South Dakota tries to limit outsiders' money in initiatives

AP News
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Posted: Feb 14, 2017 5:39 PM

PIERRE, S.D. (AP) — Top South Dakota Republicans are moving to stem the flow of out-of-state money into its ballot question campaigns after millions of dollars poured in last fall seeking to influence a long list of voter initiatives.

An amendment to South Dakota's bill set to be considered in committee Wednesday would limit ballot question campaigns to $100,000 in out-of-state contributions per general election cycle.

South Dakota is one of at least two states, along with Arizona, considering such legislation, which experts say likely wouldn't survive a legal challenge. An aide to South Dakota Gov. Dennis Daugaard said that the Republican executive believes it's a concept worth defending in court.

Since Election Day, when voters decided 10 ballot measures, Republicans have frequently complained about out-of-state interests experimenting with South Dakota's laws and constitution.

Daugaard has said out-of-state groups took advantage of the state's low signature requirements and cheap media markets to advance a national agenda. Out-of-state donors pumped over $10 million into campaigns for or against the state's questions.

A California billionaire whose sister was killed by a stalker bankrolled an amendment that established constitutional rights for crime victims. A Massachusetts group funded a transformative government ethics initiative that was on the books until lawmakers quickly repealed it. And a car title lender based in Georgia with locations in South Dakota tried unsuccessfully to amend the state constitution to allow unlimited interest rates.

"I personally am offended that someone from California is running a campaign to amend state's constitutions because he's grieving over his sister's death," House Speaker Mark Mickelson said during a committee hearing last week.

"Some of you think that's democracy. I think we can improve that process a lot by making sure that the ideas and the debate reflect our issues that we have — the people that live here."

The Arizona bill would completely ban contributions by non-residents and out-of-state committees to ballot measures. Its sponsor, Republican Rep. Bob Thorpe, didn't return email and telephone messages requesting comment.

Daugaard has said he wants legislation that is legally defensible while making sure that South Dakotans have the biggest say in debates over ballot measures. His chief of staff, Tony Venhuizen, said the federal courts have recognized in the past that governments have the right to preserve their interest in self-governance. Daugaard believes a legal fight would be worth it for such a law if it was challenged, Venhuizen said.

University of Chicago Law School professor William Baude said he doubts it would survive a court challenge.

The U.S. Supreme Court declared in a 1981 decision that limits on contributions to ballot measure committees are unconstitutional under the First Amendment, said Paul S. Ryan, a vice president at the Washington watchdog Common Cause, which opposes big money in politics.

The high court has said that contributions to candidates can be limited to prevent the corruption of public officials, Ryan said. But, he said, the court found that with a ballot measure, unlike a candidate, there is nobody to corrupted, so there's no legal justification for limiting donations.

At least two states, Alaska and Hawaii, restrict out-of-state contributions to candidates. A federal court upheld Alaska's law in November, but the case has been appealed. The courts have struck down other states' geographic contribution limitations.

In South Dakota, Daugaard noted last month in his State of the State address that South Dakota was the first state in the nation to put in place initiative and referendum out of a fear that wealthy out-of-state interests would take over the Legislature.

"Now, 120 years later, we find big out-of-state money is taking over our ballot," Daugaard said. "They use the initiative process — the very process we created to protect ourselves from them."