Why did the Arkansas AG reject the ballot measure stripping limited liability from corporations that spend on elections?

Plain-English summary

Paul J. Spencer, co-chairman of the Regnat Populus Ballot Question Committee, asked the Attorney General to certify the popular name and ballot title for a proposed initiated act, "The Arkansas Political Spending and Conditional Limited Liability for Corporations Act." The measure would strip the protection of limited liability from corporations that spend money to influence Arkansas elections, and pair that with a resolution calling for a federal constitutional amendment to overturn Citizens United v. Federal Election Commission. Attorney General Dustin McDaniel rejected it, and could not rewrite the title, for several reasons.

To start, the submitted ballot title ended in an ellipsis and left out whole sections of the measure, so it was not a complete summary. The AG noted he can modify a title to fix legal problems, but "is not authorized to craft a ballot title out of whole cloth." Beyond that, he identified deeper problems in the measure's text. Section 1, which took away limited liability as a penalty for election spending, was in his view clearly unconstitutional under the "unconstitutional conditions" doctrine: the government may not penalize people for exercising a constitutional right by withholding a benefit, and the U.S. Supreme Court had held in Citizens United that corporate election spending is protected speech. He illustrated the doctrine with Speiser v. Randall and Perry v. Sindermann. He added that even if such a penalty were allowed, Section 1 was ambiguous about who decides a violation, how limited liability gets stripped, and for how long. Finally, Section 4 tried to bar any future law or legislature from altering the act, which the AG said exceeds the people's Amendment 7 initiative power, since Amendment 7 lets the General Assembly amend or repeal initiated acts by a two-thirds vote.

Currency note

This opinion was issued in 2013. 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.

Common questions

Q: What would this measure have done?
A: It aimed to discourage corporations from spending to influence Arkansas elections by taking away their limited-liability protection if they did, and it included a resolution urging a federal constitutional amendment to reverse Citizens United v. Federal Election Commission, 558 U.S. 310 (2010).

Q: Why did the AG call Section 1 unconstitutional?
A: Under the unconstitutional conditions doctrine, the government cannot penalize the exercise of a constitutional right by withholding an otherwise available benefit. Because the Supreme Court has treated corporate election spending as protected speech, the AG concluded that conditioning limited liability on refraining from that speech penalized a protected right. He cited Speiser v. Randall, 357 U.S. 513 (1958), and Perry v. Sindermann, 408 U.S. 593 (1972).

Q: Was the ballot title itself a problem, separate from the substance?
A: Yes. The submitted title ended in an ellipsis and omitted entire sections, so it did not summarize the whole measure. The AG can tweak a title but cannot write one from scratch, so he could not certify or substitute a corrected version.

Q: What was wrong with Section 4?
A: Section 4 tried to insulate the act from being "limited, voided, or altered" by any conflicting law. The AG explained that Amendment 7 expressly lets the General Assembly amend or repeal initiated acts by a two-thirds roll-call vote, so a provision purporting to block that falls outside the people's initiative power.

Q: Did rejecting the measure mean the AG opposed limiting corporate money in politics?
A: No. He repeated that his office does not weigh the merits, philosophy, or ideology of a proposal. His role was limited to whether the popular name and ballot title fairly and completely summarized the measure, and whether he could lawfully certify them.

Background and statutory framework

The Attorney General must certify a proposed measure's popular name and ballot title under A.C.A. § 7-9-107 before petitions circulate, and may substitute a corrected title only when he can produce an accurate summary. The Arkansas Supreme Court's standards (from cases such as Kurrus v. Priest, 342 Ark. 434, 29 S.W.3d 669 (2000), Bailey v. McCuen, 318 Ark. 277, 884 S.W.2d 938 (1994), and Roberts v. Priest, 341 Ark. 813, 20 S.W.3d 376 (2000)) require the title to give voters a fair understanding of the issues while staying brief and concise (A.C.A. § 7-9-107(b)) to respect the five-minute booth limit of A.C.A. § 7-5-522.

Two constitutional threads run through the opinion. The first is federal: Citizens United held that the First Amendment protects independent corporate election spending, which is why the AG viewed a state penalty on that spending as constitutionally suspect. The second is state: Amendment 7 to the Arkansas Constitution reserves the initiative power to the people but also preserves the General Assembly's authority to amend or repeal initiated acts, so a measure cannot lock itself against future change.

