United States District Court, D. Alaska
DAVID THOMPSON; AARON DOWNING; JIM CRAWFORD; and DISTRICT 18 of the ALASKA REPUBLICAN PARTY, Plaintiffs,
v.
PAUL DAUPHINAIS, in His Official Capacity as the Executive Director of the Alaska Public Offices Commission; and MARK FISH, IRENE CATALONE, RON KING, KENNETH KIRK, and VANCE SANDERS, in Their Official Capacities as Members of the Alaska Public Offices Commission, Defendants.
MEMORANDUM OF DECISION
TIMOTHY M. BURGESS, UNITED STATES DISTRICT JUDGE.
I.
INTRODUCTION
Plaintiffs
David Thompson, Aaron Downing, Jim Crawford, and District 18
of the Alaska Republican Party (“District 18”)
bring this lawsuit against Defendants Paul Dauphinais, Mark
Fish, Irene Catalone, Ron King, Kenneth Kirk, and Vance
Sanders (collectively, “Defendants” or “the
State”) to challenge the constitutionality of four
provisions of Alaska's campaign finance laws under the
First and Fourteenth Amendments.[1] The Court called this matter
for bench trial on April 25, 2016. The parties concluded
their arguments and presentations of evidence on May 3, 2016,
[2] and
subsequently submitted post-trial briefs.[3] Having carefully
considered the pleadings, exhibits, trial testimony,
arguments of counsel, and the applicable law, the Court makes
the following findings of fact and conclusions of
law.[4]
II.
BACKGROUND
In
1996, the Alaska Legislature enacted Chapter 48 SLA 1996 for
the purpose of “substantially revis[ing] Alaska's
campaign finance laws in order to restore the public's
trust in the electoral process and to foster good
government.” Chapter 48 SLA 1996 was based on a ballot
initiative drafted by Michael Frank and certified by
Lieutenant Governor Fran Ulmer, and established, among other
things, $500 annual limits on the amount an individual could
contribute to a candidate for state office or to a group that
was not a political party, as well as aggregate limits on the
dollar amount a candidate could accept from political parties
or individuals who were not residents of Alaska. None of the
contribution limits were indexed for inflation. Chapter 48
SLA 1996 became effective January 1, 1997.
In
2003, the Alaska Legislature modified Alaska's campaign
finance laws by enacting Chapter 108 SLA 2003. Chapter 108
SLA 2003 relaxed some of the campaign contribution limits set
by Chapter 48 SLA 1996, including by raising the amount an
individual could contribute to a political candidate or group
that was not a political party from $500 to $1, 000,
annually. Chapter 108 SLA 2003 became effective September 14,
2003.
Three
years later, 73 percent of Alaska voters voted in favor of
Ballot Measure 1, which proposed revising Alaska's
campaign finance laws to lower the amount an individual could
contribute to a political candidate or group that was not a
political party back to $500 per year. The $500 base limits
became effective December 17, 2006.
Plaintiffs
in this case are individuals and a subdivision of a political
party who contributed or attempted to contribute the maximum
dollar amount permitted under Alaska's current campaign
finance laws, as established by the above session laws and
initiatives. Downing is an Alaska resident who, in 2015,
contributed $500 to the campaign of mayoral candidate Larry
DeVilbiss and to the campaign of state house candidate George
Rauscher, the maximum contribution amounts permitted under
Alaska Stat. 15.13.070(b). Crawford is an Alaska resident
who, in 2015, contributed $500 to the campaign of mayoral
candidate Amy Demboski and to the Alaska Miners'
Association Political Action Committee, the maximum
contribution amounts permitted under Alaska Stat.
15.13.070(b). Thompson is a Wisconsin resident and
brother-in-law to Alaska State Representative Wes Keller who,
in 2015, attempted to make a $500 contribution to
Keller's campaign, but was unable to do so because the
campaign had already received the maximum dollar amount it
could accept from nonresidents under Alaska Stat.
15.13.072(e)(3). And District 18 is a subdivision of the
Alaska Republican Party that was limited to a $250
contribution to Amy Demboski's mayoral campaign, the
maximum amount that it was permitted to contribute under the
aggregate limit on the dollar amount a campaign can accept
from a political party set forth in Alaska Stat.
15.13.070(d)(4).
By this
suit, Plaintiffs challenge four distinct parts of
Alaska's campaign finance laws under the First and
Fourteenth Amendments. Each challenged provision is discussed
individually below. In relief, Plaintiffs seek a declaratory
judgment that each of the challenged provisions are
unconstitutional, a permanent injunction prohibiting the
State from enforcing the challenged provisions, and full
reasonable costs and attorney's fees under 42 U.S.C.
