D.C. Council member Kathy Patterson (D-Ward 3) yesterday proposed increasing the maximum penalty for a violation of city campaign finance laws from $500 to $2,500 and banning candidates from accepting corporate and labor union contributions.

Patterson said she decided to propose the higher fines after The Washington Post reported that Mayor Anthony A. Williams had waited nearly a year to disclose two consulting arrangements with city contractors that paid him $40,000 during a six-month period when he was running for office and then was mayor-elect.

The city's Office of Campaign Finance has charged the mayor with violating a clause in the D.C. Code that requires candidates for public office to report any changes in their income within 30 days. After a hearing next week, campaign finance officials could decide to fine Williams up to $1,000, or $500 per violation for each consulting arrangement he did not report within 30 days.

The new law, if enacted, would raise the maximum fine in such a case to $5,000. But it would not be retroactive and so would not apply to the mayor if he is penalized.

"To be perfectly frank, the mayor's situation is what caused us to look at the fine and see that it had not changed since the 1970s," Patterson said. "It makes sense to raise the fines, since they haven't been raised in 20 years."

Patterson, who oversees the council committee that monitors campaign finance, has suggested to Williams that he voluntarily release his bank records from June 1998 -- when he left his $118,000-a-year job as the city's chief financial officer to run for office -- to January 1999, when he took office as mayor.

She said this would be a way for the mayor to show he had given a full account of the income he received as a candidate for mayor.

The bank statements would reveal any funds deposited into the mayor's bank accounts, whereas the disclosure form that Williams submitted to the campaign finance office requires only that he list any funds that come from entities that do business with D.C. government.

Williams has said that he took on the consulting work to provide an income for his family while he ran for mayor, and he recently apologized for not disclosing the arrangements with the accounting firm Arthur Andersen & Co. and NationsBank until last month, in financial forms that all D.C. officials are required to file annually.

He has said that not disclosing the work earlier was an oversight, and he has not responded to Patterson's suggestion that he open his bank records.

"The mayor has disclosed the information requested by the Office of Campaign Finance and will continue to provide any information they request," said Peggy Armstrong, Williams's spokeswoman. "The mayor believes it is inappropriate to comment further on an ongoing investigation."

Benjamin F. Wilson, chairman of the D.C. Board of Elections and Ethics, said that the board has asked the D.C. Council to endorse tougher penalties for campaign finance violations several times without success.

"I just want a stiffer penalty so people will think twice before breaking the law," Wilson said. "The obvious reason you want to raise the penalty is so that those who violate the law understand that they can pay a severe fine."

Council member Jack Evans (D-Ward 2) said he supports raising the fines because he believes that full disclosure allows the public to make informed decisions about the candidates they support.

But Evans, whose unsuccessful campaign for mayor last year was fueled by significant corporate donations, said he does not support the part of Patterson's bill that would ban corporate and labor contributions.

Patterson said D.C. law allows people to make contributions well beyond the $2,000 limit by creating groups or partnerships that donate as separate entities. Twenty-two states and the U.S. government have enacted the type of limits on corporate and labor donations that Patterson wants.

"I think it's an uphill battle," Patterson said, "but it's an issue we should have a debate on."

CAPTION: Council member Kathy Patterson wants Mayor Anthony A. Williams to release his bank records to show he has given a full account of his campaign income.

CAPTION: Williams said his failure to reveal the consulting work was an oversight.