HEAVICAN, C.J.
In this original action, the court is asked to determine the constitutionality of Nebraska's Campaign Finance Limitation Act (CFLA).
Pursuant to Neb.Rev.Stat. § 84-215 (Reissue 2008), the Attorney General was then directed to file an action in court to determine the validity of the CFLA. Section 84-215 charges the Secretary of State with defending the action. We find that the CFLA substantially burdens the First Amendment rights of Nebraska citizens and that it is, therefore, unconstitutional.
In 1992, the Nebraska Legislature passed the CFLA as 2009 Neb. Laws, L.B. 556. Under the CFLA, candidates for certain covered elective offices, including the Governor, State Treasurer, Secretary of State, Attorney General, and Auditor of Public Accounts, as well as members of the Legislature, Public Service Commission, Board of Regents of the University of Nebraska, and State Board of Education, may choose to abide or to not abide by voluntary spending limits.
In 2011, in Arizona Free Enterprise Club v. Bennett,
In response to the Bennett opinion, the executive director of the Commission requested an opinion from the Nebraska Attorney General as to the effect of the Bennett decision on the CFLA. Section 84-215 provides that the Attorney General may issue a written opinion as to the constitutionality of an act of the Legislature.
In the Attorney General's opinion, he found it "likely" that the matching funds provisions of the CFLA would be found to impose a substantial burden on the speech of privately financed candidates and that a court would "likely" find that the matching funds provisions of the CFLA are unconstitutional.
Under § 84-215, if the Attorney General issues a written opinion that an act is unconstitutional and any state officer charged with the duty to implement the act, in reliance on the opinion, refuses to implement the act, the Attorney General is required to file a court action to determine the act's validity. In reliance upon the opinion, the Commission adopted a resolution refusing to implement, administer, or enforce the CFLA in connection with the 2012 state election cycle or subsequent election cycles. The Commission also notified the Attorney General of its resolution.
The Attorney General then instituted this original action. The parties stipulated that the action is a civil one in which the State of Nebraska is a party and that it involves public funds; therefore, it is a case relating to the revenue of the State under Neb.Rev.Stat. § 24-204 (Reissue 2008).
(1) Whether the public financing provisions of the CFLA violate the free speech provisions of article I, § 5, of the Nebraska Constitution and the Free Speech Clause of the First Amendment to the U.S. Constitution.
Whether a statute is constitutional is a question of law.
The general rule is that when part of an act is held unconstitutional, the remainder must likewise fail, unless the unconstitutional portion is severable from the remaining portions.
The Secretary of State asserts that there is a question as to whether this court has jurisdiction. Under § 84-215, the Attorney General is responsible for filing an action in court to determine the validity of a statute after the Attorney General has issued an opinion as to the constitutionality of a statute and a state officer or agency that is charged with implementing the statute relies on the opinion and refuses to implement it.
In this case, the Attorney General did not issue a definitive opinion stating that the CFLA is unconstitutional. Rather, he surmised that a court "would likely find the public financing provisions of the [CFLA] to be unconstitutional" and that "a court could find" the entire CFLA invalid, because the offending provision is not severable. The Secretary of State argues that § 84-215 requires a definitive conclusion of unconstitutionality before an agency can reasonably rely on the Attorney General's opinion and refuse to implement the act in dispute.
We find that the court has jurisdiction to determine the constitutionality of the CFLA, and we decline to parse the language of § 84-215 to require that an Attorney General's opinion must definitively state that a statute is unconstitutional. Our review arises from the decision of the Commission to refuse to implement the CFLA. We are asked to determine whether the statute is unconstitutional, not to decide whether the Attorney General's opinion is correct.
The amici curiae, Common Cause Nebraska and the League of Women Voters of Nebraska, also question this court's jurisdiction, asserting that there is no justiciable controversy because the interests of the Attorney General and the Secretary of State, who both represent the State of Nebraska, are not inherently adverse.
The statutory scheme set forth in § 84-215, as passed by the Legislature, by its very nature establishes adverse interests between the Attorney General and the Secretary of State. The statute requires the Attorney General to bring a court action if a state officer refuses to implement the act. A justiciable issue requires a present, substantial controversy between parties having adverse legal interests susceptible to immediate resolution and capable of present judicial enforcement.
We conclude that there is a present, substantial controversy between the Attorney General, who believes that the CFLA is unconstitutional, and the Secretary of State, who by statute is directed to defend
The Legislature incorporated into the CFLA its findings that the cost of running for statewide offices and legislative seats has risen and results in the exclusion of qualified candidates from the democratic process.
However, the Legislature noted that based on holdings of the U.S. Supreme Court, "any limitation on campaign expenditures must be entered into voluntarily."
The Legislature stated in the statute that there are
The Legislature found that the State's interests could only be achieved if
The CFLA lays out a procedure for candidates to qualify for public funds to support their campaigns. It requires that every candidate, whether or not the candidate seeks public funds, must make timely filings under the CFLA.
