Dark Money and Alaska's Fight for Transparent Elections

Nearly 15 years ago, in 2010, the Supreme Court ruled in Citizens United v. FEC [1] that corporations and unions could contribute unlimited amounts of money to political causes. This decision was a complete reversal of the 60-year-old Federal Election Campaign Act, or FECA, [2] which created strict regulations including mandatory reporting and limits to contributions. The logic behind policies like these is simple: unchecked money in politics risks destroying democratic institutions, allowing wealthier individuals and organizations to influence elections.

Citizens United v. FEC removed two significant things: contribution limits and regulations requiring organizations and individuals to report where their donations came from. This ruling led to the rise of dark money, funding from nonprofits, or political action committees that are not required to disclose their donors [3]. The majority opinion in Citizens United, written by Justice Anthony Kennedy, stated anonymity is essential to free speech. However, some argue these changes have destroyed political integrity and transparency, leaving voters in the dark about who is financing political campaigns.

Since 2010, most of the decisions from Citizens United have been reaffirmed by the courts. Expanded contribution limits were upheld in McCutcheon v. FEC (2014) [4], which removed aggregate limits for individual donors. This allowed wealthy individuals to distribute large amounts of money across multiple different candidates. In another case, SpeechNow.org v. FEC (2010) [5], the Court enabled super PACs, which have no limits on spending as long as they operate independently. Despite established jurisprudence, donor disclosure remains a contentious issue in the public.

In 2020 Alaska passed Ballot Measure 2 [6], a campaign finance reform law designed to counteract the influence dark money had in the state. The law requires donors contributing more than $2,000 to disclose their identities and advertisements funded by out-of-state organizations to include disclaimers about their funding being from out of the state. These measures are the most aggressive state-level responses to Citizens United ruling on disclosures.

As expected, Ballot Measure 2 was met quickly with legal challenges. In 2022, advocacy groups, Families of the Last Frontier and the Alaska Free Market Coalition, filed a federal lawsuit arguing that the law violates the First Amendment by compelling speech–forcing donors to reveal their identities and requiring political ads to carry government-mandated disclaimers. Represented by the Liberty Justice Center, the plaintiffs claimed the compelled disclosure hurt political participation and discouraged contributions, particularly for donors who fear harassment or retaliation for their political views.

The Citizens United ruling on spending contribution has been repeatedly upheld by preceding courts, but have recognized that disclosure laws can serve an important government interest. In Buckley v. Valeo (1976), the Supreme Court decided disclosure requirements were acceptable, reasoning that they prevent corruption and inform the public. In Doe v. Reed (2010), The Court ruled that compelled disclosure can be justified when it advances significant state interests. The District Court, reviewing Ballot Measure 2, relied on these precedents, claiming “the State has an important governmental interest in deterring the appearance of and actual corruption in elections.” As a result, a motion for a preliminary injunction was denied, which would have temporarily halted the law. The Ninth Circuit Court of Appeals later upheld this ruling, agreeing the disclosure requirements were "reasonably tailored to the state's important interests in keeping the public informed.” Despite its setbacks, the Liberty Justice Center later appealed to the Supreme Court. In November 2024, the Court declined to hear the case, leaving the Ninth Circuit’s decision as the final word on the matter.

Reilly Stephens, an attorney for the Liberty Justice Center, criticized the measure on the disclaimer requirements, claiming they stigmatized certain political messages, describing it as a “scarlet letter” that discourages speech [7]. This claim is based on the doctrine of compelled speech, which the Supreme Court has historically criticized under cases like Wooley v. Maynard (1977) [8], where they ruled the government cannot force individuals to promote an ideological message. However, courts have been more lenient when the government compels disclosures in commercial and electoral contexts, as seen in Zauderer v. Office of Disciplinary Counsel (1985) [9] where the Court upheld mandatory disclaimers in attorney advertising.

While Alaska’s law remains, its future is not completely safe. The Supreme Court’s refusal to hear the case does not necessarily indicate agreement with the Ninth Circuit’s ruling. This case was one of dozens rejected by the court that month, showing this might be an issue with docket constraints. Despite the Court's rejection, Jacob Huebert, president of the Liberty Justice Center, has indicated that the group will continue to challenge the disclosure law within the U.S. District Court of Alaska.

This legal battle extends well beyond Alaska. If states continue to push the boundaries of donor disclosure laws, they may force the Supreme Court to respond, potentially creating stricter rules about transparency measures. For now, states remain free to experiment with broad election transparency measures, but the constitutional questions surrounding disclosure laws remain unanswered, and the fight over dark money is not over.

Sources:

1. Citizens United v. FEC, 558 U.S. 310 (2010).
2. Federal Election Campaign Act of 1971, 52 U.S.C. §§ 30101–30146.
3. Bob Biersack, 8 Years Later: How Citizens United Changed Campaign Finance, OPEN SECRETS (Feb. 7, 2018)
4. McCutcheon v. FEC, 572 U.S. 185 (2014).
5. SpeechNow.org v. FEC, 599 F.3d 686 (D.C. Cir. 2010).
6. Alaska Ballot Measure 2, Top-Four Ranked-Choice Voting and Campaign Finance Laws Initiative (2020).
7. Liberty Justice Ctr., Alaska Ballot Measure 2: U.S. Supreme Court Declines to Hear Challenge, (Nov. 28, 2024).
8. Wooley v. Maynard, 430 U.S. 705 (1977).
9. Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985)