In the News

Bloomberg Government: Parties Set for Election Law Clash as Senate Bill Heads to Floor

By Kenneth P. Doyle

The Senate Rules and Administration Committee will hold a hearing on [S. 1] March 24 and schedule a markup to advance it to the floor soon after, Chairwoman Amy Klobuchar (D-Minn.) said in a statement Wednesday…

The bill faces long odds in the Senate, where Republican Leader Mitch McConnell (R-Ky.) promised Tuesday a “scorched-earth” response if they try to change filibuster rules to pass the election bill and other liberal measures on a party-line vote…

McConnell, the Senate’s strongest opponent of changes in federal election and campaign finance laws, said earlier this year that the Democratic bill the House recently passed was an effort to “grab unprecedented power over how America conducts its elections and how American citizens can engage in political speech.” …

Digital ads are already running…

Democrats have used reform messages successfully to elect candidates in recent elections, according to Tiffany Muller, head of the nonprofit End Citizens United/Let America Vote, which is spearheading the latest ad effort. But this effort is aimed at getting a bill passed, not election messaging, she insisted…

There’s no similar ad campaign among opponents of the election bill, David Keating, president of the nonprofit Institute for Free Speech, said in an email, but he pointed to widespread opposition from Republican officials, conservative organizations, and the American Civil Liberties Union.

New from the Institute for Free Speech

H.R. 1 Will Force Organizations – and Their Donors – to Publicly Profess Allegiance to Politicians

By Margaux Granath

H.R. 1, the so-called “For the People Act,” recently passed the House, despite opposition from all Republicans and one Democrat…

The legislation creates a new category of speech to regulate, “campaign-related disbursements.” This stunningly broad category would unconstitutionally regulate speech about legislative issues that mentions federal candidates – many of whom will be elected officials – if the speech “promotes,” “attacks,” “supports,” or “opposes” (“PASO”) the candidate or official. This is one of the many needlessly vague and worrisome provisions included in the legislation. Groups could be forced to hire an attorney in a frustrating effort to understand whether their communications will be deemed to PASO a candidate.

Regrettably, the vagueness and expansiveness of the PASO standard are not the only problems with H.R. 1’s regulation of “campaign-related disbursements.” If H.R. 1 becomes law, organizations, including nonpartisan nonprofits, would be bound to publicly declare their support or opposition to any candidates named in their communications, even if, in reality, the group neither supports nor opposes those individuals. These declarations must be included in public reports for each “campaign-related disbursement” filed with the Federal Election Commission. This has disastrous implications not only for speech rights, but for privacy rights as well.

ICYMI

As H.R. 1 Moves to the Senate, Consider What Motivates Politicians

By Alex Baiocco

“Campaign finance laws… easily can serve as incumbent-protection devices, insulating current officeholders from challenge and criticism,” now-Supreme Court Justice Elena Kagan wrote in a 1996 University of Chicago Law Review article. Kagan warned that “there may be good reason to distrust the motives of politicians when they apply themselves to reconstructing the realm of expression.”

Recent commentary from politicians in Congress validates the wisdom in Kagan’s writing. In comments celebrating the House of Representatives’ partisan passage of H.R. 1, Speaker Nancy Pelosi (D-CA) explained that achieving the Democrats’ legislative agenda will be easier if certain voices are “not weighing in.” In other words, suppressing speech is not an unfortunate side effect of the bill’s complex and onerous regulations on advocacy. It’s a primary motivation.

As the Senate begins debate on its own version of the bill, S. 1, Democrats should consider the short-sightedness of their anti-speech motives. Not long ago, several key Republicans, still in control of the Senate, expressed their own interest in suppressing political speech by “regulating money.”

Misunderstanding Corporate PACs: The Media’s Mistaken Target

By Nathan Maxwell

In the aftermath of the Capitol riot on January 6, certain media outlets have turned their attention toward an often-misunderstood vehicle for political contributions – corporate PACs. The newsletter Popular Information reached out to 144 corporations whose company PACs contributed to the campaign efforts of one or more of the 8 Senators who voted to object to the certification of the election results in January.

A trio of Washington Post reporters wrote that the corporate PACs that are now halting donations as a result of the election objections are “reexamin[ing] their role in powering the nation’s fractious politics.” The New York Times columnist Andrew Ross Sorkin argued that these groups “shouldn’t be paying the refs” at all. Language like this hyperbolizes and misconstrues corporate PACs’ impact on campaigns and politics and inspires three important points that warrant clarification.

