___________

No. 95-2857

___________

Shrink Missouri Government PAC, *

a political action committee; *

W. Bevis Schock; Frederick T. *

Dyer, *

*

Appellees, *

* Appeal from the United States

v. * District Court for the 

* Eastern District of Missouri.

John Maupin, in his official *

capacity as Chair of the *

Missouri Ethics Commission; *

Jeremiah W. Nixon, is his *

official capacity as Missouri *

Attorney General, *

*

Appellants. *

___________

 Submitted: September 13, 1995

 Filed: December 19, 1995

___________

Before BOWMAN, ROSS, and JOHN R. GIBSON, Circuit Judges.

___________

BOWMAN, Circuit Judge.

Missouri's Campaign Finance Disclosure Law, Mo. Rev. Stat. Ch. 130

(1994), was amended twice in 1994. In July the state legislature adopted

a measure commonly known as Senate Bill 650, and in November the citizens

of Missouri adopted a ballot initiative commonly known as Proposition A.

Both of these measures limit election campaign contributions and

expenditures and thus tend to limit the free exercise of political speech

that the First Amendment guarantees. W. Bevis Shock and Frederick T. Dyer,
 The Honorable Catherine D. Perry, United States District

1

Judge for the Eastern District of Missouri.

 The state does not appeal the District Court's decision that 2

the "approved and authorized" requirement of Mo. Ann. Stat.

§ 130.031 is unconstitutional, so that issue is not before us.

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prospective candidates for public office, and Shrink Missouri Government

PAC, a political action committee (PAC) planning to make campaign

contributions in future elections, sought a permanent injunction against

the implementation and enforcement of the following provisions of the

amended Campaign Finance Disclosure Law: (1) the Proposition A limits on

campaign contributions, Mo. Ann. Stat. § 130.100 (Vernon Supp. 1995), as

applied to contributions by candidates to their own campaigns; (2) the

limits on total expenditures by candidates, id. §§ 130.052, 130.053; (3)

the restrictions on carrying over campaign funds from one election to

another, id. § 130.130; and (4) the requirement that negative campaign

advertisements state that they were approved and authorized by the

candidate on whose behalf they were disseminated, id. § 130.031. On crossmotions for summary judgment, the District Court held that each of these 1

provisions violated the First Amendment rights of candidates and their

contributors. The court enjoined the Attorney General of Missouri and the

Chair of the Missouri Ethics Commission (referred to herein jointly as "the

state") from implementing, enforcing, or acting in reliance on the

challenged provisions. Shrink Missouri Government PAC v. Maupin, 892 F.

Supp. 1246 (E.D. Mo. 1995). The state now timely appeals. After a de

2

novo review of the District Court's judgment, see Maitland v. University

of Minnesota, 43 F.3d 357, 360 (8th Cir. 1994), we conclude that the

challenged provisions violate the First Amendment. We therefore affirm the

well-reasoned decision of the District Court.
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I.

As a preliminary matter, we must address the state's contention that

summary judgment should not have been granted because genuine issues of

material fact remain in dispute. See Fed. R. Civ. P. 56(c). The state did

not make this contention in the District Court. Moreover, as the state

notes, both sides agreed that the case could be decided on the cross

motions for summary judgment. The state thus has waived the issue. See

Empire State Bank v. Citizens State Bank, 932 F.2d 1250, 1253 (8th Cir.

1991). In any event, we are satisfied that no genuine issues of material

fact remain in dispute.

II.

The State argues that the District Court erred when it (1) addressed

the constitutionality of applying the Proposition A contribution limits to

the candidates themselves because no Article III case or controversy

existed between the parties with respect to that issue; (2) held that the

state's "voluntary" expenditure limits scheme is unconstitutional; and (3)

held that the restrictions on carrying over campaign funds from one

election to another is unconstitutional. We will address each of these

arguments in turn. 

A.

The District Court held that the Proposition A campaign contribution

limits are unconstitutional to the extent that they limit a candidates's

ability to use his or her personal funds or property in support of the

candidate's own campaign for public office. See Mo. Ann. Stat.

§ 130.100 (Vernon Supp. 1995) (limiting "contributions"); Mo. Rev. Stat.

§ 130.011(12)(a) (1994) (defining "contributions" to include a "candidate's

own money"). The state argues that the District Court was without

jurisdiction to consider
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this question, there being no Article III case or controversy because state

officials have not threatened to prosecute candidates for making over-thelimit contributions to their own campaigns. We need not consider the

jurisdictional point, however, because in a companion case this Court has

held that the Proposition A contribution limits are unconstitutional on

their face. Carver v. Nixon, No. 95-2608, slip op. at 25 (8th Cir. Dec.

