Our Republican legislators wag their fingers at us voters for passing Initiated Measure 22, which they repealed on the insistence that it was unconstitutional. But when they want to pass their own limits on campaign finance, Republican leaders gleefully ignore concerns about constitutionality.
This week’s example of selective constitutional zeal is House Bill 1074, Representative Spencer Gosch’s proposal to limit out-of-state money in ballot question campaigns. Gosch’s original bill was both unworkable (a floating cap on out-of-state donations at 75% of in-state donations) and unconstitutional. On Wednesday, House State Affairs threw out the unworkable but kept the unconstitutional. HB 1074 now seeks to cap contributions to ballot question committees from people, political committees, and organizations not based in South Dakota at $100,000 per election cycle.
The unconstitutional nature of HB 1074 is its obvious violation of the First and Fourteenth Amendments. Freedom of speech applies to every citizen, regardless of home state. South Dakota cannot say, “South Dakotans can say X but Minnesotans cannot.” In this case, “say X” happens to be “write a check for $150,000 to SD Voice to promote Cory’s I&R amendment.”
Representative David Lust tried to make this point in House State Affairs, calling the $100K cap on out-of-state contributions to ballot question committees “censorship.” Speaker G. Mark Mickelson insists that the state has a compelling interest (key phrase to use when trying to override the First and Fourteenth Amendments) in limiting out-of-state contributions, but the case law Mickelson wishfully dismisses says no way:
University of Chicago Law School professor William Baude said he doubts it would survive a court challenge.
The U.S. Supreme Court declared in a 1981 decision that limits on contributions to ballot measure committees are unconstitutional under the First Amendment, said Paul S. Ryan, a vice president at the Washington watchdog Common Cause, which opposes big money in politics.
The high court has said that contributions to candidates can be limited to prevent the corruption of public officials, Ryan said. But, he said, the court found that with a ballot measure, unlike a candidate, there is nobody to corrupted, so there’s no legal justification for limiting donations [James Nord, “South Dakota Tries to Limit Outsiders’ Money in Initiatives,” AP via Pierre Capital Journal, 2017.02.15].
That ruling suggests Mickelson and friends can’t even impose the uniform cap on contributions to ballot question committees that Secretary of State Shantel Krebs originally proposed in Senate Bill 54. Amendments have stripped that cap from SB 54.
Contributions to a statewide ballot question committee from a person who is not a resident of the state at the time of any contribution, a political committee that is organized in a state other than South Dakota, or any other organization that is not filed as a domestic entity with the secretary of state for the four years preceding a contribution may not exceed one hundred thousand dollars in the aggregate for a general election cycle [2017 HB 1074, Section 1, excerpt, as amended 2017.02.15].
If I’m a billionaire who wants to plunk over $100K into a South Dakota ballot question committee, I can show a little foresight, organize an entity in the state this year, and be ready to pour unlimited funds into a petition drive in 2021. Or I can hire a lawyer or Lisa Furlong to organize a political committee for me in South Dakota and start transferring money right now. Or I can call up MyDakotaAddress.com in Madison, rent a mailbox, and establish my personal South Dakota residency in days.
Those holes in HB 1074 will render it useless in stopping what Mickelson and friends say they want to stop. The Constitution says they can’t stop what they want to stop. But when HB 1074 comes to the House floor this week, these Republicans will continue to insist that their desire to rein in initiative and referendum is worth a losing fight in court.