United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 97-3922

___________

Ron Russell, Kent Ingram, *

William R. Austin, and Associated *

Industries of Arkansas Political *

Action Committee, *

*

Appellants, *

*

v. *

*

Troy Burris, In His Official Capacity *

as Chairperson of the Arkansas Ethics *

Commission; Rita Looney, In Her * 

Official Capacity as a Member of the *

Arkansas Ethics Commission; * Appeals from the United States

Tom Alexander, In His Official * District Court for the Eastern

Capacity as a Member of the Arkansas * District of Arkansas.

Ethics Commission; Ben Allen, In *

His Official Capacity as a Member of *

the Arkansas Ethics Commission; *

Jack Kearney, In His Official Capacity *

as a Member of the Arkansas Ethics *

Commission; and Citizens for Clean *

Government, *

*

Appellees. *

*

____________________ *

*

American Civil Liberties Union of *

Arkansas, James Madison Center for *

Free Speech, Shrink Missouri *
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Government PAC, and Zev David *

Fredman, *

*

Amici Curiae on Behalf of Appellants. *

*

*

*

Connecticut, Iowa, Kansas, Kentucky, *

Massachusetts, Minnesota, Missouri, *

Montana, New Mexico, North Dakota, *

Utah, and Vermont, *

*

Amici Curiae on Behalf of Appellees. *

*

___________

No. 97-4033

___________

Ron Russell, Kent Ingram, *

William R. Austin, and Associated *

Industries of Arkansas Political *

Action Committee, *

*

Appellees, *

*

v. *

*

Troy Burris, In His Official Capacity *

as Chairperson of the Arkansas Ethics *

Commission; Rita Looney, In Her * 

Official Capacity as a Member of the *

Arkansas Ethics Commission; *

Tom Alexander, In His Official *

Capacity as a Member of the Arkansas *

Ethics Commission; Ben Allen, In *

His Official Capacity as a Member of *
-3-

the Arkansas Ethics Commission; and *

Jack Kearney, In His Official Capacity *

as a Member of the Arkansas Ethics *

Commission, *

*

Appellants, and *

*

Citizens for Clean Government, *

*

Intervenor as Defendant. *

*

____________________ *

*

James Madison Center for *

Free Speech, Shrink Missouri *

Government PAC, and Zev David *

Fredman, *

*

Amici Curiae on Behalf of Appellees. *

*

*

*

Connecticut, Iowa, Kansas, Kentucky, *

Massachusetts, Minnesota, Missouri, *

Montana, New Mexico, North Dakota, *

Utah, and Vermont, *

*

Amici Curiae on Behalf of Appellants. *

*

___________

No. 97-4038

___________

Ron Russell, Kent Ingram, *

William R. Austin, and Associated *
-4-

Industries of Arkansas Political *

Action Committee, *

*

Appellees, *

*

v. *

*

Troy Burris, In His Official Capacity *

as Chairperson of the Arkansas Ethics *

Commission; Candi Sue Russell, In Her * 

Official Capacity as a Member of the *

Arkansas Ethics Commission; Marvin *

Delph, In His Official Capacity as *

a Member of the Arkansas Ethics *

Commission; Rita Looney, In Her *

Official Capacity as a Member of the *

Arkansas Ethics Commission; and Norton *

Wilson, In His Official Capacity as a *

Member of the Arkansas Ethics *

Commission, *

*

Defendants, and *

*

Citizens for Clean Government, *

*

Appellant. *

*

____________________ *

*

James Madison Center for Free *

Speech, Shrink Missouri Government *

PAC, and Zev David Fredman, *

*

Amici Curiae on Behalf of Appellees. *
-5-

___________

Submitted: April 13, 1998

Filed: June 4, 1998

___________

Before WOLLMAN, BEAM, and MORRIS SHEPPARD ARNOLD, Circuit Judges.

___________

MORRIS SHEPPARD ARNOLD, Circuit Judge.

