Disclosure of political spending

In the wake of a U.S. Supreme Court ruling that will allow corporations to spend freely to advocate for or against political candidates, a new law will require better disclosure of political expenditures in Minnesota.

Sponsored by Rep. Ryan Winkler (DFL-Golden Valley) and Sen. Ann Rest (DFL-New Hope), the law is a response to the case of Citizens United v. Federal Election Commission. In January, the court ruled that independent expenditures — political spending by private entities — could not be limited, under the U.S. Constitution. Rather than attempting to limit independent political expenditures, the law would create disclosure requirements.

Expenditures of greater than $100 by corporations or other associations must be made through independent expenditure political committees or funds, under the law. All such expenditures must be reported to the Campaign Finance and Public Disclosure Board. Those who violate the provision will be subject to a fine of four times the amount of the expenditure, up to a maximum of $25,000.

Independent expenditures do not include direct spending on a candidate’s political campaign, or any expenditures authorized by a candidate. Doing so would be a violation of the law.

Associations that make independent political expenditures from membership dues or fees must provide information on the association’s members, including names, addresses and how much of the expenditure is attributable to each member of the association. This will only apply to associations that make expenditures of greater than $5,000, and only when $1,000 or more of that expenditure is from membership dues or fees. Again, a fine of up to $25,000 or four times the amount of the expenditure applies for those who violate the provisions.

The law also includes a provision banning public utility companies from recovering political expenditure costs by charging their customers.

The provisions requiring corporations to make their political expenditures under the state’s independent expenditure laws are effective May 28, 2010. Unless otherwise noted, the rest of the law takes effect June 1, 2010.

HF2754/ SF2471*/CH397