19, 1995). Thus those limits necessarily are unconstitutional as applied

to candidates as well as to other contributors.

B.

The District Court held that Senate Bill 650's "program of voluntary

expenditure ceilings," State's Brief at 13, is coercive, restricts

protected speech, and fails to pass constitutional muster under the strict

scrutiny test. Shrink Missouri Gov't PAC, 892 F. Supp. at 1252. The state

argues that these voluntary spending limits are constitutional under

Buckley v. Valeo, 424 U.S. 1 (1976) (per curiam), in which, inter alia, the

Supreme Court struck down spending limits imposed by the Federal Election

Campaign Act of 1971 as amended in 1974, 2 U.S.C. § 441a (1976). 

The statute at issue in this case requires candidates for elected

public office in Missouri to file an affidavit stating whether they will

comply with spending limits that vary depending on the office sought. Mo.

Ann. Stat. § 130.052.1 (Vernon Supp. 1995). The affidavit must be filed

with the candidate's declaration of candidacy. Candidates who choose not

to comply with the spending limits may accept contributions from

individuals only and must refuse contributions from PACs, political

parties, labor unions, corporations, etc. Id. § 130.052.3. Non-complying

candidates also must submit daily disclosure reports once they exceed the

spending limits. See id. § 130.052.3. No such restrictions or

requirements are placed on candidates who swear to
 Because the Missouri expenditure limits are distinguishable

3

from the scenario described in the Buckley footnote, we need not

and do not address the difficult question of the extent of the

state's power to condition the receipt of benefits on the

renunciation of constitutionally protected rights. See Rust v.

Sullivan, 500 U.S. 173, 197 (1991) (distinguishing constitutional

conditions placed on uses of government funds by benefit recipients

and unconstitutional conditions placed on recipients themselves);

compare Rodney A. Smolla, The Reemergence of the Right-Privilege

Distinction in Constitutional Law, 35 Stan. L. Rev. 69 (1982), with

William W. Van Alstyne, The Demise of the Right-Privilege

Distinction in Constitutional Law, 81 Harv. L. Rev. 1439 (1968).

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abide by the limits, though they are penalized if they spend more than the

applicable limit, see id. § 130.053.1. 

When considering whether a campaign finance law unconstitutionally

infringes freedom of speech, this Court's task is to decide whether the

provision in question actually "burdens the exercise of political speech

and, if it does, whether it is narrowly tailored to serve a compelling

state interest." Austin v. Michigan Chamber of Commerce, 494 U.S. 652, 657

(1990) (citing Buckley, 424 U.S. 1); see also Day v. Holahan, 34 F.3d 1356,

1361 (8th Cir. 1994), cert. denied, 115 S. Ct. 936 (1995).

Relying on a footnote in Buckley, the state argues that the

expenditure limits are clearly constitutional regardless of the level of

scrutiny applied because they are voluntary and merely provide an incentive

for compliance. In Buckley, the Supreme Court held that limitations on the

total expenditures by a candidate for federal office violated the First

Amendment. 424 U.S. at 54-58. The Court nonetheless noted that

Congress may engage in public financing of election campaigns

and may condition acceptance of public funds on an agreement by

the candidate to abide by specified expenditure limitations.

Just as a candidate may voluntarily limit the size of the

contributions he chooses to accept, he may decide to forgo

private fundraising and accept public funding.

Id. at 57 n.65. The spending limits adopted by the Missouri legislature

differ substantially from the scenario described in footnote 65 of Buckley

and are thus distinguishable. The Senate 3
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Bill 650 limits are not voluntary because they provide only penalties for

noncompliance rather than an incentive for voluntary compliance. Therefore

the state's reliance on the dicta in footnote 65 of Buckley is misplaced.

In the hypothetical set out in footnote 65, a candidate agreeing to

limit his or her expenditures receives the benefit of public funding.

Candidates who do not so agree do not receive public funding, but are not

penalized for their reliance on private funding. Under Senate Bill 650,

however, a candidate agreeing to abide by the spending limits receives no

benefit other than the state's blessing to seek the private funding he or

she would be free to seek in any event. At the same time, candidates who

do not agree to abide by the spending limits are penalized in two ways: (1)

the state makes it unlawful to seek important sources of private funding

that otherwise they would be free to seek; and (2) the state requires daily

reporting of expenditures. These penalties make the limits coercive, not

voluntary. The state, however, does not believe that it is withdrawing an

otherwise available source of funding; it characterizes the availability

of organizational funding as the incentive that it offers to candidates to

agree to abide by the spending limits. We disagree with the state's

characterization. 

