Could Maryland cap how much people or corporations give to committees supporting or opposing a ballot question?

Plain-English summary

The Administrator of Maryland's State Administrative Board of Election Laws asked the Attorney General whether Article 33, section 26-9(b)(2) of the Maryland Code, which capped contributions to ballot-question committees at $2,500, could survive a First Amendment challenge in light of the U.S. Supreme Court's recent decision in Citizens Against Rent Control v. City of Berkeley. The opinion concluded it could not. Tracing the Supreme Court's reasoning from Buckley v. Valeo through First National Bank of Boston v. Bellotti to City of Berkeley, the opinion explained that while the government has a strong interest in limiting contributions to candidates (preventing quid pro quo corruption), that interest does not exist for ballot questions, since there is no candidate to corrupt. Every court to address contribution limits on ballot-question committees, the opinion noted, had struck them down. It advised that Maryland's own $2,500 limit would likely meet the same fate if challenged.

Currency note

This opinion was issued in 1982. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The opinion applied Article 33 of the 1982 Maryland Code, which has since been recodified into Maryland's Election Law Article, and analyzed First Amendment campaign-finance case law as it stood after City of Berkeley in 1981. Campaign finance law, including the constitutional treatment of contribution and expenditure limits, has continued to develop substantially in the decades since, through later Supreme Court decisions and further legislative changes to Maryland's own election and campaign finance statutes. Anyone researching current limits on contributions to Maryland ballot-question committees should consult the current Election Law Article and recent case law rather than relying on this opinion's 1982 analysis.

Common questions

Why would a contribution limit be constitutional for candidates but not for ballot questions?
The opinion explained that the Supreme Court in Buckley v. Valeo upheld contribution limits for candidates because of the government's substantial interest in preventing corruption, meaning large donors using contributions to secure political favors from officeholders. In City of Berkeley, the Court held that interest simply does not exist in a referendum or ballot-question campaign, since there is no candidate who can be corrupted or who owes a debt to a contributor.

Did courts treat corporate contributions to ballot questions differently from individual contributions?
No. The opinion described First National Bank of Boston v. Bellotti as the first case extending this reasoning to corporate spending on ballot questions, and noted that City of Berkeley itself involved both individual and corporate contributions, with the Court applying the same First Amendment analysis to both.

Had any other state's ballot-question contribution limit survived a court challenge by the time of this opinion?
Based on the cases discussed in the opinion, no. It stated that lower federal courts, including the Fifth Circuit in Let's Help Florida v. McCrary and the Ninth Circuit in C & C Plywood Corp. v. Hanson, had uniformly struck down state restrictions on contributions to ballot question campaigns, and that the Supreme Court's summary affirmance in Firestone v. Let's Help Florida reinforced that trend.

Background and statutory framework

Article 33, section 26-9(b) of the Maryland Code set two separate contribution limits: subsection (b)(1) capped contributions to candidates and their committees at $1,000 per contribution and $2,500 in total per election, while subsection (b)(2), the provision at issue, capped contributions to committees organized to promote or defeat a ballot question at $2,500. The Administrator asked the Attorney General to assess subsection (b)(2) specifically against the Supreme Court's intervening decision in Citizens Against Rent Control v. City of Berkeley, 454 U.S. 290 (1981).

The opinion built its analysis in four steps. First, it read Buckley v. Valeo, 424 U.S. 1 (1976), for the principle that political contributions receive less First Amendment protection than direct expenditures, but that a state may still restrict contributions only if it demonstrates a sufficiently important interest, and that the only interest the Court accepted in Buckley was preventing corruption or its appearance in candidate elections. Second, it read First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978), for the Court's observation that referenda are held on issues rather than candidates, so the risk of corruption present in candidate elections is absent from a popular vote on a public issue. Third, and most directly, the opinion applied Citizens Against Rent Control v. City of Berkeley, 454 U.S. 290 (1981), in which the Supreme Court struck down a Berkeley ordinance limiting contributions to ballot-question committees to $250, holding that such limits burden the First Amendment rights of association and expression without serving the anti-corruption interest that justifies candidate contribution limits, and rejecting the argument that a $250 cap was needed to preserve public confidence in the ballot process. The opinion noted that Maryland's $2,500 cap was $2,250 higher than Berkeley's invalidated limit but only $500 higher than the Florida limit struck down in Firestone v. Let's Help Florida, 454 U.S. 1130 (1982). Fourth, the opinion surveyed lower court decisions, including Let's Help Florida v. McCrary, 621 F.2d 195 (5th Cir. 1980), C & C Plywood Corp. v. Hanson, 583 F.2d 421 (9th Cir. 1978), and Schwartz v. Romnes, 495 F.2d 844 (2d Cir. 1974), all of which struck down or narrowly construed state restrictions on contributions to ballot-question campaigns.

