Washington, D.C. — Today, the Hawaii State Legislature approved a historic measure that would effectively undo the corrosive effects of the Supreme Court’s 2010 Citizens United decision. The bill now heads to Gov. Josh Green’s (D) desk for his signature.
The measure would redefine corporate law so that corporations are no longer granted the power to spend in the state’s politics. In response, Neera Tanden, president and CEO of the Center for American Progress, issued the following statement:
Hawaii made history today in the fight against corporate and dark money that has sullied American politics for the past 16 years. Once the governor signs this measure into law, it will send a message that will be heard in legislatures far beyond the Aloha State. States can redefine the powers they grant to corporations. And they can choose not to give those corporations the power to spend money in state politics. This groundbreaking law makes Hawaii a leader in the national fight to get corporations out of politics and return power to the people.
The bill draws on a breakthrough legal strategy crafted by the Center for American Progress: States define the powers of the corporations they create, and a state’s corporate code can grant every power a business needs while withholding political spending power.
What would S.B. 2471 do?
The bill redefines the powers Hawaii grants to corporations that operate within the state. The powers that Hawaii grants to corporations would no longer include the power to spend in federal, state, and local elections in Hawaii. The bill also applies to out-of-state corporations that operate within Hawaii. It does not regulate corporate speech.
Political committees remain governed by existing campaign finance law. This bill applies to corporations, limited liability companies, partnerships, and similar artificial persons—entities that operate in Hawaii only because Hawaii law creates them or empowers them to do so.
Why doesn’t it violate Citizens United?
The Supreme Court in Citizens United struck down a federal regulation that prohibited an already-empowered corporation from spending its resources in elections. Neither that case nor any other has addressed whether a state must grant political spending power in the first place. Every Supreme Court case on corporate political speech has assumed the corporation already had the underlying power to spend. S.B. 2471 does not regulate that power—rather, it no longer grants it.
When would it take effect?
If passed, the new law would take effect on July 1, 2027.
What would happen if a corporation spent in Hawaii elections anyway?
The expenditure would be void because no corporation operating in Hawaii would have the power to make political expenditures. A company attempting to spend on Hawaii politics would risk revocation of its authority to do business in the state, and officers and directors who authorized the expenditure could face shareholder lawsuits and personal liability. The state’s attorney general could move to revoke a corporation’s charter.
Additional background on the Corporate Power Reset Plan:
For more information on this topic or to talk to an expert, please contact Sam Hananel at [email protected].