In 1996, the people of Arkansas, by voter initiative, approved a campaign finance

reform measure entitled Initiated Act I. Prior to Act I, Arkansas law limited individuals

and political action committees to contributions of $1,000 per candidate during each

election cycle. Act I reduced the contribution limit to $300 for the offices of governor,

lieutenant governor, secretary of state, treasurer, auditor, attorney general, and

commissioner of state lands, see Ark. Code Ann. § 7-6-203(a), § 7-6-203(b), and to

$100 for all other state public offices, see Ark. Code Ann. § 7-6-203(a)(1), § 7-6-

203(b)(1). 

Act I also created a special category of political action committee (PAC), see

Ark. Code Ann. § 7-6-201(9), § 7-6-201(10), known as a small-donor PAC. See Ark.

Code Ann. § 7-6-201(12). Under Act I, a small-donor PAC may accept no contribution

larger than $25, see Ark. Code Ann. § 7-6-201(12)(B), and it may contribute no more

than $2,500 per election to any candidate, see Ark. Code Ann. § 7-6-203(d). Act I

authorized as well the creation of a campaign fund-raising entity known as an

independent expenditure committee. See Ark. Code Ann. § 7-6-201(14). An

independent expenditure committee may, like any person, make unlimited independent

expenditures (that is, ones not coordinated with a candidate) to advocate the election

or defeat of a clearly identified candidate for office. See Ark. Code Ann. § 7-

6-201(13), § 7-6-201(14). Such a committee, however, may accept no more than 
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$500 from any person annually. See Ark. Code Ann. § 7-6-203(k). Finally, Act I

authorized local governments to set reasonable limitations on fund-raising for campaigns

for local offices. See Ark. Code Ann. § 7-6-224. Ron Russell, Kent Ingram, William

Austin, and the Associated Industries of Arkansas Political Action Committee

challenged each of these Act I provisions in the district court, as well as a pre-Act I

provision limiting contributions to any one PAC to $200 annually, see Ark. Code Ann.

§ 7-6-201(9)(B).

Following a bench trial, the district court held that the contribution limits of $300

for certain statewide offices and of $100 for state judicial offices were unconstitutional

because they violated the First Amendment's prohibition against limitations on the

freedom of speech. See Russell v. Burris, 978 F. Supp. 1211, 1222, 1224, 1229 (E.D.

Ark. 1997). The trial court, however, upheld the $100 contribution limit as to all other

offices and the $200 contribution limit to PACs. Id. at 1223, 1225, 1229. The trial

court also held that the differential treatment for ordinary PACs and small-donor PACs

did not violate the Fourteenth Amendment's equal protection clause. Id. at 1227, 1229.

The trial court declined to reach the merits on the other two issues, finding that the

plaintiffs did not have standing to contest the limit on contributions to independent

expenditure committees, id. at 1217, 1229, and that the provision authorizing relevant

actions by local governments was not ripe for a constitutional challenge. Id. at 1217-

18, 1229. 

All parties appeal the rulings unfavorable to their litigating positions. We affirm

in part and reverse in part.

I.

Standing is, of course, a threshold issue in every case before a federal court: If

a plaintiff lacks standing, he or she cannot invoke the court's jurisdiction. See Boyle v.

Anderson, 68 F.3d 1093, 1100 (8th Cir. 1995), cert. denied, 516 U.S. 1173 (1996). In

order to invoke the jurisdiction of a federal court, one must meet three requirements. 
-7-

First, a plaintiff must have suffered an "injury in fact," and such an injury must be

concrete, particularized, and either actual or imminent. Id. at 1100-01. Second, a

would-be litigant must make out a causal connection between the alleged injury and the

conduct challenged. Id. at 1100. Third, he or she must show that the injury is likely to

be redressed by a favorable decision. Id. 

The trial court determined that each of the plaintiffs had Article III standing as

to all but one of their challenges, see Russell, 978 F. Supp. at 1217, and the defendants

do not contest that determination here. The plaintiffs maintain, however, that the trial

court erred in finding that they did not have Article III standing to challenge the

provisions of Act I relating to independent expenditure committees. 