Based on this unbroken line of authority, and noting that Maryland's own law, like the Berkeley ordinance, already required public disclosure of ballot-question contribution sources under Article 33, section 26-11(d), the opinion concluded that Article 33, section 26-9(b)(2) would not survive a First Amendment challenge and advised that a court presented with the question would likely declare it unconstitutional. The opinion's footnote 4 noted that the City of Berkeley Court left open the possibility that a contribution limit could survive if the state made a sufficient factual showing that it was needed to preserve voter confidence in the ballot process, but observed that the legislative history behind Maryland's own limit contained no such findings or supporting record.

Citations

Statutes:

• Article 33, §26-9(b)(2)
• Article 33, §26-9(b)(1)
• Article 33, §26-11(d)
• Federal Election Campaign Act of 1971, as amended by the Federal Election Campaign Act Amendments of 1974, Pub. L. No. 93-433, 88 Stat. 1263

Cases:

• Citizens Against Rent Control v. City of Berkeley, 454 U.S. 290 (1981)
• Buckley v. Valeo, 424 U.S. 1 (1976)
• First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978)
• Let's Help Florida v. McCrary, 621 F.2d 195 (5th Cir. 1980)
• Firestone v. Let's Help Florida, 454 U.S. 1130 (1982)
• C & C Plywood Corp. v. Hanson, 583 F.2d 421 (9th Cir. 1978)
• Schwartz v. Romnes, 495 F.2d 844 (2d Cir. 1974)
• 61 Opinions of the Attorney General 363, 368-69 (1976)

Source

• Landing page: https://oag.maryland.gov/resources-info/Pages/attorney-general%E2%80%99s-opinions.aspx
• Original PDF: https://oag.maryland.gov/resources-info/Documents/pdfs/Opinions/1982/Volume67_1982.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain, the linked PDF is authoritative.

Elections—Political Contributions—Ballot Questions—Constitutional Law—First Amendment—Limitations on Contributions to Promote or Defeat Referenda and Other Ballot Questions are Unconstitutional

October 25, 1982

Mr. Willard A. Morris
Administrator
State Administrative Board
of Election Laws

In your letter of October 20, 1982, you requested our opinion on the constitutionality of Article 33, §26-9(b)(2) of the Maryland Code, which imposes a $2,500-limit on the amount that individuals, corporations, and others may contribute "to one or more committees for the purpose of promoting or defeating the passage of one or more questions, principles, propositions, or referendum questions ... in any primary, general or special election". Specifically, you question the impact on §26-9(b)(2) of the recent decision of the Supreme Court in Citizens Against Rent Control v. City of Berkeley, 454 U.S. 290 (1981).

For the reasons given below, it is our opinion that Article 33, §26-9(b)(2) unconstitutionally infringes upon the rights to free speech and association guaranteed by the First Amendment to the United States Constitution.1

1 Article 33, §26-9(b) provides, in its entirety: "(b) Limit of contributions—(1) It is unlawful for any individual, association, unincorporated association, corporation, or any other entity either directly or indirectly, to contribute any money or thing of value greater than $1,000 to any candidate or to contribute money in excess of $100 except by check in any primary, general or special election. Total contributions by a contributor under this subsection shall not exceed $2,500 in any primary or general election. (2) It is unlawful for any individual, association, unincorporated association, corporation, or any other entity either directly or indirectly, to contribute any money or thing of value greater than $2,500 to one or more committees for the purpose of promoting or defeating the passage of one or more questions, principles, propositions, or referendum questions or to contribute money in excess of $100 except by check in any primary, general or special election. Contributions under this subparagraph shall not be counted toward the contribution limit in [subsection] (b)(1) of this section." As will be seen from the discussion below, the provisions of subsection (b)(1), which impose monetary limits on contributions "to . . . candidate[s] . . . in any primary, general or special election", are themselves constitutional, at least to the extent that they are not applied to contributions given in connection with campaigns for federal office. See 61 Opinions of the Attorney General 363, 368-69 (1976).

I
The Buckley Decision

The constitutionality of restraints on political contributions was first extensively addressed by the Supreme Court in Buckley v. Valeo, 424 U.S. 1 (1976).

