The Center for Competitive Politics (CCP) submitted testimony with the Wisconsin Senate Labor, Elections & Urban Affairs Committee for its hearing today on campaign finance legislation.
Senate Bill 540 would implement shareholder regulations mandating burdensome votes by individual shareholders before a corporation could engage in independent political spending. The bill would not impose any restrictions on unions, who also were freed up by the Supreme Court’s ruling in Citizens United v. Federal Election Commission.
“Despite any evidence of a current or impending problem, Wisconsin’s Senate Bill 540 would impose burdensome and impractical requirements on corporations and cooperatives by requiring shareholder or member consent before independent expenditures can be made,” CCP Research & Government Relations Director Laura Renz wrote in prepared testimony. “This barrier to speech is likely to raise serious constitutional issues that will be costly and time consuming for the state to defend.”
Before Citizens United, both corporations and unions were banned from spending independently to advocate for or against state candidates. Direct contributions to candidates from unions and corporations are still prohibited.
The provision raises serious equal protection issues because similar requirements are not imposed on nonprofit organizations or unions, Renz wrote. In the majority opinion in Citizens United, Justice Kennedy quoted the Court in an earlier decision, stating: “The worth of speech ‘does not depend upon the identity of its source, whether corporation, association, union, or individual.’”
“This strongly suggests that the courts are unlikely to uphold a law imposing a major burden on only one type of incorporated entity, for-profit firms, while allowing other incorporated entities and unincorporated associations to remain unburdened when it comes to political speech,” Renz said.
CCP is a nonpartisan, nonprofit organization formed by former Federal Election Commission Chairman Bradley A. Smith to promote and protect the First Amendment political rights of speech, assembly and petition.