§ 1983.
The
Court has jurisdiction over this case pursuant to 28 U.S.C.
§§ 1331 and 1343. This civil action arises under
the First and Fourteenth Amendments of the United States
Constitution and 42 U.S.C. § 1983.
III.
ANALYSIS
It is
well established that the First Amendment protects political
association as well as political expression.[5] It is equally
well established that laws which limit the amount of money a
person may give to a candidate or campaign organization
intrude upon both of those First Amendment interests,
[6] as
a contribution serves both “as a general expression of
support for the candidate and his views” and “to
affiliate a person with a candidate.”[7] But because
“contributions lie closer to the edges than to the core
of political expression, ”[8] laws which regulate
political contributions, as opposed to political
expenditures, are subject to “a lesser but still
‘rigorous standard of review.'”[9] Under that
standard of review, “state contribution limits will be
upheld if (1) there is adequate evidence that the limitation
furthers a sufficiently important state interest, and (2) if
the limits are ‘closely
drawn.'”[10] The State bears the burden of
establishing both prongs of the constitutional
inquiry.[11]
After
Citizens United, what constitutes a sufficiently
important state interest to support limits on campaign
contributions has narrowed. Now, the prevention of quid pro
quo corruption, or its appearance, is the only state interest
that can support limits on campaign
contributions.[12]“That Latin phrase captures the
notion of a direct exchange of an official act for money,
”[13] or “‘dollars for political
favors.'”[14] Campaign finance laws that pursue other
objectives, such as reducing the amount of money in politics,
restricting the political participation of some in order to
enhance the relative influence of others, or targeting the
general gratitude a candidate may feel toward those who
support him or his allies, “impermissibly injects the
Government ‘into the debate over who should
govern'” and thus cannot survive constitutional
scrutiny.[15]
a.
Counts One and Two: Individual-to-Candidate and
Individual-to-Group Base Limits
Plaintiffs
first challenge the provisions of Alaska's campaign
finance laws that prohibit an individual from contributing
more than $500 per year to a candidate for political office
and to a group that is not a political party.[16] They argue
that the $500 individual-to-candidate and individual-to-group
base limits set forth in Alaska Stat. 15.13.070(b) are not
closely drawn to further the sufficiently important state
interest of combating quid pro quo corruption or its
appearance.
i.
Sufficiently important state interest
As part
of that argument, Plaintiffs contend that Defendants did not
present adequate evidence at trial to establish that
Alaska's $500 base limits further the sufficiently
important state interest of combating quid pro quo corruption
or its appearance. The Court disagrees.
At
trial, the State put forward evidence that the risk of quid
pro quo corruption or its appearance in Alaska politics and
government is both actual and considerable. To start, Dr.
Gerald McBeath, a Professor Emeritus of Political Science at
the University of Alaska Fairbanks who was qualified as an
expert in this case on the topic of Alaska state and local
politics and government, identified several factors that make
Alaska highly, if not uniquely, vulnerable to corruption in
politics and government. The first of these factors is
legislative size. Alaska has the second smallest legislature
in the United States and the smallest senate, with only
twenty senators. As Dr. McBeath explained at trial, that
means that just ten votes can stop a legislative action such
as an oil or gas tax increase from becoming law.
Consequently, the incentive to buy a vote, and the chances of
successfully doing so, are therefore higher in Alaska than in
states with larger legislative bodies. A second factor is
Alaska's almost complete reliance on one industry for a
majority of its revenues. The percentage of Alaska's
budget generated by royalties, taxes, and revenues from oil
and gas is the highest among all of the oil and gas producing
states in the United States. In fact, it is exponentially
greater: typically 85 to 92 percent in Alaska compared to
less than 50 percent for every other state. Another factor
making Alaska susceptible to corruption in politics and
government is its small population coupled with its vast
size. According to Dr. McBeath, these characteristics make
enforcement of campaign finance laws much more challenging,
as it limits both the number and abilities of watchdog
organizations.
