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Effort launches to block laws loosening rules for ‘dark money’

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Arizonans could get the last word on whether to uphold or reject newly enacted campaign finance laws that would allow more “dark money” to flow into state elections.

Opponents of changes approved earlier this year by the Republican-controlled legislature filed the necessary paperwork Friday to begin circulating petitions to refer the two new laws to the ballots.

The two measures would create new exceptions to existing statutes that require certain groups that try to influence elections to disclosure the true source of their cash. That would bar both the secretary of state and the Citizens Clean Elections Commission from demanding they open up their books.

Foes have until Aug. 5 to gather 75,321 valid signatures on each of two petitions.

If they are successful, both measures would not take effect until voters decide in November whether to ratify what lawmakers have approved or reject it.

The heart of the fight is over provisions in SB1516 and HB2296 that say if an organization is classified as a “social welfare” organization by the Internal Revenue Service, it need not disclose its donors to efforts to affect political races. Rep. J.D. Mesnard, R-Chandler, who spearheaded that effort, said the Internal Revenue Code aligns with existing law which says groups that spend less than half their money on political issues can keep the sources of their funding secret.

Rep. Ken Clark, D-Phoenix, said the problem with that is the IRS does not actively police these groups to ensure they are, in fact, living within their fiscal limits.

“SB1516 in a very kind of sneaky way abdicates the state’s responsibility to oversee expenditures in campaigns from dark money groups,” he said. Clark said the two state agencies that have the power to police election laws need to be able to demand groups that are spending money to influence Arizona voters open their books.

And there’s something else.

While federal law says “social welfare” groups cannot spend more than half their money trying to elect candidates, there is no such limit on trying to approve or defeat ballot measures. That means these groups could theoretically spend all of their money — from anonymous donors — to influence elections.

Clark also said the changes give political parties the power to “launder” anonymous donations and get the funds to candidates, all outside the purview of voters.

Mesnard does not dispute that the change could mean less information for voters about who is trying to influence them. But he said he’s not bothered by that.

“At the end of the day, this is fundamental to democracy, and that is the right of a person or a group of people, an organization, to weigh in on our election process,” he said.

And he insisted that there’s a right to influence elections, even anonymously.

“Somewhere along the line, some folks got it into their heads that we have a ‘right to know,’” he said. Mesnard said he does not believe that.

“A message is a message,” he said.

“If it’s important to you to know who’s behind the message and you don’t know who’s behind the message, then disregard it,” Mesnard said. “But if it’s not important to you and you want to focus on the message itself, then there’s no harm done with the current system.”

Clark, however, is proceeding under the premise that people do want to know who is spending millions of dollars on commercials to affect the outcome at the ballot.

“We know the public wants nothing to do with dark money and they can see through these games,” he said.

The amount of anonymous donations in the 2014 election was closed to $15 million.

In the governor’s race alone, the $5 million spent on the general election by Republican Doug Ducey and Democrat Fred DuVal was eclipsed by the $9 million others spent trying to influence the race.

And two Republicans got elected to the Arizona Corporation Commission with $3 million spent by outside groups. Arizona Public Service, the state’s largest electric utility that is regulated by the commission, refuses to confirm or deny whether it was the source of any of that money.

Mesnard, however, argued that campaign donations are akin to speech and that anonymous speech has been central to democracy for centuries.

“Folks would request anonymity because they wanted the message to be the issue … and not focus on who was saying it,” he said. “I don’t see any harm in that.”

Clark said he is lining up donors and believes his group, dubbed Stop Corruption Now, will have more than enough money to get the necessary signatures.

The reason Clark needs to do two petition drives is because of a last-minute maneuver organized by Mesnard.

After the governor signed SB1516 foes began making plans to refer it to the ballot. So Mesnard had the same language inserted into HB2296, complete with a provision to have it take effect ahead of the November election.

That would ensure that even if voters rejected SB1516, the language would revert to what is in HB2296, effectively nullifying the whole referendum process. Clark said he intends to refer both measures to the ballot to ensure that does not happen.

One comment

  1. For the record, J. D. Mesnard is a card carrying member of ALEC. The Koch founded, corporate funded (like APS) bill mill. It’s time that we the people of Arizona, took our government back from corporate interests.

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