The Campaign Legal Center filed this amicus brief on behalf of 14 nonprofit organizations (including the Sunlight Foundation) before the U.S. Supreme Court this past Friday. It concerns a challenge to part of the Citizens United decision that allows independent entities to raise and spend unlimited amounts of dark money to influence elections. The high court must decide whether to hear argument in a case involving the potential invalidation of a Montana law that limits corporate political expenditures, known as American Tradition Partnership, Inc. v. Bullock.

In our amicus brief, we challenge two assumptions made by the Supreme Court in its prior decision: that "independent expenditures" are actually independent, and that current disclosure laws are sufficient to deter corruption and avoid the appearance of corruption.

Three major arguments animate the brief. First, the current law's accommodation of close relationships between candidates and "independent" spenders could lead to corruptions and the appearance thereof. Second, current law facilitates efforts by corporations to deny shareholders and citizens the information necessary to hold corporations and elected officials accountable for their positions. And finally, that even when campaign finance information is disclosed, it is often done so in a way that is insufficiently timely and accessible to inform the electorate.

Supreme Court Amicus Brief American Tradition Partnership, Inc. v. Bullock

Yesterday, the Senate Homeland Security and Governmental Affairs Committee voted, in essence, to sanction the practice of secret “pay-to-play” in the awarding of government contracts. With only Senator Tester recording his opposition, the committee voted out a bill that would ban federal agencies from collecting or disclosing any information about the political expenditures of federal contractors.

Turning logic on its head, the Keeping Politics Out of Federal Contracting Act of 2011 embodies the theory that maintaining the secrecy of dark money political contributions made by those seeking huge federal contracts somehow protects the integrity of the contracting process. I guess the lessons of Justice Brandeis that sunlight is the best disinfectant were lost on supporters of the bill.

Too add to the absurdity of the vote, the bill is a response to a phantom. The bill blocks disclosure that would result from an Executive Order mandating transparency by federal contractors. An Executive Order that was never issued. Ever fearful of disclosure, the Chamber of Commerce, the National Association of Independent Business and their ilk flexed their muscles to preempt any transparency of dark money that has resulted from the Citizens United case.

This bill would be funny if it weren’t so scary, but sanctioning secrecy in our democracy is no laughing matter. If this bill makes its way to the Senate floor, we hope Senators see that rather than keeping politics out of the federal contracting process, this bill will keep corruption in it.

Yesterday, a three-judge panel of the D.C. Circuit Court of Appeals demonstrated that it gets the need for greater transparency of money in politics. In a victory for transparency advocates, the court denied a motion to stay a lower court ruling that requires comprehensive disclosure of “electioneering communications.” In non-lawyer language, that means that nonprofit groups like the Chamber of Commerce, Crossroads GPS and Priorities USA that want to run political ads right before an election will have to disclose their donors.

The case is Van Hollen v. FEC and the issue is whether the FEC properly narrowed its own disclosure rules, leaving donors in the dark about who is funding campaign ads. Under the Bipartisan Campaign Reform Act, (also known as the McCain-Feingold law) certain disclosure requirements applied to organizations making “electioneering communications”—ads that refer to a candidate and run within 30 days of a primary election or 60 days of a general. Under the law, the group running the ad must identify any person, corporation or labor union that contributed $1000 to the organization. (It should be noted that the old rule also permits the group to set up a separate segregated bank account to make electioneering communications. If it does that, only donors to that account need to be disclosed. This is not unlike provisions in the DISCLOSE Act.)

The FEC gutted the old rule, limiting disclosure to only those contributions made “for the purpose of furthering electioneering communications.” In other words, the Commission created a gaping disclosure loophole that meant donors behind some of the nastiest political ads that flood the airwaves would remain secret. Van Hollen sued, and the lower court agreed with him that the original rule should remain in place. By that time, however, two other groups joined the case as “intervenors” and urged the court to “stay”—or hold off—enforcing the decision that would require immediate disclosure.

The panel of D.C. Court of Appeals agreed with the lower court and refused to grant the stay, recognizing the importance of disclosure. The lower court judge based her decision in part on the Supreme Court’s observation that, “the disclosure requirements serve an important public function because they ‘provide the electorate with information about the sources of election-related spending’ and help citizens ‘make informed choices in the political marketplace.’ (Citations omitted) The result of the ruling is that the original, broad disclosure requirement is in effect and groups should be on notice that they are required to disclose their donors if they plan to run electioneering communications.

