Proposed Local Law Would Abolish Super PACs and Ban Spending by Foreign-Influenced Corporations in Seattle Elections

The Seattle Ethics and Elections Commission heard testimony yesterday in favor of a bill that would abolish super PACs and prohibit spending by foreign-influenced corporations in local elections.

The proposed legislation, sent to the Commission by Councilmember M. Lorena Gonzalez, will prohibit corporations from spending money in Seattle elections if they are foreign-influenced, or owned in whole or significant part by foreign entities. The ordinance will also establish limits on contributions to "independent expenditure" political action committees, thereby abolishing super PACs in local elections.

Political spending in Seattle has skyrocketed, including $875,000 in independent expenditures this year alone in just the primary election. Many campaign finance scholars argue that super PACs have now become vehicles for wealthy donors to evade campaign contribution limits designed to prevent corruption and the appearance of corruption.

"Transparency and fairness in our electoral system is serious business," said Councilmember M. Lorena Gonzalez. "Voters deserve to know who is influencing our local elections through independent expenditures and public ads. My proposed legislation would send a clear message to those who seek to buy our democracy that our local democratic process is not for sale to the highest bidder. I'm honored to work with democracy protectors in Seattle to uphold our ongoing commitment to a more level playing field in our election system."

"Elections should be influenced by the citizens authorized to vote in them, not by big money from out of town, and certainly not by big money from foreign countries," says Cindy Black, the Executive Director of Fix Democracy First. "The Seattle Defend Our Democracy ordinance directly addresses this issue. Fix Democracy First, a Washington State pro-democracy organization, is delighted to play a lead role in advancing this local legislation which is potentially of national importance. We are so appreciative of Free Speech for People for proposing model language, Councilmember M. Lorena Gonzalez for sponsoring the bill, and our local League of Women Voters for their whole hearted support."

The Commission heard testimony in favor of the proposed ordinance from local and national advocates including: Kathy Sakahara from the Seattle League of Women Voters, Fix Democracy First Executive Director Cindy Black, Free Speech For People President John Bonifaz and it received written testimony from Federal Election Commission Chair Ellen Weintraub; Free Speech For People Legal Director Ron Fein; Harvard Law Professor Laurence Tribe; University of Chicago Law School Professor Emeritus Albert Alschuler; and political scientist (and former Campaign Finance Institute Assistant Director of Policy) Stephen Weissman.

In March 2010, the U.S. Court of Appeals for the D.C. Circuit in SpeechNow.org v. FEC opened the door to super PACs by holding that the federal law limiting contributions to political committees to $5,000 per person each year did not apply to a political committee that promised to make only "independent expenditures."

"[W]hile independent spending groups may maintain some distance from their preferred candidates, their largest donors do not," says Weissman. "In reality, they are directly financing the same candidates they are assisting through their simultaneous contributions to independent groups. In effect, these large donors are circumventing the legal limits for contributions which were established to prevent corruption and its appearance -- thereby intensifying the danger to our democracy."

Meanwhile, the Supreme Court's January 2010 decision in Citizens United v. FEC sanctioned political spending by corporate entities as political speech protected by the First Amendment on the theory that corporations are "associations of citizens." As many major corporations are owned in substantial part by foreign shareholders, they can now circumvent federal law which explicitly prohibits foreign nationals from making any political expenditures in U.S. elections.

"The Supreme Court's decision in Citizens United created a loophole through which foreign investors can circumvent this [ban on election spending by foreign nationals] using the corporate form," Tribe writes. "Yet if foreign investors do not have a constitutional right to spend money to influence federal, state, or local elections, then they do not have a constitutional right to use the corporate form to do indirectly what they could not do directly."

"It defies logic to allow groups of foreign nationals, or foreign nationals in combination with American citizens, to fund political spending through corporations. You cannot have a right collectively that you do not have individually," says Weintraub.

"Seattle does not need to wait for federal action to protect its state and local elections from foreign influence. The 2016 election showed us that the threat of foreign influence in elections is real," says Fein.

For more information about the proposed legislation and the testimony being submitted, visit: https://freespeechforpeople.org/seattle-legislation/