Jackley: Mickelson Ban on Out-of-State Money for Ballot Questions Likely to Face Constitutional Challenge

Attorney General Marty Jackley released his explanation yesterday of Speaker G. Mark Mickelson’s proposed ballot initiative to ban contributions to ballot question committees from people, PACs, and businesses from outside of South Dakota. A.G. Jackley agrees with LRC director Jason Hancock and me that Mickelson’s ban “is likely to be challenged on constitutional grounds.”

Mickelson is willing to risk this constitutional challenge to block wealthy out-of-state interests who “want to come in and screw around with things” in South Dakota elections. Yet while Mickelson’s initiative would restrict out-of-state meddling with laws on the ballot, Mickelson seems unwilling to prevent out-of-state meddling with our lawmakers. As I contended during my testimony to the Legislature’s Initiative and Referendum Task Force in June, if rich out-of-staters can harm South Dakota by buying the passage of one law on the ballot, they could do at least as much harm by buying a legislator, or several legislators, or a Governor who can change multiple laws.

Mickelson complains that out-of-state donors spent over $10 million on ballot measures in South Dakota’s 2016 election. But two of the ballot measures that passed—Mickelson’s favored Amendment R on vo-tech governnance and the grassroots Initiated Measure 21 capping payday loan interest—passed with supporters spending very little money, in-state or out-of-state. If I were a rich out-of-stater like California billionaire Henry T. Nicholas with $2.1 million to blow on South Dakota elections and if I wanted to have a more lasting impact on South Dakota law than writing one vanity project into the state constitution, I’d form PACs to funnel $58,000 each to 36 legislative candidates—12 in the Senate, 24 in the House—who would form one-third blocs who could make or break votes in each chamber. If I could recruit one equally rich buddy, we could buy ourselves a supermajority and set the agenda in Pierre for two years. Why would Mickelson mobilize and initiative against dreaded out-of-state influence on ballot measures but not against the arguably larger threat of out-of-state influence in candidate elections?

Speaker Mickelson accepted $7,100 pre-general and $500 post-general from out-of-state or federal PACs. Senator John Thune, whose campaign committee Mickelson’s wife Cynthia chairs, received 78% of his itemized individual contributions and 99% of his PAC contributions from out-of-staters.

Oh—that’s why. Mickelson is happy to lead a conversation about the influence of wealthy out-of-staters on ballot measures that threaten his legislative authority, but he doesn’t want to talk about the out-of-state money that helps him and his Republicans grab that legislative authority.

Oh well. Mickelson now must gather 13,871 signatures to put this hypocritical measure to a vote. Then he’ll need to beat back the beaucoup bucks that his out-of-state friends the Koch Brothers will spend to beat his measure. And then if he wins our vote (and he might, because his anti-out-of-stater message will play well to South Dakota’s bunker mentality), he’ll have to go to court, where his unconstitutional measure will lose before any sober judge.


11 Responses to Jackley: Mickelson Ban on Out-of-State Money for Ballot Questions Likely to Face Constitutional Challenge

  1. Donald Pay

    Yes, this will likely be held unconstitutional by federal courts. The US Supreme Court equates money with speech in a long line of cases.

    But I’d be willing to see if there is a way to argue the case using some research regarding the impact of money on the voting public. If you are, for example, buying politicians who do your bidding, that is illegal. If you give a certain amount to a politician’s campaign committee, that’s fine, if it’s below a certain threshold and there is no (directly stated) quid pro quo. Likewise, you can spend a certain amount (which is up to some dispute) to wine and dine legislators at various social events, but beyond a certain amount begins to approach bribery.

    Initiatives and referenda are legislative matters under the SD Constitution. The people are the ultimate “legislators” and the vote on the ballot questions constitutes the voters’ “legislative session.” If we look at it that way, there may be need to place some limits to “free speech,” just as there are in the legislative process.

    The Legislature has set certain laws and regulations that constrict free speech for the good of the process. I can’t go into the gallery and shout my opinion incessantly as the Senators begin to deliberate. I will be pulled out and arrested. There are limits on my and your free speech that are needed to allow for the legislative process to work. Similarly, many states limit how much money can be spent to wine and dine legislators. That is a limit of free speech, but it also provides some protection against corruption.

    You may be able to find a way to argue that beyond a certain threshold which may be different in every state, a billionaire’s dollars spent on “free speech” amounts to shouting in the gallery. It’s a long shot and it requires some model (similar to the political gerrymandering case) of when money actually pushes out others’ free speech and inhibits the peoples’ legislative process . It requires empirical data and number crunching.

    I’ll try to talk to Ken Meyers at the University of Wisconsin. He’s done work on the Wisconsin political gerrymandering case now before the US Supreme Court, and he may be able to help or at least point us in the proper direction.

  2. Good thoughts, Donald! You make a good point that free speech is not absolute, so even if money is speech, we can still limit it.

    Among the challenges here is that there is no conceivable “quid pro quo” when a rich guy supports a ballot measure. The rich guy isn’t backing a legislator to do his bidding; he’s just shouting really hard to write his bidding into law. Without that quid pro quo, it could be harder for Mickelson to prove the state’s compelling interest in limiting outsiders’ spending/speech on ballot questions than to prove the state’s compelling interest in a comparable on outsider spending/speech on candidates.

