New Mexico’s Proposed Small Donor Public Financing Program is Constitutional

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On April 5, 2013, Governor Susana Martinez vetoed a proposed amendment to New Mexico’s public financing law that would have established a small-donor matching program. Under the legislation, after participating candidates received an initial public finance grant from the state, they would have been eligible to receive a four-to-one match for small-donor contributions of up to $100, up to an established limit. Governor Martinez’s veto message cited, among other objections, that “it is entirely unclear that this proposed legislation is constitutional.”[1]

As discussed below, Governor Martinez’s concerns about the constitutionality of the proposed legislation are unwarranted. Small-donor public financing is undoubtedly constitutional and conforms fully with the First Amendment.[2]  Indeed, the U.S. Supreme Court has twice ruled that public financing is constitutional[3] and explicitly upheld a small-donor matching funds program in 1976.[4]

Background on New Mexico’s Public Financing Law

The New Mexico Voter Action Act (the “Act”) gives candidates for appellate judgeships and for the Public Regulation Commission the option of financing their election campaigns with public funds if they agree not to accept funding from other sources.[5]  In 2012, the United States District Court for the District of New Mexico struck down one provision of the Act, the so-called “trigger” provision, which provided publicly funded candidates with funds to match spending by their opposition.  The court held that this provision impermissibly burdened the protected political speech of participating candidates’ opponents, because their spending triggered additional funding for publicly financed candidates.  The district court ruled, however, that the remainder of New Mexico’s public financing law remained “operable and enforceable.”[6]

In 2013, the State Legislature passed Senate Bill 16, which replaced the Act’s trigger provision with a small-donor public financing program.  On April 5, 2013, Governor Martinez vetoed this bill, questioning its constitutionality.

Small-Donor Public Financing is Constitutional

In Buckley v. Valeo, the cornerstone of modern campaign finance law, the U.S. Supreme Court upheld the constitutionality of public financing, including a small-donor public financing program similar to the one proposed for New Mexico.

In Buckley, the Court considered a series of statutes establishing public financing of presidential election campaigns, including a small-donor matching program for primary elections.  Finding that public financing “furthers, not abridges, pertinent First Amendment values,” the Court upheld this public financing system, explaining that the purpose of public financing is to “facilitate and enlarge public discussion and participation in the electoral process, goals vital to a self-governing people.” [7]  With respect to the small-donor matching program, where candidates in presidential primaries receive a one-to-one match of small-donor contributions of up to $250,[8] the Court noted that “[t]he thrust of the legislation is to reduce financial barriers and to enhance the importance of smaller contributions.”[9]  Since Buckley, lower courts have repeatedly found public financing programs to be constitutional.[10]

In 2011, the U.S. Supreme Court reaffirmed the constitutionality of public financing in Arizona Free Enterprise Club’s Freedom Club PAC v. Bennett: “[G]overnments may engage in public financing of election campaigns and . . . doing so can further significant governmental interests, such as the state interest in preventing corruption.”[11]  Although the applicable statute did not include a small-donor matching program, nothing in the Court’s reasoning draws the constitutionality of small-donor matching – already recognized by the Court in Buckley – into question. 

Bennett addressed the constitutionality of a public financing “trigger” mechanism, like the one considered by United States District Court for the District of New Mexico in Dolan; indeed, it is Bennett that compelled the result in Dolan.   At issue in both cases was whether it was constitutional for a state to disburse additional public funds to publicly financed candidates based on significant spending by an opposing candidate or independent group.  The Bennett Court ruled that the use of this mechanism imposed an unconstitutional burden on opposition speech because it directly tied public financing amounts to the level of opposition spending: “Once a privately financed candidate has raised or spent more than the State’s initial grant to a publicly financed candidate, each personal dollar spent by the privately financed candidate results in an award of almost one additional dollar to his opponent.”[12]

This reasoning is inapplicable to small-donor public financing, where public funds match small contributions to a participating candidate, and the distribution of public funding bears no relation whatsoever to opposition spending.  Unlike the trigger at issue in Bennett, small-donor public financing does not penalize or otherwise burden opposition speech – how much any other candidates or independent groups spend is unrelated to the amount a publicly financed candidate receives.  Thus, as Bennett makes clear, because small-donor public financing does not implicate a speaker’s “autonomy to choose the content of his own message,”[13] it raises no concerns under the First Amendment.[14]  Indeed, the Bennett decision struck down only the trigger provision in Arizona’s public financing law, leaving the rest of the law operable.

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In short, public financing of elections – including small-donor matching – enhances public debate and First Amendment values, and the U.S. Supreme Court has made clear that these programs are wholly consistent with the First Amendment. New Mexico’s Senate Bill 16 therefore raises no constitutional questions or concerns.