Citations and references

Statutes:

• A.C.A. § 7-9-107 (Repl. 2013) (AG certification of popular name and ballot title)
• A.C.A. § 7-9-107(b) (ballot title must be brief and concise)
• A.C.A. § 7-5-522 (five-minute limit in the voting booth)
• Ark. Const. Amendment 7 (initiative and referendum; legislative amend/repeal power)

Cases:

• Citizens United v. Federal Election Commission, 558 U.S. 310 (2010), corporate election spending is protected speech
• Speiser v. Randall, 357 U.S. 513 (1958), penalizing speech by withholding a benefit
• Perry v. Sindermann, 408 U.S. 593 (1972), unconstitutional conditions doctrine
• Kurrus v. Priest, 342 Ark. 434, 29 S.W.3d 669 (2000)
• Bailey v. McCuen, 318 Ark. 277, 884 S.W.2d 938 (1994), essential-facts and ballot-title standards
• Roberts v. Priest, 341 Ark. 813, 20 S.W.3d 376 (2000)

Source

• Landing page: https://arkansasag.gov/divisions/opinions-foia/attorney-general-opinions-search/

Original opinion text

STATE OF ARKANSAS

THE ATTORNEY GENERAL
Dustin McCDANIEL

Opinion No. 2013-128

October 23, 2013

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Post Office Box 1087

Little Rock, Arkansas 72203-1087

Dear Mr. Spencer:

This is in response to your request for certification, pursuant to A.C.A. § 7-9-107
(Repl. 2013), of the following popular name and ballot title for a proposed
initiated measure. You have previously submitted a similar measure, which I
rejected due to, among other things, ambiguities in the text of your proposed
measure. See Op. Att’y Gen. No. 2013-113. You have since made changes to
your proposal and now submit the following popular name and ballot title for my
review:

Popular Name

THE ARKANSAS POLITICAL SPENDING AND
CONDITIONAL LIMITED LIABILITY FOR CORPORATIONS ACT

Ballot Title

An act providing that the principles of limited liability of corporate
entities and their investors shall not apply to any corporate entity
organized under the laws of Arkansas, nor any corporate entity
organized under the laws of any other state which conducts business

323 CENTER STREET, SUITE 200 * LITTLE Rock, ARKANSAS 72201
TELEPHONE (501) 682-2007 © Fax (501) 682-8084
INTERNET WEBSITE * http://www.ag.state.ar.us/

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 2

in, owns real property in or performs any other activity in
Arkansas...

The Attorney General is required, pursuant to A.C.A. § 7-9-107, to certify the
popular name and ballot title of all proposed initiative and referendum acts or
amendments before the petitions are circulated for signature. The law provides that
the Attorney General may substitute and certify a more suitable and correct
popular name and ballot title, if he can do so, or if the proposed popular name and
ballot title are sufficiently misleading, may reject the entire petition. Neither
certification nor rejection of a popular name and ballot title reflects my view
of the merits of the proposal. This Office has been given no authority to
consider the merits of any measure.

In this regard, A.C.A. § 7-9-107 neither requires nor authorizes this office to make
legal determinations concerning the merits of the act or amendment, or concerning
the likelihood that it will accomplish its stated objective. In addition, consistent
with Arkansas Supreme Court precedent, unless the measure is “clearly contrary to
law,”! this office will not require that a measure’s proponents acknowledge in the
ballot title any possible constitutional infirmities. As part of my review, however,
I may address constitutional concerns for consideration by the measure’s
proponents,

Consequently, this review has been limited primarily to a determination, pursuant
to the guidelines that have been set forth by the Arkansas Supreme Court,
discussed below, of whether the popular name and ballot title you have submitted
accurately and impartially summarize the provisions of your proposed amendment.

| See Kurrus v. Priest, 342 Ark. 434, 445, 29 S.W.3d 669, 675 (2000); Donovan v. Priest, 326
Ark. 353, 359, 931 S.W.2d 119, 121 (1996); Plugge v. McCuen, 310 Ark. 654, 841 S.W.2d 139
(1992),

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 3

The purpose of my review and certification is to ensure that the popular
name and ballot title honestly, intelligibly, and fairly set forth the purpose of
the proposed amendment or act.”

The popular name is primarily a useful legislative device. It need not contain
detailed information or include exceptions that might be required of a ballot title,
but it must not be misleading or give partisan coloring to the merit of the
proposal.’ The popular name is to be considered together with the ballot title in
determining the ballot title’s sufficiency.”