The trial court found that the plaintiffs did not face a credible threat of present or

future prosecution with respect to this part of their claim, and thus could show no actual

or imminent "injury in fact," because none of them "could think of an independent

expenditure committee to which they had contributed in the past or to which they

planned to contribute." Id. Indeed, one plaintiff testified, "Well, in all honesty, I'd have

to tell you it would take a stretch of my imagination to figure out why I'd want to

contribute anything to an independent committee." Another simply testified that he did

not know if he would ever contribute to such a committee. 

We are mindful that where "plaintiffs allege an intention to engage in a course of

conduct arguably affected with a constitutional interest which is clearly proscribed by

statute, courts have found standing to challenge the statute, even absent a specific threat

of enforcement." United Food & Commercial Workers International Union v. IBP,

Inc., 857 F.2d 422, 428 (8th Cir. 1988). But the plaintiffs have not demonstrated any

such intention: They have indicated neither that they would contribute to a specific

independent expenditure committee nor that, but for the limitations of Act I, they would

form an independent expenditure committee. Standing may not be predicated merely

upon a conjectural or hypothetical injury or, as one of the plaintiffs here would have it,
-8-

upon a stretch of the imagination. See Lujan v. Defenders of Wildlife, 504 U.S. 555,

564 (1992). We therefore affirm the trial court's determination that the plaintiffs lacked

standing to challenge the provisions relevant to independent expenditure committees.

II.

 "Where at all possible, government must curtail speech only to the degree

necessary to meet the particular problem at hand, and must avoid infringing on speech

that does not pose the danger that has prompted regulation." Federal Election

Commission v. Massachusetts Citizens for Life, 479 U.S. 238, 265 (1986).

Government attempts to limit campaign contributions, therefore, are " ' "subject to the

closest scrutiny." ' " Carver v. Nixon, 72 F.3d 633, 636 (8th Cir. 1995), cert. denied,

116 S. Ct. 2579 (1996), quoting Buckley v. Valeo, 424 U.S. 1, 25 (1976) (per curiam),

itself quoting NAACP v. Alabama, 357 U.S. 449, 461 (1958). Under this standard, a

significant interference with protected rights of political association may be sustained

only when the state demonstrates a compelling interest and means closely drawn to

avoid unnecessary abridgement of associational freedoms. Carver, 72 F.3d at 636. 

Intervenor (as a defendant) Citizens for Clean Government (CCG) argues that we

should apply a more lenient standard of review to the legislation in this case because

Act I included not only contribution limits but also a public subsidy scheme. For this

proposition, CCG relies upon the Supreme Court's ruling in Buckley that upheld a ban

on general election campaign contributions to, and a limitation on general election

campaign expenditures by, a presidential candidate who elected to receive a public

subsidy. See Buckley, 424 U.S. at 85-109. 

But the Buckley Court was clear that it was the optional nature of the contribution

and expenditure limit scheme, not the subsidy, that rendered the scheme constitutionally

permissible: "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. Similarly, we recently upheld a voluntary
-9-

campaign subsidy and limitation scheme in Minnesota because the scheme "presents

candidates with an additional, optional campaign funding choice, the participation in

which is voluntary." Rosenstiel v. Rodriguez, 101 F.3d 1544, 1552 (8th Cir. 1996),

cert. denied, 117 S. Ct. 1820 (1997). It is true that Act I provided a subsidy and

limitation scheme, but unlike the schemes upheld in Buckley and Rosenstiel, Act I was

imposed upon all candidates: Candidates do not have the power to opt out. We

therefore decline this invitation to apply a standard of scrutiny to this case that is

different from the one that we adopted in Carver.

