A sweeping campaign finance bill enacted by the Arizona Legislature that critics say will flood the state with dark money in campaigns also removes criminal penalties for various types of political corruption.
The criminal punishments eliminated under the bill include a law that was used to indict a leading figure in the Fiesta Bowl corruption scandal in which the college football organization was accused of buying influence with lawmakers by plying them with gifts and tickets and reimbursing bowl employees for making contributions to politicians.
The weakening of the law has received little attention in the Legislature as the conversation over the bill has been consumed by the dark money debate. Gov. Doug Ducey signed the legislation last week, saying it simplifies regulations and increases freedom of speech.
Democrats say the bill pairs an alarming lack of disclosure with deregulation that together allow anonymous donors and politicians to use more dark money to influence Arizona elections.
The law was touted by Republicans and Secretary of State Michele Reagan as a simplification of state campaign finance laws. But it also allows politicians to give as much as $6,250 in campaign contributions to each other and lets political donors spend unlimited amounts on food and beverages to throw extravagant fundraisers without having to disclose a single dollar.
The bill also cedes regulation of dark money and other nonprofit groups to the Internal Revenue Service, essentially doubling the amount dark money groups can spend on ballot measures and allowing nonprofits to spend more money influencing elections without having to reveal donors.
And once the law goes into effect on Jan. 1, it will no longer be expressly illegal for a candidate to promise a job to someone in return for volunteering for a political campaign.
The new law also drops provisions that make it illegal for businesses and labor organizations to contribute money or anything of value to influence elections, and makes it illegal to knowingly file a false campaign finance report. In addition, it will no longer be illegal for people to make political contributions in the name of another person or organization.
Lobbyist Gary Husk was charged with seven counts under that statute — each a felony that carries a term of up to one year in prison. Husk pleaded down to a misdemeanor charge after reaching a deal with prosecutors and was sentenced to 200 hours of community service.
State Election Director Eric Spencer, who spent a year crafting the bill, says the criminal punishments will be added back into law through a proposal he won’t introduce until the next legislative session. He said it would have been too complicated to rewrite the campaign finance bill and also deal with the criminal corruption provisions.
Sen. Martin Quezada, D-Phoenix, said the changes make it easier to secretly funnel campaign contributions through individuals while hiding the source of the influence and leaving no punishment for people who flout the law.
“That’s a textbook definition of dark money,” Quezada said.
But Republican Rep. J.D. Mesnard of Chandler said leaving out the criminal provisions was a far cry from a nefarious plot.
“Whenever you have a comprehensive modification like we had, you are going to be back a second, third and fifth time,” he said.
Mesnard said he will push a bill to reinsert the criminal provisions into the law before the end of the session and seek to address other issues with the law, including the so-called “kingmaker provision.”
Republicans also note that the bill includes civil penalties that could yield fines for violating campaign finance law. But opponents say fines are not a serious enough punishment and merely amount to the cost of doing business for politicians.
“I’m confident that the criminal provisions when put in a separate bill will complete the picture,” Spencer said.
If the penalties are added next session, that would create a gap between when the current bill takes effect Jan. 1 and possible enactment of the new law later in 2017. Spencer said the gap would not be a problem because there would be little political activity during the first few months of the election cycle. But critics say it creates a loophole just as campaigns start fundraising ahead of 2018 state legislative and gubernatorial races.