From the state's perspective, it is providing complying candidates

with a substantial benefit by "allowing" PACs, political parties, labor

unions, corporations, and other organizations to make campaign

contributions. The state's argument, however, assumes that it properly

could ban such organizations from making any contributions to candidates

running for state office. This assumption is incorrect. We believe it is

clear that a ban on
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campaign contributions by organizations would not survive a constitutional

challenge. See, e.g., Federal Election Comm'n v. Massachusetts Citizens

for Life, Inc., 479 U.S. 238, 263 (1986) (striking down federal limitation

on use of corporate funds in connection with federal elections as applied

to nonprofit corporation); Day v. Holahan, 34 F.3d at 1365-66 (invalidating

Minnesota's $100 limit on contributions from individuals and PACs). We

note that the Supreme Court has indicated that expenditure limits applied

to organizations "impinge on protected associational freedoms" as well as

freedom of speech. Buckley, 424 U.S. at 22. Thus the state's argument

that it offers an incentive by allowing candidates to accept such

contributions is disingenuous. Organizational contributions are

constitutionally protected irrespective of any agreement by a candidate to

abide by the state-imposed expenditure limits. No candidate would

voluntarily agree to comply with the expenditure limits in exchange for

access to sources of funding to which he or she already has a

constitutional right of access. Rather, Senate Bill 650 forces compliance

by imposing substantial penalties for non-compliance. The purported

benefit is illusory, and the statute is coercive.

We therefore conclude that Senate Bill 650 "impose[s] direct and

substantial restraints on the quantity of political speech," speech that

is "at the core of . . . the First Amendment freedoms." Buckley, 424 U.S.

at 39 (internal quotation marks and citation omitted); see also Day v.

Holahan, 34 F.3d at 1360 (holding that limits on independent expenditures

infringe protected speech). Even though the statute infringes protected

speech, the statute nonetheless will be upheld "if the state can show that

it is narrowly drawn to serve a compelling state interest." Day v.

Holahan, 34 F.3d at 1361; see also Austin, 494 U.S. at 657. In this case

the state has failed to meet its burden.

First the state argues that the "over-arching state interest" served

by Senate Bill 650 is the reduction of corruption and the
 Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), 4

is not to the contrary. While the Supreme Court upheld Michigan's

restriction on independent expenditures by corporations in support

of or in opposition to candidates for state office, the Court did

not overrule Buckley and "hinted" that its decision was limited by

the fact that the restriction applied only to independent

expenditures by corporate entities and did not apply to such

expenditures by individuals. See Lillian R. BeVier, Campaign

Finance Reform: Specious Arguments, Intractable Dilemmas, 94

Colum. L. Rev. 1258, 1270 (1994). 

-8-

appearance of corruption in the state's election process. State's Brief

at 15. The state also refers to its related concerns with "the integrity

of the [electoral] process," id. at 20, and public "confidence in the

system of representative government," id. at 30 (quotation marks and

citation omitted). While the state's interest in reducing corruption and

its related concerns constitute a compelling state interest, the state has

failed to explain how the campaign spending limits here in question are

narrowly tailored to serve this interest or address these concerns.

Indeed, we are hard-pressed to discern how the interests of good government

could possibly be served by campaign expenditure laws that necessarily have

the effect of limiting the quantity of political speech in which candidates

for public office are allowed to engage. See Buckley, 424 U.S. at 55-57.

The state also argues that the expenditure limits are justified by

its interests in (1) maintaining the individual citizen's participation in

and responsibility for the conduct of government and (2) discouraging "the

race toward hugely expensive campaigns, especially at the local level,"

State's Brief at 17-18. The state's interest in maintaining individual

participation is what the District Court correctly described as an effort

to "`level[] the playing field' between the rich and the poor." Shrink

Missouri Gov't PAC, 892 F. Supp. at 1253. The Supreme Court in Buckley,

however, specifically held that the government may not "restrict the speech

of some elements of our society in order to enhance the relative voice of

others," Buckley, 424 U.S. at 48-49, and no subsequent decision of the

Court has undermined that holding. With respect to the state's interest 4

in keeping down the
-9-

costs of running for office, we note that the Buckley Court held that "the

mere growth in the cost of . . . election campaigns in and of itself

provides no basis for governmental restrictions on the quantity of campaign

spending." Buckley, 424 U.S. at 57. This Court is not at liberty to

disregard the explicit holdings of Buckley. We therefore hold that the

state, having failed to show that the expenditure limits here at issue are

narrowly drawn to serve a compelling state interest, has not justified the

substantial burden that these limits place on speech that is at the core

of the First Amendment.