    I somewhat like the “shouting in the gallery” analogy. It at least gets at the idea of a “time, place, and manner” restriction on free speech that is content-neutral.

    But that analogy shows two constitutional problems for Mickelson’s measure.

    First, he’s banning spending/speech by certain people but not others. His measure says Minnesotans can’t shout from the gallery, but South Dakotans can? Courts will have a problem with that.

    Second, Mickelson’s ban isn’t content-neutral. He’s saying out-of-staters can’t spend/speak about ballot measures while letting them spend/say all they want about candidates (via campaign contributions) and legislation in the Capitol (through lobbying, advertising, etc.). If the state can establish a compelling interest in preventing outsiders from influencing South Dakota politics, Mickelson will be hard-pressed to justify a ban solely on one narrow aspect of our politics.

  3. If the SD GOP had to rely on in-state money, they’d be as monetarily broke as they already are morally and intellectually.

    Rural people are the GOP stronghold – with isolationist views, below avg intel, and a backwards selfish attitude. They don’t want grow, they just want America to leave them alone. However, they welcome Russia’s help in 2018 to help the GOP keep those gosh darn liberals out of U.S. gubment.

  4. I want to know – no, I NEED TO KNOW what % of total SDGOP revenue comes from out of state sources. I bet it’s >80%.

    The SDGOP functions a lot like an out of state or Federal PAC.

  5. Donald Pay

    Yeah, Cory, I missed that that Mickelson was aiming at “out-of-state” contributions. My arguments were more about how much money, regardless of residence, might be considered too much. When we were dealing with the SDDS situation in his father’s administration we simply could not talk about regulation based on in-state or out-of-state origin of the waste. Anything that attempts to wall off the state is likely to be hammered down by a court, whether it’s waste or speech. That’s pretty well established in all sorts of cases.

    However, here’s a wild idea: a US Supreme Court decision, called Reeves v. Stake might be a precedent for Mickelson’s approach. The case involved South Dakota’s attempt to limit sales of cement from the State Cement Plant (when it was the State Cement Plant) to out-of-state buyers. Janklow argued the case, and won. When the state acts in the marketplace, it can discriminate between in-state and out-of-state sales, and prefer in-state sales. You would have to figure out how cement sales from a state-owned facility are equivalent to the process of enacting or rejecting ballot measures. Maybe the words of the SD Constitution on initiative and referendum would suffice to provide a means to discriminate, since these measures are reserved for the people of the state.

  6. Adam, that’s a worthwhile research project. Looks a long week spent on the SOS-CFR website!

  7. Reeves v. Stake… interesting! I’ll read that and see if an analogy jumps out at me.

    There should be a common-sense argument here: residents of each state should enjoy rights above non-residents in determining the laws of each state. It shouldn’t be hard to shut non-residents out of the process. But we residents already get the unique privilege of voting. We’re going to be hard pressed to find a way to prohibit non-residents from dropping by and spending/speaking about how we ought to vote.

  8. Thinking about Reeves v. Stake… interstate discrimination…

    Before I reach for a wild equivalency, let’s take a path straight through the Reeves precedent. When the state participates in the marketplace, it can give residents preference over non-residents. So what if the state participates in the media marketplace? Suppose the state buys up 10% of advertising air time, print space, and billboards from Labor Day to Election Day. The state then resells this asset to interested in-state political advertisers. The state can refuse to do business with committees accepting out-of-state money. Any state ad space not purchased is used for printing public notices about the election, sample ballots, official Pro/Con statements from the SOS ballot question pamphlet, etc. This state ad space would be branded “Real South Dakotans” and featured on special pages/sections of the newspaper, special times on air, and with special markings on billboards to distinguish those ads from ads out-of-staters might purchase on other pages or boards or in other time slots.

    Far from perfect, possibly not even effective… but I’ll keep thinking.

    Of course, Mickelson may just have to face the fact that the only way to prevent undue out-of-state influence in ballot questions is complete transparency, voter education, and faith in the voters to distinguish good ideas from bad regardless of where those ideas come from.

  9. Porter Lansing

    Great idea for state sponsored, non-biased advertising. I can see the advertising using local artist’s graphics and local musicians on the background tracks. A homespun tv/billboard (do you still have those eyesores?) campaign to promote homespun political messages.
    Here’s an example of a campaign my state gov’t does to educate kids and parents wanting to teach kids about a danger. SoDak can do the same to educate voters about another danger … overly biased political imagery.
    https://goodtoknowcolorado.com/

  10. Donald Pay

    What I mean to suggest with my musings above is Mickelson should have figured out a legal strategy that might have a plausible chance at succeeding before putting something on the ballot. I don’t think what I have proposed above has much of a chance. He’s proposing something that will be immediately struck down unless he has some very innovative factual and legal arguments. I’d vote for it, because I had to go up against millions of out-of-state dollars (even foreign money) with the nuclear waste, solid waste and mining issues. I give him this: he’s kicking the nuts of the Republican Party power structure, which depends on out-of-state money.

  11. That’s a thought, Donald. If Mickelson is working on a strategy that could set a precedent that wedge open the door to undoing Citizens United, then heck yeah, we should support his ballot measure. But he’s going to need to convince me that he has such a strategy before I vote for what otherwise looks like an unconstitutional law that only offers him and the GOP a chance to fan and synergize with anti-coastal prejudices at the ballot box.