A new Utah state law requiring independent expenditure reporting for political spending became effective today. House Bill 39 requires all persons and entities, except political parties, to file independent expenditure reports with Utah’s chief election officer within 30 days after the day on which a person or entity has made a total of at least $1,000 in independent expenditures during an election cycle.

Another provision of the new law is the requirement to retain records related to the filings for two years, including all independent expenditures, receipts, and donations described in the reports. New definitions concerning independent expenditures are now codified, including telephone bank, which is defined as “500 or more identical or substantially similar telephone calls within any 30-day period.” Fines from $100 to $1000 can be imposed for violations.

The New York City Council has introduced legislation imposing increased independent expenditure disclosure requirements. Introduction No. 148-A requires any electioneering communications to include the phrase “paid for by,” whether typed or spoken, followed by the identity of the top five donors to the organization sponsoring the communication.

Campaign Finance Board Executive Director Amy Loprest testified before the council on April 25, 2014, supporting the legislation. In support of the bill, Loprest stated, “Providing voters with clear information about who is responsible for these campaign messages will reduce the likelihood of confusion among voters.”

Photo of the New York City Hall by Momos on Wikipedia.

On November 4, in response to a court decision enjoining the Texas Ethics Commission from enforcing parts of the Election Code, the Ethics Commission released guidance concerning independent expenditure-only PACs.

The commission acknowledged restrictions on independent expenditures from independent expenditure-only PACs, referred to in the state as “direct campaign expenditure only committees,” are currently unenforceable under the October 16, 2013, ruling in Texans for Free Enterprise v. Texas Ethics Commission.

The commission requires independent expenditure-only PACs submit a sworn statement stating the committee intends to act exclusively as a direct campaign expenditure only committee in accordance with Texans for Free Enterprise and the committee will not use its funds to make contributions to candidates for elective office, officeholders, or political committees supporting or opposing candidates or assisting officeholders.

The commission also made available sample template political committees may use to submit their sworn statements

The Second Circuit Court of Appeals has reversed a District Court ruling, denying a preliminary injunction on campaign contributions to independent-expenditure PACs. The lawsuit was filed by New York Progress and Protection PAC, who alleged that a wealthy donor, Shaun McCutcheon, pledged to donate $200,000 to the PAC in support of Joseph J. Lhota, a NYC mayoral candidate. McCutcheon’s donation, however, would exceed the contribution limit of $150,000 to independent-expenditure committees set by New York law.

The Circuit Court granted the injunction, stating the contribution limits are “likely unconstitutional” and the claim has a substantial likelihood of success. The Court further noted the plaintiffs would face irreparable harm if the injunction was not granted.

The donor in question, Shaun McCutcheon, is also embroiled in a similar suit before the Supreme Court of the United States, challenging the federal limits to campaign contributions.

City Council passed an ordinance creating registration and reporting requirements for organizations involved in making independent expenditures. Organizations supporting or opposing any candidate for mayor, alderperson, or municipal judge are required to register with the city clerk upon accepting contributions made for, incurring obligations for, or making independent expenditures exceeding $25 in the aggregate during a calendar year. Such organizations are also required to file reports as required by Wisconsin Statutes.

The ordinance is meant to take the place of a provision no longer enforced by the Wisconsin Government Accountability Board (GAB) after it reached a settlement in a suit filed by two advocacy groups. As such, the ordinance is ripe for challenge on the same grounds as the original GAB rule was challenged.

Photo of the Madison skyline by Patrick43470 on Wikimedia Commons.

Several members of city council announced the introduction of legislation to reform independent expenditures made in the city. The legislation would close a “loophole” in state campaign finance law allowing limited liability companies to give at the individual aggregate contribution limit of $150,000 instead of the corporate aggregate limit of $5,000. Such a change would only apply to city elections.

The legislation would also require the disclosure of the top donors to independent expenditure communications.

Finally, the legislation would force any independent expenditure communication to inform voters the communication was not subject to the city’s campaign finance laws.

Photo of the New York City Hall by Momos on Wikipedia.

On March 21, 2013, the New Jersey Election Law Enforcement Commission (ELEC) issued an advisory opinion deciding it does not have the jurisdiction to declare contribution limits unenforceable or unconstitutional for political committees making only independent expenditures.

Advisory Opinion 01-2013 holds current state registration and reporting requirements and contribution limits apply to political committees making independent expenditures.

Fund for Jobs and Growth, a political organization not registered in the state and intending to make independent expenditures in the state’s 2013 elections, requested the opinion in order to determine whether it needed to register and report with the state and whether the state contributions limits for political committees applied to its fundraising activity. The organization was held to be a political committee requiring registration and reporting.