CCG argues for a more lenient standard of review on the basis of two recent

Supreme Court decisions as well, but neither of these authorities modifies the standard

of review appropriate to this case. In Colorado Republican Federal Campaign

Committee v. Federal Election Commission, 518 U.S. 604, 609 (1996) (opinion of

Breyer, J.), a case involving the application of federal campaign expenditure limits,

three justices resorted to what CCG calls a weighing test, rather than strict scrutiny, to

decide the case. See id. at 616, 618. These justices described their approach as

consistent with cases in which the Court "essentially weighed the First Amendment

interest in permitting candidates (and their supporters) to spend money to advance their

political views against a 'compelling' governmental interest in assuring the electoral

system's legitimacy, protecting it from the appearance and reality of corruption." Id. at

609. This adjudicatory approach appears to us to be a restatement or reformulation, not

a modification, of the Court's familiar strict scrutiny analysis. 

We are aware that during the last term, in Timmons v. Twin Cities Area New

Party, 117 S. Ct. 1364, 1370 (1997), the Supreme Court upheld an election regulation

that barred a political party from choosing as its nominee a candidate already appearing

on another party's ballot. The Court held that while regulations "imposing severe

burdens on plaintiffs' rights must be narrowly tailored and [must] advance a compelling

state interest," lesser burdens "trigger [a] less exacting review." Id. We believe,

however, that restrictions on individual contributions to candidates and on candidates'
-10-

amassing sufficient resources to run for office are more severe than the restrictions at

issue in Timmons. Where the regulations impose severe burdens on First Amendment

rights, as here, Timmons reiterates the Court's position that strict scrutiny applies.

We must therefore first determine what interest can be sufficiently compelling to

permit the state to restrict First Amendment freedoms. The compelling state interest

identified in Buckley was "the prevention of corruption and the appearance of corruption

spawned by the real or imagined coercive influence of large financial contributions on

candidates' positions and on their actions if elected to office." Buckley, 424 U.S. at 25.

The Court reiterated this position five years later, holding that "Buckley identified a

single narrow exception to the rule that limits on political activity were contrary to the

First Amendment. The exception relates to the perception of undue influence of large

contributors to a candidate." Citizens Against Rent Control v. Berkeley, 454 U.S. 290,

296-97 (1981) (emphasis omitted). Subsequently, the Court stated flatly that

"[p]reventing corruption or the appearance of corruption are the only legitimate and

compelling government interests thus far identified for restricting campaign finances."

Federal Election Commission v. National Conservative Political Action Committee,

470 U.S. 480, 496-97 (1985). 

Only three years ago, we emphasized in Carver, 72 F.3d at 638-39, that the state

may abridge political speech in the form of campaign contributions only to address the

reality or perception of undue influence or corruption attributable to large contributions.

We turn, then, to a consideration of whether the challenged provisions can pass muster

under this standard. 

III.

We consider first the provisions of Act I that limited direct contributions to

candidates to $300 per election for certain statewide offices, see Ark. Code Ann. § 7-

6-203(a), § 7-6-203(b), and to $100 per election for all other state offices, see Ark.

Code Ann. § 7-6-203(a)(1), § 7-6-203(b)(1). The defendants must prove first that there
-11-

is real or perceived undue influence or corruption attributable to large political

contributions in Arkansas, and then that these challenged provisions of Act I are

narrowly tailored to address that reality or perception. We find that the defendants

failed to carry their burden before the trial court.

We note that our review of the trial court's judgment may involve the review of

some of the factual determinations that it made. The Supreme Court has instructed that,

in cases involving the First Amendment, appellate courts are to make an independent

examination of the whole record to ensure that their judgments do not constitute a

forbidden intrusion on the right of free expression. See New York Times Co. v. Sullivan,

376 U.S. 254, 285 (1964). But we are also mindful of Fed. R. Civ. P. 52(a), which

provides that a trial court's factual findings are typically reviewed for clear error. 

To reconcile these two legal propositions, we held last year that, in cases

involving the First Amendment, we would review findings of noncritical facts for clear

error, but would conduct an independent review of critical facts. See Families

Achieving Independence and Respect v. Nebraska Department of Social Services, 111

F.3d 1408, 1411 (8th Cir. 1997) (en banc). Accordingly, in the discussion that follows,

we give due deference to the trial court's determination of noncritical facts, while we

review independently those facts that we believe to be critical.