In
addition to Dr. McBeath's testimony, the public officials
who appeared at trial, regardless of whether they were called
by Plaintiffs or the State, uniformly testified that they
experienced and observed pressure to vote in a particular way
or support a certain cause in exchange for past or future
campaign contributions while in office. Defense witness David
Finkelstein, a former Alaska state representative who served
from 1989 to 1996 testified that “there was an
inordinate influence from contributions on the actions of the
legislature, ” and that legislators would often mention
which interest groups had contributed large amounts to their
campaigns or to their party during closed-door caucus
meetings over whether particular bills would move forward. He
further testified that “it inevitably would affect
[his] vote if [he'd] received a thousand dollars or
stacks of thousand dollar[ ] checks, from one side and not
the other.” Defense witness Charles Wohlforth, who
served two terms as a member of the Anchorage Assembly from
1993 to 1999, similarly testified that “the system was
rigged by money[ed] interests and that too frequently the
decisions of the assembly were controlled by those interests
and their desires, based on the kind of contributions they
would make.” And Eric Croft, who is currently a member
of the Anchorage Assembly and who previously served in the
state legislature for ten years, testified at trial that
although he has never been directly asked for a political
favor in exchange for a contribution, he has experienced
situations where “it [was] clear that if you don't
vote the way somebody wants, you're not going to get
their continued contribution.”
Witnesses
for the Plaintiffs also provided evidence that some large
contributors expect political favors in exchange for their
contribution.[17] Senator John Coghill testified that on
one occasion during the legislative session, he was
approached in the hallway of the State Capitol by a lobbyist
demanding that Senator Coghill vote a certain way, saying
“This is why we gave to you. Now we need your
help.” Senator Coghill refused, and those represented
by that lobbyist never made a contribution to Senator Coghill
again. Bob Bell testified that during his tenure on the
Anchorage Assembly in the 1990s, an oil executive offered to
hold a fundraiser for him if he would publicly support a
private prison project in South Anchorage. When Bell refused
to support the project, the oil executive held a fundraiser
for his opponent instead.
Beyond
this testimony, the State presented evidence about the widely
publicized VECO public corruption scandal, in which
approximately ten percent of the Alaska Legislature,
including state representatives Vic Kohring, Pete Kott, and
Beverly Masek, were directly implicated for accepting money
from Bill Allen and VECO, Allen's oilfield services firm,
in exchange for votes and other political
favors.[18] A surveillance video from the VECO
investigation introduced at trial showed Kohring in a Juneau
hotel room asking Allen and Rick Smith, another VECO
official, for help with his (Kohring's) $17, 000 debt. In
the video, Kohring accepts a relatively small cash payment
from them in response to his request, and then, in the same
exchange, asks Allen and Smith what he can do for them on oil
tax legislation that was then pending before the Alaska
Legislature. After being criminally charged, Kohring wrote a
newspaper column in which he stated that other legislators
were no better than he was and were unfairly critical of him
because he got caught.
The
State also introduced at trial a Government Ethics Center
study commissioned by the Alaska State Senate in 1990 in
which the Government Ethics Center surveyed Alaska
legislators, public officials, and lobbyists as to the image
of and the public trust in the Alaska Legislature. The study
concluded that “that things are not what they should
be” and that “[t]he reputation and image of the
legislature is unacceptably low.” Of particular
relevance to this case, the survey results showed that 24
percent of lobbyists surveyed believed that “about
half” or more of Alaska's legislators could
“be influenced to take or withhold some significant
legislative action . . . by campaign contributions or other
financial benefits provided by lobbyists and their employers,
” and that 40 percent of legislators surveyed believe
that very few members of the public had a sufficiently high
degree of trust and confidence in legislators'
integrity.[19]
Taking
all of the testimony and other evidence together, the Court
finds that Defendants have made an adequate showing that the
risk of quid pro quo corruption or its appearance in Alaska
politics and government from large campaign contributions is
pervasive and persistent.[20]Quid pro quo corruption, or
even its appearance, undermines public trust in the electoral
process and government. Having concluded that the $500 base
limits set forth in 15.13.070(b) further Alaska's
sufficiently important interest in preventing quid pro quo
corruption or its appearance, the Court turns to the question
of whether those $500 limits are “closely drawn”
to further that interest.
ii.
Closely drawn
In
determining the constitutionality of Alaska's $500 base
limits, Plaintiffs contend that the Court should apply the
two-part, multi-factor “closely drawn” test
articulated by the Supreme Court in Randall v.