The CFLA designated certain statewide offices as "covered."
A candidate who indicates that he or she will not abide by the spending limits must also file an affidavit providing a reasonable estimate of his or her maximum expenditures for the primary election.
In order to qualify for public funding, an abiding candidate must raise at least 25 percent of the spending limit for the covered office sought.
The CFLA provides that no candidate shall accept contributions from "independent committees, businesses, including corporations, unions, industry, trade, or professional associations, and political parties" which, when aggregated, exceed 75 percent of the spending limitations for the office under § 32-1604.
A candidate seeking public funds may request such funds upon making expenditures which equal or exceed 25 percent of the spending limitation for the election period.
A nonabiding candidate must also file an affidavit with the Commission when his or her expenditures equal or exceed 40 percent of the spending limitation for the primary election period and a second affidavit for the general election period.
Public funds are disbursed to the qualified abiding candidate "no earlier than the last date to amend an affidavit stating a reasonable estimate of expenditures," which is up to 30 days before a primary and up to 60 days before the general election, but no later than 14 days after the election.
After an abiding candidate meets the fundraising and filing requirements of § 32-1604(4), he or she is entitled to receive public funding of the greater of either (a) the difference between the office-specific spending limitation and the nonabiding candidate's estimate of expenditures
According to the stipulation of facts entered into by the parties, since the enactment of the CFLA, there have been 486 candidates for elective offices covered by it. Of those 486 candidates, 11 have been advised by the Commission that public funding was available and 10 have received all or part of the public funding available under the CFLA. At least three candidates have challenged the constitutionality of the CFLA through litigation. Two percent of all candidates have received public funding.
The Commission requested the Attorney General's opinion after the U.S. Supreme Court issued its opinion in Bennett.
Bennett arose under Arizona's Citizens Clean Elections Act, which created a voluntary public financing system to fund campaigns of candidates for state office.
Candidates who accept these conditions are given public funds and may be granted additional equalizing or matching funds in both primary and general elections.
Once matching funds are triggered, publicly financed candidates receive $1 in state funding for each additional dollar that a privately financed candidate spends in the primary (less a 6-percent reduction to cover fundraising expenses).
In addition, spending by independent groups on behalf of a privately funded candidate or in opposition to a publicly funded candidate results in dollar-for-dollar matching funds once the public financing cap is exceeded.
The Court provided several examples to demonstrate how the public financing scheme operates. If the privately funded candidate spent $1,000 of his or her own money to distribute a direct mailing or held a fundraiser that generated $1,000 in contributions, each of his or her publicly funded opponents would receive $940 ($1,000 less the 6-percent offset). And if an independent group spent $1,000 on a brochure opposing one of the publicly financed candidates, but did not mention the privately financed candidate, the publicly financed candidate would receive $940 directly.
The petitioners in Bennett were five past and future candidates for Arizona state office and two independent groups that spent money in campaigns. They argued that the matching funds provision unconstitutionally penalized their speech and burdened their ability to fully exercise their First Amendment rights.
The Court stated that "`[d]iscussion of public issues and debate on the qualifications of candidates are integral to the operation' of our system of government."
The Court has stated that "[l]aws that burden political speech are" accordingly "`subject to strict scrutiny,' which requires the Government to prove that the restriction `furthers a compelling interest and is narrowly tailored to achieve that interest.'"
"The direct result of the speech of privately financed candidates and independent expenditure groups is a state-provided monetary subsidy to a political rival."
Having found that the matching funds provision imposes a substantial burden on the speech of privately financed candidates and independent expenditure groups, the Court then considered whether the provision was justified by a compelling state interest. The Court determined that providing a level playing field to opposing candidates is not a compelling state interest that can justify undue burdens on political speech.
The Court concluded that Arizona's campaign financing scheme gives money to a candidate in direct response to the campaign speech of an opposing candidate or an independent group when the opposing candidate has chosen not to accept public financing and has engaged in political speech above a level set by the state.
We now consider whether the CFLA violates the First Amendment in the wake of the Bennett decision. The Attorney General argues that the public
Whether a statute is constitutional is a question of law.
The 1st Amendment to the U.S. Constitution, as applied to the states through the 14th Amendment, provides that "Congress shall make no law ... abridging the freedom of speech...."
In Bennett, the Court stated that because discussion of public issues and debate on the qualifications of candidates are integral to the system of government, the First Amendment ""`has its fullest and most urgent application'" to speech uttered during a campaign for political office."
The CFLA states:
However, in Bennett, the Court held that neither a state's interest in equalizing electoral opportunities nor a state's interest in combating corruption justified the burden imposed on privately financed candidates by the Arizona matching funds provision.
Under the CFLA, a candidate who has agreed to abide by the voluntary spending limits becomes eligible for public funds after meeting the following two requirements:
The Nebraska statutory scheme is similar to that of Arizona, which was found unconstitutional in Bennett. In both states, publicly funded candidates may become eligible for matching funds as a direct result of the spending of privately financed candidates who have not agreed to the voluntary spending limits.