We begin with the observation that no defendant provided any credible evidence

to the trial court of actual undue influence or corruption stemming from large

contributions. We are left, then, to determine whether the defendants proved that a

reasonable person could perceive, on the basis of the evidence presented at trial, that

such contributions make for undue influence or spawn corruption.

CCG presented proof at trial that was intended to demonstrate specific instances

in which large contributions had given rise to the appearance of undue influence or
-12-

corruption. Much of this proof focused on the introduction in the Arkansas legislature

of a bill that would have prohibited local governments from regulating tobacco. The

bill's sponsor, State Representative James Dietz, had received as much as $2,700 in

contributions the previous year from various sources related to the tobacco industry,

such as the Tobacco Institute. Many other supporters of the bill had apparently also

received contributions from pro-tobacco sources. An opponent of the bill, State

Representative Ted Thomas, testified that there was a "uniform" public perception of

corruption associated with the bill's having been introduced and supported by legislators

who had received contributions from tobacco interests. 

Even assuming that Mr. Thomas was correct that there was a public perception

of corruption, we must determine whether that public perception was reasonable, and

whether that perception of corruption derived from the magnitude of the contributions

to Mr. Dietz and other supporters of the bill. We believe, after an independent review

of the facts presented to the trial court, that the defendants did not prove that the

perception of corruption to which Mr. Thomas alluded was objectively reasonable. A

newspaper article admitted into evidence quoted Mr. Dietz as saying that he supported

the preemption measure because he believed that one "ought to have the right to say

what goes on inside his building as long as it's legal." That Mr. Dietz received political

contributions from those whose interests he tended to support hardly indicates, on its

own, any corruption.

The defendants provided no evidence at trial, for instance, that Mr. Dietz changed

his position on the tobacco bill due to an intervening contribution. Nor did the

defendants provide evidence that Mr. Dietz sought to conceal his contributions from

tobacco-related sources. If it were reasonable to presume corruption from the fact that

a public official voted in a way that pleased his contributors, legislatures could

constitutionally ban all contributions except those from the public official's opponents,

a patent absurdity. That would spell the end to the political right, protected by the First

Amendment, to support a candidate of one's choice.
-13-

The defendants' objections to Mr. Dietz's activities are also, we believe,

essentially unrelated to the size of the individual contributions that he received. The

defendants did not provide evidence, such as that produced by the government in

Buckley, of multi-million-dollar contributions to Mr. Dietz. Indeed, our review of the

evidence presented to the trial court indicates that Mr. Dietz reported no individual

contribution larger than $1,000 from any source, tobacco-related or otherwise. We

believe that $1,000 is simply not a large enough sum of money to yield, of its own

accord and without further evidence, a reasonable perception of undue influence or

corruption. 

The defendants essentially criticize Mr. Dietz for offering a bill favorable to

interests from whom he had already accepted campaign contributions. The difficulty

pointed to, then, seems to be the identity of the contributors and their subsequent

interest in legislation rather than the size of their contributions. We note that even if Mr.

Dietz had received twenty-seven individual contributions of $100 from various tobaccorelated sources instead of a few somewhat larger contributions, the defendants could

make the same criticism of his activities as they made here. We therefore conclude that

the evidence that the defendants presented regarding the tobacco legislation does not

permit a finding of a reasonable perception of corruption or undue influence due to large

contributions.

The defendants also produced proof at trial that was related to contributions by

lobbyists to State Representative Ode Maddox. In April, 1996, a group of lobbyists

held a fund-raiser for Mr. Maddox at the Arkansas Poultry Federation in Little Rock.