While holding state contribution limits apply, the opinion notes several other jurisdictions have held contribution limits applied to political committees making independent expenditures are unconstitutional. ELEC did not find “that the Third Circuit Court of Appeals has addressed these issues, nor has the United States Supreme Court issued a specific determination concerning the constitutionality of contribution limits for political committees making only independent expenditures.”

The essence of the rule will force people who make independent expenditures to disclose funding and amounts spent by treating them as a political committee. Therefore, they will have to register as an independent expenditure committee and, for those elections in which they support or oppose a candidate, file reports before and after the election. The committee will also be responsible for filing periodic reports on January 15 and July 15 of each year.

Independent expenditures are defined by the state as expenditures made in support of or opposition to a candidate, expressly advocating for the election or defeat of a candidate, and made in complete independence from the candidate. Expressly advocate is defined as communicating with specific words calling for the election or defeat of a candidate, such as “vote,” “oppose,” “support,” “defeat,” “elect,” or “reject.”

Using these definitions, groups can avoid registering and reporting as an independent expenditure committee if they avoid using the special buzz words that would make their advertisements expressly advocating. The board of elections has said these rules are not completely new, but rather have been adopted to shed light on the rules and to ensure that people understand exactly what is expected when making independent expenditures. The rules have already taken effect and committees making these expenditures will next have to file a report on January 15, 2013.

The New York State Board of Elections has approved and adopted rules concerning independent expenditures, but many feel the rules won’t do a thing to slow down the campaign money train. According to the rules, people making independent expenditures will have to register and report as if they were a political committee.

Independent expenditures are defined by the state as expenditures that expressly advocate the election or defeat of a candidate that the candidate did not authorize in any way. Expressly advocated is defined as containing express words calling for the election or defeat of a candidate. Therefore, committees can run advertisements that avoid using certain words and can escape registration and reporting requirements.

Bill Mahoney, a research coordinator for a New York good government group said the new rules “will make it even easier for independent expenditure committees, Super PACs, to hide who’s paying for them, and because of that it will lead to language that is much more harsh than what we’ve heard before.”

The United States Court of Appeals for the First Circuit on October 19, 2012 ordered the district court to enjoin Puerto Rico from enforcing provisions of Law 222, a campaign finance law passed in 2011. The provisions in question required corporations and unions to establish separate committees in order to make independent expenditures.

Such committees were required to hold membership meetings and vote to approve expenditures related to elections. The court found those provisions were likely to be held unconstitutional regulations of political speech.

Coat of Arms of Puerto Rico courtesy of Creative Commons on Wikipedia.

The Board of Supervisors has adopted an ordinance limiting campaign contributions for all county elective office candidates, and increasing public disclosure requirements for independent expenditures.

The new ordinance limits contributions to $3,900 per election cycle from a single source, including corporations, special interest groups, and individuals. The ordinance also requires all county candidates and independent expenditure committees to electronically report contributions and expenditures exceeding $10,000.

The ordinance goes into effect January 1, 2013.

Seal of San Bernardino County courtesy of Jetijones on Wikipedia.

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.”

On Friday, July 6, 2012, Governor Pat Quinn signed Senate Bill 3722 into law, rewriting the state campaign contribution limits. Under this new law, if a natural person or an independent expenditure committee makes independent expenditures in support of, or in opposition to, the campaign of a candidate or incumbent in an amount over $250,000 for statewide office, or $100,000 for all other elective offices, then the contribution limits are waived for all candidates for that specific office. For example, if an independent expenditure committee spends more than $250,000 for commercials against candidate A, who is running for governor, then the contribution limits do not apply for any of the gubernatorial candidates.

The new law also establishes registration and reporting requirements for independent expenditure committees. The law goes into effect immediately, which means these rules apply for the state house and senate seats which are up for election in November.

The U.S. Supreme Court has invalidated a portion of Montana law which prohibits corporations from making independent expenditures in connection with a candidate or a political committee that supports or opposes a candidate or a political party.

In Western Tradition Partnership v. Bullock, the Court quoted from its prior Citizens United v FEC ruling that “political speech does not lose First Amendment protection simply because its source is a corporation.”

Four of the nine Justices dissented. The dissenting opinion quoted from the dissent in Citizens United, arguing “independent expenditures can be corrupting in much the same way as direct contributions.”

The dissenting opinion also argued the Citizens United ruling should not bar the Montana Supreme Court’s finding “that independent expenditures by corporations did in fact lead to corruption or the appearance of corruption in Montana.”

The dissent continued, “Given the history and political landscape in Montana, [The Montana Supreme Court] concluded that the State had a compelling interest in limiting independent expenditures by corporations. Thus, Montana’s experience, like considerable experience elsewhere since the Court’s decision in Citizens United, casts grave doubt on the Court’s supposition that independent expenditures do not corrupt or appear to do so.”