Our analysis is not complete, however, because the state argues that

the District Court should not have enjoined enforcement and implementation

of sections 130.052 and 130.053 in their entirety. The state contends that

several provisions can be implemented constitutionally despite the

invalidity of the expenditure limits. These provisions include the

requirement that candidates declare whether they will keep their

expenditures within the unconstitutional limits, the unconstitutional

limits themselves (described by the state for purposes of its severability

argument as "the legislature's views as to the appropriate ceilings on

expenditures," State's Brief at 30), and the disclosure requirements that

are triggered by exceeding the unconstitutional limits. The state argues

that these provisions should have been severed from the invalid parts of

the statute. See Mo. Rev. Stat. § 1.140 (1994) (providing for general

severability of all Missouri statutes). 

The District Court did not address the severability of any remaining

portions of Senate Bill 650 under Missouri law, see Kinley Corp. v. Iowa

Utilities Board, 999 F.2d 354, 359 (8th Cir.
-10-

1993) (holding that questions regarding severability of state statutes are

controlled by state law), but we think the proper response to the state's

argument is clear: the remaining portions of sections 130.052 and 130.053

are not severable. 

Once the unconstitutional portions of a statute are excised, the

remainder can be upheld under Missouri law if it "is in all respects

complete and susceptible of constitutional enforcement" and the court

concludes that it would have been adopted even if it had been known that

"the excluded portion was invalid." Millsap v. Quinn, 785 S.W.2d 82, 85

(Mo. 1990) (en banc). In Ryan v. Kirkpatrick, the Missouri Supreme Court

left intact the remainder of the Campaign Finance Disclosure Law after

invalidating one discrete provision. 669 S.W.2d 215, 219-20 (Mo. 1984) (en

banc). That court held that the unconstitutional portions "are not so

intertwined with [the law's] valid provisions as to leave it too enervated

to stand." Id. In this case, the District Court did not invalidate all

of Senate Bill 650; here the state asks us to leave intact portions of the

very same discrete provisions that impose unconstitutional restraints on

First Amendment rights. We cannot oblige the state. Every subsection of

sections 130.052 and 130.053 makes some reference to the expenditure limits

that we have held unconstitutional. The invalid portions are inextricably

intertwined with the remainder of the statute. Moreover, the statute

provides that "[c]ampaign expenditures shall be limited pursuant to this

section" and that "[t]o be in compliance with the expenditure limits . .

., the following expenditure limits . . . may not be exceeded by a

candidate committee." Mo. Ann. Stat. § 130.052 (Vernon Supp. 1995)

(emphasis added). The state proposes that we convert this mandatory

language into a non-binding legislative recommendation. The legislature,

however, did not enact a set of suggestions. 

In sum, any remaining valid provisions of sections 130.052 and

130.053 are not complete and susceptible of constitutional
 The legislature, in Senate Bill 650, earlier adopted a

5

similar, but less restrictive, measure. See Mo. Ann. Stat.

§ 130.038 (Vernon Supp. 1995). Only the Proposition A "war chest"

limitation is challenged in this case.

-11-

enforcement and we cannot conclude that the legislature would have adopted

them had it known the expenditure limits were unconstitutional. The

District Court thus did not err when it enjoined the enforcement and

implementation of sections 130.052 and 130.053 in their entirety.

C. 

In Proposition A the citizens of Missouri adopted a measure designed

to address the practice of carrying over "war chests" of campaign funds for

future elections. Under the ballot initiative measure, within ninety days 5

of an election a candidate must turn over any excess funds, "except for an

amount no greater than ten times the individual contribution limit" for the

office sought, to the Missouri Ethics Commission or to contributors. Mo.

Ann. Stat. § 130.130 (Vernon Supp. 1995). This is popularly known as a

"spend-down provision" because candidates will most likely choose to spend

all of their funds during the last days of the campaign rather than

returning funds to contributors or turning them over to the state. The

ability of a candidate to retain contributions for future elections is thus

substantially limited. 

The District Court held that the spend-down provision imposes a

substantial burden on political speech by requiring that funds raised

during a particular campaign be spent during the campaign. The court

rejected the state's assumption that "blind support" in the form of a

contribution that can be used in the current campaign or any future

campaign "must constitute an impermissible attempt at improper quid pro quo

influence." Shrink Missouri Gov't PAC, 892 F. Supp. at 1254. The state,

on the other hand, argues that the spend-down provision does not limit

speech but encourages it by
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requiring candidates "to do precisely what the contributors intend: to

speak." State's Brief at 38. In our opinion, the state's argument makes

an unwarranted assumption about the intention of campaign contributors and

badly misrepresents reality. Some contributors undoubtedly do intend to

give a candidate "blind support," and they do so without any hope of

gaining improper influence with that candidate. Beyond that, we believe

the state's characterization of the provision confirms the District Court's

decision that it infringes the First Amendment. From the state's

perspective, the provision is intended to require the candidate to speak

in the current election. We note that "the right of freedom of thought

protected by the First Amendment against state action includes both the

right to speak freely and the right to refrain from speaking at all."