According to the trial court, at that event Mr. Maddox raised a total of more than

$22,000 from various lobbyists, PACs, and corporations. Our independent review of

the record shows that Mr. Maddox received no contribution in excess of $1,000 from

any single source.
-14-

The record does not indicate any change in Mr. Maddox's political behavior

following these donations, nor does it indicate that Mr. Maddox sought to conceal his

contributions or their sources. Indeed, the defendants did not even demonstrate that

Mr. Maddox voted in any particular fashion with respect to any relevant issues

following the receipt of these donations. At bottom, the defendants' complaint about

Mr. Maddox's contributions is that they came from lobbyists who live outside his district

and have business before his committee from time to time. But this complaint is not

related to the size of the contributions made to Mr. Maddox, and thus does not satisfy

the compelling state interest standard established in Buckley and Carver. We conclude,

then, that the evidence that the defendants offered regarding Mr. Maddox's fund-raising

practices does not permit a finding of a reasonable perception of corruption or undue

influence stemming from large contributions.

The defendants also adduced proof at trial of contributions by "real estate

interests" to members of the Little Rock municipal government. But, again, the

defendants' declared interest in regulating these has to do with the identity of the

contributor and that contributor's interests rather than with the size of individual

contributions. According to records provided to the trial court, no member of the Little

Rock municipal government received more than $1,000 from any so-called "real estate

interest." The record does not indicate any change in any official's behavior following

such contributions, nor did the defendants demonstrate that any official attempted to

conceal the source of the contributions. The evidence instead shows that the "real estate

interests" contributed to candidates who supported initiatives with which the

contributors agreed -- that is, the "real estate interests" appear to have chosen well

which candidates to support. 

We cannot say that this evidence is sufficient to establish that there could be a

reasonable perception of corruption or undue influence due to large contributions. The

defendants identify, instead, a concern that "real estate interests" gave money to officials

of a municipal government, and that those officials then voted on issues
-15-

relevant to real estate. This concern, as we have said above, is not related specifically

to the size of the contributions, and thus is outside the scope of the compelling state

interest as defined by Buckley and Carver.

We also believe that the candidate contribution limits set forth in Act I are too

low to allow meaningful participation in protected speech and association. See Carver,

72 F.3d at 641-42. In Buckley, 424 U.S. at 20-35, the Supreme Court approved a

$1,000 contribution limit as a narrowly tailored means to address the problem of large

campaign contributions. As we noted in Day v. Holahan, 34 F.3d 1356, 1366 (8th Cir.

1994), cert. denied, 513 U.S. 1127 (1995), inflation has eroded approximately 60

percent of the value of a dollar since 1976. A $1,000 contribution in 1976 would thus

be worth about the same as a $2,500 contribution today. We recognize that the

contribution limit upheld in Buckley does not constitute a constitutional minimum and

that we may not fine-tune the contribution limits established by Act I. See Carver, 72

F.3d at 641. We must, however, invalidate the contribution limitations if they are

different in kind from those that Buckley upheld. See id. 

The provisions of Act I challenged here limited contributions to a candidate to

only $100 or $300, depending upon the office. See Ark. Code Ann. § 7-6-203(a), § 7-

6-203(b). The limits prescribed by Act I, then, are (adjusted for inflation)

approximately 4 percent or 12 percent, respectively, of the limit upheld in Buckley. In

Day, 34 F.3d at 1366, we concluded that a limitation of $100, or 4 percent of the

inflation-adjusted limit upheld in Buckley, constituted a difference in kind from the limit

upheld in Buckley. In Carver, 72 F.3d at 641-42, we held that contribution limitations

of $100 or $300 per election cycle (2 percent or 6 percent, respectively, of the limit

approved in Buckley) were "dramatically lower," and thus different in kind, from the

limit upheld in Buckley. We believe that the limitations in question here are similarly

dramatically lower than, and different in kind from, the limits approved in Buckley, and

thus are unconstitutionally low.
-16-

We note, finally, that even if there were a compelling state interest to prevent the

perception of corruption or undue influence due to any of the various concerns identified

here by the defendants -- that is, supporting tobacco legislation, accepting contributions

from those appearing before or having interests before one's legislative committee,

accepting contributions from supporters outside one's district, or the like -- Act I was

not narrowly tailored to address them. As we have already noted, "[w]here at all

possible, government must curtail speech only to the degree necessary to meet the

particular problem at hand, and must avoid infringing on speech that does not pose the

danger that has prompted regulation." Massachusetts Citizens for Life, 479 U.S. at 265.