The ballot title must include an impartial summary of the proposed amendment or
act that will give the voter a fair understanding of the issues presented.° According
to the court, if information omitted from the ballot title is an “essential fact which
would give the voter serious ground for reflection, it must be disclosed.”’ At the
same time, however, a ballot title must be brief and concise (see A.C.A. § 7-9-
107(b)); otherwise voters could run afoul of A.C.A. § 7-5-522’s five minute limit
in voting booths when other voters are waiting in line.® The ballot title is not
required to be perfect, nor is it reasonable to expect the title to cover or anticipate
every possible legal argument the proposed measure might evoke.” The title,
however, must be free from any misleading tendency, whether by amplification,

• See Arkansas Women’s Political Caucus v. Riviere, 283 Ark. 463, 466, 677 S.W.2d 846 (1984).
  3 Pafford v. Hall, 217 Ark. 734, 739, 233 S.W.2d 72, 75 (1950).

• E.g., Chaney v. Bryant, 259 Ark. 294, 297, 532 S.W.2d 741, 743 (1976); Moore v. Hall, 229
  Ark, 411, 316 S.W.2d 207 (1958).

May v. Daniels, 359 Ark. 100, 105, 194 S.W.3d 771, 776 (2004).

° Becker v. Riviere, 270 Ark. 219, 226, 604 S.W.2d 555, 558 (1980).
” Bailey v. McCuen, 318 Ark. 277, 285, 884 S.W.2d 938, 942 (1994).

• Id, at 288, 884 S.W.2d at 944.

• Id, 293, 884 S.W.2d at 946-47.

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 4

omission, or fallacy; it must not be tinged with partisan coloring.'® The ballot title
must be honest and impartial,'' and it must convey an intelligible idea of the scope
and significance of a proposed change in the law."

Furthermore, the Court has confirmed that a proposed amendment cannot be
approved if “[t]he text of the proposed amendment itself contribute[s] to the
confusion and disconnect between the language in the popular name and the ballot
title and the language in the proposed measure.”'? The Court concluded that
“internal inconsistencies would inevitably lead to confusion in drafting a popular
name and ballot title and to confusion in the ballot title itself.”!* Where the effects
of a proposed measure on current law are unclear or ambiguous, it is impossible
for me to perform my statutory duty to the satisfaction of the Arkansas Supreme
Court without clarification of the ambiguities.

Having analyzed your proposed amendment, as well as your proposed popular
name and ballot title under the above precepts, it is my conclusion that (a)
ambiguities in the text of your measure and (b) deficiencies in the ballot title
prevent me from certifying your proposed popular name and ballot title, Further,
these ambiguities render me unable to fairly and completely summarize your
proposal in a popular name or ballot title. I am therefore unable to substitute and
certify a more suitable and correct popular name and ballot title pursuant to
A.C.A. § 7-9-107(b).

You have submitted a ballot title that ends in ellipses and fails to mention whole
sections of your proposal. Thus, I have not been presented with a full and

'° Td. at 284, 884 S.W.2d at 942.
'' Becker vy. McCuen, 303 Ark. 482, 489, 798 S.W.2d 71, 74 (1990).

Christian Civic Action Committee v. McCuen, 318 Ark. 241, 245, 884 S.W.2d 605, 607 (1994)
(internal quotations omitted).

? Roberts v. Priest, 341 Ark. 813, 825, 20 S.W.3d 376, 383 (2000).

14 Td

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 5

complete summary of your proposal. While I am authorized to modify the
language in a ballot title so that it aligns more closely with legal requirements, I
am not authorized to craft a ballot title out of whole cloth. The current ballot title
is wholly deficient.

Further, I must reject your proposal as submitted for four additional reasons: (1)
Section 1 is clearly unconstitutional; (2) Section 1 contains a critical ambiguity;
(3) you have failed to remedy the clear constitutional problem I previously noted
with Section 4; and (4) there are several ambiguities in the text setting out the
resolution part of your proposal.

The constitutional problem with Section 1

In response to your prior submission (Op. 2013-113), I noted that the two main
parts of your proposal contradicted each other. While you have tried to address
this contradiction, the attempt to solve the problem has resulted in a provision that
is clearly unconstitutional. At this stage, I merely point this out because you may
be unaware of it. Further, you should know, as I pointed out in Op. 2013-113, that
the Arkansas Supreme Court has indicated that the people lack Amendment 7
power to initiate statutes that are unconstitutional. To show how your attempted
solution is clearly unconstitutional, I will briefly review the problem with your
prior proposal, examine the current effort to remedy the problem, and explain why
the proposed remedy creates further problems.

