Compliance Corner: A Brief Introduction to the History and Theory of Campaign-Finance Law, Part II – InsiderNJ

In Part I of our look at the history and theory of campaign-finance law, we considered the 1976 US Supreme Court case of Buckley v. Valeo, which established the principle that First Amendment political speech can be limited by the government only when there is a compelling justification, such as preventing corruption or the appearance of corruption.

These principles set forth in Buckley continue to play a role in our campaign-finance system today. Under US Supreme Court jurisprudence, it is permissible for the federal government or a state to institute limits on the amount of a contribution that may be received from one contributor, because high-dollar contributions from one individual could create the appearance of corruption. But once funds are raised in accordance with applicable limits, states cant then restrict what a candidate can expend on his or her campaign because there is no anti-corruption rationale for such a restriction.

Thus, New Jersey non-gubernatorial candidates can only accept $2,600 per election from each contributor, and contributions that exceed $300 per election must be reported in detail to ELEC. These limits and requirements are consistent with the First Amendment. (Some states have opted to allow unlimited contributionsfor example, Pennsylvania allows individuals to contribute without limit to a Pennsylvania candidate. The First Amendment protection of free speech allows contribution limits, but doesnt require them.) But New Jersey candidates cant be forced to endure an expenditure cap, except in the limited scenario of a candidate that voluntarily opts to participate in the gubernatorial public-financing system.

These concepts even apply to independent expenditures and Super PACsif the rationale the Supreme Court cited to uphold contribution limits is that these limits are necessary to prevent corruption or the appearance of corruption, then it follows that independent expenditures and committees that make only independent expenditures must not be subject to limits because there is no danger of corruption when activities are not coordinated with the candidate. This was the rationale behind the Citizens United line of casesprovided that expenditures are truly independent, the Supreme Court determined that there is no danger of corruption or the appearance of corruption, and thus limits on what may be contributed to a Super PAC are unconstitutional. People can and do disagree on the effects of Super PACs on our politics, but overturning Citizens United isnt as simple as it may seem: the legal principles underlying our politics date back to Buckley in 1976 and the First Amendment.

Other countries, not subject to the First Amendment protections on political speech, have devised different systems. In Germany, for example, there is no limit on what an individual may contribute to a political party. But elections there are not dominated by large individual contributors because there is significant public funding of major parties and there are also federal and state limits on expenditures made by the partiesin one clarifying example, German public guidelines ensured that the two largest parties would be limited to 12 minutes of TV ad time per campaign period, with smaller parties limited to either 6 or 3 minutes. While TV viewers in October of a US Presidential election year might appreciate these limits on TV commercials, these mandatory limits would not pass constitutional muster under our First Amendment.

The key thing for those looking to be active in political activity is to understand both the theory of campaign-finance law as well as the practical application of the law.

Avi D. Kelin, Esq. is Counsel in Genova Burns LLCs Corporate Political Activity Law Practice Group and Chair of the firms Autonomous Vehicle Law Practice.

This column is for educational and informational purposes only and is not intended and should not be construed as legal advice. It is recommended that readers not rely on this column, but that professional advice be sought for individual matters.

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Compliance Corner: A Brief Introduction to the History and Theory of Campaign-Finance Law, Part II - InsiderNJ