But, don’t expect to see a database of donors pop up on the FEC’s website tomorrow. Groups will try to avoid disclosure and have already begun to craft ads they think won’t trigger disclosure requirements. (Think ads that say “Congress” instead of “Congressman Smith.”) The groups will also ask the FEC to provide “Advisory Opinions” (AOs) as to whether disclosure rules apply in particular circumstances. How the FEC responds to these requests for AOs may signal how serious the commission is about enforcing the new, old rule. The FEC, with its even split between Democrats and Republicans may well deadlock rather than move forward on disclosure and enforcement.

The judicial system is likely not done with the case either. It is possible that the decision denying the stay will be appealed, in which case we would hope the judicial system continues to favor disclosure over secrecy. Yesterday's decision gives us reason to believe that the judicial branch will continue to trend toward greater transparency.

The Senate Rules Committee will hold a hearing on Thursday to discuss S. 2219, the “Democracy Is Strengthened by Casting Light on Spending in Elections Act of 2012” (The DISCLOSE Act.) Sunlight’s Ellen Miller is submitting testimony in support of the DISCLOSE Act.

We hope this hearing will put to rest all of the arguments against the bill. In dismantling 100 years of prohibitions against corporate treasury funds being used to elect candidates, the Supreme Court, in the Citizens United case put a great deal of faith in the idea that disclosure will remove the taint of corruption from the new influx of cash. The majority opinion observed that the Internet is becoming the best way to hold politicians and influencers accountable. But, the Court created an entirely new spending regime for which no disclosure system is in place. For online transparency to perform the functions ascribed to it by the Citizens United ruling, Congress has to create new laws that reflect the new reality of expanded independent spending. DISCLOSE 2012 creates that system of transparency and as such should receive wide support from members on both sides of the aisle.

The DISCLOSE Act introduced earlier this year goes straight to heart of the problem: the lack of transparency for unlimited, dark money and the influence it has on our elections and our elected officials. The updated bill removes extraneous and controversial provisions that plagued an earlier version of DISCLOSE, instead focusing on what the public demands — transparency. 


Specifically, the bill’s robust reporting requirements for Super PACs, corporations, unions and nonprofit organizations that make independent expenditures and electioneering communications will begin to address many of the problems wrought by Citizens United: It will shine a light on dark money; it will provide an enforcement mechanism to ensure that no foreign money is influencing our political process; it will allow citizens to determine the credibility of campaign ads based on the messenger as well as the message; and it will arm citizens with information about campaign funding before they go to the polls, in real time and online. The disclosure and disclaimer provisions of the DISCLOSE Act are narrowly crafted so as not to infringe on constitutional protections. The Act does not require organizations to disclose donors who have contributed less than $10,000 and allows groups to create a firewall that allows donors who do not wish to contribute to political activities to remain anonymous. At the same time, the DISCLOSE Act, for better or worse, does not put an end to concentrations of wealth being used in an effort to impact elections. Simply put, it does not chill speech. But the Act rightly and importantly shines a light on the dark money now infecting our elections and creates informed citizens and a more accountable government.

So far, the bill has the support of Senate Democrats. The issue of transparency in government is too important to become bogged down in partisanship, and we hope many more Senators on both sides of the aisle will cosponsor the legislation after Thursday’s hearing.

Ellen Miller Testimony DISCLOSE 2012 Final

Senate Democrats unveiled their version of the DISCLOSE Act today. (We wrote about the House bill, introduced last month, here.) Senator Whitehouse was joined by approximately 35 of his Democratic colleagues on legislation that has been described as a pure disclosure and disclaimer bill, with none of the controversial provisions that caused the DISCLOSE Act to fail in the Senate by one vote in 2010. The Senate’s laser-like focus on disclosure and disclaimer provisions mirrors Sunlight’s recommendations in our draft Stop Undisclosed Payments in Elections from Ruining Public Accountability Act (the SUPERPAC Act). By focusing on disclosure and disclaimer provisions only, with no carve outs for select groups or bans on certain types of contributions, the 2012 version of the DISCLOSE leaves opponents of the previous bill with little or nothing to object to--unless they believe our elections should continue to be paid for by dark money.

Specifically, the bill will create robust reporting requirements for Super PACs, corporations, unions and nonprofit organizations that decide to make campaign expenditures. It will also require ads to contain disclaimers by the top officials of such groups, similar to the stand by your ad mandates required of candidates.

