On April 2, the United States Supreme Court released its much-anticipated decision in McCutcheon v. FEC, 572 U.S. __ (2014). The case was closely watched because it presented the Court the opportunity to revisit the framework of First Amendment campaign finance jurisprudence.
The modern constitutional analysis for campaign finance law has its origin in Buckley v. Valeo, 424 U.S. 1 (1976). There, the Court determined that contributions to candidates could be subject to more regulation than could election-related expenditures. This is because the Court has found that preventing actual or apparent quid pro quo corruption is the only governmental interest strong enough to justify regulation of campaign speech. Though the parties and amici in McCutcheon challenged Buckley’s contribution/expenditure distinction, the Court declined to revisit it.
Federal law provided both base and aggregate campaign contribution limits, the latter of which Mr. McCutcheon challenged. First, base limits permit individuals to contribute $2,600 per election to a candidate, and varying amounts to national, state and local party committees and PACs. Second, the aggregate amount of these individual contributions was limited to $123,200 total, with no more than $48,600 of that amount going to federal candidates (as opposed to party committees or PACs).
Though the Supreme Court upheld aggregate contribution limits in 1976, this year it struck them down. McCutcheon rejected the argument, previously accepted by the Court, that aggregate limits were necessary to prevent circumvention of base limits. Intervening legislation, the Court determined, made the circumvention concerns obsolete, and the Court held that the aggregate limits were unconstitutional.
Like federal campaign finance law, Wisconsin has base limits and aggregate limits for individuals who contribute to political campaigns. Individuals can contribute base amounts ranging from $250 to candidates for some local offices to $10,000 to candidates for statewide offices. In addition, Wisconsin law limits contributions by individuals to an aggregate amount of $10,000 per calendar year. So if an individual makes the maximum contribution to a candidate for statewide office in one year, that individual can support no other candidates that year. The $10,000 aggregate limit is the only limit on donations to political party committees and political action committees in Wisconsin.
McCutcheon places Wisconsin’s aggregate limits in jeopardy. In rejecting the argument that aggregate limits were essential to enforce base limits, the Court contrasted the 30 states with base limits but no aggregate limits with the eight states (including Wisconsin) that imposed both base limits and aggregate limits. 572 U.S. __, Slip Op. at 21 n.7 (Opinion of Roberts, C.J.). The Court implied that the experience of the 30 states demonstrates that the aggregate limits in the eight states (including Wis. Stat. § 11.26(4)) are unnecessary. Id.
Wisconsin aggregate limits were challenged last summer in federal court in Milwaukee. The case has been on hold pending the McCutcheon decision. Decisions like McCutcheon tend to have a ripple effect on state law. It is widely expected that Wisconsin’s $10,000 aggregate limit will, in time, be ruled unconstitutional.
If that happens, Wisconsin’s campaign finance landscape will change significantly. Individuals will be able to contribute to more campaigns. Political party and non-candidate committees (often referred to as "political action committees") will be able to receive unlimited individual contributions until new legislation is enacted. Other statutory limits might also be at risk. McCutcheon has set the stage for sweeping changes to Wisconsin campaign finance law.
Legal News Alert is part of our ongoing commitment to providing up-to-the-minute information about pressing concerns or industry issues affecting our clients and our colleagues. If you have any questions about this update or would like to discuss this topic further, please contact your Foley attorney or the following:
Raymond R. Carey
Philip C. Babler