Colorado Republican Party files suit to form “party-sponsored” Independent Expenditure Committee despite legal ban

Despite failing earlier this year in an attempt  to get the Colorado Secretary of State to sanction a “party-sponsored”  Independent Expenditure Committee allowing the Colorado Republican Party to evade contribution limits (source and amount) applying to political parties, party chair Ryan Call has apparently decided to gamble the state party’s fortunes in the courts.  Despite lacking any assurance or binding opinion that forming a “party-sponsored” IEC is legal (in fact, the Secretary of State’s advisory opinion explicitly cautioned that even “a declaratory order would not prevent a person or organization from filing a campaign finance complaint against Petitioner”), Call rolled the dice by filing the IEC on Wednesday and immediately filing suit on Thursday in Denver District Court.

Interestingly enough, although the supposedly “independent” committee – filed as the Colorado Republican Party Independent Expenditure Committee – lists a physical address in Colorado (at state party headquarters), the registered agent for the committee, Harden Global, is located in Alexandria, VA (a Washington DC suburb).

Aside from the interesting twist in having the registered agent for the Colorado Republican Party Independent Expenditure Committee located across the country (a DC-area paid political consultant), the party’s lawsuit advances basically the same arguments that failed to convince the Colorado Secretary of State to issue a Declaratory Order several months ago.  Specifically, the party’s attorney continues to conflate the issue of party independent expenditures (for which there is legal precedent and constitutional protection) and the ability of the party to “sponsor, maintain, and operate an IEC” not subject to the contribution limits applying to political parties (for which there is neither precedent nor constitutional protection – indeed, the Colorado Constitution explicitly states the opposite).

Background and Constitutional/Statutory Framework

Following the passage of Amendment 27 in 2002 (enacted as Article XXVIII, Colorado Constitution), contribution limits have applied to organizations supporting or opposing candidates in state elections –including political parties.  Under current Colorado law, political parties may accept a maximum of $3,400 per year (state, county, local levels combined) in aggregate (total) contributions from any individual – and are prohibited from receiving contributions from corporations or labor organizations (unions).

Independent Expenditure Committees (IECs), a more recent statutory (vs. constitutional) creation, on the other hand, are not subject to contribution limits, and may support or oppose candidates, but only so long as the support and spending are” truly independent and not coordinated with the candidate.”  (cf OGREexposed.org analysis, Colorado GOP seeks approval for new independent expenditure committee)

Colorado Republican Party Lawsuit

Colorado Republican Party State Chair Ryan Call, represented by his law firm partner (and designated party attorney) Richard Westfall, filed a lawsuit seeking the Court’s advance blessing (via a Declaratory Order) for an entity combining the features of an “independent expenditure committee” (no contribution limits to amount and/or source) that would simultaneously be “sponsored, maintained, and operated” by the party and wearing the Republican party label  –
in many respects, seeking to “have their cake and eat it, too.”

The COGOP advanced the following main arguments in support of their lawsuit:

• Supreme Court precedent affirming the right of political parties to make independent expenditures
• Colorado’s constitutional/statutory framework is consistent with Supreme Court precedent
  • “Independent expenditures” are allowed so long as there is no coordination
  • “Any person” may make independent expenditures
  • “Political parties” are defined as a “person” under campaign finance law
  • “Independent Expenditure Committees” are not subject to contribution limits or source prohibitions

Additionally, the petition asserted that “the Republican party’s Independent Expenditure Committee will be structured and operated to ensure that no expenditures will be coordinated with candidates.”

Analysis of COGOP’s Arguments:

The COGOP lawsuit spends an inordinate amount of space asserting the right of political parties to make independent expenditures – a fact that is not in dispute.  The party is already able to make independent expenditures without necessarily having to form a separate committee (arguably, this is a default function of party organizations anyway).  The dispute arises from conflating the ability to make independent expenditures with the ability to receive contributions without limit to amount or source that is a special feature of IECs under Colorado law.

As noted in previously published analyses, the right for a political party to make unlimited independent expenditures is distinct from the legal ability of the party to raise funds not subject to contribution limits – which, like it or not, Colorado has imposed on political parties.

Additionally, the COGOP chair’s assertion of “significant structural and operational protections” preventing coordination is risible, as is the very notion that an entity owing its existence to the state party, with the director and management committee appointed personally by the state party chair, would be “independent” in any sense of the word.  Such an entity is almost by definition “pre-coordinated” – although it would not be constrained by party bylaws (bylaws theoretically restricting, for example, the IEC’s ability to spend or promise spending in order to influence primary elections).

Likewise, reliance on the party qualifying as a “person” under constitutional and statutory language, and thus eligible to form an IEC, also leads to an absurd result; since, following that logic, a candidate for office (subject to contribution limits) is likewise a “person” and would also be able to form an IEC as a “candidate-sponsored” entity (with similar “safeguards” against coordination, wink wink nudge nudge).

Indeed, the issue of “coordination” is central to the legality of the proposed “party-sponsored” IEC:

Petitioner must ensure the absence of “coordination” to avoid the potential for corruption or the appearance of corruption. (SOS Ruling at 9)

The Secretary’s advisory opinion closed in classically understated language:

The fact that the party exercises control over the appointment – and presumably removal – of the IEC’s executive director and management committee is potentially problematic.

Clear The Bench Colorado generally opposes the imposition of contribution limits or other restrictions on free speech in the civic and political arena (see, Speaking Out on Reforming Colorado’s Campaign Finance Laws) as unconstitutional abridgments of the 1st Amendment; in particular, the excessively complex and convoluted nature of campaign finance laws in Colorado challenge the Constitution, chill free speech, and curtail civic participation.  Any such laws that do remain in effect, however, must be fairly and equitably applied to everyone – with no “special exemptions” for favored entities.  It is our view that the COGOP Chair’s lawsuit is an attempt to create just such a “special exemption” and should be denied.

Read more about the COGOP Chair’s attempt to skirt Colorado Campaign Finance Law

• COGOP Denver District Court Complaint seeking Declaratory Order 20140508
• Secretary of State Final Agency Decision, In the Matter of the Colorado Republican Party’s Petition for Declaratory Order, 6 February 2014
• Colorado Republican Party Chair Seeks Exemption to State Campaign Finance Law, 10 January 2014)
• Colorado Republican Party Petition for Declaratory Order concerning independent expenditure committees – 11/8/2013 (PDF)