Sorrell[21] rather than the test laid out by the
Ninth Circuit Court of Appeals in
Eddleman.[22] Plaintiffs' position, however, is
foreclosed by the Ninth Circuit's opinion in
Lair.[23]In Lair, the Ninth Circuit
considered whether and to what extent Randall
abrogated Eddleman's “closely drawn”
analysis.[24] Applying Miller v. Gammie,
[25]
it found that “there simply was no binding
Randall decision on that point,
”[26] and that the district court's
decision to apply Randall's “closely
drawn” analysis to the contribution limits at issue in
that case was therefore legal error.[27] The Court will therefore
determine the constitutionality of Alaska's campaign
contribution laws using Eddleman's
“closely drawn” test.
Under
Eddleman's “closely drawn” test,
limits on contributions are “closely drawn” if
they “(a) focus narrowly on the state's interest,
(b) leave the contributor free to affiliate with a candidate,
and (c) allow the candidate to amass sufficient resources to
wage an effective campaign.”[28] In conducting that
tailoring analysis, a court must be “mindful that the
dollar amounts employed to prevent corruption should be
upheld unless they are ‘so radical in effect as to
render political association ineffective, drive the sound of
a candidate's voice beyond the level of notice, and
render contributions pointless.'”[29]
Here,
Plaintiffs do not dispute and the Court agrees with
Defendants that the base limits set forth in Alaska Stat.
15.13.070(b) leave an individual free to affiliate with a
candidate. Plaintiffs do, however, dispute that Alaska's
$500 base limits focus narrowly on Alaska's interest in
the prevention of quid pro quo corruption or its appearance.
They further claim that the State has failed to prove that
the $500 base limits allow candidates, particularly
challengers in competitive races, to amass sufficient
resources to run effective campaigns. The Court addresses
each claim in turn.
1.
Focus narrowly
Citing
Frank's testimony as to why and how he selected $500 as
the individual-to-candidate and individual-to-group
contribution limit amounts for his ballot initiative back in
the 1990s, Plaintiffs contend that the $500
individual-to-candidate and individual-to-group contribution
limits were put in place for impermissible purposes other
than preventing quid pro quo corruption or its appearance,
and that the State therefore cannot show that those limits
satisfy the first part of Eddleman's
“closely drawn” test. But Plaintiffs'
argument forgets that Ballot Measure 1, which established the
current $500 base limits and which was approved by a 73
percent margin of Alaska voters, explicitly contemplated an
anticorruption purpose.[30] Indeed, the statement in support of
the successful initiative included in the Alaska Division of
Elections voter information packet stated as follows:
Corruption is not limited to one party or individual. Ethics
should be not only bipartisan but also universal. From the
Abramoff and Jefferson scandals in Washington D.C. to side
deals in Juneau, special interests are becoming bolder every
day. They used to try to buy elections. Now they are trying
to buy the legislators themselves.
Plaintiffs
also argue that the $500 base limits impermissibly restrict
their free speech and associational rights because Defendants
have not shown that a higher contribution limit, such as a
$750 or $1, 000 limit (or even a $500 limit indexed for
inflation), would be ineffective at preventing quid pro quo
corruption or its appearance. That argument, however,
misunderstands both the Court's role in assessing and the
State's task in proving the constitutionality of a
contribution limit. In Buckley, the Supreme Court
rejected an overbreadth claim that the $1, 000 contribution
limit at issue in that case was “unrealistically
low” because “much more than that amount would
still not be enough to enable an unscrupulous contributor to
exercise improper influence over a candidate or
officeholder.”[31] In rejecting the claim, the
Buckley Court adopted the Court of Appeals for the
District of Columbia's observation that “[i]f it is
satisfied that some limit on contributions is necessary, a
court has no scalpel to probe whether, say, a $2, 000 ceiling
might not serve as well as $1, 000.”[32] The law
instead requires “a fit that is not necessarily
perfect, but reasonable; that represents not necessarily the
single best disposition but one whose scope is in proportion
to the interest served.”[33] In the context of this case,
that means that the State need not prove that $500 is the
highest possible contribution limit that still serves to
prevent quid pro quo corruption or its appearance, but rather
that the challenged $500 contribution limits further that
interest and also permit candidates to “amas[s] the
resources necessary for effective
advocacy.”[34]
What is
more, the State did elicit testimony at trial indicating that
the $500 individual-to-candidate and individual-to-group
limits are, in fact, likely more effective at furthering the
State's interest in preventing quid pro quo corruption or
its appearance than a hypothetical $750 or $1, 000 limit.