In Buckley, the Court assessed the constitutionality of the Federal Election Campaign Act of 1971 (the "Campaign Act"), as amended by the Federal Election Campaign Act Amendments of 1974, Pub. L. No. 93-433, 88 Stat. 1263. The Campaign Act Amendments imposed certain limitations on contributions to candidates and candidate-authorized campaign committees, as well as limitations on direct expenditures by individuals and groups in candidacy elections. In a long per curiam opinion, the Supreme Court upheld the contribution limitations, but struck down the restrictions on direct spending. 424 U.S. at 58-60.

The Court's analysis was guided by at least two basic constitutional principles: First, that one of the primary purposes of the First Amendment is to safeguard free and uninhibited discourse on public and political issues. 424 U.S. at 14-15. Second, that a law which infringes on fundamental First Amendment rights must be subjected to strict judicial scrutiny. 424 U.S. at 25, 29, 44-45. The Court reasoned that the spending of money in a political campaign, whether by way of contributions or independent expenditures, is "political speech", because disseminating political information "in today's mass society requires the expenditure of money". 424 U.S. at 19. The Court also reasoned that political spending, like partisan party activities and political rallies, involves not only First Amendment rights of expression but also First Amendment rights of association. Because the costs of an effective political campaign are often great, it is only through resource pooling that advocates with otherwise limited financial means can make themselves heard in political debate and focus their otherwise individual efforts. 424 U.S. at 21-22.

The Court differentiated, however, between contributions and independent expenditures. Political contributions in candidacy elections enjoy less First Amendment protection than do campaign expenditures. The Court explained:

"A limitation on the amount of money a person may give to a candidate or campaign organization . . . involves little direct restraint on his political communication, for it permits the symbolic expression of support evidenced by a contribution but does not in any way infringe the contributor's freedom to discuss candidates and issues.

The overall effect of the [Campaign] Act's contribution ceilings is merely to require candidates and political committees to raise funds from a greater number of persons and to compel people who would otherwise contribute amounts greater than the statutory limits to expend such funds on direct political expression, rather than to reduce the total amount of money potentially available to promote political expression." Id.

Nevertheless, even though political contributions to candidates enjoy a lesser degree of First Amendment protection than do direct expenditures, a state may restrict such contributions only if the state "demonstrates a sufficiently important interest and employs means closely drawn to avoid unnecessary abridgment of associational freedoms". 424 U.S. at 25. In this regard, the sole governmental interest that the Court identified in Buckley as a legitimate justification for contribution limits was the prevention of corruption in the electoral process. 424 U.S. at 26-29. This interest is substantial: corruption, resulting from a candidate's dependence on large individual contributors, erodes the integrity of representative democracy; even the appearance of corruption, the possibility that large contributions could be used to secure political favors from a candidate, undermines public confidence in the electoral process. Id.

II
The Bellotti Decision

Two years later, in First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978), the Supreme Court first addressed the application of Buckley to ballot question campaigns, at least insofar as corporate spending is concerned.

In Bellotti, the Court invalidated a statute that generally prohibited both corporate expenditures and corporate contributions in public issue campaigns. The Court observed:

"Referenda are held on issues, not candidates for public office. The risk of corruption perceived in cases involving candidate elections . . . simply is not present in a popular vote on a public issue. To be sure, corporate advertising may influence the outcome of the vote; this would be its purpose. But the fact that advocacy may persuade the electorate is hardly a reason to suppress it: The Constitution 'protects expression which is eloquent no less than that which is unconvincing.' . . . We noted only recently that 'the concept that government may restrict the speech of some elements of our society in order to enhance the relative voice of others is wholly foreign to the First Amendment . . .'" 435 U.S. at 790-91 (footnotes and citations omitted).

This distinction between candidacy and referendum elections has been recognized by several lower courts, which have uniformally struck down state restrictions on contributions to ballot question campaigns. See Let's Help Florida v. McCrary, 621 F.2d 195 (5th Cir. 1980), affd mem. sub nom. Firestone v. Let's Help Florida, 454 U.S. 1130 (1982) (invalidating a Florida law that imposed a $3,000-limit on the amount an individual could contribute to a committee in a ballot question campaign); C & C Plywood Corp. v. Hanson, 583 F.2d 421 (9th Cir. 1978) (invalidating a Montana law that prohibited corporate or bank contributions to ballot question campaigns); Schwartz v. Romnes, 495 F.2d 844 (2d Cir. 1974) (holding that a New York law, which prohibited corporate spending for political purposes, must be narrowly construed under the First Amendment to permit contributions by corporations in referendum elections).

