A Federal Court has ruled Montana’s contribution limits are unconstitutional under the First Amendment.

On October 3, 2012, the U.S. District Court for the District of Montana, issuing a decision in Lair v. Murry, found the contribution limits in Montana Code Annotated §13-37-216 “prevent candidates from ‘amassing the resources necessary for effective campaign advocacy.’”

The Court has enjoined the state from enforcing the provisions of the code relating to limiting political contributions.

Montana Attorney General Steve Bullock issued the following statement: “In declaring our campaign contribution limits unconstitutional, a federal judge has effectively put Montana’s elections up for auction to the highest bidder. My office will aggressively pursue all legal remedies available to overturn this decision, including filing an emergency stay before the U.S. 9th Circuit of Appeals —the court which upheld Montana’s contribution limits just a decade ago.”

Nevada Secretary of State Ross Miller has proposed a bill draft resolution for the 2013 legislature to increase the accountability of candidates and public officials.

Secretary Miller advocates changes to the current campaign finance laws to clarify who is required to disclose contributions and expenditures when making independent expenditures or electioneering communications. Other changes put forth include requiring reporting within 72 hours for contributions received in excess of $1000, allowing the Secretary of State’s office to seek greater authority and greater penalties for campaign finance violations, and requiring every expense made from a candidate’s campaign account to be report.

Additionally, the Secretary is proposing an overhaul of the law regarding gifts given to public officials in order to “significantly restrict the ability of candidates and public officials to receive ‘gifts’ from donors who may pose a conflict of interest”, according to a press release from the Secretary’s office.

Assemblymen Marcus Conklin and Pat Hickey, and senate candidate Sheila Leslie, have expressed interest in the ideas. The Nevada Legislature is scheduled to begin its next session on February 4, 2013.

President Obama has signed an Executive Order “to ensure that taxpayer dollars do not contribute to trafficking in persons.”

The Executive Order, “Strengthening Protections Against Trafficking In Persons In Federal Contracts,” signed yesterday, orders the Federal Acquisition Regulatory (FAR) Council to amend its regulations and implement specific requirements of federal contractors.

For example:

• Vendors will be required to agree to cooperate fully in providing reasonable access to allow audits, investigations, or other actions to ensure compliance;
• Contractors will be prohibited from charging employees recruitment fees;
• Contractors will be prohibited from destroying, concealing, and confiscating an employee’s identity documents, such as passports or drivers’ licenses; and
• Contracting officers will have a duty to notify the government if they become aware of any activities concerning the use of forced labor, trafficking in persons, and other specified illegal activities.

While the order is effective immediately, it will apply to solicitations issued after the FAR Council makes its rules. FAR has six months to realize the regulations.

Today the FEC posted an article answering some questions about political contributions made and received by text messaging.

The article can be found here.

A bill introduced by U.S. Representative Bill Posey hopes to curtail members of congress from becoming lobbyists.

The “End the Congressional Revolving Door Act,” H.R. §6424, would prohibit a former member of congress or former congressional employee, while employed as a lobbyist, from being eligible for certain federal benefits.

Those benefits are:

• The Civil Service Retirement System;

• The Federal Employees’ Retirement System;

• The Federal Employees’ Health Benefits Program; and

• The Federal Employees’ Group Life Insurance Program.

The prohibition covers each month the individual is a compensated lobbyist.

In May, a similar bill was introduced by U.S. Representative Steve Israel. The “Congressional Double Dipping Pension Prevention Act,”  H.R. §5737, would prohibit a former member of congress receiving annual compensation exceeding $1,000,000 as a lobbyist from being eligible to concurrently receive federal retirement benefits for the period of time he or she is employed as a lobbyist and receiving such income.

A federal appellate court has reversed a district court’s electioneering reporting decision, sending the issue back to the FEC.

The significance of today’s decision, pending further possible rule changes or court decisions, is that political contributors giving to an organization making an electioneering communication will not have to be disclosed to the FEC unless the donor specifically earmarks his or her contributions to fund electioneering communications.

This was the rule from 2007 until this spring when a district court ruled that all contributors giving over $1,000, regardless of whether they gave for the specific purpose of electioneering communications, had to be disclosed to the FEC.

In the initial lawsuit, Van Hollen v. FEC, the plaintiff,  U.S. Representative Van Hollen, claimed the FEC regulation 11 C.F.R. §104.20(c)(9), which requires disclosure only of those making contributions over $1,000 to an entity for the purpose of furthering electioneering communications, contradicts the statute requiring disclosure of all donors making contributions over $1,000.

In the spring, a U.S. district court agreed and declared 11 C.F.R. §104.20(c)(9) invalid and vacated the regulation. The court reinstated the FEC’s prior regulation, which was promulgated on December 17, 2002 and was in effect until December 25, 2007. The FEC had formally reiterated the district court’s requirement on July 27, 2012, retroactively applying the disclosure of donors to March 30, 2012.