Professor Richard Painter, whom the Court qualified as an
expert in government ethics and institutional corruption with
an emphasis on campaign finance reform, explained that lower
contribution limits are often more effective at decreasing
the risk of quid pro quo arrangements or their appearance
because they make a candidate less dependent upon an
individual or group of individuals for financial support,
especially in a state like Alaska where the cost of campaigns
for state or municipal office are relatively low. Lower
limits often increase the donor base and decrease the impact
of an individual contribution, thus making it easier for a
candidate to decline a contribution contingent upon the
performance of a political favor. Consistent with Professor
Painter's expert testimony, Croft testified that the
higher the contribution limit, “it's harder and
harder to turn that down.”
Finally,
with respect to the individual-to-group contribution limit,
the Court finds that Defendants have made the appropriate
showing that Alaska Stat. 15.13.070(b)'s
individual-to-group limit focuses narrowly on the State's
interest in reducing the risk of quid pro quo corruption or
its appearance, as it works to keep contributors from
circumventing the $500 individual-to-candidate base limit.
The Supreme Court in McCutcheon affirmed that the
anti-circumvention interest originally recognized in
Federal Election Commission v.
Beaumont[35]remains valid after Citizens
United.[36] Alaska's campaign finance laws
define a “group” as “two or more
individuals acting jointly who organize for the principal
purpose of influencing the outcome of one or more elections
and who take action the major purpose of which is to
influence the outcome of an election.”[37] Under Alaska
Stat. 15.13.070(c), a group that is not a political party may
contribute up to $1, 000 per year to a candidate. Without the
$500 individual-to-group limit, an individual could make
unlimited donations to a group, $1, 000 of which could then
be passed on to the candidate-double the
individual-to-candidate limit.
2.
Amassing sufficient resources to effectively
campaign
In
addition to their argument that the $500 base limits set
forth in Alaska Stat. 15.13.070(b) do not focus narrowly on
the State's interest in avoiding actual or apparent quid
pro quo corruption, Plaintiffs argue that those limits are
unconstitutionally low under the third prong of
Eddleman's “closely drawn” test.
While it is certainly true that a contribution limit that is
too low “could itself prove an obstacle to the very
electoral fairness it seeks to promote, ”[38] the Supreme
Court in Buckley specifically rejected the
contention that $1, 000, or any other amount, was a
constitutional minimum below which legislatures could not
regulate.[39] It instead held that courts should
determine “the outer limits of contribution regulation
by asking whether there was any showing that the limits were
so low as to impede the ability of candidates to
‘amas[s] the resources necessary for effective
advocacy.'”[40] In making that determination, the
Ninth Circuit has instructed courts to “look at all
dollars likely to be forthcoming in a campaign, rather than
the isolated contribution” and to “consider
factors such as whether the candidate can look elsewhere for
money, the percentage of contributions that are affected, the
total cost of a campaign, and how much money each candidate
would lose.”[41]
In this
case, Plaintiffs claim that the $500 base limits set forth in
Alaska Stat. 15.13.070(b) are not closely drawn because they
do not allow candidates in Alaska, and in particular
challengers in competitive races, to amass the resources
necessary for effective advocacy. But Plaintiffs'
evidence does not show that Alaska's $500 base limits are
“‘so radical in effect as to render political
association ineffective, drive the sound of a candidate's
voice beyond the level of notice, and render contributions
pointless.'”[42] Michael Gene Pauley, a campaign
manager and consultant whom the Court qualified as an expert
in Alaska political campaigns, testified that he considers
Alaska's $500 base limits to be too low because they are
not indexed for inflation, because the cost of campaigns is
generally increasing, and because the limits are annual in
nature. Pauley further testified that most challengers in
Alaska do not enter political races in the off year.
Plaintiffs also offered the testimony of Senator Coghill, who
testified that he has always been able to raise sufficient
funds to run an effective campaign, but that it was
“just harder” under the current $500 limits than
under the $1, 000 limits because “the lower limits do
cause you to have to go broad.” In other words, it
requires more work.
Plaintiffs
also called Clark Bensen, a consultant and a former director
of political analysis for the Republican National Committee
whom the Court qualified as an expert “in the area of
analyzing campaign finance data for the purpose of
determining whether contribution limits permit candidates to
amass the resources that they need to mount effective
campaigns, ” to testify at trial. Based on his analysis
of campaign finance data for the State of Alaska, Bensen
opined that the $500 base limits set forth in Alaska Stat.
15.13.070(b) are unconstitutionally low because candidates in
competitive campaigns often spend more than they raise and
because those candidates would be able to raise more money if
the $500 limits were instead $750 or $1, 000. The Court,
however, does not find Bensen's testimony to be credible.
At trial, Mr. Bensen acknowledged that his analysis ...