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.”

A federal judge has upheld Vermont’s contribution limits on political action committees. Vermont Right to Life Committee (VRLC) and its related political committee, Vermont Right to Life Committee – Fund for Independent Political Expenditures (FIPE), filed suit alleging that Vermont’s registration, reporting, and disclosure requirements for PACs are too broad and unconstitutional, and that FIPE should not be subject to the $2,000 limit on PAC contributions because it only makes independent expenditures.

The judge rejected FIPE’s claim that it should not be subject to the contribution limits on the basis that there is a “fluidity of funds” between FIPE and VRLC that provides no safeguard against unlimited contributions being used to fund candidate contributions.

Secretary of State Jim Condos applauded the ruling; however, the opinion makes clear that the decision to uphold the $2,000 contribution limit weighed heavily on the facts of the case, in particular the lack of separation between FIPE and VRLC. VRLC plans to appeal the ruling.

With the Republican convention less than 2 months away, speculation about Governor Romney’s choice for Vice President continues to grow. A report was released earlier last week that Florida Senator Marco Rubio, thought to be a frontrunner, was not being vetted as a candidate for the ticket. However, Gov. Romney’s campaign quickly rebuffed those rumors, and Gov. Romney himself announced that Rubio was being fully vetted. Other candidates have either withdrawn or effectively removed themselves from consideration, including Indiana Governor Mitch Daniels who this week announced he was accepting the position as President of Purdue University at the completion of his tenure as governor.

While Rubio is still in the running, former Minnesota Governor Tim Pawlenty appears to be the latest frontrunner for the job. Pawlenty staged an unsuccessful run at the presidential nomination and has since been an aggressive Romney surrogate on the trail. Other names on the shortlist include Ohio Senator Rob Portman, who has long held a position at the top of the list, Wisconsin Congressman Paul Ryan, who submitted his questionnaire to the campaign Friday, New Jersey Governor Chris Christie, Louisiana Governor Bobby Jindal and South Dakota Senator John Thune.

Other campaign notes:

• This week, the Supreme Court will announce its decision concerning the Affordable Care Act. The court’s ruling will have a definitive impact on the Presidential race with both sides using the decision to encourage their base and shore up support for November. Court announcements will be made at 10:00 a.m. on Thursday and can be found on SCOTUSblog.

• Former Florida Senator George Lemieux (R) has ended his campaign for Florida’s senate seat effectively clearing the way for Rep. Connie Mack (R). Lemieux was appointed to the Senate in 2008 by Gov. Charlie Crist after then Senator Mel Martinez resigned prior to the end of his term. Lemieux’s seat was then won by Marco Rubio in 2011. Lemieux cited dwindling resources and money as his reason for leaving the race. Lemieux and Mack have waged an often times contentious campaign during the primary.

• Rep. Nydia Velasquez (D-NY) received an endorsement last week from New York Governor Andrew Cuomo. The endorsement is welcome support as Velasquez, a 20 year house veteran, faces a tough race against City councilman Eric Dilon in the newly drawn 7th district.

• Senator Orrin Hatch (R-UT) will likely weather the storm created by his failure to obtain 60% of the vote at Utah’s state convention in April. Hatch faces Dan Liljenquist in the state’s primary on Tuesday. A new poll by Key Research shows Hatch has a comfortable 16 point margin over Liljenquist.

“State limits on corporation campaign contributions rejected by Supreme Court” by The Associated Press in the New Orleans Times-Picayune.

“Powerful congressman accused of campaign finance violations” by Scott Bronstein and Drew Griffin (CNN) in KTVQ.com.

Connecticut: “Malloy, legislature make last stab at campaign reform” by Mark Pazniokas in the CT Mirror.

Maryland: “Bartlett fined $5,000 by FEC for inaccurate campaign finance report filing” by The Associated Press in The Washington Post.

Massachusetts: “Massachusetts legislators calling for Constitutional Amendment to reverse Supreme Court’s Citizens United decision” by Michael Norton and Matt Murphy in MassLive.com.

New York: “With Cuomo, a New Group Will Push for Publicly Financed Elections” by Thomas Kaplan in The New York Times.

Federal:

Critics: Lobbying ethics rules go too far

Nonprofits Outspent Super PACs in 2010, Trend May Continue

Supreme Court Rules against Union on Nonmember Fees for Politics

From the States and Municipalities:

Connecticut

Malloy Vetoes Campaign Finance Bill

Connecticut

Probes Cast Shadow in Congressional Race

District of Columbia

District’s Political Corruption Has Deep Roots

Illinois

Illinois House Expulsion in 1905 Laid Groundwork for 2012 Smith Case

Montana

Montana AG Asks Federal Judge to Uphold Campaign Contribution Limits

New Jersey

N.J. Governor Candidates Can Receive More Money from Donors, Public Financing under New Guidelines

Ohio

Ex-Rep. Weddington Gets Three Years for Bribery

Wyoming

Wyoming Lawsuit Challenges FEC Regulations
State and Federal Communications produces a weekly summary of national news, offering more than 80 articles per week focused on ethics, lobbying, and campaign finance.

News You Can Use is a news service provided at no charge only to clients of our online Executive Source Guides, or ALERTS™ consulting clients.

It’s time again for our Highlighted Site of the Week. This week’s site, aptly named Politwoops, displays for us the Tweets that politicians delete from their Twitter feed.

Politwoops has this motto:  “Sure, we all tweet things we don’t mean to share, but now politicians have no way to hide them. Discover tweets that your politician shared and promptly deleted.”

You may think you know some of these politicians, but with the 334 pages of deleted tweets, you may find out there is a whole other side to them. Sometimes politicians can be a little silly.

