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Questions and Answers About Colorado Republican II: Supreme Court Upholds Restrictions on Political Parties

Published: June 26, 2005

Questions and Answers About
Colorado Republican II:
Supreme Court Upholds Restrictions on Political Partie

On Monday, June 25, in FEC v. Colorado Republican Federal Campaign Committee, 2001 U.S. Lexis 4668 (June 25, 2001), the U.S. Supreme Court upheld the federal limit on expenditures that political parties coordinate with their candidates. The case, commonly known as Colorado Republican II, is the second major Supreme Court victory for campaign finance reform in two years and bodes well for future challenges to the soft money ban in McCain-Feingold. In this news alert, the Brennan Center for Justice at NYU School of Law explains what was at stake in the case, what the Court decided, and what the decision means for the future.

What Was at Stake in Colorado Republican II?

In the federal system, there are three different ways that political parties may use money to help elect candidates. First, the parties may donate funds directly to candidates’ campaigns, under specified contribution limits. Second, the Supreme Court ruled in Colorado Republican I that political parties, like individuals and PACs, can spend unlimited sums independently of the candidates (i.e., make independent expenditures). Finally unlike other political players parties are permitted to make limited expenditures in coordination with their candidates, without counting those coordinated expenditures toward their contribution limits. Colorado Republican II involved a First Amendment challenge to the caps on the amount of expenditures that could be coordinated with candidates.

The principal reason for limiting coordinated spending is to prevent circumvention of contribution limits applicable to individuals and PACs. The caps protect against evasion by reducing incentives for wealthy donors to funnel money through political parties. The same anti-evasion rationale supports other campaign finance restrictions, such as limits on contributions to parties and PACs. If the Court had rejected that rationale in Colorado Republican II, we would have seen not only skyrocketing coordinated spending, but also attacks on a wide array of other campaign finance regulations.

What Did the Supreme Court Decide in Colorado Republican II?

In a 5–4 decision, authored by Justice Souter (and joined by Justices Stevens, O’Connor, Ginsburg, and Breyer), the Supreme Court decided that Congress was justified in limiting coordinated expenditures because, without the limit, wealthy donors would have an added incentive to circumvent existing contribution limits by channeling funds through the political parties. The Court noted that the “tally” system whereby candidates get credit for funds they raise for the party, which in turn supports the candidates’ campaigns was already “a sign that contribution limits are being diluted and could be diluted further if the floodgates were open.” To deny the potential for abuse, said Justice Souter, was to suffer from a kind of “myopia, a refusal to see how the power of money actually works in the political structure.”

The Court refused to “ignore reality” in evaluating the party’s role in raising and spending money. The party’s funding “comes from contributors with their own personal interests” contributors who sometimes give to both parties and even to competing candidates in a single race. “Parties are thus necessarily the instruments of some contributors whose object is not to support the party’s message or to elect party candidates across the board, but rather to support a specific candidate for the sake of a position on one, narrow issue, or even to support any candidate who will be obliged to the contributors.” The coordinated spending limits control the extent to which parties will be exploited in this way and thus contain the threat of corruption and apparent corruption.

What Is the Significance of Colorado Republican II?

On the federal level, the reasoning of the Court supports arguments favoring a soft money ban. The purpose of such a ban is to prevent the circumvention of contribution limits (and the ban on contributions from corporations and unions). Colorado Republican II strongly reaffirmed this anti-evasion rationale for campaign finance regulation, stating in no uncertain that “all members of the Court agree that circumvention is a valid theory of corruption.”

Moreover, the Court put to bed the idea that political parties are entitled to more constitutional protection from campaign finance regulations than are individuals and PACs. Indeed, the Court recognized that the very closeness of parties to their candidates increases the efficacy of parties as “conduits for contributions meant to place candidates under obligation.” Opponents of a soft money ban can no longer claim, as they have in the past, that political parties cannot be regulated because they play no role in the corruption of candidates. Nor can opponents seek a higher standard of First Amendment review just because political parties are subject to restrictions. States that have regulated, or are considering regulating, soft money in state elections should also take comfort from this decision.

On the state level, the case also calls into question the decision in Missouri Republican Party v. Lamb, 227 F.3d 1070 (8th Cir. 2000), a case invalidating limits on contributions from political parties to candidates for state offices in Missouri. The U.S. Court of Appeals for the Eighth Circuit rested its decision in Lamb on its rejection of the anti-evasion rationale. Now that the Supreme Court has firmly endorsed the rationale, specifically in the context of limits on the functional equivalent of contributions, Missouri and other states in the Eighth Circuit should be free to cap the amounts contributed to state candidates by political parties. (States in the Eighth Circuit, in addition to Missouri, include Arkansas, Iowa, Minnesota, Nebraska, North Dakota, and South Dakota.)

Finally, the case augurs well for campaign finance jurisprudence generally. All too often, courts have been willing to decide First Amendment challenges to campaign finance reforms on the basis of mere speculation of what might happen, without consideration of political reality. The Supreme Court’s refusal in Colorado Republican II to ignore “how the power of money actually works in the political structure” will be enormously important when the Court is asked to consider the constitutionality of laws regulating soft money and sham issue ads. We stand an excellent chance of closing those gaping loopholes if the Court continues to ask, as it did in Colorado Republican II, “whether experience under the present law confirms a serious threat of abuse.”