1) Only a fraction of the corporate PACs’ donations in the 2020 cycle went to objectors in the Senate…

2) Corporate PACs are not party loyalists…

3) Corporate PACs are funded voluntarily by a company’s employees…

Congress

The Gazette: HR 1 is the ‘For the Partisans Act’

By Adam Sullivan

It’s one of those bills with a universally agreeable name. How could anyone be against The People?…

It’s a big bill so some of the finer points get lost in the chatter. What’s pitched as a plan to empower voters is more complicated than that. Measures on political spending could instead stifle dissenting speech…

Issue advocacy groups that mention candidates would be required to disclose their donors, even if they aren’t expressly supporting or opposing candidates. Some organizations would also have to include donors’ names in their ads.

Those measures are sure to turn away some donors who don’t want their names publicized, and likely to silence some groups that can’t afford compliance costs.

It creates an especially difficult situation for groups that don’t toe a party line. The American Civil Liberties Union, for example, takes stances that don’t neatly break down into left or right. A donor supporting the group’s LGBTQ advocacy might be wary of their name being associated with certain religious liberty projects.

Lobbying

The Hill: Environmental group asks energy regulators to block use of utility customers’ money for lobbying

By Zack Budryk

In a petition Wednesday, the Center for Biological Diversity called on the Federal Energy Regulatory Commission (FERC) to take action against what it says are electric utilities’ use of customer money to bankroll anti-environmental lobbying organizations.

The environmental group argues in its petition that customers unknowingly subsidize lobbying activity with their bill payments, specifically citing the Edison Electric Institute’s (EEI) funding of the Republican Attorneys General Association, as well as the American Gas Association’s history of lobbying state legislators against phasing out fossil fuels, citing laws passed in 2020 in Arizona, Louisiana, Oklahoma and Tennessee.

Under current accounting practices, utilities are able to recover the costs spent on this lobbying directly from customers, the center claims in the FERC petition.

“Millions of dollars are funneled from ratepayers to organizations that pose tremendous threats to the climate and clean energy development,” Howard Crystal, legal director of the center’s Energy Justice program, said in a statement.“People have a fundamental First Amendment right not to be forced to bankroll groups engaged in political activities they oppose.”

Independent Groups

Center for Responsive Politics: ‘Dark money’ topped $1 billion in 2020, largely boosting Democrats

By Anna Massoglia and Karl Evers-Hillstrom

The 2020 election saw more than $1 billion in “dark money” spending at the federal level, a massive sum driven by an explosion of secret donations boosting Democrats in a historically expensive cycle.  

That’s according to an estimate from OpenSecrets. The billion-dollar sum includes a whopping $660 million in donations from opaque political nonprofits and shell companies to outside groups. In 2020, dark money groups preferred to bankroll closely-tied super PACs rather than spend the money themselves — politically active nonprofits that do not disclose their donors reported roughly $88 million in direct election spending to the Federal Election Commission. The remainder of the total is made up of spending on “issue ads” targeting candidates online and on the airwaves. 

Anonymous donors poured record amounts of money into groups backing President Joe Biden in the 2020 contest, leaving the public without a full accounting of who helped him win the White House.

Biden’s presidential bid attracted around $174 million in support from anonymous donors, more than six times the $25.2 million in dark money contributions and spending boosting President Donald Trump’s unsuccessful re-election effort…

After years of dark money overwhelmingly boosting Republicans, this marks the first presidential election cycle where dark money benefited Democrats. That’s a continuation from the 2018 midterm elections when Democrats benefited from more dark money than their Republican counterparts at the federal level for the first time since Citizens United.  

PACs

Bloomberg Tax: Navigating the Current Anti-PAC Sentiment

By Caleb P. Burns and Trey Richardson

Numerous groups have seized on the Jan. 6 riot at the U.S. Capitol to shame the business community for making political contributions from their employee-funded political action committees (PACs). The disapprobation ranges from criticism for contributing to certain politicians—that is, those who disputed the results of the Electoral College—to calls for the complete abolition of business PACs.

Following Jan. 6, some Big Law firms and several corporations indicated they would either stop contributions from their PACs or review their process.

Critics of PACs are not the first to co-opt the political stage with designs on reordering our system of campaign finance. And there is no denying the high-volume of anti-PAC rhetoric we are hearing today.

So, the question on the minds of us in the business community—from manufacturers of goods to service providers like law firms—is how to address it. Before answering that, let’s first see what history can tell us.

