Ruling Against Colorado Disclosure Law Left Intact

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By Kenneth P. Doyle

Oct. 5 — The U.S. Supreme Court let stand a federal appeals court ruling that said Colorado's campaign finance disclosure requirements could not apply to a group that raised and spent only $3,500 to influence a ballot initiative ( Williams v. Coalition for Secular Government , U.S., No. 16-28, cert. denied 10/3/16 ).

The Supreme Court’s Oct. 3 action denying the state's petition for review was “the final chapter for Colorado’s speech laws that buried grassroots groups in red tape,” Tyler Martinez, an attorney for the nonprofit Center for Competitive Politics (CCP), said. CCP, a critic of campaign finance regulation, represented the challenger of the Colorado disclosure law, a nonprofit group called the Coalition for Secular Government.

“When a few citizens want to voice an opinion, the government can’t subject them to burdensome disclosure rules designed for multimillion-dollar campaigns,” Martinez said.

Appeals Court Found Law ‘Too Burdensome.'

The plaintiff was a small organization launched in 2008 by Colorado resident Diana Hsieh. Hsieh organized the nonprofit Coalition for Secular Government in order to promote the separation of church and state.

According to CCP, Hsieh claimed that vague and confusing state laws regarding what constitutes political speech made it nearly impossible to carry out the activities of such a small group without fear of running afoul of Colorado’s complex campaign finance laws.

A three-judge panel of the U.S. Court of Appeals for the Tenth Circuit ruled in March that Colorado's issue committee registration and disclosure requirements violated the First Amendment as applied to the Coalition for Secular Government because it sought to raise and spend only a small amount .

The group—operated by single person—was expected to raise and spend $3,500 to combat an anti-abortion state ballot initiative, the court said. Requirements to provide details about the “most mundane, obvious and unimportant expenditures” and to file 12 disclosures in seven months were “too burdensome when applied to a small-scale issue committee,” the court said.

The court applied exacting scrutiny to the requirements, considering whether there was a substantial relation between them and a sufficiently important government interest. The strength of the state's interest in issue-committee disclosures partly depends on the amount of money raised or spent, the court said, holding that interest isn't substantial at the $3,500 level.

The decision left open the question of what threshold above $3,500 would still be subject to the requirements under Colorado's regulatory framework for issue committees.

To contact the reporter on this story: Kenneth P. Doyle in Washington at kdoyle@bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com

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