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The Honolulu Advertiser
Posted on: Tuesday, April 1, 2008

Campaign finance law fix halted

By Derrick DePledge
Advertiser Government Writer

The state House, succumbing to pressure from activists, has given up on clarifying a state campaign finance law that restricts corporate contributions to political candidates.

House and Senate leaders had tentatively agreed to fix what many believed was an inadvertent change to the law in 2005 that limited corporations to using $1,000 from corporate treasuries for corporate political action committees. In much of the previous decade, corporations were allowed to put unlimited amounts of money from corporate treasuries into corporate PACs, which would then donate money to candidates.

But groups such as Common Cause Hawai'i, the League of Women Voters and the Sierra Club Hawai'i chapter opposed lifting the $1,000 limit and used the debate to argue for a complete ban on corporate contributions. The federal government and 22 states ban direct corporate contributions to candidates.

Open-government activists claimed lawmakers were favoring corporate interests, and inviting additional corporate contributions in an election year, which eroded the bill's support in the House. The House shelved its version of the bill in February and quietly decided late last week not to move a Senate version.

The House decision leaves the law in confusion. A Maui court ruled last year that corporations can make donations directly to candidates without going through corporate PACs. The state Campaign Spending Commission is appealing the ruling to the Hawai'i Intermediate Court of Appeals.

Pending the appeal, the commission will not enforce the law if corporations make direct contributions to candidates.

Nikki Love, with Common Cause Hawai'i, said activists wanted to ban corporate contributions. "But I think this is better than if they had clarified it by raising the ($1,000) limit," she said.

Jeff Mikulina, director of the Sierra Club Hawai'i chapter, called it "somewhat of a Pyrrhic victory" but said the clarification being discussed would have been a step backward. He cautioned corporations from making donations directly to candidates because of the legal uncertainty and the public perception of undue corporate influence on politics.

"We do think it's time for the Legislature to move on prohibiting corporate contributions," Mikulina said.

Some lawmakers believe it is more transparent for the public to track corporate donations in campaign spending reports if the money moves through corporate PACs. Direct corporate contributions to candidates can also be monitored, although the donations would show up on individual candidate campaign spending reports and would be much harder to tabulate.

"We were interested in trying to get a clarification but it appears that, especially based off of the advocates' concerns and criticisms, that at this point it just appears better to wait," said state Rep. Blake Oshiro, D-33rd ('Aiea, Halawa Valley, 'Aiea Heights), vice chairman of the House Judiciary Committee.

State Senate President Colleen Hanabusa, D-21st (Nanakuli, Makaha), said senators will likely leave it up to the House whether to address the issue again. "I don't think that it's something the senators should continue to take the lead on, and we get stomped basically in the House, when we think we have something going.

"I can't see the senators continue to take unnecessary hits on a bill that we understand perfectly well is a clarification measure and not to change the law."

Reach Derrick DePledge at ddepledge@honoluluadvertiser.com.