As the Bennett Court noted, the amount of funding provided by the State is not the problem. "It is the manner in which that funding is provided — in direct response to the political speech of privately financed candidates and independent expenditure groups."
The Secretary of State argues that the CFLA does not impose a substantial burden on political speech unrelated to a compelling state interest merely by establishing voluntary campaign spending limits and allocating public funds to encourage participation in the spending limitation scheme. The Secretary of State claims that the CFLA furthers compelling and substantial state interests in preventing corruption and the appearance of corruption and in encouraging greater participation in the electoral process.
The CFLA is not identical to the Arizona statute which was found to be unconstitutional. In both states, candidates could voluntarily participate in a public financing campaign system if they accepted certain restrictions and obligations. However, in Arizona, candidates who chose to participate were given an initial outlay of public funds for their campaigns. Once a set spending limit was exceeded, the publicly financed candidate received virtually $1 for every dollar spent by a privately financed opponent or certain independent expenditure groups. In addition, under the Arizona law, spending by independent groups was included in the amount that triggered the distribution of public funds.
The Nebraska financing scheme does not provide an initial outlay of public funds to all candidates who opt to participate.
Under the Nebraska law, both abiding and nonabiding candidates must file with the Commission affidavits indicating their intention to abide or to not abide within 10 days after a candidate committee is formed.
Although the U.S. Supreme Court has held that a voluntary system of "public financing as a means of eliminating the improper influence of large private contributions furthers a significant governmental interest,"
Under the CFLA's public financing provisions, public funds are disbursed to abiding candidates in response to the political speech of privately financed candidates. Such restrictions on campaign spending create substantial burdens on the rights of free speech under the First Amendment, as determined by the Bennett Court. The public financing provisions impose a substantial burden on the free speech rights of Nebraska citizens without serving a compelling state interest.
We must also consider whether the CFLA's public financing provisions are narrowly tailored to serve a compelling state interest. In the CFLA, the Legislature found several compelling state interests in providing public funds for campaigns. It stated that the integrity of the electoral process would be preserved "by ensuring that these elections are free from corruption and the appearance of corruption," by "providing the electorate with information that will assist them with electoral
The Bennett Court held that the burden imposed on privately financed candidates by the Arizona matching funds provision was not justified by a state's interest in equalizing electoral opportunities or a state's interest in combating corruption. "Burdening a candidate's expenditure of his own funds on his own campaign does not further the State's anticorruption interest. Indeed, we have said that `reliance on personal funds reduces the threat of corruption[.]'"
In FEC v. National Conservative PAC,
Thus, the CFLA, like the Arizona statutes, is not narrowly tailored to serve a compelling state interest, because the interests identified by the Legislature — maintaining the integrity of the electoral process and ensuring elections that are free from corruption — have been held not to be sufficient in Bennett. The Court stated that "`[t]he interest in alleviating the corrupting influence of large contributions is served by ... contribution limitations.'"
The Court also addressed Arizona's argument that the matching funds provision indirectly served the anticorruption interest by ensuring that enough candidates participate in the State's public funding system.
The CFLA provides for public funds for campaigns which are triggered by the expenditures of privately financed candidates, just as the Arizona statutes provided. The Court has held that a state's interests in equalizing opportunities for candidates and in combating corruption do not serve a compelling state interest to justify the burdens placed on a candidate's First Amendment rights. The CFLA is not narrowly tailored to serve a compelling state interest, and it does not pass constitutional muster.
Having determined that the public financing provisions of the CFLA are unconstitutional, we must decide whether those provisions are severable. Our general rule provides that when part of an act is held unconstitutional, the remainder must likewise fail, unless the unconstitutional portion is severable from the remaining portions.
Only one section of the CFLA, § 32-1606, specifically concerns disbursement of public funds. Other sections include legislative findings,
In State ex rel. Stenberg v. Moore,
The portions of the CFLA which do not concern the public financing scheme address aggregate contribution limits,
The first two factors we are to consider in determining severability are whether a workable statutory scheme remains without the unconstitutional portion and whether valid portions of the statute can be enforced independently.
The statute concerning civil penalties also specifically provides for penalties based on violations of spending limitations set out in § 32-1604.01, and it cannot stand if the campaign financing limitations are unconstitutional.
Finally, we note that the CFLA did not include a severability clause when it was passed in 1992.
The Legislature specifically found that campaign finance limits, disclosure of the sources of funding, and the provision of public funds were all necessary to achieve its goals in passing campaign election reform.
Based upon the decision of the U.S. Supreme Court in Bennett, the CFLA, §§ 32-1602 through 32-1613, violates the First Amendment and is unconstitutional in its entirety.
JUDGMENT FOR RELATOR.
WRIGHT and MILLER-LERMAN, JJ., not participating.