In response to your earlier submission, I noted that your proposal essentially
addressed two distinct issues: a prohibition on corporate spending to influence
elections and a resolution regarding a federal constitutional amendment to
overturn the U.S. Supreme Court decision in Citizens United v. Federal Election
Commission.'> I went on to note that these two parts of your proposal were
inconsistent with each other. On the one hand, the resolution provisions seemed to
recognize both (a) that the U.S. Supreme Court has held that the First Amendment
to the U.S. Constitution affords corporations the right to spend money in those

'S §58 U.S. 310 (2010),

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 6

ways and (0) that, therefore, the only way to prohibit corporations from making
such expenditures is to amend the U.S. Constitution. Yet, on the other hand, the
prohibition sought to effect those restrictions by way of a state statute. (The
prohibition was to be enforced by a penalty: offending corporations were to be
stripped of their limited liability.) Because of this inconsistency, I was unable to
ensure that your measure was properly summarized in the ballot title.

Your current submission tries to resolve this inconsistency by retaining the
resolution and rewording the prohibition language so that, instead of flatly
prohibiting the corporate spending, the measure seeks to deter such spending
through a penalty. Under your proposal, corporations must choose between either
(a) engaging in certain constitutionally-protected speech (i.e., certain kinds of
election spending) and being stripped of their limited liability, or (5) refraining
from constitutionally-protected speech in order to retain their limited liability. So
the proposal’s earlier iteration tried to stop constitutionally protected speech
before it occurred (via the prohibition) and tried to enforce that prohibition by way
of a penalty (via the provision about losing limited liability). The current proposal
‘attempts to achieve the same result (preventing certain constitutionally-protected
speech) by way of a penalty.

While this shift in wording does resolve the proposal’s internal inconsistency, it
does so in a way that renders the proposal clearly unconstitutional. Under the
unconstitutional conditions doctrine, “the government may not indirectly
accomplish a restriction on constitutional rights which it is powerless to decree
directly, and the government may not deny a benefit to a person on a basis that
infringes the person’s First Amendment rights.”'® In other words, the doctrine
“prevents the government from penalizing those who exercise their constitutional
rights by withholding a benefit that would otherwise be available.”'” In this case,

'6 16A Am. Jur. 2d Constitutional Law § 411 (2013).

" Erwin Chemerinksy, Constitutional Law: Principles and Polices, 4th ed. (Wolters Kluwer, 2011), p.
1009; see generally Mitchell N. Bermann, Coercion, Compulsion, and the Medicaid Expansion: A Study in
the Doctrine of Unconstitutional Conditions, 91 Tex. L. Rev. 1283, 1316-1333 (2013); Seth F. Kreimer,
Allocational Sanctions: The Problem of Negative Rights in a Positive State, 132 U. Pa. L. Rev. 1293
(1984).

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 7

the benefit that is otherwise available is the retention of and protection afforded by
the limited liability that is part and parcel of the corporate form. Your current
proposal clearly attempts to arrive at the same objective as your prior proposal:
fewer corporations engaging in, what the Court has declared to be, constitutionally
protected speech. The only material difference between the two proposals is the
means chosen to arrive at that objective: the prior proposal flatly prohibited the
corporate spending, while the current proposal tries to deter it by way of a penalty.

The unconstitutional conditions doctrine, which prohibits this kind of government
action, is illustrated by the Court’s 1958 decision in Speiser v. Randall.'*®
California had certain property-tax exemptions for veterans. The state passed a law
requiring that, in order to receive the exemptions, a veteran had to sign a
declaration affirming that they did not believe that the United States government
should be overthrown by force or violence. The Court held that the statute was
unconstitutional because, inter alia, “|t]o deny an exemption to claimants who
engage in certain forms of speech is in effect to penalize them for this speech.”
In a later case, the Court elaborated on the impropriety of penalizing the exercise
of a clear constitutional right:

[E]ven though a person has no “right” to a valuable government
benefit, and even though the government may deny him the benefit
for any number of reasons, there are some reasons upon which the
government may not rely. It may not deny a benefit to a person on a
basis that infringes his constitutionally-protected interests—
especially his interest in freedom of speech. For if the government
could deny a benefit to a person because of his constitutionally
protected speech or associations, his exercise of those freedoms
would in effect be penalized or inhibited.”°

'§357 U.S. 513 (1958).
9 Speiser, 357 U.S, at 518.

