Brief Fact Summary.
The Arizona Clean Elections Act established public financing rules for state elections that allowed candidates to receive state funds if they complied with certain criteria. The PAC argued that the law was unconstitutional under the First Amendment because it effectively placed a penalty on self-funded candidates. The state argued that the law promoted transparency in campaign finance and reduced corruption by allowing publicly-funded candidates to financially match candidates who were receiving funds from unnamed interest groups.
Synopsis of Rule of Law.
Campaign finance laws that have any chilling or burdensome effects on speech will likely be unconstitutional under the First Amendment.
But the fact that burdening constitutionally protected speech might indirectly serve the State's anticorruption interest, by encouraging candidates to take public financing, does not establish the constitutionality of the matching funds provision.View Full Point of Law
The Arizona Clean Elections Act established public financing rules for state elections. Under the law, the candidates could opt-in to the program and receive additional money from the state when they collected a certain number of $5 donations from voters and complied with other requirements. Once a spending limit was exceeded, a publicly financed candidate could receive one dollar for every one dollar spent by an opposing, privately financed candidate who did not opt-in to the program. The law also increased contribution and spending limits for publicly funded candidates.
The law was passed in 1998, and in 2008, the Supreme Court ruled in Davis v. Federal Election Commission (2008) that giving public advantages to opponents of candidates that spent $350,000 or more of their own money was unconstitutional under the First Amendment.
The PAC here argued that the Clean Elections Act was unconstitutional under the same logic as Davis: the law had a chilling effect on speech because it sought to equalize funding. The State argued that the system deterred corruption by increasing transparency and limiting the influence of interest groups.
Does the Arizona Clean Elections law violate the First Amendment?
Yes, the Arizona Clean Elections law violates the First Amendment.
Justice Kagan (with Ginsburg, Breyer, and Sotomayor)
The program does serve to reduce dependence on interest groups, and it does not discriminate against any candidate or point of view. It actually subsidizes more speech by providing resources to many candidates.
The First Amendment‘s core purpose is to foster a healthy political system, and this election law does not run afoul of that purpose. As precedent, Davis does not compel this decision.
Davis controls this case. The matching funds provision imposes a penalty on candidates who are self-funding, and self-funding is political speech under the First Amendment because it gives a nearly one-for-one award to the publicly funded candidate. This forces the privately financed candidate to shoulder an extra burden if they decide to fund themselves.
The law also hinders independent groups from donating because their donation ends up benefitting the other party as well. This negatively impacts their free speech.
The law also does not promote the state’s interest in anticorruption because reliance on personal funds also reduces the threat of corruption by reducing the candidate’s dependence on outside contributions.