Act I, however, is at once both overinclusive and underinclusive, by limiting the free

speech of all who would contribute without addressing the specific concerns identified.

IV.

The plaintiffs challenged two provisions relating to the activities of political

action committees. The first of these was a provision, enacted in 1990, that prohibited

persons from giving more than $200 each year to any one political action committee.

See Ark. Code Ann. § 7-6-201(9)(B). 

State-enforced limits on contributions to political action committees stifle "not

only free political speech, but also free political association," and are reviewed

according to a strict scrutiny standard. Day, 34 F.3d at 1365. We must therefore

determine whether the defendants demonstrated that the provision was narrowly tailored

to address the compelling state interest in avoiding corruption or the appearance of

corruption that stems from large contributions. 

We hold that this provision, like the provision that we invalidated in Day, is not

narrowly tailored to serve a compelling state interest, because the annual limit is so low

as to be different in kind from the limit approved in Buckley. See id. at 1366. In Day,

we noted that a $100 limit (in 1994 dollars) for contributions to political action
-17-

committees was, adjusted for inflation, equal to approximately 4 percent of the

contribution limit upheld in Buckley. Id. Thus, a $200 limit (in 1998 dollars) is equal

to no more than 8 percent of the contribution limit approved in Buckley. That limit is

also less than 5 percent, even before any adjustment for inflation, of the $5,000

limitation on contributions to PACs approved by the Supreme Court in California

Medical Association v. Federal Election Commission, 453 U.S. 182, 195-99 (1981)

(plurality opinion). 

There is also less of a danger of quid pro quo corruption, such as the sort that one

might presume from large contributions given directly to candidates, when a

contribution is given to a PAC that does not itself wield legislative power. Cf. Day, 34

F.3d at 1365. We believe that a $200 limit (in 1998 dollars) will significantly impair the

ability of individuals to exercise their political rights. The limit is simply too low to

allow for appropriately robust participation in protected political speech and association,

and thus violates the protections for free political speech and free association that the

First Amendment affords.

The plaintiffs also challenged the provision in Act I that permitted small-donor

political action committees to give as much as $2,500 to a candidate (in contrast to the

lower limits applicable to contributions by ordinary political action committees). See

Ark. Code Ann. § 7-6-203(d); see also Ark. Code Ann. § 7-6-201(a), § 7-6-201(b). We

believe that such differential treatment must be evaluated according to a strict scrutiny

standard. "Because the right to engage in political expression is fundamental to our

constitutional system, statutory classifications impinging upon that right must be

narrowly tailored to serve a compelling governmental interest." Austin v. Michigan

Chamber of Commerce, 494 U.S. 652, 666 (1990). 

The defendants argue that the differential treatment of ordinary and small-donor

PACs is justified because of the difference in regulations as to their method of raising

money. The only compelling government interest that might permit this infringement
-18-

of First Amendment rights, as we have said, is preventing the reality or perception of

undue influence or corruption that might arise from large contributions. As the Supreme

Court has held, "To the extent that large contributions are given to secure a political

quid pro quo from current and potential office holders, the integrity of our system of

representative democracy is undermined." Buckley, 424 U.S. at 26. Ostensibly to

alleviate this potential for corruption, Act I limited individuals and ordinary PACs to

giving $300 to certain candidates and $100 to others (although we note that our holding

above returns these limits to their pre-Act I limits of $1,000). See Ark. Code Ann. § 7-

6-201(a), § 7-6-201(b). Act I allowed small-donor PACs, however, to give $2,500 to

any candidate. See Ark. Code Ann. § 7-6-203(d). This differential treatment is said to

be acceptable because small-donor PACs themselves receive that money in

contributions of $25 or less, see Ark. Code Ann. § 7-6-201(12)(B). 

