Proposal to allow direct corporate giving

11/28/2004

COLUMBUS - Those who have urged the General Assembly to force corporations that have anonymously bankrolled ads targeting Ohio Supreme Court candidates to come out from cover now fear they may get more than they bargained for.

State lawmakers are considering legislation that, for the first time, could write into state law the right of a corporation to directly participate in Ohio's political process, even if they have to do it in public.

"It proposes to legalize electioneering communication funded by corporations and does so in a rather radical way without limitation," said Cliff Arnebeck, attorney for Alliance for Democracy. "Ohio for nearly 100 years has prohibited corporate treasury money from influencing elections."

There is also talk of raising or eliminating contribution caps to candidates. Caps are currently $2,500 each for the primary and general elections.

The bill started out as an attempt to force organizations like Citizens for a Strong Ohio, a nonprofit arm of the Ohio Chamber of Commerce, to reveal who funds their efforts targeting high-court candidates.

By stopping short of expressly asking voters to elect or defeat a candidate, the chamber has maintained the ads are constitutionally protected issue advocacy.

This year Strong Ohio spent $3 million on radio and television ads promoting three successful Republican candidates for the high court, including Toledo appellate Judge Judith Lanzinger.

Strong Ohio voluntarily revealed that more than half the money came from corporations and the rest from the Ohio and U.S. chambers.

Emboldened by the U.S. Supreme Court's upholding of the McCain-Feingold law, the Ohio Senate overwhelmingly passed a bill that would deem such ads as "electioneering communication" if they mention a candidate and air close to an election, even if don't use magic words like "elect," "vote for," or "defeat."

They would be forced to disclose where they got their money and how they spent it.

Senate Republicans angered their business base and Democrats risked their labor support when they voted to ban both from directly financing "electioneering communication" in Supreme Court elections.

The first thing a House committee did was expand the disclosure requirements to every state and locally elected office in Ohio. But it also removed the prohibition against corporate and labor cash in such ads.

"This is a bill about disclosure. Disclosure is, in fact, significant campaign-finance reform," said Rep. Kevin DeWine (R., Fairborn) during a recent committee hearing.

Negotiations between the House, Senate, and Gov. Bob Taft's office are under way to also include provisions in the bill addressing recent fund-raising scandals involving county party operating and state candidate funds, suspected of being used to hide corporate money and circumvent individual contribution limits.

Former campaign operatives for the House Republican caucus are under federal and state investigation for their campaign tactics, and three former associates of Ohio Treasurer Joe Deters pleaded guilty to charges they promised state business in exchange for campaign contributions.

The bill's sponsor, Sen. Randy Gardner (R., Bowling Green), said the climate is right to go far beyond simple disclosure.

"To do something we should have been doing all along in exchange for not getting other meaningful reforms seems to me to be a gigantic missed opportunity," he said. "Sometimes compromise isn't the only option."

Under current law, corporations may not directly contribute to candidates or campaigns, but they may form political action committees through which employees and others may contribute. PACs must report where they get their money and are subject to contribution limits.

Corporations, however, have been directly involved in the previously unregulated issue-ad committees that currently face no such restrictions. By simply bringing such ads under Ohio's election law umbrella when they cross the line into electioneering communication, Ohio would be opening its first election-process window to direct corporate cash.

"Apparently, we're smart enough to figure out what we like or don't like about these organizations," said Rep. Jim Trakas (R., Independence), chairman of the Cuyahoga County Republican Party. "This bill provides a balance because organized labor and business are going to be able to participate. You'll see both sides able to compete."

He noted that Justice Alice Robie Resnick, an Ottawa Hills Democrat, handily won re-election in 2000 despite Strong Ohio's $4 million ad campaign against her. But Mr. Arnebeck countered that the chamber has since gone five for five in electing or re-electing Republican justices.

"If you allow unlimited corporate money, the people who win elections are corporations, not the people," he said.

Contact Jim Provance at: jprovance@theblade.com or 614-221-0496.