Update: The Tempe City Council voted unanimously Thursday to send the Sunshine Ordinance to voters in March 2018.
Original story published Oct. 25:
Tempe may send a ballot measure to voters in an attempt to curb “dark money” influence in municipal elections.
Even if voters approve the measure, it would need to pass muster with the state. Arizona leaders have so far maintained that political non-profits, often referred to as “dark money” because their donors can remain anonymous, do not have to reveal their funding sources in most cases.
The amount of independent expenditures in local and national races has grown in recent years.
Some question whether Tempe is setting itself up for a lawsuit, but City Councilwoman Lauren Kuby says reform “percolates upward.”
“Cities lead the way,” she said.
Tempe already has lowered the cap on donations that can be made to city candidates and has shone a light on lobbying efforts at the municipal level.
The City Council is expected to decide next month whether it will send the latest proposal, called the Sunshine Ordinance, to voters in March.
What would the Sunshine Ordinance do?
The proposal would require groups making independent expenditures over $1,000 in municipal elections to disclose what type of organization it is and its financial backers.
The independent spending often goes toward robo-calls, TV ads, mailings and other campaign tactics to help a political candidate, including by attacking his or her opponents. But donors are prohibited from coordinating with the candidate.
Independent expenditures are usually associated with “mud-slinging” tactics such as attack ads, according to Joel Edman, executive director of the Arizona Advocacy Network.
Dark-money spending has not played an outsized role in city politics so far. Independent expenditure groups spent $4,678 in 2014 and $3,862 in 2016 in Tempe elections, according to the city.
But Councilman Kolby Granville says he has felt the bite.
A group calling itself the Tempe Residents Council sent mailers saying “Kolby Granville. Not a leader,” and “Kolby Granville is wrong for Tempe” during the 2016 election.
To this day, the councilman said he does not know who was behind the mailers.
“It’s truly impossible to find out,” he said.
Granville says the Sunshine Ordinance would empower voters with context about who is behind such tactics.
“It’s about shinning a light,” Kuby said.
Lawsuit in waiting?
Mayor Mark Mitchell, Vice Mayor Robin Arredondo-Savage and the Tempe Chamber of Commerce have raised concerns the city could be sued for infringing on First Amendment rights or face backlash from the state.
The council will huddle behind closed doors this week to further discuss those legal risks.
Edman at the Arizona Advocacy Network says those fears, which often stem from a 2010 U.S. Supreme Court decision, are unfounded.
The Citizens United decision, which restricted the government from prohibiting independent political expenditures by non-profit corporations, for-profit corporations, labor unions and other associations, makes many believe that campaign-finance reform is impossible, Edman said.
But a passage within the ruling would shield Tempe from litigation, he said.
“The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages,” the court wrote in its ruling.
The court further went on to state that disclosure ordinances such as the one Tempe is exploring should be examined as a possible remedy.
However, campaign-finance attorney Kory Longhofer told The Arizona Republic the measure would “most certainly” open Tempe to lawsuits.
“Lawyers will rejoice when this passes because of the money they will make, but taxpayers will not be so enthused,” he said.
Longhofer said the anonymity of independent expenditures often helps groups who fear retaliation for criticizing a politician. A city forcing a group to reveal its donors could put them at risk and infringe on their First Amendment rights.
Campaign finance Lawyer Jim Barton disagrees. He said be believes any challenge would be struck down if the measure is done in an “equal fashion.”
People or groups engaged in independent expenditures are doing so to “influence the process” so residents have a right to know who those people are, Barton said.
Ducey would get to weigh in
State lawmakers have gone after cities when they think local leaders have overreached. Just this week, the state said Bisbee violated state law when the city’s elected leaders prohibited plastic bags.
Something similar could happen to Tempe.
Tempe’s proposed Sunshine Ordinance would automatically get a state review because it’s a city charter amendment. The Arizona Constitution requires such amendments to go before the governor to check that it’s not“in conflict with (the state) Constitution or with the laws of this state.”
The governor could take his time. When Tempe voters lowered the cap on individual candidate donations in 2015 — another city charter change — Gov. Doug Ducey didn’t sign off until 2017.
Ducey benefited from more than $8 million in spending by dark-money groups during his 2014 campaign for governor, according to a 2014 Republic analysis.
Transparency in following the money
Tempe’s latest campaign-finance reforms are part of an effort that began two years ago.
Along with the caps on candidate donations, Tempe required that lobbyists register with the city or face penalties. All registered lobbyists are listed on the city’s website.
The city defines a lobbyist as anyone who is paid to influence city policy or decisions. While an unpaid spokesperson for a citizen’s group wouldn’t qualify as a lobbyist, a developer-paid zoning attorney would.
Phoenix and Peoria are the only other Valley municipalities that require lobbyists to register. At the state level, Arizona requires lobbyists to register.
Beginning in January, Tempe also will require lobbyists to report what they spend on city lobbying efforts.
And Tempe will take transparency a step further by noting which municipal candidates’ campaign donations were made by registered lobbyists.
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