20 Perry y, Sindermann, 408 U.S. 593, 597 (1972) (emphasis added).

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 8

Your proposal is designed to penalize corporations for engaging in
constitutionally-protected speech. Accordingly, it falls squarely within the
unconstitutional conditions doctrine and is, therefore, clearly unconstitutional.

Section 1’s penalty provision is ambiguous

In the foregoing discussion, I explained why the government cannot penalize
constitutionally-protected activity, especially in the area of speech rights. So the
foregoing addressed the use of a penalty at all. In this section, I address the
ambiguities associated with the kind of penalty your proposal employs. Your
penalty provision states: “Principles of limited liability otherwise applicable to
corporate entities and their investors by common law, statute, regulation or
otherwise under Arkansas law, shall not apply with respect to any corporate entity
organized under the laws of this state...which [corporation] spends funds to
influence any federal, state, or local election in Arkansas [in certain ways].”

Even if the use of a penalty were constitutional, the following ambiguities prevent
me from ensuring that your penalty provision is properly summarized in the ballot
title:

e The proposal does not indicate who or what body decides whether a
corporation has engaged in activities that violate the proposal’s terms.

e The proposal does not indicate how a corporation’s limited liability is
stripped. For example, it is unclear whether this will occur through some
court or administrative action.

e The proposal does not indicate the temporal scope of the penalty. For
example, if a corporation engages in the kind of spending that the proposal
would prohibit, is the corporation forever subject to having its limited
liability stripped?

These are matters of significant interest to the voters. Accordingly, they must be
summarized in the ballot title so that voters will have a fair understanding of the

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 9

issues presented. But unless these ambiguities are resolved, I am unable to
substitute and certify a more suitable ballot title for the measure.

Section 4 is clearly unconstitutional

As currently worded, Section 4 attempts to insulate your entire proposal from
being modified or repealed either by a future initiated measure or by the General
Assembly: “This act shall not be limited, voided, or altered by any conflicting
laws in any section of the Arkansas Code including, but not limited to, any section
of Title 7.” This language, which is identical to your prior submission, is clearly
unconstitutional. In response to your prior submission, I explained (on p. 6, note
18) why this language was problematic. Pursuant to Amendment 7, the General
Assembly has the authority to “amend or repeal” initiated acts “upon a yea and
nay vote on roll call of two-thirds of all the members elected to each house....”
Art. 5, § 1, under “General Provisions.” Therefore, the power to initiate such a
provision falls outside the Amendment 7 power.

Ambiguities in the text of the resolution provisions

The resolution part of your proposal is comprised of two sections. Section 2 of the
proposed measure identifies a policy and directs all of Arkansas’s elected and
appointed officials “to act whenever possible to promote this policy.” Section 3
calls for a “joint resolution” amending the U.S. Constitution as one means of
promoting the policy. As explained below, Section 2 is structurally ambiguous and
contains textual ambiguities. There are also ambiguities contained in the text of
Section 3, and in the way Sections 2 and 3 work together.

Section 2 is structurally ambiguous in two ways. First, while it is labeled a
“policy,” it directs Arkansas officials to act to “promote” the policy. Thus, the
Section appears to move beyond stating policy to directing officials to act in
certain ways. Second, Section 2(2) says that “[w]hen carrying out the policy under
subsection (1), Arkansas’ [sic] elected and appointed officials are generally
directed as follows....” The Section then lists a series of separately enumerated
clauses, all beginning with the phrase “that the people of Arkansas” believe,
intend, or regard something to be true or desirable. It is unclear what the
relationship is between these clauses and the prefatory language about the officials

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 10

being “generally directed” according to them. For example, it is unclear whether
these additional statements are further policy statements — statements that would
typically appear in a section of a resolution where certain things are “resolved” to
be the case — or something else entirely. These ambiguities regarding the meaning
of Section 2 prevent me from ensuring it is accurately summarized in a ballot title.

Sections 2 and 3, when considered together, jointly call for and explain some goals
for an amendment to the U.S. Constitution. These sections contain the following
ambiguities and deficiencies that prevent me from ensuring that your measure is

properly summarized in a ballot title:

Section 2 contains numerous typographical errors where words are
inadvertently lumped together. For example, Section 2(1) states, “It
is the policy of the state [sic] of Arkansas that corporations are not
endowedwith [sic] the constitutional rightsof [sic] people and should
not be permitted to use....”

