By Howard Fischer
Mail | X: @azcapmedia

PHOENIX — Arizonans have an absolute right to demand to know just who is trying to influence elections, the Arizona Court of Appeals ruled Friday.

In a unanimous decision, the three-judge panel rejected a series of claims by the Arizona Free Enterprise Club and the Center for Arizona Policy that Proposition 211 interferes with their rights of privacy in the Arizona Constitution and the rights of their contributors.

“Donors to organizations that receive money from private individuals to use in making public declarations on government policy positions can hardly be engaging in private affairs,” wrote appellate Judge Jennifer Campbell for the unanimous three-judge panel.

More significant, the court said Proposition 211 serves an “important government interest” because it can help prevent corruption by ensuring voters know exactly who is trying to sway elections for those who support their positions rather than allowing them to hide their identities by funneling their cash through other organizations.

“In doing so, donors may exchange their indirect monetary support for political favors once the candidate is elected,” Campbell wrote. “At that point, the same corruption concerns exists as if the donors had contributed to the candidate directly,” donations that state law has long required to be disclosed.

The same is true, she said, of money spent to advocate for or against ballot measures.

“If out-of-state donors pour donations into nonprofit organizations seeking to influence Arizona elections, voters have an informational interest in the disclosure of the identities of the advocacy group’s donors,” said Campbell.

This isn’t the end of the line. Joe Seyton, a spokesman for the Goldwater Institute which is representing both organizations that have been involved in public policy and political campaigns in the past, said it will seek review by the Arizona Supreme Court.

Approved by voters in 2022 by a nearly 3-1 margin, the Voters Right to Know Act says any organization that spends more than $50,000 on a statewide race — half that for other contests — has to publicly disclose anyone who has given at least $5,000.

More to the point, it says those recipient groups have to trace the money back to the original source.

Arizona law has long had campaign finance laws. Until the measure was approved, however, all that was required is the name of the group that provided the cash. That meant a donation to a candidate or ballot measure or an expenditure for or against a ballot measure could be listed as coming from some group with a name like “Arizonans for Arizona,” with no clue who formed that group and no clue as to who is providing the cash.

This measure requires the names of those who have financed that organization must be made public.

The challenging groups argued all that interferes with the rights of donors.

“The act violates Arizonans’ right to speak freely by chilling donors from supporting causes they believe in and wish to support, lest their charitable giving become public knowledge,” argued attorney Scott Freeman of the Goldwater Institute.

Campbell, in the 25-page ruling, detailed a series of reasons why those arguments fail.

It starts, she said, with the fact the framers of the Arizona Constitution made it clear they believe financial disclosure is important, directing lawmakers to require a public list of all campaign contributions to candidate for public office.

“By expressly mandating the disclosure of campaign contributions, the framers of the Arizona Constitution in fact highlighted an intent to compel the disclosure of the identities of persons and groups contributing money to influence elections,” Campbell wrote. Proposition 211, she said, simply expands on that requirement.

She also rejected arguments that such disclosure runs afoul of free speech protections.

“The laws at issue implicate only disclosure requirements, which, again, do not prevent anyone from speaking or impose ceilings on campaign related activities,” the judge said.

Nor was Campbell swayed by arguments requiring such disclosure interferes with a separate constitutional right of people to associate with each other.

She pointed out the initiative has an escape clause for those who want to associate with a group but don’t want their names showing up on campaign finance reports: They can spell out that any money they provide cannot be used for political purposes.

“The association only becomes public if the donor chooses to allow their contributions to be used for political media campaigns,” Campbell said.

All of this, the judge said, serve the purpose of providing information to voters.

“Without the act’s disclosure requirements, the public could never evaluate the true source of the funds hidden by filtering through front groups or intermediaries,” she said.

The appellate court also rejected parallel arguments by the Free Enterprise Club and the Center for Arizona Policy that even if Proposition 211 is constitutional, it should not be applied to them and their donors.
Both groups cited what Freeman said was a history of “harassment and intimidation based on their policy positions,” claiming if their donors are identified “they, too, will suffer the same treatment.” They also said this harassment will hinder their ability to raise money.

Campbell, however, said the evidence does not back that up.
She acknowledged both organizations submitted declarations that staff members have received threatening and harassing phone calls, voicemails, emails and social media posts in response to the public positions they have taken. But the judge said that there were only a “handful of harassing communications” received by each group.

CAP said it hired private security guards on two occasions in response to expected protests.

“However, there was no allegation that the protesters harassed or threatened CAP’s staff or caused any property damage,” Campbell said. And as to other activities, she said “peaceful protests are protected speech and cannot serve as the basis for an as-applied challenge to a disclosure law.”

Nor was the judge impressed by the arguments of two individual plaintiffs, neither of whom were identified, that they would face harassment and retaliation if their large donations are disclosed.

“Plaintiffs’ allegations are too speculative to show a reasonable probably that donors would face threats, harassment, or reprisals because of disclosures required under the act,” Campbell said.

Others who have challenged the initiative have had no better luck.
Last year, Maricopa County Superior Court Judge Timothy Ryan rejected a bid by House Speaker Ben Toma and Senate President Warren Petersen to block implementation of the law ahead of the 2024 election. Their attorney had argued the initiative infringed on the rights of the Republican-controlled Legislature.

But Ryan said voters have an absolute right to enact laws requiring full disclosure of the true source of political donations — even if GOP lawmakers don’t like it.

Ryan pointed out the people have the same authority as legislators to enact laws. He said that, just like measures approved by the Legislature, they are presumed just as valid unless there is something unconstitutional about them.

And the judge said there is no such evidence here that would allow him to keep what voters approved from taking effect.

“The citizens of Arizona voted to receive more information about the sources of money trying to influence Arizona elections,” he wrote. “The public interest weighs heavily in favor of protecting Arizona voters’ constitutionally protected legislative authority, and their interests in being fully informed when choosing their representatives and voting on initiatives and referenda, as expressed in Prop. 211.”

That ruling is currently on appeal.

In a third challenge, U.S. District Court Judge Roslyn Silver knocked down a series of arguments by Americans for Prosperity Now, an organization founded by the Koch Brothers, that Prop 211 infringes on its free speech rights and those of its donors. That case, too, is being appealed.