Dark money and the end of Boulder’s campaign finance reform

By Steve Pomerance

The 2017 election may deliver the deathblow to Boulder’s campaign finance reform laws, contained in a citizen initiative passed by the voters in 1999. These laws limit contributions to candidates’ own committees as well as to “unofficial candidate committees” (organized by third parties) to $100 per person, and provide matching city funds for candidates up to $10,000 if they abide by a $20,000 limit on total expenditures.

But this year, spending has been dominated by “dark money” (allegedly tech millionaires, developers, and the like) funding mailers, ads, etc., in the name of Open Boulder and possibly others. They have tried to avoid the City’s regulations by carefully not using the “magic words” of “vote for”, “vote against”, or synonyms of these. These words are what are called “express advocacy” in Federal case law, and Boulder’s laws regulate “expressly advocating” as described above. So instead Open Boulder has used words like “endorse”, “vote to make Boulder”, “candidate”, etc.

So it’s clear, Boulder’s laws specifically allow individuals to spend as much as they want, so long as they do so in their own name, do not coordinate with others, and disclose their expenditures that support candidates. (BRC 13-2-10) So these folks could have done their campaigning in full view, and voters could have then evaluated what was being said by knowing who was saying it. But instead of being transparent, these folks have chosen to operate in the dark, and Open Boulder has belied its name by being a vehicle for this dark money.

City Clerk OK’s spending

The City Clerk has now rejected two citizen complaints about Open Boulder’s activities, referencing the 2012 Colorado Supreme Court decision Colorado Ethics v. Senate Majority Fund, which forbids regulation by the state, under Article XXVIII of the Colorado constitution, of campaigning that does not use the “magic words”.

There are a number of problems with the Clerk’s decision. First, no hearing was held. Boulder’s campaign laws are very strong about maintaining the confidentiality of investigations, and forbid City staff from making public the results of any “inquiry or investigation” prior to a hearing. (BRC 13-4-13) That’s to avoid prejudicing the public about either of the parties without the facts and arguments being heard. And who knows? Perhaps, in a hearing, a good case could be made that the Colorado Ethics case doesn’t apply locally. It would be tough, but perhaps doable. But the City’s publicly relying on this particular case law to dismiss the complaints prejudged the result.

Second, it is the City staff’s job to enforce the laws on the books, not to determine whether a law is unconstitutional. (That falls to the courts to decide, and the council to then fix the City laws if necessary.) This same thing happened in 2015, in a complaint against the Chamber of Commerce that I brought. The Chamber stipulated that all of my complaints were accurate, but then brought forward a different Colorado Supreme Court case that protected city contractors from spending restrictions in campaigns about ballot issues (that case did not address candidate campaigns). The City Attorney said that this case voided Boulder’s law that forbid contractor contributions, so my complaint was moot.

I thought there were some pretty good arguments that the court’s decision didn’t apply to the Chamber’s situation. But instead of fixing Boulder’s law to comport with that case while preserving what was not affected, the council completely discarded its contractor restrictions, including the prohibition on contributions to candidates, which the case did not address at all. The argument was that the existing $100 limit on contributions to candidates would prevent abuse.

Dark money untouched

But then, during the recent charter “cleanup”, the City failed to address the concern that the 2012 Colorado Ethics case could void the City’s $100 limit and disclosure requirements for everyone, including city contractors. So now we have the dark money forces spending huge sums of unreported (and unlimited) money to elect candidates to serve their interests. And the City has no plan to protect the campaign finance laws that the citizens voted into place.

The recent complaint filed against PLAN Boulder and the Sierra Club is based on some 2016 additions to the Boulder code that state, “Unofficial candidate committees cannot be combined with an issue committee.” and vice versa. (BRC 13-2-6 and 13-2-7) But neither PLAN nor Sierra “combined” their candidate and issue committees. For both, these committees are separate entities with separate accounting and separate reporting. And nothing in the Boulder Revised Code prevents two such committees from printing their messages on the same piece of paper, so long as there is proper attribution and sharing of costs. Also, there is no requirement to identify the human members of entities like corporations, LLCs, etc. that might contribute, so claims about “anonymous contributors” are misplaced.

I hope that the City simply acknowledges its missteps. But I fear that they may try to come up with some esoteric interpretation for “combined” that stretches its meaning to cover activities like handing out multiple pieces of literature together in a packet, holding a combined “meet the candidate and learn the issues” event, printing two separate messages on a single piece of paper, or having a joint party after the election. Such gratuitous limitations would seriously inhibit citizen involvement in the electoral process (and, anyway, I don’t think that this is what the Council intended when it changed the law last year). But given the quotes from City staff in the Daily Camera this week, the City has already prejudiced (in both senses of the word) the situation, destroying any appearance of impartiality, and making public its conclusions before a hearing has been held, apparently in defiance of its own laws.

From Steve Pomerance, on the day after Halloween (please feel free to share with friends and acquaintances)