Here is a deleted tweet from U.S. Sen. John McCain: “Victory – we fried the catfish office! Senate passes my amd’t w/ @JohnKerry today – full stmt: http://t.co/ko59ISL6“

I wonder if this website will make some politicians think twice before they send any messages out into the Twitterverse.

Politwoops is an interesting new site. I think I’m going to go home and read through it to find the funniest tweet I can.

Have a great weekend and we’ll see you next time!

The Henderson Nevada City Council has passed a new ethics ordinance. City employees will be limited to accept no more than $50 in meals or gifts per year from entities doing business with the city.

According to the Las Vegas Review-Journal, the ordinance additionally prohibits city employees from soliciting gifts and provides for penalties.

The ordinance does allow employees to accept tickets or admissions to charitable events or fundraisers if given prior approval.

“Dems won’t release jackabramoff.com” by John Bresnahan in Politico.

“Jack Abramoff Wants His Name Back from Democrats” by Eric Randall in The Atlantic.

“Lobby shop CEO to join RNC” by Anna Palmer in Politico.

“Leadership shake-up at Ogilvy Government Relations” by Kevin Bogardus in The Hill.

Georgia: “Legislators push for lobbyist cap” by Stephen Abel in WALB News.

New York: “Groups seek probe of NY gov, business lobby link” by The Associated Press in CBS News.

Rhode Island: “Former R.I. House speaker earned at least $78,000 as a lobbyist in 2012” by Philip Marcelo in the Providence Journal.

The New Jersey Election Law Enforcement Commission (ELEC) has voted unanimously to raise the inflation-adjusted limits and thresholds for political contributions beginning in 2013.

If accepted by the legislature, contributors would be able to give up to $3,800 per election to gubernatorial candidates. The contribution limits from single donors for non-gubernatorial candidates would increase from $2,600 to $3,000.

Additionally, political committee reporting thresholds for non-gubernatorial candidates and committees would increase, as would penalties for violations.

According to the press release from ELEC, gubernatorial candidates who qualify for public funding could spend a maximum of $5.6 million in primary elections and $12.2 million in general elections.

The commission has until December 15th to report to the legislature its final limits and threshold adjustments.

The ELEC 2013 Cost Index Report can be downloaded here.

U.S. Representative Adam B. Schiff has introduced a constitutional amendment to reverse the resulting outcomes of the U.S. Supreme Court’s decisions in Citizens United and Arizona Free Enterprise Club’s Freedom Club PAC V. Bennett, an Arizona public financing law struck down by the Court.

The amendment, proposed in House Joint Resolution 111, reads as follows: “Nothing in this Constitution shall be construed to forbid Congress or the states from imposing content-neutral limitations on private campaign contributions or independent political campaign expenditures. Nor shall this Constitution prevent Congress or the states from enacting systems of public campaign financing, including those designed to restrict the influence of private wealth by offsetting campaign spending or independent expenditures with increased public funding.”

In his press release, Congressman Schiff said: “I have always been loath to amend the constitution, but this tragic line of reasoning by the Supreme Court has so threatened the health of our democracy that I am moved to introduce today’s amendment.”

The commission studying state campaign finance laws is likely to recommend raising the limits on campaign contributions.

At Monday’s meeting, the commission took no formal vote on a final recommendation, but appeared to reach a consensus on raising the total amount an individual may contribute to state election campaigns from the current $10,000 to $25,000 during a four-year election cycle. The commission also reached consensus on raising the current limit to any single candidate from $4,000 to at least $5,000 and possibly to $7,000 in any four-year election cycle. The current contribution limits have been in place for 19 years.

At the next meeting on July 16, 2012, the commission plans to discuss a total ban on contributions from business corporations and from companies doing business with the state.

The Ohio Society Summer Social is tomorrow, June 20th from 6-8 pm at Tortilla Coast (Capitol Hill Location) 400 First Street SE, Washington, D.C.

State and Federal Communications is proud to be one of the sponsors of the event.

Campaign Finance

“Campaign donations coming soon to Twitter” by Dave Levinthal in Politico.

“No action from U.S. Supreme Court on Montana campaign spending law” by Charles S. Johnson in the Missoulian.

“Will the Supreme Court Consider a Campaign Finance Mulligan?” by Alex Altman in Time.

“Texting: The New Way for Campaigns to Draw Contributions” by Kenneth P. Doyle in Bloomberg News.

Government Ethics

Louisiana: “Ethics bills: Jindal signs two, vetoes one” in the New Orleans Times-Picayune.

Ohio: “Former state lawmaker sentenced to prison for bribery” by John Futty in the Columbus Dispatch.

State Legislatures

“State lawmakers short on experience” by Chuck Raasch in USA Today.

“Herbert calls special session to OK more liquor licenses, fixed funding” by Ed Gehrke in the Salt Lake Tribune.

“SC legislators return for special session” by The Associated Press in GoUpstate.com.

The Securities and Exchange Commission has extended the date advisers and third-party solicitors must comply with new pay-to-play rules until April 2013.

The Commission is extending the compliance date for the ban on third-party solicitation under rule 206(4)-5 of the Investment Advisers Act of 1940 in order to ensure an orderly transition for third-party solicitors and advisers and as well as to provide additional time to adjust compliance policies and procedures after the transition.

Rule 206(4)-5, the “Pay to Play Rule,” prohibits an investment adviser from providing advisory services for compensation to a government client for two years after the adviser or certain of its executives or covered associates make a contribution to elected officials or candidates.

The rule also prohibits an adviser and its covered associates from providing or agreeing to provide, directly or indirectly, payment to any third-party for a solicitation of advisory business from any government entity on behalf of such adviser, unless such third-party was an SEC-registered investment adviser or a registered broker or dealer subject to pay to play restrictions adopted by a registered national securities association.

More information can be found here.