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1989-53: Restrictions on Using Contributions for Advocating a Ballot Proposal Position

October 26, 1989

On November 7, 1989, a general election will be held in New York City. Voters will cast ballots both to elect candidates to various municipal offices and to approve or disapprove certain ballot proposals, including amendments to the New York City Charter proposed by the Charter Revision Commission. An advisory opinion has been requested whether the New York City Campaign Finance Act restricts a political committee authorized by a candidate, who is participating in the Campaign Finance Program and seeking election on November 7, from expending contributions for the purpose of advocating the disapproval of a Charter amendment submitted to the electorate that same day.

Candidates participating in the Campaign Finance Program and their authorized committees agree to abide by limits on the amount of contributions they may accept and on the amount of expenditures they make in their election campaigns. They may not accept contributions "for each election in which they seek to be qualified" to receive public funds in excess of specified amounts. Administrative Code §3-703(1) (f). They may not spend more than a specified amount of any contribution received before February 29, 1988, the day the Act became law, for "nomination for election or election." Administrative Code §3-703(1) (g). Funds attributed to contributions exceeding these limits must be deposited in segregated accounts and may not be used in an election in which the candidate has agreed to abide by the limits. Campaign Finance Board Rule 401(a), (c), (d).

Furthermore, expenditure limits apply "in each primary election and in each general election." Administrative Code §3-706(1) (a). The Board has applied the expenditure limits to expenditures "made... for the purpose of promoting or facilitating the nomination or election of the candidate." Campaign Finance Board Rule 105(a).

The question presented is whether any of these provisions restrict the use of "segregated monies," representing contributions exceeding the amount of these limits, for the purpose of urging voters to disapprove a Charter amendment. The Board recognizes that there is a question whether placing restrictions on monies used solely to advocate a position on a proposed Charter amendment would impair the free exercise of the rights of speech and association protected under the First and Fourteenth Amendments of the United States Constitution1. The Board need not address this question, however, because it has concluded that the City Council, in adopting the Act, did not intend to limit contributions used solely for the purpose of advocating a position on a ballot measure.

The Act restricts the acceptance and expenditure of contributions for "an election", which is defined as

any primary, runoff primary or general election for nomination for election, or election, to the office of mayor, president of the city council, comptroller, borough president or member of the city council.

Administrative Code §3-702(10). Referenda elections are not included in this definition.

An expenditure by the candidate's authorized committee advocating a position on a ballot proposal will nonetheless be subject to the restrictions of the Act if it also promotes or facilitates the election of the candidate. Under Campaign Finance Board Rule 102(e), a disbursement is presumed to be made for the next following election in which the candidate seeks nomination or election. The candidate therefore has the burden before the Board of demonstrating that the disbursement was not made to promote or facilitate his or her election, but rather only to promote a position on a ballot proposal.

The Board will presume that the use of segregated monies by a candidate's authorized committee to advocate a position on a ballot proposal is not subject to the restrictions of the Act if expended in the following manner:

1) for material that does not in any way identify the candidate; and

2) for contributions to another political committee advocating a position on a ballot proposal, provided that the material paid for by the committee receiving the contribution does not promote or facilitate the candidate's election.

In other circumstances, the Board will evaluate all relevant facts in determining whether an expenditure to advocate a position on a ballot proposal is nonetheless subject to the provisions of the Act because it also promotes or facilitates the election of a candidate.



1 The United States Supreme Court has upheld the constitutionality of limits imposed on contributions to candidates and their authorized committees for the purpose of limiting the actuality and appearance of corruption resulting from the making and acceptance of large contributions. Buckley v. Valeo, 424 U.S. 1, 26 (1976). These are the very purposes underlying the City Council's determination to adopt contribution limits. See Local Law No. 8 of 1988 §1. On the other hand, the Court has struck down limits on contributions to committees formed to advocate a position on ballot measures. Citizens Against Rent Control/Coalition for Fair Housing v. City of Berkley, 454 U.S. 290 (1981). In that case, the majority opinion found "no significant state or public interest in curtailing debate and discussion of a ballot measure." 454 U.S. at 299. The Court has not, however, addressed the question whether anti-corruption purposes justify the imposition of limits on contributions to committees authorized by candidates or elected officials solely to advocate a position on ballot measures.