Voters have been bombarded with campaign ads largely paid for by outside groups, with much of that money totally undisclosed. The Supreme Court’s Citizens United decision, while touting the importance of disclosure, created a system in which money laundering could be used to funnel unlimited secret money into our political system. The DISCLOSE Act is a crucial step to address the corrupting influence of that money on our elections and our elected officials.

Senator Schumer has promised to hold a hearing on the bill in the Rules Committee next week. It will be interesting to see how his colleagues, including John McCain, Olympia Snowe, Lisa Murkowski and others who have expressed concern about the impact of the Citizens United decision, will react to this leaner version of DISCLOSE. We hope they recognize that the bill does nothing more, and nothing less, than lift the cloud that has been obscuring money in politics so that all citizens can know who is paying for our elections.

Sunshine Week presents the perfect opportunity each year to recognize the importance of transparency and open government. This year, with the ever-increasing influence of often secretive super PACs in our elections, the need for transparency is even more clear.

We have an opportunity for greater disclosure right now. A new bill -- the DISCLOSE Act 2012  will, if passed by Congress, require:

• Corporations and other outside groups to stand by their campaign ads -- with their leader and top financial contributors disclosed in the ads.

• Public reporting by corporations, unions, super PACs and other outside groups to the FEC within 24 hours of making a campaign expenditure or transferring funds to other groups for campaign-related activity (of $10,000 or more).

• Corporations and other outside groups to disclose campaign-related spending to shareholders and organization members.

• Lobbyists to disclose campaign-related expenditures in conjunction with their lobbying activities.

In the wake of the two-year-old infamous Supreme Court ruling on Citizens United v. FEC  -- which allowed unlimited and undisclosed money to flow into our elections, an increase in new super PACs has now led to an increase in the amount of money making it’s way into our elections -- to the tune of over 74.8 million (and counting)! This is no cheap change.

Help get the word out by writing a letter to the editor of your local newspaper. Let your community know that it’s time to expose dark money behind our elections. It’s time to pass the DISCLOSE Act 2012.

Though we can see what these super PACs are spending their money on, the rules that let us see who’s giving them money are weak and don’t let us see the whole picture. Without disclosure, we can’t know if the ads we’re watching are funded by corporate VIPs with hidden agendas or everyday people like you and me.

If you want to see if your rep is a co-sponsor on the bill, look them up here and encourage them to keep up the support. If they are not co-sponsors, let them know too that it’s time to open up our government.

The bill has not yet made its way to Senate, so make sure to ask your senator to introduce a complementary bill and bring transparency into our government.

Writing a letter to the editor is easy and takes only a few minutes with our online tool -- we’ll walk you through each step. Lawmakers pay close attention to what goes on in the newspapers of their districts. A letter to the editor will help raise awareness about the need for transparency and accountability in your community. And it sends a clear message to your representative: we’re not afraid to speak out and demand transparency in our elections.

Want to learn more about the DISCLOSE Act? You can follow our updated blog posts about it here:

The Federal Election Commission is the supposed enforcer of the nation’s campaign finance and disclosure laws. But, with commissioners evenly divided between Democrats and Republicans, the FEC has long lived up to its reputation as being an agency designed to fail. Based on the witnesses it invited to testify about proposed rules regarding disclosure of independent expenditures and electioneering communications, it seems the agency is not only designed to fail, but is setting itself up to do so.

The FEC would probably argue that the five witnesses who testified represented a cross-section of ideas and positions, from the Chamber of Commerce to the AFL-CIO; the Alliance for Justice Action Campaign to the Center for Competitive Politics and the James Madison Center for Free Speech. But in terms of the positions they advanced on whether the FEC has the authority to draft new disclosure rules in light of the Citizens United Case, the group spoke with one voice—and the message they delivered was a resounding “no.”

Eleven U.S. Senators, Sheldon Whitehouse, Jeanne Shaheen, Al Franken, Jeff Merkley, Tom Udall, Sherrod Brown, Michael Bennet, Chuck Schumer, Barbara Boxer, Bernard Sanders and Kirsten Gillibrand, beg to differ. They submitted comments to the Commission urging the agency to “use its rulemaking authority to implement broad disclosure and disclaimer requirements.”

