Justices May Revive Cap on Contributions

SAN FRANCISCO — After a 1998 political campaign in which state candidates spent more than $200 million, a federal appellate court Tuesday considered reinstating a far-reaching ballot initiative that imposed strict contribution limits.

The three-judge panel of the U.S. 9th Circuit Court of Appeals is deciding the fate of Proposition 208, which was approved by California voters two years ago. The measure limited individual contributions to state Senate and Assembly candidates at $250 and to candidates for statewide offices at $500. If a candidate agreed to spending limits, the individual contribution levels could double.

The initiative’s defenders appealed to the circuit court after U.S. District Judge Lawrence Karlton of Sacramento issued an injunction in January blocking Proposition 208. Karlton concluded that the measure’s tough contribution and spending limits denied candidates their 1st Amendment right to free speech.

On Tuesday, Judge Stephen Reinhardt repeatedly signaled his belief that the limits appeared to infringe on candidates’ ability to campaign. The other two judges seemed more willing to consider upholding the initiative.

“Judging from the questions, two judges seem oriented toward reversing [Karlton], and one toward affirming,” said UCLA law professor Daniel H. Lowenstein, an opponent of the initiative who watched the arguments.

Apparently looking for middle ground, Judge Michael D. Hawkins wondered whether the case could be turned over to the California Supreme Court to rewrite portions of the measure to make it constitutional.

Without Proposition 208, campaign fund-raising and contributions in California have continued to skyrocket. Donations of $100,000 by individuals and corporations to candidates for statewide office are common. Legislative leaders also pull in six-figure donations from individual sources.

Candidates in this year’s general election campaign for governor and other statewide offices raised at least $95 million, according to the California Voter Foundation. Candidates for the 100 legislative contests raised about $75 million. Add in primary spending, and the tab for this year’s campaigns tops $200 million--not counting ballot initiatives, which weren’t covered by Proposition 208.

Under the initiative, a gubernatorial candidate could raise no more than $14 million. Without the limits in place this year, Democratic Gov.-elect Gray Davis raised about $30 million. His Republican opponent, Atty. Gen. Dan Lungren, raised about $22 million.

At several points during Tuesday’s court debate, the argument veered into discussions about this year’s campaigns and wealthy former Northwest Airlines Chairman Al Checchi, who spent about $40 million--most of it his own money--in his failed effort to win the Democratic gubernatorial nomination. The initiative would not have blocked wealthy people from spending their own money on their campaigns.

Proposition 208’s opponents include many Republican and Democratic politicians and many of their supporters, including organized labor, represented Tuesday by San Francisco attorney Joseph Remcho, and the California Pro-Life Council, represented by attorney Jim Bopp from Terre Haute, Ind.

The initiative’s defenders included the state Fair Political Practices Commission and Los Angeles attorney Bradley S. Phillips, who represented the authors, former acting Secretary of State Tony Miller and former California Common Cause director Ruth Holton.

Phillips and FPPC attorney Lawrence Woodlock defended the initiative as a legitimate effort on the voters’ part to limit campaign spending and curtail corruption by reducing the size of donations.

“This is one of the aspirations of 208--to put an end to the arms race,” Woodlock said.

In his questioning, Hawkins focused on the initiative’s contribution caps, noting that Oregon, Washington and Arizona have contribution limits and that $1,000 is the maximum individual donation permitted by federal election law.

Attorneys attacking the initiative--and Judge Reinhardt--noted that the $1,000 limit was imposed on federal campaigns 24 years ago, when the average congressional race cost $73,000. At the time, only 5% of the donations exceeded $1,000. Today as much as 85% of all donations in California political races exceed the restrictions of Proposition 208, noted Bopp.

On the counsel table, Bopp displayed a copy of a book titled “Bribes” by John T. Noonan, one of the judges on Tuesday’s panel.

Bopp said some of the book’s passages support his contention that campaign contributions should not be curtailed, as long as they are fully disclosed. Noonan, however, seemed skeptical about the attacks on the initiative. When one lawyer opposing Proposition 208 said the limits would deny candidates the right to wage a “meaningful mail campaign,” Noonan interrupted:

“A meaningful mail campaign?” he said. “I’ve never known a meaningful mail campaign. . . . People throw it away.”