III
The City of Berkeley Decision

More significantly, in Citizens Against Rent Control v. City of Berkeley, 454 U.S. 290 (1981), the Supreme Court itself confirmed that limitations placed on the amounts that individuals or corporations may contribute towards a ballot question unconstitutionally infringe upon the First Amendment rights of free speech and association.

In that case, the Court considered a First Amendment challenge to a provision of the Berkeley Election Reform Act of 1974, which established a $250-limit on contributions to committees formed to support or oppose any ballot question.2 The Court held that this limitation violated the rights to freedom of association and speech guaranteed by the First Amendment.

2 As quoted by the Court, the provision in question stated: "No person shall make, and no campaign treasurer shall solicit or accept, any contribution which will cause the total amount contributed by such person with respect to a single election in support of or in opposition to a measure to exceed two hundred and fifty dollars ($250)." 454 U.S. at 292.

The Court began its analysis by discussing at some length the important and historical right of political association. It found that "[c]ontributions by individuals to support concerted action by a committee advocating a position on a ballot measure is beyond question a very significant form of political expression." 454 U.S. at 298. Thus, with respect to the First Amendment right of association: "To place a spartan limit, or indeed any limit, on individuals wishing to band together to advance their views on a ballot measure, while placing none on individuals acting alone, is clearly a restraint on the right of association." 454 U.S. at 296 (emphasis added).3

3 The issues in City of Berkeley were virtually identical to those addressed by the earlier, Fifth Circuit decision in Let's Help Florida v. McCrary, 621 F.2d 195 (5th Cir. 1980). Of significance here is the fact that, in City of Berkeley, the Supreme Court used virtually the same interpretation of Buckley and Bellotti as did the Fifth Circuit; then, a month later, it summarily affirmed the decision of the Fifth Circuit in Firestone v. Let's Help Florida, 454 U.S. 1130 (1982). In this regard, we note that the Florida limitation held unconstitutional was $3,000, some $2,750 higher than the Berkeley restriction and $500 higher than the Maryland maximum.

The Court then analyzed the contribution limitation in terms of the "virtually inseparable" First Amendment right of expression. 454 U.S. at 299. According to the Court, limits on contributions automatically limit expenditures; and the consequent limits on expenditures impose a direct restraint on the freedom of expression of groups, and of individuals desiring to speak through groups, with respect to ballot questions. Unlike a state's interest in controlling money channelled to candidates: "[T]here is no significant state or public interest in curtailing debate and discussion of a ballot measure. Placing limits on contributions which in turn limit expenditures plainly impairs freedom of expression. The integrity of the political system will be adequately protected if contributors are identified in a public filing revealing the amounts contributed." Id.

In City of Berkeley, the Court emphatically rejected the proffered "compelling State interest" that had been used in Buckley to justify candidate contribution limitations: "the prevention of quid pro quo corruption between a contributor and a candidate". 454 U.S. at 297. Rather, the Court adhered to its earlier statement in Bellotti that "[t]he risk of corruption perceived in cases involving candidate elections . . . simply is not present in a popular vote on a public issue". Id.

The Court likewise rejected the argument that contribution limitations encourage disclosure of the sources of contributions; indeed, the Berkeley statute, as does our own law in Article 33, §26-11(d), already required source reporting of contributions. Finally, the Court was unpersuaded by the record below that the limitation was necessary to preserve the confidence of the voters in the ballot question process.4

4 In this regard, the Court seemed to have left open the possibility that a statute limiting ballot measure contributions might be sustained if a sufficient showing were made that the provision was indeed "needed to preserve voters' confidence in the ballot measure process". 454 U.S. at 299. However, in our case, the legislative history of Article 33, §26-9(b)(2) lacks any findings, let alone a detailed record, of any such need.

IV
Conclusion

In summary, we find that the several courts which have considered the propriety of various statutory limitations on ballot question contributions, under various asserted justifications and claims of substantial state interest, have uniformly held such limitations to violate the First Amendment. For these reasons, it is our opinion that, if confronted with the question, the courts similarly would declare the limitations imposed by Article 33, §26-9(b)(2) to be unconstitutional.

Stephen H. Sachs, Attorney General
Linda H. Lamone, Assistant Attorney General
Avery Aisenstark
Chief Counsel,
Opinions and Advice