Wooley v. Maynard, 430 U.S. 705, 714 (1977). From the appellees'

perspective, the provision limits the quantity of a candidate's speech in

future elections. We note that this effect is identical to the effect of

the expenditure limits addressed earlier in this opinion except that the

impact of the provision is postponed to future elections. Whether we

accept the state's or the appellees' characterization of the spend-down

provision is irrelevant. Either way, we conclude that rights protected by

the First Amendment are implicated and that the provision must be subjected

to strict scrutiny.

While strict scrutiny may not always be fatal to a challenged

restriction on speech, it is in this case. The state has not demonstrated

that the spend-down provision is narrowly tailored to serve a compelling

government interest. The state argues that this provision serves three

interests.

First, it attacks corruption and its appearance by (1)

preventing the kinds of quids pro quo that occur when money is

given to candidates in uncontested races, and (2) ensuring that

the contributions limits of Proposition A . . . have a

measurable effect on the political system . . . . Second, it

preserves the integrity of the electoral process by (1)

counterbalancing any
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discriminatory effects against challengers and in favor of

incumbents that are created by Proposition A's contribution

limits, (2) ensuring the opportunity of all citizens, not just

those who have amassed large war chests in noncompetitive

races, to participate in the political process as candidates,

and (3) protecting the free speech interests of contributors.

Third, it promotes speech and fairness, thus sustaining the

active, alert responsibility of the individual citizen in our

democracy.

State's Brief at 38-39 (citations omitted). At the outset, we note that

any interest related to the effective operation of Proposition A's

contribution limits fails to qualify as compelling because we have held

that those limits are unconstitutional. See Carver v. Nixon, slip op. at

25. We further note that any interest defined by reference to funds raised

in "noncompetitive" or "uncontested races" is unhelpful because the spenddown provision applies to funds raised in all campaigns; thus the provision

is not narrowly tailored to serve such an interest. The sole remaining

interests asserted by the state are that the provision "preserves the

integrity of the electoral process by . . . protecting the free speech

interests of contributors" and that it "promotes speech and fairness, thus

sustaining the active, alert responsibility of the individual citizen in

our democracy." Assuming that the state has articulated compelling

interests, we conclude that the state has failed to demonstrate that the

spend-down provision is narrowly tailored to do either of the things that

the state asserts it will do. Although the state asserts that the

provision protects the free speech interests of contributors, it is just

as likely that the provision infringes those interests. Surely the

contributor's political free speech interests are not well served if a

candidate is compelled (1) to waste campaign contributions on unnecessary

speech (in order to spend down the campaign's accumulated assets) or (2)

to turn over those contributions to the Missouri Ethics Commission or

return them to contributors. With respect to the provision's impact on the

"active, alert responsibility of the individual citizen," the state's

arguments are broad and
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conclusory. The state makes no attempt to show how the spend-down

provision is narrowly tailored to serve that interest, saying only that

"[c]itizens now may decline to participate in a particular race . . .

because of the overwhelming advantage carried over from another day" and

that the "carryover restriction may well be the difference between having

noncompetitive races, in which there is little or no speech, and having

active campaigns in which there is uninhibited, robust, and wide-open

debate on public issues," State's Brief at 45 (internal quotation marks and

citation omitted). These statements fall far short of a showing that the

spend-down provision is narrowly tailored to promote "the active, alert

responsibility of the individual citizen in our democracy." We conclude

that section 130.130 cannot withstand strict scrutiny and that it violates

freedoms that the First Amendment protects.

III.

In sum, we hold that the expenditure limits of Senate Bill 650 and

the spend-down provision of Proposition A restrict expression protected by

the First Amendment and that the state has not demonstrated that these

provisions are narrowly tailored to serve a compelling government interest.

Furthermore, based on this Court's decision in Carver v. Nixon, slip op.

at 25, which holds that Proposition A's contribution limits are facially

unconstitutional, we conclude that those limits are necessarily

unconstitutional insofar as they would limit contributions by candidates

to their own campaigns. The judgment of the District Court enjoining the

Attorney General of Missouri and the Chair of the Missouri Ethics

Commission from implementing, enforcing, or acting in reliance on the

challenged provisions is therefore affirmed.
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A true copy.

Attest:

CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.