Corporate Campaign Contributions Still Illegal in Massachusetts … For Now

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Corporations still can’t donate directly to political campaigns for state office in Massachusetts and unions can still give as much as $15,000, under a ruling from the Massachusetts Supreme Judicial Court.

Bu the U.S. Supreme Court may have the ultimate say.

The Massachusetts high court rejected 7-0 a challenge by two corporations to a century-old state prohibition on direct campaign donations.

The court justified the decision by highlighting the state legislature’s original motivation in 1907 of preventing corruption.

“If corporate contributions were permitted, every time a political decision was made that helped or hurt a corporation’sinterests, members of the public might wonder if thecorporation’s political contributions — or lack thereof — played a role in the decision,” Chief Justice Ralph Gants wrote in the decision Thursday. “Both history and common sense have demonstrated that, when corporations make contributions to political candidates, there is a risk of corruption, both actual and perceived.”

But a concurring opinion suggested the Massachusetts high court’s decision might only be temporary if the U.S. Supreme Court extends its reasoning in a previous campaign-finance case to include corporate donations to political campaigns.

Justice Scott Kafker voted with the other justices didn’t buy the chief justice’s distinction between corporations and unions when it comes to corruption, pointing out illegal end-arounds of campaign donation limits that both types of entities have made.

“The Supreme Court has … rejected treating business corporations differently simply based on the substantial aggregations of wealth amassed by corporations or the advantages of the corporate structure, at least in the context ofindependent expenditures,” Kafker wrote in the case, called 1A Auto Inc. v. Director of the Office of Campaign and Political Finance. “…I assume at least some of the same reasoning would apply to contributions as well, although this is less clear.  Campaign finance restrictions that stem from a desire to even the political playing field by reducing corporate power would certainly be impermissible.”

Kafker referred to a 2010 U.S. Supreme Court Case called Citizens United v. Federal Elections Commission, in which the court allowed corporations to create and donate to political action committees but didn’t address direct donations by corporations to political candidates’ campaigns.

In the Massachusetts case the plaintiffs, 1A Auto Inc., of Pepperell, and 126 Self-Storage Inc., of Ashland, argued that banning direct corporate campaign donations to political candidates violates their right to free speech under the state and federal constitutions. They also argued that allowing unions to make contributions without allowing corporations to do so violates the corporations’ guarantee of equal protection under the federal constitution’s Fifth Amendment.

1A Auto is co-owned by Rick Green, of Pepperell, a Republican running for the open Third Congressional District seat in the Merrimack Valley. Green could not immediately be reached for comment Thursday.

Green is also founder of the Massachusetts Fiscal Alliance, which sharply criticized the state court decision and predicted it may lead to a federal court challenge.

“Today’s SJC ruling can only be described as a major disappointment that only further upholds the country’s most unfair state campaign finance law,” said Paul D. Craney, a board member and spokesman for the Massachusetts Fiscal Alliance, in a written statement. “This is a major defeat for proponents of campaign finance reform. Since it was first enacted decades ago, the union loophole has tainted countless elections across our state, even giving a louder voice to out of state union bosses than Massachusetts residents and employers. Fortunately, we are evaluating the next steps and are considering bringing this case to the US Supreme Court, which would have good standing to intervene.”

On the other side, a supporter of the state court decision said it is correct and needed.

“We are pleased and unsurprised by today’s unanimous decision to uphold Massachusetts’ ban on corporate campaign contributions,” said Pamela Wilmot, executive director of Common Cause Massachusetts, which filed a friend-of-the-court brief in the case, in an email message to New Boston Post. “More than a half-dozen circuit court cases from around the country and the U.S. Supreme Court have concluded the same thing — that the state may limit contributions directly to candidates from business corporations. There is too much money in politics. We do not need another loophole to allow even more.”

A spokesman for the state agency that defended the Massachusetts case did not offer a substantive comment Thursday.

“We don’t have a comment. We’re pleased that the court made a decision, but our office is still digesting the decision,” said Jason Tait, spokesman for the Massachusetts Office of Campaign and Political Finance.