A little heralded decision by the Colorado Court of Appeals could cause headaches for politically active organizations involved in Colorado’s 2020 elections. In an unpublished opinion, the court of appeals affirmed that Colorado Pioneer Action – a nonprofit organization run by former congressman and GOP gubernatorial candidate Bob Beauprez – qualified as a “political committee” during the 2016 election.
Brought by serial campaign finance gadfly Matt Arnold and his alter-ego organization, Campaign Integrity Watchdog (a group I litigated against on multiple occasions over the past five years), the case took square aim at the 501(c) framework often used by both sides of the political aisle.
Colorado Pioneer Action operated as a 501(c)(4) social welfare organization promoting conservative principles and policies in Colorado. As a part of that work, Colorado Pioneer Action provided significant funding to an affiliated independent expenditure group, Colorado Right Now, to engage in political communications during the 2016 primary and general elections.
What might seem like a cynical shell game to outside observers is standard operating procedure for partisans on both sides of the aisle. Conservative and liberal organizations alike raise funds into one group that doesn’t spend money on elections but donates to an affiliate that does. Consequently, the only “contributor” disclosed by the second group is the first; individual contributors to the original organization never become public.
For example, Planned Parenthood of the Rocky Mountains Action Fund is also a 501(c)(4) organization. Its stated goals include “to foster and preserve a social and political climate favorable to the exercise of reproductive choice.” In 2018, it made $236,544.79 in total political contributions, all directed to its affiliated Planned Parenthood Votes Colorado Independent Expenditure Committee.
The independent expenditure committee then paid for television, radio, mailing, phone banks or other communications to support or oppose candidates.
By determining that Colorado Pioneer Action fell within the constitutionally defined ambit of a political committee, the court of appeals set off a domino-effect that required Colorado Pioneer Action to abide by restrictive contribution amount limits ($625 per contributor, per election cycle) and publicly disclose all its contributors. And, of course, there is the $17,735 penalty imposed on the group.
That’s the kind of thing that should make groups like Planned Parenthood sit up and take notice.
There are caveats. First, as an unpublished court of appeals decision, the Colorado Pioneer Action case cannot be cited as binding legal precedent. Second, while the lower court reviewed the proportionate amount of money Colorado Pioneer Action made during an individual calendar year, the administrative law judge equivocated on the test’s applicability to groups with a longer history of activity.
Unfortunately for groups like Colorado Pioneer Action and Planned Parenthood, there is no good way to know in advance. The byzantine bramble created by campaign finance and election laws rarely provide bright-line rules that should be requisite when discussing core free-speech rights.
That paradox led former Supreme Court Justice Anthony Kennedy to lament in the landmark Citizens United decision that the “First Amendment does not permit laws that force speakers to retain a campaign finance attorney, conduct demographic marketing research, or seek declaratory ruling before discussing the most salient issues of our day. Prolix laws chill speech for the same reason that vague laws chill speech: People ‘of common intelligence must necessarily guess at [the law’s] meaning and differ as to its application.’”
Unfortunately, and perhaps unconstitutionally, that is not the position politically active groups may now find themselves. To the contrary, even with the help of legal counsel, it seems the only path to resolution may now be through further litigation.
Colorado Pioneer Action may still appeal to the Colorado Supreme Court or could eventually challenge the whole law in federal court. If they don’t, every other group employing a similar framework may want to begin putting a few more dollars into their own legal defense funds.
Regardless, the landscape for Colorado’s 2020 election cycle has already been altered.
Mario Nicolais is an attorney and columnist who writes on law enforcement, the legal system, health care and public policy. Follow him on Twitter: @MarioNicolaiEsq
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