Mayor Kenney's campaign committee canceled a Tuesday fund-raiser after questions arose about whether the event's sponsors would be affected by the city's pay-to-play laws.
The invitation to the event by the Kenney for Philadelphia political action committee listed 21 sponsors, including the law firms Obermayer Rebmann Maxwell Hippel LLP, Dilworth Paxson LLP, and Linebarger Goggan Blair & Sampson LLP, as well as Ken Trujillo, an attorney at Chamberlain Hrdlicka. All have contracts with the city.
Under the city's pay-to-play laws, all money raised at the fund-raiser would be attributed to each sponsor - which would become significant if a sponsor has or is seeking a non-competitively bid contract with the city.
Businesses are limited to $11,900 in campaign contributions to be eligible for no-bid contracts. The fund-raiser was expected to raise more than $80,000.
The Inquirer asked the Kenney campaign and administration officials this week about the potential consequences of the fund-raiser on city contracts.
On Friday, the campaign reimbursed all contributions received for Tuesday's event and canceled the fund-raiser, which was to be held at Bop on South Broad Street.
"All contributions will be returned out of an abundance of caution because of the inadvertent use of the word sponsor," Martin O'Rourke, spokesman for the Kenney PAC, said.
The PAC's attorney, Michael A. Schwartz, emailed Shane Creamer, the city Board of Ethics' executive director, Friday to notify him of the matter.
"Kenney for Philadelphia intends to report both the contributions and return of the contributions on its next campaign finance report," Schwartz wrote. He attached a spreadsheet of all 51 contributions that ranged from $100 to $10,000.
Individual tickets started at $100. Anyone who donated $3,000 would be considered a bronze sponsor; PACs and businesses that donated $5,000 or $10,000 would be listed as silver or gold sponsors, respectively.
In total, the campaign returned more than $80,000 that had been donated for the event.
Creamer declined to comment Friday.
Gregory Harvey, a veteran election lawyer and campaign finance expert, said any business or person named as a sponsor on the fund-raiser invitation would be subject to the city's attribution rules for businesses that have or are seeking non-competitively bid contracts with the city.
"If an entity sponsors a fund-raiser, all the money raised is attributed to the firm," Harvey said, "and would be cause for debarment."
Harvey said that rule applies only to sponsors and hosts of fund-raisers, not someone attending as a guest.
Kenney spokeswoman Lauren Hitt said that the only sponsor listed on the Kenney for Philadelphia invitation that did not go through a competitively bid process is Obermayer. The firm's spokeswoman did not return request for comment.
The city recently hired Chamberlain Hrdlicka through an $800,000 no-bid contract to help the city defend its sweetened beverage tax in court. Trujillo will be doing the work.
Trujillo and city officials have said that even though Trujillo has the title of shareholder, he does not share in the profits of the firm and therefore his contributions should not be attributed to Chamberlain. Trujillo did not respond to requests for comment Friday.
Some of the other firms on the fundraiser sponsor list have city contracts that went through a bidding process. Those firms, however, have professional services contracts, which do not have to go to the lowest bidder, and therefore fall under the non-competitively bid category for the purpose of the city's pay-to-play rules.
Had the fundraiser gone through as planned, the city's contracts with Linebarger, Obermayer, Dilworth and Cozen O'Connor would've been invalidated, Hitt said.
Barry Kauffman, executive director of Common Cause Pennsylvania, said the rule should apply to all contracts, including the publicly bid ones.
"If you have a government contract, you shouldn't be allowed to donate," he said. "It just makes things clean and easy."
Even for publicly bid contracts, Kauffman said, campaign contributions could "skew judgment" when deciding whether to renew a contract or not.