The Fight Against Dark Money in New Mexico and Beyond

State and local races across the country have become new targets for dark money groups.

Today, new campaign finance disclosure rules go into effect in the state of New Mexico. The new rules are an important step forward for the people of the state, providing much-needed transparency around the money being used to support and oppose state political candidates. In addition to other changes, they require individuals, candidates, and groups that make significant campaign-related communications to disclose the true source of their funds.

Transparency is no cure-all for problems in the political process. But it is a critical means for preventing corruption and providing a fuller understanding of political messages. U.S. Supreme Court Justice Antonin Scalia once wrote, “I do not look forward to a society which, thanks to the Supreme Court, campaigns anonymously … hidden from public scrutiny and protected from the accountability of criticism.” Sadly, to a substantial degree, that is the society in which Americans now live—apart from those in places like New Mexico, where local leaders are doing something about it.

However, the new rules, though overwhelmingly supported by the public, have been fiercely resisted by a small coterie of mostly out-of-state organizations. Much of the financing for this opposition appears to have come from the network of nonprofits run by Charles and David Koch, conservative megadonors notorious for their opposition to campaign finance reform.

Fortunately, the progress being made in New Mexico offers a useful example for other states where similar battles for transparency are being fought—against a similarly well-funded opposition.

When commonsense reform meets staunch opposition

In the late-2000s, a series of court decisions held that major parts of New Mexico’s campaign finance law were unconstitutional, offering little clarification on how the newly limited laws should be applied. As a result, New Mexico’s campaign rules were left unclear and, to a large extent, unenforceable. The National Institute on Money in State Politics predictably gave New Mexico an F on transparency.

Still, attempts at reform in the state legislature were repeatedly stymied. In 2011, New Mexico Senate Majority Leader Peter Wirth (D) began making annual attempts to pass legislation that would clarify the law, lower reporting thresholds for political spending, and expand campaign finance disclosure. This year, he and his House of Representatives co-sponsor James Smith (R) finally succeeded, passing S.B. 96 with solid bipartisan support in March—only to have it vetoed by New Mexico Gov. Susana Martinez (R) in April.

Although the core mandate of the bill—requiring more public disclosure of spending on candidate-related advertisements—was supported by almost 90 percent of New Mexicans, S.B. 96 unleashed a surprisingly potent opposition. Many of the opposition groups appear to have been financed by the Koch brothers’ political network, including at least 7 of eleven signatories to a coalition letter sent to Gov. Martinez. One Koch-backed group, Concerned Veterans for America, painted the bill as an attack on nonprofits’ free speech, despite the fact that it would not affect any nonprofit not engaging in campaign-related spending. And even for the affected nonprofits, it would merely require that they disclose the contributors that paid for their campaign-related work. Other in-state allies, including the Rio Grande Foundation, posted videos linking the bipartisan bill to a leftist tyrannical plot.

Undeterred by this opposition, Secretary of State Maggie Toulouse Oliver (D) decided to launch a rulemaking to clarify the existing law. She held four public hearings at various locations around the state. And although only 79 unique comments were submitted—63 in favor of the new rule and 16 against—one of the opposition comments was sent 758 times, courtesy of an internet ad posted by Concerned Veterans of America that asked viewers to tell Secretary of State Oliver “to stop attacking free speech.”

The rule, which goes into effect today, is limited by the language of New Mexico’s long-neglected Campaign Practices Act and therefore does not go quite as far as S.B. 96. It does, however, establish concrete rules that prohibit coordination between outside groups that can accept unlimited contributions and campaigns, which can only accept contributions in limited amounts. And it makes major strides in clarifying and implementing commonsense disclosure requirements.

As a result of these rules, from this point on, New Mexico voters will be better able to evaluate candidates and campaign messages. They will also be able to know when the Koch brothers and other wealthy interests are disproportionately driving the public debate in their state and local elections.

Lessons for transparency efforts nationwide

New Mexico’s struggle with undisclosed outside spending is not unique; state and local races across the country have become new targets for dark money groups. A six-state study by the Brennan Center for Justice found that, in 2014, only 29 percent of outside spending was fully transparent, down drastically from 76 percent in 2006. So it isn’t a surprise that well-funded dark money groups are pushing hard to prevent the implementation of rules that threaten their ability to operate in secret.

In November 2016, for example, South Dakota voters passed Initiated Measure 22, which provided for an overhaul of the state’s campaign disclosure laws and other major reforms, including tough new rules on lobbying and ethics and the creation of a new state ethics commission. Two Koch-backed groups—Americans for Prosperity (AFP) and Concerned Women for America—spearheaded a campaign called Defeat22, with AFP providing $590,000 of the roughly $610,000 raised. Although the campaign failed to stop the ballot measure, which passed with 52 percent of the vote, it was apparently enough to persuade the state legislature to step in. Invoking an “emergency” clause, legislators repealed the changes that the voters had just approved, undoing the much-needed reforms.

AFP has also taken credit for stopping disclosure bills from advancing through state legislatures, including in Minnesota and Georgia, two states that also received Fs from the National Institute on Money in State Politics for their lack of campaign finance transparency.

Fortunately, there are many states where efforts to fight corruption and provide transparency in elections continue. Advocates and policymakers who are undertaking these efforts should be mindful of how these policy fights are playing out across the country. Some of the lessons to be taken from New Mexico and elsewhere include:

  • Look to other states for examples of how to craft effective disclosure policies. Campaign finance is an area of the law in which the courts have been heavily involved; as a result, it can be a challenging area in which to legislate or write rules. New Mexico’s rules, which take a careful, commonsense approach, are a good starting point. Other states have gone further to ensure transparency, with lower reporting thresholds and disclaimers that require organizations to list their top three contributors in campaign ads.
  • Expect opposition—and know your opponent. Despite widespread public support, transparency efforts can expect to be met with opposition, often from the same set of actors, using the same arguments that they have used elsewhere. They frequently claim that such rules will pose a threat to ordinary, nonpolitical charitable organizations—a claim belied by the fact that political disclosure rules apply only to activity that is directly related to campaigns for public office. They often also argue that disclosure of campaign spending is an infringement of First Amendment rights, which eight out of nine Supreme Court justices disagreed with when they found that “transparency enables the electorate to make informed decisions and giver proper weight to different speakers and messages.”
  • Remember that the public overwhelmingly supports transparency in campaigns. In New Mexico, activists and elected officials pointed out early and often that their efforts in support of disclosure were supported on a bipartisan basis by the public. The same is true of the public nationwide. Americans support transparency in their elections, and policymakers should be reminded that honoring that consensus is what democracy is all about.

Alex Tausanovitch is the associate director of Democracy and Government Reform at the Center for American Progress. Adele Hayer is a legal intern at the Center.