Today, in Center for Individual Freedom v. Van Hollen, the U.S. Court of Appeals for the District of Columbia Circuit reversed Van Hollen v. FEC, vacated the district court’s prior judgment, and remanded the case to the district court. Presently, under the jurisdiction of the district court, the FEC must pursue rulemaking to address the issues brought by the lawsuit or defend 11 C.F.R. §104.20(c)(9) in court against the parties bringing the action.

This is a signature issue for Representative Van Hollen who will probably continue to vigorously litigate this issue.

The FEC has not publicly declared its next course of action.

The Bergen County, New Jersey Board of Chosen Freeholders will consider revising its pay-to-play ordinances on Wednesday, September 19.

Bergen County has only had its local pay-to-play ordinance since December. According to NorthJersey.com, proposed changes “would strip the requirement that contractors report their contributions to candidates on the municipal, state, and federal level, leaving only county campaigns on the mandatory reporting form.”

While the proposal was introduced on September 12 and is scheduled for an October 3 consideration, the Freeholder’s agenda lists the ordinance introduction for Wednesday.

The New Jersey Election Law Enforcement Commission (ELEC) has proposed changes to the administrative code allowing for electronic filing for lobbyists’ annual reports.

Electronic filing would be mandatory through ELEC’s website and would replace the requirement to file paper copies. Copies of what a lobbyist files electronically must be retained by the lobbyist.

The proposed amendments cover governmental affairs agents, represented entities, and representatives of “persons communicating with the general public.” The proposals also make technical changes, such as substituting “represented entity” for “lobbyist” throughout the relevant sections. A copy of the proposal can be found here.

ELEC will conduct a public hearing at its offices concerning this proposal on Tuesday, October 16 at 11:00 a.m.

An alert for municipal securities dealers concerning pay-to-play rules has been issued by a department of the Securities and Exchange Commission (SEC).

The SEC Office of Compliance Inspections and Examinations has released a National Examination Risk Alert summarizing observations and providing some guidance of pay-to-play compliance by firms engaged in municipal securities.

The alert identifies issues found “in the course of examinations regarding compliance by firms” subject to municipal securities pay-to-play prohibitions. Municipal Securities Rulemaking Board (MSRB) Rule G-37 prohibits certain political contributions for two years prior to engaging in a municipal securities business where a related official received contributions.

The alert details problems with recordkeeping, inaccurate filing of reports, and inadequate supervision by firms to ensure compliance with MSRB Rule G-37.

Additionally, the alert’s reporting staff “has observed facts that suggest that some firms may have engaged in municipal securities business with issuers within two years of their MFPs making [prohibited] contributions.”

The full report can be found at http://www.sec.gov/about/offices/ocie/riskalert-munipaytoplay.pdf.

The Federal Election Commission (FEC) issued an advisory opinion offering limited guidance on what type of solicitations for political contributions are permissible and what type of advertisements qualify as expressly advocating the election or defeat of a candidate.

In Advisory Opinion 2012-27, the FEC found two of four proposed donation requests permissible. The Commission also concluded three of seven proposed advertisements did not expressly advocate the election or defeat of a clearly identified federal candidate.

The remaining advertising and donation requests were not decided by the FEC because it lacked the required four affirmative votes for agreement.

Trustees of the Houston Independent School District (HISD) hope to change ethics rules involving vendor contracting.

According to the Houston Chronicle, the new rules would require trustees to disclose relationships with vendors, prohibit trustees from voting on contracts where a vendor contributed $500 or more to a trustee’s political campaign, and prohibit vendors’ contributions while bidding for HISD contracts.

Last October, similar ethics changes were discussed but not implemented by HISD. The trustees are expected to vote on new policies in September.

Concord, New Hampshire Mayor Jim Bouley is calling for a review of the city’s ethics ordinance enacted just last year.

According to the Concorde Monitor, the mayor has requested the city council ask the Board of Ethics to assess the ordinance to “ensure a fair and efficient review of ethics complaints.” Two complaints filed against the mayor were recently dismissed by the board.

The next city council meeting is scheduled for tonight.

The New Hampshire Attorney General’s office has advised the Secretary of State against restricting contributions to political committees that only make independent expenditures.

While New Hampshire’s statute R.S.A. §664:4 sets contribution limits for political committees, the law does not distinguish between political committees in general and committees making only independent expenditures.

The Attorney General made this recommendation, and reviewed the current status of law concerning independent expenditures, in a letter to the Secretary of State on August 1, 2012. The Attorney General also stated in the letter that enforcement of “contributions to any political committee is a fact-specific determination that can only be made on a case-by-case basis.”

The Federal Election Commission (FEC) announced persons reporting electioneering communications must report the name and address of each donor giving $1,000 or more, aggregated since the first day of the preceding calendar year.

The application of this rule applies retroactively to March 30, 2012, coinciding with a court decision in Van Hollen v. FEC that ruled the current regulation, 11 C.F.R. 104.20(c)(9), is invalid.

Previously, donors were only required to be disclosed if their donations were “made for the purpose of furthering electioneering communications.” The FEC will now consider all donors as contributors “regardless of their subjective purpose in contributing.”

As the Commission has not adopted any new regulations or explanation of its rules, and Van Hollen v FEC is still pending, the FEC outlined this requirement in a public statement issued Friday.