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‘Dark money’ may get darker if judge strikes down AZ disclosure laws

A federal judge is being asked to rule that “dark money” groups that now don’t disclose the source of their contributions can also legally hide how they’re spending the money – and on whose behalf.

Attorney Paul Avelar pointed out to U.S. District Court Judge James Teilborg that he already declared more than a year ago that a key state law about political committees is unconstitutional. Teilborg said the 183-word definition of who has to register with the state is so vague as to be unclear to “people of common intelligence.”

But Avelar told Teilborg on Wednesday that Arizona continues to require groups spending money on campaigns to register. So now he wants the judge to issue an order immediately blocking the state from enforcing the law.

Avelar, an attorney with the Institute for Justice, conceded that would have ripple effects.

If the law about who needs to register with the Secretary of State’s Office goes away, so do all the laws that govern what political committees, other than those operated by candidates themselves, need to do. And that includes detailing not just what they are paying for TV commercials, newspaper ads, mailers and phone banks, but also which candidates those efforts are designed to elect or defeat.

That possibility alarms Jim Drake, the deputy secretary of state.

“I don’t think you can understand what sort of chaos that would cause,” he said.

Drake said it would leave Arizonans with no way to tell which outside groups have been spending millions of dollars to influence their votes. It also would leave these groups free to run attack ads without even a hint of the amount they are spending.

And it even would eliminate those minimal disclosures that outside committees are now required to make at the end of their TV commercials.

Drake said if Teilborg enjoins enforcement of the law, the state will seek immediate review by the 9th U.S. Circuit Court of Appeals. And he said the state will ask that Teilborg’s ruling be placed on hold until that can happen.

But absent a stay or overturning the law, Drake said the judge’s order would leave the door wide open to all sorts of spending that can be shielded from the public – at least until the Legislature gets a chance to come to the Capitol to try to fix it in a way acceptable to the judge.

But Tom Collins, executive director of the Citizens Clean Elections Commission, said there may be an escape valve of sorts. Collins said his agency, set up under different laws, may still be able to demand spending reports by those trying to influence elections, no matter what Teilborg decides.

The state finds itself in this position because of efforts by Dina Galassini to oppose a 2011 bond election in Fountain Hills. She sued when town officials told her that state law requires she first register as a political committee before she could hold protests prior to the election.

Attorneys for the state intervened to defend the law. But the judge ruled last year the law requiring political committees to register was so badly worded as to be unintelligible, perhaps even to attorneys, making it unenforceable.

That ended the fight with Fountain Hills. But Avelar told Teilborg that the state continues to impose the registration and reporting requirements – illegally, he contends – in statewide and legislative races.

Assistant Attorney General Paula Bickett did not dispute that fact.

But she argued that Teilborg’s earlier ruling simply bars Fountain Hills from enforcing the law. And she said that, once Galassini’s dispute with Fountain Hills was resolved, the legal issue went away.

“The court no longer has jurisdiction,” she told Teilborg.

The judge was skeptical.

“It sounds like you’re suggesting that, because it’s just a judgment against the city, it has no ramification beyond that and therefore is not really a declaration of unconstitutionality,” Teilborg told Bickett.

“It is a declaration of unconstitutionality as it applies to the town,” she responded.

But Teilborg persisted, pointing out that the lawsuit claimed the entire law is unconstitutional, not just that Fountain Hills was applying it illegally. Bickett, however, insisted that only the town can be bound by his ruling.

Teilborg said he will consider the arguments.

Avelar said if the judge sides with challengers, there are broad implications.

He said many of the requirements the state imposes on groups that seek to influence elections turn on the fact that state law requires political committees to register. The laws then list things political committees must do, including disclosing how they are spending their money.

And if the judge says the definition of what is a political committee is unconstitutional and unenforceable, then no one has to register – and everything tied to that, including reporting expenses, go away.

Avelar said it did not have to come to this.

“This is the state’s fault,” he said.

“They’ve been aware that this statute is constitutionally problematic for three years,” Avelar said, since the lawsuit was first filed.

And if that wasn’t enough, he pointed out that Teilborg called the law “facially unconstitutional” more than a year ago. He said that provided lawmakers with enough time to re-write the statute in a legal way.

“And the only amendment they’ve made to the definition of a ‘political committee’ in those three years actually made the definition less intelligible,” Avelar said.

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