Metropolitan News-Enterprise


Monday. December 11, 2006


Page 1


Limits on Donations to Candidate Committees Invalidated


From Staff and Wire Service Reports


The Third District Court of Appeal Friday struck down regulations of the Fair Political Practices Commission limiting donations to ballot measure-committees controlled by candidates for elective offices.

“Whatever the wisdom of the FPPC’s effort to plug loopholes in California’s campaign contribution regulatory scheme, we agree with the trial court’s determination that the regulation conflicts with multiple provisions of the Political Reform Act of 1974,” Justice Vance Raye wrote for the court.

California Code of Regulations Sec. 18530.9, enacted two years ago, prohibits a contribution of more than $3,000 to a ballot measure committee controlled by a legislative or Board of Equalization candidate, $5,000 to a committee controlled by a candidate for statewide office other than governor, or $20,000 to a committee controlled by a gubernatorial candidate.

In enacting the restrictions, the commission expressed concern that candidates could use the ballot measure committees to circumvent the campaign contribution limits for campaigns for state office, adopted in 2000 when the voters approved Proposition 34.

But Sacramento Superior Court Judge Shelleyann Chang granted a preliminary injunction sought by Gov. Arnold Schwarzenegger—whose controlled committees unsuccessfully backed four measures on last year’s special election ballot—-and Republican legislators, who challenged the regulation on both statutory and First Amendment grounds. Chang said the measure violated both the First Amendment and the PRA, also was enacted in 1974 as Proposition 9 and has since been amended.

The PRA is subject by its terms to amendment by a two-thirds vote of both houses of the Legislature, provided that the amendment furthers the purposes of the initiative, or by the voters.

Raye said Chang was correct on the statutory question, and that since that was dispositive of the case, it was unnecessary to rule on whether the regulation was constitutional.

The justice said it was doubtful that voters intended to limit donations to candidate-controlled ballot measure committees when they approved Proposition 34. He also noted that the Legislature has, in the last two sessions, considered, but not passed, bills that would expressly limit contributions to candidate-controlled ballot measure committee.

Raye further pointed to a provision in the PRA that limits contributions to political party committees to $25,000 per year if the committee supports or opposes a candidate for elective state office. The challenged regulations, he said, directly conflict with that provision by setting substantially lower limits.

The FPPC regulations could create an uneven situation if a ballot measure committee controlled by a candidate was opposed by a campaign committee that was not controlled by a candidate or officeholder and thus had no contribution limits, the justice also said.

And he questioned whether unlimited donations to a candidate’s ballot measure committee created the same possibility of corruption as large donations made directly to a candidate.

“Large contributions to the candidate ... are more likely to result in the appearance of corruption,” the jurist said. “But a contribution to a ballot measure committee, even if controlled by a candidate, typically is a contribution for the passage or defeat of the initiative. The general appearance is that of support for or opposition to the initiative, not for the candidate.”

Besides, Raye wrote, the regulations still allow the contributor to give far more to a candidates’ committees than the donor may give to the candidate. He noted, for example, that if a candidate for governor controls multiple committees, a single contributor may give $20,000 to each. “This indicates [the FPPC] does not truly view truly view contributions to candidate-controlled ballot measure committees as contributions to the candidate, else the FPPC would count these contributions toward the $20,000 total contribution permissible under [Proposition 34.],” the jurist reasoned.

An FPPC spokesman, Jon Matthews, said the commission was disappointed and would consider whether to take further action.

James Parrinello, an attorney representing Citizens To Save California, one of the committees that supported Schwarzenegger’s 2005 ballot measures, said the FPPC’s only option, other than dropping the case, would be to appeal to the state Supreme Court. But he said the commission could have trouble convincing the high court to take the case.

He said the appeals court decision “confirmed what we thought from the beginning, that the regulation was illegal and exceeded the FPPC’s authority.”

Supporters of such limits might have better luck surviving a court challenge if the Legislature imposed them, Parrinello said.

Schwarzenegger’s attorney, Thomas Hiltachk, also said he was pleased with the ruling. He said the “court affirmed our belief from the outset that the FPPC regulation conflicted with Proposition 34 and was invalid.”

Ned Wigglesworth, a spokesman for California Common Cause, which lobbies for campaign finance reform, said the FPPC could make a strong argument to the Supreme Court that voters intended to limit all donations to candidates, including donations to their ballot measure committees, when they approved Proposition 34.

“Arguing that these committees ... can’t be used as a purposeful circumvention of the state’s law just does not square with reality,” he said. “Big political donors, be they corporations, unions or gaming tribes, will simply write million dollar checks to candidates’ ballot committees as a way to gain access and influence.”

The case is Citizens to Save California v. California Fair Political Practices Commission, 06 S.O.S. 5980.


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