SBE-08-12-00020-A Disclosure of Independent Expenditures

10/24/12 N.Y. St. Reg. SBE-08-12-00020-A

NEW YORK STATE REGISTER

VOLUME XXXIV, ISSUE 43

October 24, 2012

RULE MAKING ACTIVITIES

STATE BOARD OF ELECTIONS

NOTICE OF ADOPTION

 

I.D No. SBE-08-12-00020-A

Filing No. 1003

Filing Date. Oct. 09, 2012

Effective Date. Oct. 24, 2012

Disclosure of Independent Expenditures

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following action:

Action taken:

Amendment of section 6200.10 of Title 9 NYCRR.

Statutory authority:

Election Law, section 3-102; L. 2011, ch. 399 (Unconsolidated Law)

Subject:

Disclosure of Independent Expenditures.

Purpose:

Set requirements relative to disclosure of Independent Expenditures.

Text or summary was published

in the February 22, 2012 issue of the Register, I.D. No. SBE-08-12-00020-P.

Final rule as compared with last published rule:

No changes.

Text of rule and any required statements and analyses may be obtained from:

William McCann, New York State Board of Elections, 40 North Pearl Street, Albany, NY 12207, [phone], email: [e-mail]

Assessment of Public Comment

4 Public Comments were received - Citizens Union; The League of Women Voters of NYS; Common Cause/NY; and The Brennan Center for Justice.

The Legislature has charged the New York State Board of Elections ("Board of Elections"/ "Board") with regulating independent expenditures to the "fullest extent of the law" in elections for New York State and municipal offices. In response to the proposed definition of "express advocacy" in the Board's draft regulation of independent expenditures, Citizens Union, Common Cause New York, and the League of Women Voters have commented that the Board should regulate certain independent expenditures that subsidize pure issue advocacy - viz., "communications that discuss an organization's views on issues endorsed by a political candidate or party without expressly advocating the election of that candidate or party." Matter of Klepper v. Christian Coalition of New York, Inc. ("Klepper"), 259 A.D.2d 926, 927 (3d Dep't 1999). To this end, it was suggested that the regulation require disclosure of "Electioneering Communications." Electioneering Communications are certain communications that contain a clearly identified candidate by references such as name, caricature, or photo, made during a specific window period prior to a primary or general election, that are not express advocacy. The Brennan Center for Justice has commented that the draft regulation appropriately does not govern issue advocacy as proposed by the other three entities who responded. The proposal of Citizens Union, Common Cause New York, and the League of Women Voters that the Board regulate independent expenditures that subsidize pure issue advocacy would constitute impermissible regulation beyond the fullest extent of the law in New York, whose definition of a "political committee" in Election Law § 14-100(1) has been construed to authorize only regulation of communications that expressly advocate in favor of or against a clearly identified candidate for public office.

The Brennan Center for Justice recognizes this circumstance, and notes that the Board's independent expenditure regulations must apply to express advocacy at its fullest extent. However, the Brennan Center for Justice also states that the Regulation does not pertain to the full range of communications that constitute "express advocacy." In response, the Board considered leaving its proposed definition of express advocacy as is, broadening its definition by eliminating examples of words that signal express advocacy, or specifying that express advocacy includes its "functional equivalents."

Klepper interpreted New York's definition of a political committee to encompass entities engaged in "express advocacy," not entities engaged solely in "issue advocacy," as the United States Supreme Court has distinguished those terms in Buckley v. Valeo ("Buckley"), 424 U.S. 1 (1976). Pursuant to that interpretation, the Board determined that New York's regulations concerning independent expenditures should require disclosure only with respect to express advocacy, not issue advocacy. To mandate disclosure of issue advocacy, as the Brennan Center has correctly asserted in its comment, would surpass the "fullest extent of the law" in New York -- i.e., that only express advocacy is subject to disclosure. To the extent that they argue otherwise, the comments offered by Citizens Union, Common Cause New York, and the League of Women Voters are beyond the scope of Law in New York State.

