Both sides in ‘dark money’ debate voice concerns at hearing

Opponents countered that the rules would strip away privacy from even small donors to nonprofit groups and other organizations that engage in electioneering.

A focus of the proposed rules is so-called dark money groups, which engage in electioneering but aren’t formed primarily for a political purpose, meaning they don’t have to register with the Secretary of State as political committees and publicly disclose their financial backers and how they spend their money.

Under the proposed rules, a group that isn’t a political committee but pays for political advertisements or other communications costing more than $1,000 would have to file a report with the Secretary of State’s Office. The report would identify the group that paid for the communications, as well as any donor who contributed more than $200 for the expenditures.

While the state Democratic Party has adopted campaign finance reform as a platform plank and Chairman Richard Ellenberg has called the flood of money into politics “a cancer on our democracy,” he said at the public hearing that the definition of advertising in the proposed rules might not be clear enough, potentially covering email newsletters or social media posts, not just print and television ads.

The rules would expressly exempt communications from an organization to its members and comments made in a news story or editorial, at a forum or in voter guides.

Mark Friedman, a founder of the progressive group Indivisible Santa Fe, said he backs the proposed rules and greater transparency in money in politics. “While money is not speech, money is power,” he said.

But Friedman argued that the focus should be on major donors with political influence, not relatively small spenders.

Toulouse Oliver told reporters after hearing that her office had received several comments about the $200-or-over threshold for potential donor name disclosure. Her staff is reviewing those concerns, she said, but she maintained that disclosure is key.

“If you’re going to be engaging in the political sphere, in advocacy on behalf of a candidate or ballot measure, we do believe that disclosure is required,” she said.

Tyler Martinez from the Center for Competitive Politics, a nonprofit Virginia group that says its mission is to protect political speech, said he was concerned the proposed reporting requirements would be an added burden on nonprofits. Some nonprofits are permitted to engage in electioneering, as long as that isn’t their primary purpose.

The regulations “would mandate detailed record keeping and force groups to create multiple bank accounts and solicitations,” Martinez said in comments submitted to the Secretary of State’s Office.

The rules would “likely place a heavy burden … on any entity that speaks using the name of a candidate, including charities,” he said.

The rule could affect fundraising, he said, and force nonprofit groups to reject some anonymous donations.

A coalition of conservative groups and individuals, including former Gov. Gary Johnson, also are opposed to the proposed rules, saying they would curb donations to politically active nonprofits and other groups because some potential donors would fear their names would become public and open them to harassment.

“This rule will chill the First Amendment rights of New Mexicans,” said Burly Cain, state director of the conservative group Americans for Prosperity.

The coalition also has said that Toulouse Oliver is exceeding her authority by trying to adopt by rule what was vetoed by Gov. Susana Martinez. The Legislature, in its session that ended in March, approved legislation to require limited disclosure by some dark money groups, but Martinez rejected the legislation.

But Viki Harrison, executive director of the open-government group Common Cause New Mexico, said the proposed rules do not require anything new of organizations that are involved in political advocacy. Instead, she said, it merely requires the groups make public some of the informational they already keep. And if donors to a nonprofit group do not want their contributions used for political purposes, they can say so.

Members of grass-roots groups such as Taos United and Action Alliance of the Embudo Valley said they favor the proposed rules as a means of giving voters more information about political groups trying to influence elections.

The Secretary of State’s Office plans two more hearings for next week, one in Albuquerque and another in Las Cruces. The office also will accept comments on the proposed rules online at sos.state.nm.us.

If the Secretary of State’s Office implements the rules in some form, which Toulouse Oliver said she hopes to do by Oct. 3, Americans for Prosperity and other conservative groups appear poised to take her to court over the regulations.

Contact Andrew Oxford at 505-986-3093 or aoxford@sfnewmexican.com. Follow him on Twitter @andrewboxford.