Chapel Hill Town Councilwoman Sally Greene was attending a meeting of the Public Housing Program Advisory Board last summer when a board member, perusing the list of council members’ names on the agenda, told Greene, “I’d like to see my name there.”

“I told her how to run a campaign and wished her luck,” Greene says of the woman, who lived in public housing. “She didn’t file. She probably doesn’t have the resourcesor the perception that she doesn’tto run for office.”

That political hopeful might be able to run next year if the council approves a pilot program for publicly financed elections.

Last year, the state legislature authorized the council to launch “voter-owned” elections for the 2009 and 2011 mayoral and council contests. A public hearing on a draft proposal is scheduled for Wednesday, May 14, at 7 p.m. at Town Hall, 405 Martin Luther King Blvd. (Read the proposal, PDF, 31 KB.)

If Town Council passes the proposal, Chapel Hill would be the first municipality in North Carolina to test-drive the voluntary program, which would require $50,000 in appropriations from the town’s general fund. The program would be monitored by the State Board of Elections.

Publicly financed systems are used in North Carolina’s Court of Appeals and Supreme Court races and those for state auditor, insurance commissioner and superintendent of public instruction.

There has long been a movement afoot, locally and nationally, to clean the stream of campaign contributions. Publicly financed electionsalso known as “voter-owned” electionscan lower financial barriers to running for office, help reduce the amount of special-interest money in elections, and relieve candidates of the burden of constant fundraising.

“Citizens have been talking about it for years,” Greene says.

Chapel Hill’s program, which would be voluntary, places spending and contribution limits on candidates who opt into the program. Town Council candidates can raise and spend a maximum of $6,000 culled from seed money, qualifying contributions and public grants; mayoral candidates can raise $9,000 from those sources.

Qualifying contributions are defined as those from Chapel Hill residents who are eligible to vote in municipal elections. That provision helps to eliminate special-interest money and funds from outside the county, such as contributions from lobbyists.

A small “rescue fund” is also available for candidates in the program whose non-participating opponents raise more than 140 percent of those limits; those opponents’ overages would be disclosed in a special campaign finance filing.

Greene says the $6,000 amount is close to the average spent on council elections. She raised $7,800 and spent $5,700 in her re-election bid last fall.

Councilman Bill Strom, who made public financing a major component of his platform in his first campaign in 1999, led the council committee that crafted the proposal. He raised $9,380 and spent $6,500 last fall.

To receive public grants, candidates running for town council must raise 75 qualifying contributions of $5-$20 totaling at least $750; mayoral hopefuls must raise 150 qualifying contributions that add up to at least $1,500.

“Getting 75 people to give you money is a demonstration of significant support,” Strom says. “It was very important for us to make it clear that this is not a welfare program for candidates.”

Bob Hall, executive director of Democracy North Carolina, a campaign finance watchdog and advocacy group, says one of the challenges of publicly funded elections is determining the proper threshold.

“They need to be challenging, but not exclusionary or so burdensome that it shuts out people who do have a good base. But this is public money and there needs to be a public purpose served by people having the money,” Hall says. “It’s not just for anybody who raises their hand.”

The program also increases financial reporting requirements for all candidates and political committees, including an additional filing report five days before Election Day.

To finance campaigns, candidates often tap into their personal nest eggs or a conduit of special-interest money.

“In the case of Chapel Hill, what was happening is that candidates were putting their own money into their campaigns,” Hall says. “You had to go into hock to become a candidate. It was a crazy burden in the face of other candidates being very wealthy.”

Last fall, challenger Matt Czajkowski loaned himself $17,750 and spent $20,000 on his campaign; he won the fourth council seat by 63 votes, upending incumbent Cam Hill.

Czajkowski opposes the program because it uses tax dollars.

“I don’t see evidence of a problem that needs to be solved using $50,000 of taxpayer money,” he says. “People who are well-funded generally win, but there have been ordinary citizens who’ve gone out and found people who support them. That’s democracy.”

“We don’t have special-interest money funding council campaigns,” he continues. “If we’re going to talk about a problem, it’s that incumbents never get unseated.”

However, when Strom was a challenger in 1999, he and fellow challenger Jim Ward won seats while incumbent Julie McClintock was ousted; in 2003, Greene, although she didn’t unseat any incumbents, placed ahead of two to win her seat for the first time.

Czajkowski declined to speculate whether he will run for re-election in 2011, nor if he would participate in a voter-owned election program if he chooses to run.

There have been instances of special-interest money flowing into council campaign coffers. For example, in 1999, incumbent Pat Evans, (coincidentally now a Czajkowski supporter) received contributions from Roger Perry, developer of the controversial Meadowmont development.

Election reformers argue more equitable campaign finance programs would encourage non-incumbents, who may not have the network of donors that incumbents have, to runand possibly pressure fellow candidates to participate in the program. “The people who do have public financing can say ‘I don’t listen to special interests,’” Hall explains, “but they can also say ‘I’m not trying to buy the seat.’”