In order to regulate to the "fullest extent of the law" -- as the Legislature has required the Board of Elections to do -- New York's proposed regulations concerning independent expenditures must require disclosure with respect to the full range of activities that encompass "express advocacy."

The proposed regulation defines "express advocacy" as "a communication that contains express words such as vote, oppose, support, elect, defeat, or reject, which call for the election or defeat of a candidate." The Brennan Center contends that this definition -- which derives from a Buckley footnote that sets forth certain "magic words" that denote express advocacy -- does not cover the whole spectrum of express advocacy, in that it does not include so-called "functional equivalents of express advocacy" -- i.e., communications that "could only be interpreted by a reasonable person as containing advocacy of the election or defeat of one or more clearly identified candidates." 11 C.F.R. § 100.22(b).

This definition of functional equivalents of express advocacy - also known as the "appeal to vote" test - was originally formulated by the Court in Federal Election Commission v. Furgatch, 807 F.2d 857, 862-63 (9th Cir. 1987), as a means to describe express advocacy that did not consist of the "magic words" identified by Buckley. In 1995, at the conclusion of an eight-year-long process to define communications prohibited by Section 441b of the Federal Election Campaign Act of 1971 ("FECA") (which then forbade independent expenditures by corporations), the Federal Election Commission ("FEC") followed Furgatch by promulgating an express advocacy definition that included functional equivalents. If the FEC defined express advocacy to include functional equivalents, the Brennan Center argues, so should the New York State Board of Elections.

The FEC's issuance of its express advocacy definition, however, was an act of statutory construction of FECA § 441b - not of New York's political committee definition in Election Law § 14-100(1). In 1999, Klepper declared that this definition did not include entities engaged purely in issue advocacy, but was silent whether express advocacy in New York included functional equivalents, or solely communications consisting of the "magic words" set forth in Buckley.

The Supreme Court's decisions in McConnell v. Federal Election Commission, 540 U.S. 93 (2003), Federal Election Commission v. Wisconsin Right to Life, Inc., 551 U.S. 449 (2007), and Citizens United v. Federal Election Commission, __ U.S. __, 130 S.Ct. 876 (2010) - all rendered after Klepper - do not resolve this question. In each case, the Court confirmed that required disclosure and reporting of functional equivalents of express advocacy would not violate the First Amendment to the United States Constitution. The Court did not say, however, whether functional equivalents constitute a subset of express advocacy. Although Klepper counseled that "political committees" subject to regulation include all entities that engage in express advocacy, Klepper did not answer whether express advocacy includes its functional equivalents.

What is clear is that the Board's independent expenditure regulations must regulate the entire range of express advocacy, consistent with Klepper's construction of New York's political committee definition.

The Board reviewed all of the materials submitted. An extensive review and discussion was undertaken concerning the application of the functional equivalents standard to the Klepper standard, and whether these could be read consistently with one another. On the one hand, "functional equivalents of express advocacy" are communications that "could only be interpreted by a reasonable person as containing advocacy of the election or defeat of one or more clearly identified candidates." 11 C.F.R. § 100.22(b). Klepper identified pure issue advocacy as "communications that discuss an organization's views on issues endorsed by a political candidate or party without expressly advocating the election of that candidate or party." Klepper, 259 A.D.2d 926, 927 (3d Dep't 1999). In both cases, clearly identified candidates are present in the communications. Under the functional equivalents standard, items that would not be required to be disclosed under Klepper because they would be deemed issue advocacy, would be required to be disclosed. A segment of the Board determined that functional equivalents was beyond the scope of New York Law, that the definition of Express Advocacy as proposed was the appropriate standard, and that any change to the standard would require an act of the New York State Legislature. The other segment of the Board determined that functional equivalents should be included, that New York Law supported that standard, and the regulation should be modified. It was finally determined that the Regulation would stand as written and the Board voted to adopt the Regulations.