Gov. Doug Ducey signed a bill that completely rewrites Arizona’s campaign finance laws, including a provision that critics say will open the state up to more dark money in elections.
Secretary of State Michele Reagan pushed SB1516 with the stated goal of simplifying Arizona’s outdated campaign finance statutes. Most of the bill’s provisions have been noncontroversial.
But several key parts of the law have raised the ire of legislative Democrats and others who say it will make it far more difficult for state elections officials to crack down on nonprofit groups that break the rules in spending dark money.
Federal tax law prohibits 501(c)(4) nonprofit organizations from having the primary purpose of influencing elections. SB1516 stipulates that any group that has the primary purpose of electioneering qualifies as a political committee, meaning they must register with election officials and disclose their contributors.
But the bill stipulates that any group with valid federal nonprofit status from the IRS is automatically exempted from the definition of “political committee.” That means even if a nonprofit group is spending all of its money on electioneering in Arizona, election officials can’t enforce disclosure laws against them unless the IRS, whose enforcement in recent years has been notoriously lax, strips them of their nonprofit status.
Democrats also took aim at what they called the “kingmaker” provision, which allows politicians to contribute directly to other candidates out of their own campaign funds.
The bill also eliminates restrictions on how much people can spend to host fundraisers for candidates. Under the current laws, such expenditures are considered contributions to candidates and are subject to Arizona’s campaign contribution limits.
Ducey said the bill will make it easier for citizens to take part in the electoral process.
“Arizona’s current campaign finance laws are a hodgepodge of confusing and complicated regulations, often deterring the average citizen from getting involved in the political process. Laws that relate to free speech should not be so complicated that everyday Arizonans willing to participate in public service have to hire lawyers and accountants to get involved,” the governor said in a press statement on Thursday.
Some critics of the bill have already threatened to collect enough signatures to send SB1516 to the ballot via citizen referendum so voters can have their say. Opponents must collect 75,321 valid signatures within 90 days of the end of the 2016 legislative session in order to refer the bill to the ballot. If enough signatures are collected, the bill cannot go into effect unless approved by the voters.