The States

Cleveland.com: Advocates call for greater transparency in Ohio campaign contributions raised by lobbyists

By Andrew J. Tobias

A good-government group wants Ohio to require lobbyists to disclose fundraising they coordinate on behalf of politicians, saying the change would give voters a better idea which groups are trying to influence state policy through their campaign cash.

Ohio currently requires lobbyists to disclose the money they spend wining and dining elected officials. And state campaign finance laws require political donors to disclose their name, address and employer. But those requirements don’t reflect the lobbyists who may coordinate the donations.

Common Cause Ohio, a nonpartisan left-leaning group, says the state should make lobbyists disclose their fundraising activities with the Joint Legislative Ethics Commission, the state’s ethics watchdog agency. Catherine Turcer, Common Cause Ohio’s executive director, said raising money is a major way lobbyists try to curry favor with elected officials. And special interest groups also look to close confidents of powerful officials to try to influence state policy.

“Lobbyists are lobbying state government because they want something,” Turcer said. “Gov. DeWine knows who helps him raise money for his re-election campaign, and so should we.”

The Center Square: Frerichs defends letter asking money managers not to donate to Republicans who objected to election results

By Greg Bishop

Illinois’ treasurer Michael Frerichs is asking the nation’s top money managers not to donate to Republicans who objected to the certification of the 2020 election results, a move one critic said was a taxpayer-funded political bludgeon…

Last month’s letter – spearheaded by the nonprofit Majority Action and health care union SEIU – went to Vanguard, State Street, Fidelity, JPMorgan Asset Management and BNY Mellon last month. The funds donated $1 million to members of Congress who objected to the election results. Frerichs signed letters only to Vanguard, Fidelity and State Street.

“Will State Street forswear corporate political spending (direct or indirect) to the 147 members of Congress who voted to overturn the results of a free and fair democratic election on January 6th, 2021?” the letter to State Street said…

Wirepoints founder Mark Glennon…said Frerichs’ letter was a veiled political threat that used taxpayer resources.

“We all know that there’s too much money in politics, but this is an attempt by partisans to control that money and force it only into their coffers,” Glennon said.

Glennon said the letter seems designed to leverage taxpayer resources to chill political speech supporting Republicans.

“It’s nakedly partisan and it’s an attempt to force corporations to not make political contributions to [Republican], and to [Republicans] alone,” Glennon said.

Ballotpedia News: South Dakota legislature adopts bill barring public agencies from collecting, releasing information about nonprofit donors

By Jerrick Adams

On March 8, the South Dakota state Senate approved a bill that would bar public agencies from requiring individuals or groups to disclose identifying information about a nonprofit’s donors, clearing the way for Gov. Kristi Noem (R) to sign it into law. 

What the bill does

SB103 would bar any public agency (including state and municipal government units and courts) from:

• Requiring a tax-exempt nonprofit to provide a public agency with “personal affiliation information,” defined as “any list, record, register, registry, roll, roster, or other compilation of any kind that directly or indirectly identifies a natural person as a member, supporter, volunteer, or donor of financial or nonfinancial support to any nonprofit corporation.” 
• Publicly disclosing any such information a public agency may already possess.
• Requiring a current or prospective contractor to provide a public agency with a list of the nonprofits “to which it has provided financial or nonfinancial support.” 

AL.com: Alabama riot bill moves forward, opponents say it threatens free speech, peaceful protest

By Carol Robinson

Proposed legislation to strengthen criminal penalties for rioting was passed Tuesday by the Alabama House Judiciary Committee after much conversation, a vote delay and changes to the bill.

The committee passed HB 445 in a 9-3 vote along party lines. The bill will now go to the full House of Representatives for a vote.

Rep. Allen Treadaway, R-Morris, who was Birmingham’s assistant police chief at the time of the summer riots in Birmingham following the police killing George Floyd in Minnesota, said he began drafting the legislation last year following the riots.

“Officers were in the middle of that, trying to take control of a very bad situation where bricks and bottles were thrown at them,’’ he said. “It could have been very nasty.”…

The committee held a spirited hearing last week, hearing the pros and cons on the bill. Opponents said they had concern that the new crimes would be used against peaceful protesters and some drew comparisons to the police crackdowns on peaceful civil rights protests of the 1960s.

“We definitely do not support people who are breaking the law, looting and rioting,’’ Rep. Merika Coleman, D-Pleasant Grove, said last week. “But what I’m afraid of is that this is going to be used as a tool to keep people from peacefully protesting.”