Section 2(2)(B) says that “the people of Arkansas believe that the
rights of natural persons under the United States Constitution should
not be extended to corporations[.]” If no provisions in the Bill of
Rights will apply to corporations, then your proposal would attempt
to overturn many other U.S. Supreme Court rulings. Given that your
proposal as a whole is directed to corporate spending, I realize that
this particular provision carries with it an implied restriction to the
context of the First Amendment. Nevertheless, read literally, this
provision could apply either to (a) all rights of found anywhere in
the Constitution, (d) all the rights enumerated in the Bill of Rights,
(c) only those rights found in the First Amendment, or (@) only those
speech rights found in the First Amendment. This ambiguity, which
occurs in other provisions of Sections 2 and 3 (e.g., Section 3(1)(B)),
must be clarified before I can ensure your proposal is adequately
summarized in a ballot title.

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 11

Section 2(2)(E) states that Arkansans want a “level playing field in
campaign spending,” which includes “voluntary public funding
programs designed to limit undue influence by wealthy interests and
amplify the voices of ordinary citizens.” The terms “wealthy
interests” and “ordinary citizens” are undefined. It is impossible to
provide voters with a fair understanding of this provision without
some information regarding the scope of these terms.

Sections 2(2)(D) and 2(2)(E), when viewed together, are
inconsistent. On the one hand, the former speaks of “allow[ing] all
individuals, regardless of wealth, to express their views to one
another and their government.” (Emphasis added.) On the other
hand, the latter speaks of “limiting” the “influence” of “wealthy
interests.” So while one section speaks of proposing a constitutional
amendment that treats persons equally, without regard to their
wealth, the next section speaks of limiting the influence of wealthy
persons. These two sections are contradictory, which prevents a
summary in the ballot title.

Section 3(1)(A) says that Arkansans “call upon their congressional
delegation to propose a joint resolution offering an amendment to
the United States Constitution that: overturns the U.S. Supreme
Court’s ruling in Citizens United v. FEC, Citizens United contains
at least three holdings or, as you say, “rulings”: (1) the First
Amendment prevents the government from suppressing the political
speech of a corporate entity; (2) a federal statute barring independent
corporate expenditures for electioneering communications violated
the First Amendment; and (3) the disclaimer and disclosure
provisions of the Bipartisan Campaign Finance Reform Act of 2002
did not violate the constitution under the facts of the case. Your
proposal is unclear on whether it calls for all or only some of these
holdings to be “overturned.” This ambiguity prevents me from
ensuring that your ballot title properly summarizes your measure.

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No, 2013-128

Page 12

Section 3(1)(B) calls for the amendment to establish “that
corporations are not endowed with the constitutional rights of

people.” This is ambiguous for the reason noted above in my
discussion of Section 2(2)(B).

Section 3(1)(D) calls for the amendment to “overturn[] the U.S.
Supreme Court’s ruling in Buckley v. Valeo which struck down
mandatory limits on expenditures with respect to elections[.]”
Because this is not an accurate summary of Buckley, including this
language in the ballot title would mislead voters. In fact, Buckley had
several holdings, including the holding that contributions trigger
associational (as distinct from speech) rights under the First
Amendment. And, therefore, caps or bans on contributions are more
likely to pass constitutional scrutiny. Overturning Buckley in toto
would also overturn this holding, something I suspect you do not
intend, given some of your proposal’s other provisions. The failure
to state which of the many holdings in Buckley will be overturned
prevents me from adequately summarizing your measure in a ballot
title,

Section 3(1)(E) calls for the amendment to “authorize[] Congress
and the states to impose content-neutral limitations on private
campaign contributions, campaign expenditures and independent
political expenditures.” It is not clear what is meant by “private
campaign contributions.” Nor is it clear whether the terms
“campaign expenditures and independent political expenditures” are
modified by the term “private.” Further, the provision is not clear
about whose “contributions,” “campaign expenditures,” and
“independent political expenditures” are supposed to be limited.
These ambiguities prevent me from ensuring that your ballot title
properly summarizes your measure.

Paul J. Spencer, Co-Chairman

Regnat Populus Ballot Question Committee
Opinion No. 2013-128

Page 13

I cannot begin to certify a ballot title for your proposed amendment in the face of
the ambiguities noted above. You must remedy these confusing and ambiguous
points before I can perform my statutory duty.

