Capitol Media: Elections Director Threatens Commission With 'Dark Money' Lawsuit

Elections director threatens commission with 'dark money' lawsuit

By Howard Fischer, Capitol Media Services

PHOENIX — The state’s elections director on Thursday warned the Citizens Clean Elections Commission to back off its plans to try to force disclosure of the sources of “dark money” or end up in court.

Eric Spencer told commission members that his boss, Secretary of State Michele Reagan, is the only one authorized to enforce campaign finance laws. He said that responsibility goes back to territorial days.

And Spencer brushed aside as legally irrelevant that voters specifically said they wanted to diminish “the influence of special-interest money” in approving the creation of the commission in 1998 and its optional system of public financing.

Yet Spencer conceded that Reagan, who ran on a platform of cleaning up dark money, has done nothing after conceding she doesn’t have that authority. But he insisted that doesn’t give the commissioners the right to try to step in, saying if they approve the measure “you’ve just bought yourself a lawsuit.”

That same threat of litigation came from Glenn Hamer, president of the Arizona Chamber of Commerce.

He said the proposal would affect the First Amendment rights of not just his organization but other business groups that have spent heavily over the years to influence the outcome of elections.

“We’re going to vigorously defend our right to participate in the process,” he told the commission. “There is absolutely no question that the rules as proposed will lead to litigation.”

Those arguments drew a sharp retort from Louis Hoffman. He is a former commissioner and was one of the architects of the 1998 voter-approved measure.

Hoffman acknowledged the U.S. Supreme Court in 2010 concluded that special interests, including businesses, have a right to spend unlimited amounts of money to influence elections.

Hoffman also said the high court has never questioned the right of states to require transparency of those spending the money.

“When people want to be involved in politics, that comes with an obligation to disclose to the public what their involvement is,” he said.

The fight is over the increasing activity since the U.S. Supreme Court decision by various groups in running TV commercials either supporting or attacking candidates.

Arizona law already requires disclosure of spending. But the requirement to reveal the source of the cash — the donors — kicks in only when it is determined that influencing an election is its “primary purpose,” a term not defined in statute.

Based on that, some groups have argued the requirement does not apply to them because they are “social welfare” organizations that are simply educating the public or only minimally involved in electioneering.

The proposed rule would say that once any group spends $500 on an election it is presumed to be subject to disclosure laws. It would be up to the organization to prove by “clear and convincing evidence” that the law does not apply to it.

Spencer, in addressing the commission Thursday, was not interested in providing input on how the proposal can be made better. Instead, he warned the commission to back down or end up in court, whether in a lawsuit filed by his boss or someone else.

During the 2014 campaign, Reagan campaigned with arguments that more disclosure is necessary so voters can know who is behind various groups with innocent-sounding names that seek to influence elections. Reagan even touted the fact she introduced legislation as a state senator to force that to happen but could not get the votes.

And Reagan argued that the 2010 Supreme Court ruling specifically left it up to the states to decide what needs to be disclosed. She said Arizona has, so far, fallen short in that arena.

Since taking office in January, though, Reagan has come up with no proposals. She even has said her office will not enforce a related Arizona law that requires candidates be notified of last-minute attack ads.

Spencer said his boss has since been convinced there is nothing Arizona can do about it, whether because of constitutional constraints or that most lawmakers have shown little interest in dealing with the issue. He said that is not an invitation for commission action.

“Just because the secretary of state recognizes the legal and political hurdles of getting something through the Legislature does not mean the commission has the power to occupy that space and backfill it,” Spencer said. “The commission can’t survey the political world, assess for itself how good a job the secretary of state is doing, and then decide to enact regulations to make up for what they think that she lacks.”

Hoffman, however, said he reads the laws to give the commission authority to regulate independent expenditures. And that, by extension, means the authority to force disclosure of the names of donors.

The commission could take action on the proposal next month.