for council in 2009.

He listed $732 in expenditures, the largest being a total of $344 for printing supplies.

Cathy Drzyzgula came in next highest in dollar amount, reporting $2,510 in contributions. She received 19 donations, including in-kind and those from herself and family members.

She listed $1,486 in expenditures, all but $6.40 of that being reimbursements to herself or Jud Ashman, with whom she is sharing campaign resources.

Ashman is the next highest in dollar amount donated, reporting $2,331. He received 18 total donations, including in-kind, and $250 worth of website development from his own company, the Elegant Envelope.

He lists $1,851 in expenditures, virtually all of which are reimbursements to himself, Cathy Drzyzgula, or her husband, Bob.

Paula Ross rounds out the field with $2,168 in contributions coming from 21 donations, including in-kind and those from family.

Gaithersburg donors

There have been grumblings among some in the community that such a large percentage of Spiegel's donations came from outside the city.

More than 65 percent, in fact, have addresses outside the city.

Spiegel, however, vigorously defended his fundraising tactics.

"The campaign finance data can be sliced and diced in infinite ways," he said. "If you set aside in-kind contributions and look only at the cash donations, of the five candidates, I have the highest number of donors from within the city."

In fact, he pointed out, every one of the five candidates have contributions from outside the city.

Including in-kind donations, Tom Rowse received 40 percent from outside Gaithersburg, Jud Ashman received 33 percent, Cathy Drzyzgula received 21 percent, and Paula Ross 14 percent.

Corporate donors

Another issue that has been raised is that some campaign donations have been coming from corporations.

All of the candidates accepted donations from businesses of some kind.

Ryan Spiegel received four donations from businesses, totaling $1150:

• It's Elementary, LLC — $100
  10771 Brewer House Rd. Rockville MD

• Technology Patents LLC — $500
  PO Box 61220 Potomac MD

• Patents Innovations, LLC — $500
  PO Box 1766 Venice FL

• CreatiVerge Communications — $50
  9412 White Spring Way Columbia MD

Tom Rowse accepted two donations from businesses, both in-kind, for a total of $650.

• Fraser Signs — $150 (van wrap)
  110 Frederick Road #E Rockville MD

• 60i Media Productions LLC — $500 (video development)
  725 Harrington Road Rockville MD

Jud Ashman reports only one business donation: a $250 in-kind contribution from his own business, the Elegant Envelope, for website design services.

It is his policy, however, to not accept donations from businesses. He can list at least two which he has turned down.

Cathy Drzyzgula received two donations from businesses totaling $1,000.

• Jerunazagabr LLC — $500
  P.O. Box 61220 Potomac MD

• Technology Patents LLC — $500
  P.O. Box 61220 Potomac MD

Paula Ross received four donations from businesses, three of them in-kind, for a total of $610.

• The Great Zucchini C/O Eric Knaus — $350 (entertainment)
  PO Box 6230 Washington DC

• Potomac Pizza — $60 (cupcakes and coffee)
  625 Center Point Way Gaithersburg MD

• A W Promotionals — $100 (Run with Paula t-shirts)
  14520 Whirlaway Lane Gaithersburg MD

• Keystone Real Estate Investments LLC — $100
  PO Box 83406 Gaithersburg MD

LLC Loophole

A comment thread on the Town Courier Facebook page raised some questions about whether it's permissible for individuals to make multiple donations via corporations they own.

In January, 2010, the Supreme Court ruled that corporations may make political donations just the same as any person.

This ruling holds true in Gaithersburg, which also has its own rules about campaign donations.

Relevant here are the rules (City Code Sec. 6C-12) that the maximum single donation a person can make to any one candidate is $500, and the maximum a person can donate in total—to any candidate—within an election cycle is $1,500.

All the candidates have adhered to these rules.

In fact, Spiegel has been an advocate in the past for publicly financing campaigns and adding tighter restrictions on donations. He even wrote an editorial in 2010 on Maryland Politics Watch extolling the virtues of a public financing system.

"The overall campaign cycle cap of $1,500 in contributions by any single donor, which I proposed, is a starting point in trying to reduce abuses of the system," he wrote in an email to Patch. "Of course, it is not a perfect solution, because under the current law an individual can still own multiple businesses, each of which can contribute the maximum amount."

However some community members have raised the question as to whether Potomac resident Aris Mardirossian and the three incumbents to whom he has donated, have violated the spirit of the law.

Mardirossian has made contributions under four different names, including his wife and three corporations, to Ashman, Drzyzgula and Spiegel, totaling $2,500.

Technology Patents LLC donated $500 to Spiegel and Drzyzgula.

Patents Innovations, LLC donated $500 to Spiegel.

Jerunazagabr LLC donated $500 to Drzyzgula.

And Marianne Mardirossian donated $500 to Ashman.

Ross criticised Spiegel and Drzyzgula for accepting the donations.

"Some donations to Ryan and Cathy may meet the letter of the law, but certainly not the intent of the law," she said. "They passed these ethics laws and should hold themselves to both their letter and intent."

Ross, however, accepted three donations from the Koch family: $100 from Richard Koch, $100 from Jennifer Koch, and $100 from Keystone Realestate Investments LLC, which Richard Koch owns.

In the comment threat on the Town Courier Facebook post about the finance reports, both Spiegel and Drzyzgula committed to a policy of not accepting money from more than two donors in the same family.

Drzyzgula and Spiegel both noted separately that candidates don't know who donated to what campaign until after finance reports come out—in other words, not until it's too late.

Spiegel went further to defend the donations from Mardirossian, noting that he serves on the Police Advisory committee and in 2010 was named by proclamation a Distinguished Friend of the City.

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The next round of campaign finance reports will be released on Oct. 3. The third round on Oct. 17. The fourth and final round before the Nov. 8 election will be released on Oct. 24.

This article was updated to reflect the donations Paula Ross accepted from the Kock family.