My office, in the certification of ballot titles and popular names, does not concern
itself with the merits, philosophy, or ideology of proposed measures. I have no
constitutional role in the shaping or drafting of such measures. My statutory
mandate is embodied only in A.C.A. § 7-9-107 and my duty is to the electorate. I
am not your counsel in this matter and cannot advise you as to the substance of
your proposal.

My statutory duty, under these circumstances, is to reject your proposed ballot title
(for the foregoing reasons) and instruct you to “redesign” the proposed measure
and ballot title. You may, after addressing the matters discussed above, resubmit
your proposed amendment, along with a proposed popular name and ballot title, at
your convenience. J anticipate, as noted above, that some changes or additions to
your submitted popular name and ballot title may be necessary. I will be pleased
to perform my statutory duties in this regard in a timely manner after
resubmission.

Sincerely,

DUSTIN MCDANIEL
Attorney General

DM/cyh

Enclosure

TT es Regnat Populus

P.O. Box 1087

mee Little Rock, AR 72203-1087

A es Paul Spencer and David Couch
Co-Chairs
[email protected]
(501) 515-8661
[email protected]

(501) 664-1300

October 9, 2013

OCT 09 2013

ATTORNEY GENERAL
oye
ARK AMGAS

To the Honorable Dustin McDaniel
Attorney General for the State of Arkansas

Dear Sir,

|, Paul J. Spencer, acting on behalf of the Ballot Question Committee Regnat Populus, and as Co-
Chairman of that Committee, respectfully ask that you consider the following submitted Proposed
Initiated Act Title for approval:

Popular Name

The Arkansas Political Spending and Conditional Limited Liability for Corporations Act

Ballot Title

AN ACT PROVIDING THAT THE PRINCIPLES OF LIMITED LIABILITY OF CORPORATE ENTITIES AND THEIR
INVESTORS SHALL NOT APPLY TO ANY CORPORATE ENTITY ORGANIZED UNDER THE LAWS OF ARKANSAS,
NOR ANY CORPORATE ENTITY ORGANIZED UNDER THE LAWS OF ANY OTHER STATE WHICH CONDUCTS
BUSINESS IN, OWNS REAL PROPERTY IN OR PERFORMS ANY OTHER ACTIVITY IN ARKANSAS. . .

| appreciate your attention to this matter.

Paul J. Spencer
Co-Chairman
Regnat Populus

BE IT ENACTED BY THE PEOPLE OF THE STATE OF ARKANSAS:
Preamble.

WHEREAS, the People of the State of Arkansas seek to create a democracy that is truly of, by and
for the People and not bought and paid for by corporations, unions, and the wealthy; and

WHEREAS, the People of the State of Arkansas recognize that the US Supreme Court inCitizens
United v. FECassignedcorporations the same rights as people under the US Constitution with
respect to political spending,overturning a century of precedent barring corporate money in
elections; and

WHEREAS, the People of the State of Arkansas recognize that the US Supreme Court in Buckley
v. Valeo equated money with speech and struck down mandatory spending limits for federal
elections, leading to today’s system of unlimited campaign spending dominated by big money
interests; and

WHEREAS, the People of Arkansas seek to reverse those wrongly decided and unjust rulings
which have resulted in undue financial and commercial influence by a wealthy elite over our
elections and government, fostered corruption, alienated voters, and undermined the public’s
confidence in the integrity of our democracy; and

WHEREAS, the People of the State of Arkansas seek to uphold the fundamental promise of
political equality for all and to ensure that corporations and big money interests are not able to
drown out the voices of ordinary citizens; and

WHEREAS, the People of the State of Arkansas recognize that limited liability is a privilege
granted to corporate entities by the State based on economic policy choices, and seek to safeguard
the health of the State’s democracy by revoking that privilege for corporate entities that spend their
general treasury funds to influence Arkansas elections; and

WHEREAS, the People of the State of Arkansas support an amendment to the Constitution of the
United States that will reestablish that the rights enshrined therein belong to real persons and not
corporate entities, and that will restore the authority of Congress and the states to regulate
spending with respect to political campaigns.;

THEREFORE, the people of the State of Arkansas do enact as follows:

Section 1. Changes to Corporate Charter Regulations and to Principles of Limited Liability.

