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Appeals court affirms soft money limits on political parties

Posted: Wednesday, August 13, 2003

ANCHORAGE (AP) Alaska can limit donations to political parties by individuals and corporations, the 9th U.S. Circuit Court of Appeals ruled Tuesday.

Judges overturned a 2001 decision that rejected limits on ''soft money'' donated to parties by both individuals and corporations, as long as it was used for ''party building'' and not to help specific candidates.

Under that decision, donors and the amount they gave were not required to be reported to the Alaska Public Offices Commission in the 2002 gubernatorial election. Campaign reformers say the money was used to add to a flood of thinly veiled ''issue'' ads that did everything to endorse candidates except tell people to vote for them.

Former Anchorage state Rep. David Finkelstein called the ruling a great day in the history of Alaska campaign reform because it will cut down on wealthy special interests using their resources to influence the outcome of elections.

''Individuals are not the ones who are funding soft money around the country,'' he said.

Steve Cleary, Alaska Public Interest Research Group executive director, said he appreciated the words used in the 9th Circuit ruling.

''It said this reflects Alaska's concern about the danger of corruption from soft money,'' Cleary said.

Ken Jacobus, former Republican Party of Alaska attorney and a plaintiff in the lawsuit, could not be reached for comment Tuesday.

Soft money is cash supposedly used for party activities, in contrast to money used to directly benefit candidates. Finkelstein said the distinction is largely an illusion.

''Parties exist to get candidates elected,'' he said.

The Legislature enacted limits only after backers of an initiative to do the same had collected more than 30,000 signatures to put the measure on the ballot. Lawmakers limited contributions to political parties to $5,000 and banned them by corporations, business associations and unions.

In a lawsuit filed by Republicans Jacobus and Wayne Anthony Ross, plus Libertarian Scott Kohlhaas, U.S. District Court Judge James Singleton in April 2001 ruled that the state could not limit contributions of soft money by individuals to parties. Two months later, he ruled that the ban on soft money contributions by corporations also was unconstitutional, as long as the cash was not targeted to specific candidates.

The 9th Circuit Court disagreed.

''Soft money presents a danger of corruption and the appearance of corruption because political parties trade influence and access to candidates for soft money dollars,'' the court said.

''Candidates trade influence and access for the indirect benefits that they receive from soft money contributions to their party,'' the ruling said.

Candidates' heavy involvement in raising and tracking soft money indicates it's used to circumvent hard money contribution limits, the court said.

That's just want happened last year, said attorney Mike Frank, another supporter of the 1996 initiative.

''It was clear the temporary lifting of the ban caused by Judge Singleton's decision allowed the hard money contribution limits to be exceeded and corporate and individuals flooded the parties with soft money,'' Frank said.

The only immediate effect of the ruling will be on corporation donations to parties. After Singleton's ruling, the Legislature in May 2001 repealed the $5,000 limit on individuals' donations to political parties.

The Appeals Court judges affirmed one aspect of Singleton's ruling. They said state limits on the amount of professional services, such as legal advice or media consultation, that could be donated to parties were unconstitutional.

Ross said he was most interested in that provision. He said he was withholding most comment about the entire 52-page ruling until he had read the decision but that an appeal will be discussed.

''The 9th Circuit is not known for its legal abilities,'' Ross said. ''They have the highest overturn rate by the Supreme Court of any district.''



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