This explanation, however, is manifestly flawed, because it focuses on the source

of the funds given to a PAC rather than on the entity from which the candidate receives

the funds. Because a small-donor PAC receives small donations, it is true that it is

unlikely that any one contributor to a small-donor PAC will be able to control that PAC.

Act I, however, ignored the possibility that the small-donor PAC itself will seek to

control a given candidate. A $2,500 contribution would be even more likely to

exacerbate this difficulty than the $1,000 contribution limit applicable to most other

contributors. Indeed, if any contribution is likely to give rise to a reasonable perception

of undue influence or corruption, it would be one from an entity permitted to contribute

two-and-a-half times the amount that most others are allowed to contribute. The smalldonor PAC provision is not, then, narrowly tailored to serve the compelling government

interest of combating the reality or perception of undue influence or corruption. 

We reject the defendants' argument that the plaintiffs (namely, three individuals

and a political action committee) may not assert this equal protection argument because

they are not burdened to a greater extent by this provision than small-donor PACs are.
-19-

Ordinary PACs may, it is true, raise more money per contribution than a small-donor

PAC, but the issue is their ability to speak freely by contributing money to candidates

for office. Insofar as that freedom is at issue, the ordinary PACs are burdened more

than the small-donor PACs, because ordinary PACs may donate only the amount that

individuals may donate, while small-donor PACs may donate $2,500. We believe, then,

that the plaintiffs here meet the requirements set forth in California Medical

Association, 453 U.S. at 200.

V.

The plaintiffs also challenged the constitutionality of Ark. Code Ann. § 7-6-224.

This provision states only that local governments "shall have the authority to establish

reasonable limitations" on campaign contributions and expenditures, and appears to be

simply an allocation by the state of Arkansas of certain of its plenary powers to local

governments: It does not set any specific limits on campaign contributions or

expenditures, and thus cannot restrict the First Amendment freedoms of any person or

entity seeking to contribute to or spend the revenues of a political campaign. Were a

local government to exercise the power granted it by § 7-6-224, its action might then be

challenged in the same manner as the actions of the defendants were challenged in this

suit. But no such action has yet been taken and brought to the attention of a court. Ark.

Code Ann. § 7-6-224 thus does not present a federal constitutional controversy that is

ripe for adjudication at this time.

VI.

Those provisions of the Arkansas statutes in conflict with our analysis above are

unconstitutional and unenforceable. We must now determine whether the invalid

provisions of Act I may be severed from the remainder of its provisions. 

Severability is a matter of state law. Leavitt v. Jane L., 518 U.S. 137, 139 (1996)

(per curiam). The Supreme Court of Arkansas looks to two considerations to determine

severability: "(1) whether a single purpose is meant to be accomplished by
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the act; and (2) whether the sections of the act are interrelated and dependent upon each

other." U.S. Term Limits, Inc. v. Hill, 872 S.W.2d 349, 357 (Ark. 1994). The court

provided further guidance, moreover, in its observation that "it is important whether the

portion of the act remaining is complete in itself and capable of being executed wholly

independent of that which was rejected." Id. at 358. A severability clause, such as the

one provided in Act I, is relevant but not determinative of whether individual provisions

of the act will be considered severable. Id. 

Applying the principles set forth in U.S. Term Limits, we find no single purpose

behind Act I with which our ruling could interfere. Act I provided for a series of

campaign finance reforms, including the independent expenditure committee and certain

tax provisions, that remain unaffected by the outcome of this case. We can find no

reason not to honor the intent of the drafters of Act I that, to the extent possible, its

various provisions should stand on their own.

VII.

We therefore affirm in part and reverse in part the judgment of the trial court. We

remand the case to the district court for the entry of declaratory and injunctive relief

consistent with this opinion.

A true copy.

Attest:

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