Chapter 36 is added to the Arkansas Code Annotated Title 4, Subtitle 3, and is titled “Arkansas
Political Spending and Conditional Limited Liability for Corporations Act” and reads:

il.

mo aes

Changes to Corporate Charter Regulations and to Principles of Limited Liability:
A.C.A. § 4-36-101:

(1)(A)Principles of limited liability otherwise applicable to corporate entities and their investors by
common law, statute, regulation or otherwise under Arkansas law, shall not apply with respect to
any corporate entity organized under the laws of this state, nor any corporate entity organized
under the laws of any other state, which conducts business in, owns real property in, or performs
any other activity in the state of Arkansas, and which spends funds to influence any federal, state
or local election in Arkansas by:

donating to any approved political action committee, as they are defined in A.C.A. § 7-6-
201(1)(A), or to any other person or groups of people who will use those funds to influence an
election or public policy, including but not limited to:

a ballot question committee;

a legislative question committee;

a political party;

a county political party committee;

a political action committee; or

an independent expenditure committee;

purchasing any broadcast, print, cable or satellite communication to be disseminated within sixty
(60) days of an election which:

refers to a clearly identifiable candidate for federal or state office; or

refers to a clearly identifiable pending ballot issue.

making any other purchase, expenditure, or donation with the intention of influencing public
perception of a clearly identifiable candidate or ballot issue.

Exemptions

The expenditures cited in this section do not include any news story, commentary, or editorial
distributed through the facilities of any broadcasting station, newspaper, magazine or other
periodical publication.

Section 2. Policy.

(1) It is the policy of the state of Arkansas that corporations are not endowedwith the
constitutional rightsof people and should not be permitted to use their accumulated wealth to
influence elections, and that limits on campaign-related expenditures are necessary to prevent
undue political influence and corruption and establish a level playing field that enables diverse
voices to be heard in Arkansas elections; and that each state and federal elected and appointed
official in Arkansas is called uponby the voters to act whenever possible to promote this policy.

(2) When carrying out the policy under subsection (1), Arkansas’ elected and appointed officials
are generally directed as follows:

(A) that the people of Arkansas regard money as property, not speech;

(B) that the people of Arkansas believe that the rights of natural persons under the United States
Constitution should not be extended to corporations;

(C) that the people of Arkansas regard the immense aggregation of wealth that is accumulated by
corporations using advantages provided by the government to be corrosive and distorting when
used to advance the political interests of corporations;

(D) that the people of Arkansas intend that there should be a level playing field in campaign
spending that allows all individuals, regardless of wealth, to express their views to one another and
their government; and

(E) that the people of Arkansas intend that a level playing field in campaign spending includes
limits on large campaign contributions and expenditures, by any source, including corporations,

individuals, or political committees, as well as voluntary public funding programs designed to limit
undue influence by wealthy interests and amplify the voices of ordinary citizens.

Section 3. Promotion of policy by elected or appointed officials.

(1) The voters of Arkansas call upon their congressional delegation to propose a joint resolution
offering an amendment to the United States Constitution that:

(A) overturns the U.S. Supreme Court’s ruling in Citizens United v. FEC;
(B) establishes that corporations are not endowed with the constitutional rights of people;

(D) overturns the U.S. Supreme Court’s ruling in Buckley v. Valeo which struck down mandatory
limits on expenditures with respect to elections;

(E) authorizes Congress and the states to impose content-neutral limitations on private campaign
contributions, campaign expenditures and independent political expenditures; and

(F) accomplishes the goals of Arkansans to achieve a level playing field by authorizing voluntary
public campaign financing systems.

(2) The voters of Arkansas call upon their congressional delegation to work diligently to bring
such a joint resolution to a vote and passage, including use of discharge petitions, cloture, and
every other procedural method to secure a vote and passage.

(3) The voters of Arkansas call on the members of the Arkansas legislature, if given the
opportunity, to ratify any amendment to the United States constitution that is consistent with the
policy of the state of Arkansas.

Section 4. Savings Clause.

This act shall not be limited, voided, or altered by any conflicting laws in any section of the
Arkansas Code including, but not limited to, any section of Title 7.

Section 5. Severability.

If any part of this act is invalid, all valid parts that are severable from the invalid part remain in
effect. If a part of this act is invalid in one or more of its applications, the part remains in effect in
all valid applications that are severable from the invalid applications.

Section 6. Codification instruction.

Section 1 through 5 are intended to be codified as an integral part of Title 4 and the provisions of
Title 4 apply to sections 1 through S.