Surely, if it had wanted to, the Federal Election Commission could have found one witness to testify that the agency has the authority to draft new disclosure and disclaimer rules to ensure transparency in post-Citizens United world. It could have found one witness to suggest how the agency could draft rules that would, as the Supreme Court stated in the Citizens United case, “[enable] the electorate to make informed decisions and give proper weight to different speakers and messages.”

In truth, even with a balanced panel of witnesses, the agency probably would have failed to adopt comprehensive disclosure and disclaimer rules. But, by silencing the voices that favor transparency, the FEC willingly abdicated all responsibility to foster open and honest debate.

Correction: The FEC does not have to invite any group to testify, rather, the agency publishes notice "to advise interested persons and to invite their participation." Nevertheless, it seems pro-transparency groups would have received a chilly reception at the hearing. As one FEC commissioner stated, "all discussion of this critical issue [of disclosure and disclaimer rules] was banned from the NPRM." Moreover, Commissioner Weintraub's motion to advance Chris Van Hollen's proposed rulemaking on disclosure of Independent Expenditures by non political committees deadlocked at the FEC while the motion to make rules allowing corporations and unions to make Independent Expenditures passed by a vote of 5-1. It remains that the agency is unwilling to proffer pro-disclosure rules. Hopefully, Congress will pass the DISCLOSE Act, thereby requiring the FEC to act.

Yesterday, the House Commerce Committee killed an amendment to the FCC Reform Act that would have required groups airing political ads to disclose contributors of $10,000 or more as a condition for purchasing ad time.

The amendment, offered by Rep. Eshoo, is among any number of reasonable attempts to address the avalanche of dark money unleashed since the Supreme Court’s Citizens United decision. Sunlight is disappointed by the vote, however the defeat of the amendment does not have to sound the death knell for FCC disclosure. The FCC is currently drafting rules that could shine a light on some of the dark money that is behind the often negative and misleading political ads being paid for by secret special interests.

During the rulemaking process, the Commission asked for comments addressing whether the agency should require broadcasters to disclose the names of the executives behind any entity sponsoring political ads. Broadcasters have been required to collect this information for decades, and the technology is now available to include the information on a centralized database so the public may access it. There is no reason the information should remain hidden from public view.

Opponents of transparency—perhaps the powerful broadcast lobby—appear to have flexed their muscles with the members of the Commerce Committee who voted against the Eshoo amendment. The FCC, on the other hand, should be applauded for considering stronger disclosure rules. Rules must be adopted to ensure the money, interests and influence behind political ads is not hidden in shadows.

The New York Times looked at this week’s Super PAC filings with the FEC and demonstrated—again—what we knew would be the result of the Supreme Court’s Citizens United decision: The specter of hundreds of thousands of dollars of hidden money influencing our elections and those who will be elected.

The times notes that, “some checks came from sources obscured from public view, like a $250,000 contribution to a super PAC backing Mr. Romney from a company with a post office box for a headquarters and no known employees.” But, while the public remains in the dark, it would be naïve to think that the identity of the donor (or donors) of that generous contribution is unknown to Mr. Romney. So, what does he or she want? Favorable tax treatment? Fewer regulations for a pet industry? A bailout? An ambassadorship? It is possible that the money came from a generous citizen who simply believes Romney would be the best man for the job. But the system of secret dark money now in place means the voters will never know.

The Supreme court relied heavily on the theory that transparency would cleanse the unlimited money that would shape our elections as a result of their decision in the Citizens United case, noting, “A campaign finance system that pairs corporate independent expenditures with effective disclosure has not existed before today.” Unfortunately, the Court failed to realize that such a system of disclosure does not yet exist.

There is a solution. Sunlight proposed the SUPERPAC Act as one way to shine more light on the dark money infecting our elections. It would impose a regime of disclosure and disclaimers that would lift the veil of secrecy under which large donors may hide. But Congress needs to act. So far, we’ve heard talk. House Democrats say they will re-introduce a slightly paired down version of the DISCLOSE Act, a bill that failed to be enacted last year. And on the other side of the Capitol, Senator Schumer has promised hearings on disclosure by Super PACs.

These are important steps. (Although, arguably they should have happened well before the election season got under way.) Disclosure legislation is a critical tool in the fight against the undue influence secret money has on our campaigns and our elected officials. Unless Congress acts, we can be sure that we have only seen the tip of the dark money iceberg that is undermining the fundamentals of our democracy.