Source: https://www.scribd.com/doc/149934673/12/Conclusion
Timestamp: 2016-02-10 23:19:01
Document Index: 515831403

Matched Legal Cases: ['§ 527', '§ 1', '§ 24', '§ 24', '§ 2', '§ 3', '§ 24', '§ 2', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 24', '§ 2', '§ 2', '§ 24', '§ 1', '§ 1', '§ 1', '§ 24', '§ 1', '§ 1', '§ 1', '§ 1', '§ 24']

Conclusion for SOS Opening Brief Colorado Ethics Watch v. Gessler, CO Court of Appeals
UploadSign inJoinBooksAudiobooksComicsSheet MusicScribd Selects BooksHand-picked favorites from our editorsScribd Selects AudiobooksHand-picked favorites from our editorsScribd Selects ComicsHand-picked favorites from our editorsScribd Selects Sheet MusicHand-picked favorites from our editorsTop BooksWhat's trending, bestsellers, award-winners & moreTop AudiobooksWhat's trending, bestsellers, award-winners & moreTop ComicsWhat's trending, bestsellers, award-winners & moreTop Sheet MusicWhat's trending, bestsellers, award-winners & moreCategoriesArts & IdeasBiography & MemoirBusiness & LeadershipChildren'sComputers & TechnologyCooking & FoodCrafts & HobbiesFantasyFiction & LiteratureHappiness & Self-HelpHealth & WellnessHistoryHome & GardenHumorLGBTMystery, Thriller & CrimePolitics & EconomyReferenceReligionRomanceScience & NatureScience FictionSociety & CultureSports & AdventureTravelYoung AdultCategoriesArts & IdeasBiography & MemoirBusiness & LeadershipChildren'sComputers & TechnologyCooking & FoodFantasyFiction & LiteratureHappiness & Self-HelpHealth & WellnessHistoryHome & GardenHumorLGBTMystery, Thriller & CrimePolitics & EconomyReferenceReligionRomanceScience & NatureScience FictionSociety & CultureSports & AdventureTravelYoung AdultCategoriesAdaptationsChildren’sCrime & MysteryFictionHumorMangaNonfictionRomanceSciFi, Fantasy & HorrorSuperheroesYoung AdultPublishersArcanaArchie ComicsBOOM! StudiosDynamiteIDW PublishingKingstone ComicsMarvel ComicsSpace Goat ProductionsTop Cow ComicsTop Shelf ProductionsValiant Comics ZenescopeDifficultyBeginnerIntermediateAdvancedMixedInstrumentBrassDrums & PercussionGuitar, Bass, and FrettedPianoStringsVocalWoodwindsGenreClassicalCountryFolkJazz & BluesMovies & MusicalsPop & RockReligious & HolidayStandardsP. 1SOS Opening Brief Colorado Ethics Watch v. Gessler, CO Court of AppealsSOS Opening Brief Colorado Ethics Watch v. Gessler, CO Court of Appeals|Views: 1|Likes: 0Published by Colorado Ethics WatchOpening Brief of Secretary of State in Colorado Ethics Watch, et al. v. Gessler and Paladino, et al. v. Gessler, Colorado Court of AppealsOpening Brief of Secretary of State in Colorado Ethics Watch, et al. v. Gessler and Paladino, et al. v. Gessler, Colorado Court of AppealsMore info:Categories:Types, Business/LawPublished by: Colorado Ethics Watch on Jun 25, 2013Copyright:Attribution Non-commercialAvailability:Read on Scribd mobile: iPhone, iPad and Android.download as PDF, TXT or read online from ScribdFlag for inappropriate content|Add to collectionSee moreSee lesshttps://www.scribd.com/doc/149934673/SOS-Opening-Brief-Colorado-Ethics-Watch-v-Gessler-CO-Court-of-Appeals06/08/2014pdftextoriginalSectionsIntroductionIssues on AppealStatement of the Case and FactsA. The Secretary’s rulemaking effortB. Plaintiffs’ lawsuitC. The decision belowD. The Secretary’s request for a stay and the
AssemblyConclusion
The Secretary respectfully requests that the Court reverse the
district court’s order as to Rules 1.18.2, 1.12, 7.2, 1.10, and 18.1.8(a) and
conclude that each of these rules is valid and enforceable.
Respectfully submitted on February 1, 2013.
FREDERICK YARGER, 39479*
MATTHEW GROVE, 34269*
This is to certify that I have served this OPENING BRIEF
OF APPELLANT / CROSS-APPELLEE COLORADO SECRETARY OF
STATE on all parties by LexisNexis File & Serve at Denver, Colorado,
on February 1, 2013, addressed as follows:
Denver, Colorado 80202-1256
Paladino v. Gessler, 12 CA 1712
Addendum A to the Secretary’s Opening Brief:
Campaign Finance Rules at Issue in this Appeal
“Electioneering communication” is any communication that (1) meets the definition
of electioneering communication in Article XXVIII, Section 2(7), and (2) is the
functional equivalent of express advocacy. When determining whether a
communication is the functional equivalent of express advocacy:
1.7.1 A communication is the functional equivalent of express advocacy only
if it is subject to no reasonable interpretation other than an appeal to vote for
or against a specific candidate.
1.7.2 In determining whether a communication is the functional equivalent
of express advocacy, it shall be judged by its plain language, not by an “intent
and effect” test, or other contextual factors.
1.7.3 A communication is not the functional equivalent of express advocacy if
(a) Does not mention any election, candidacy, political party, opposing
candidate, or voting by the general public,
(b) Does not take a position on any candidate's or officeholder's
character, qualifications, or fitness for office, and
(c) Merely urges a candidate to take a position with respect to an issue
or urges the public to adopt a position and contact a candidate with
respect to an issue.
[Federal Election Commission v. Wisconsin Right to Life, 551 U.S. 449 (2007)]
Former Rule 9.4 (predecessor to Rule 1.7)
Pursuant to the decisions of the Colorado Court of Appeals in the case of Harwood v.
Senate Majority Fund, LLC, 141 P.3d 962 (2006), and of the United States Supreme
Court in the case of FEC v. Wisconsin Right to Life, 127 S. Ct. 2652 (2007), a
communication shall be deemed an electioneering communication only if it is
susceptible to no reasonable interpretation other than as an appeal to vote for or
against a specific candidate. In making this determination, (1) there can be no free-
ranging intent-and-effect test; (2) there generally should be no discovery or inquiry
into contextual factors; (3) discussion of issues cannot be banned merely because the
issues might be relevant to an election; (4) in a debatable case, the tie is resolved in
favor of not deeming a matter to be an electioneering communication.
“Influencing or attempting to influence”, for purposes of political organizations as
defined in section 1-45-103(14.5), C.R.S., means making expenditures for
communications that expressly advocate the election or defeat of a clearly identified
candidate or candidates. [Buckley v. Valeo, 424 U.S. 1 (1976)]
“Issue committee”
1.12.3 For purposes of determining whether an issue committee has “a major
purpose” under Article XXVIII, Section 2(10)(a)(I) and section 1-45-
103(12)(b)(II)(A), C.R.S., a demonstrated pattern of conduct is established by:
(a) Annual expenditures in support of or opposition to ballot issues or
ballot questions that exceed 30% of the organization’s total spending
during the same period; or
(b) Production or funding of written or broadcast communications in
support of or opposition to a ballot issue or ballot question, where the
production or funding comprises more than 30% of the organization’s
total spending during a calendar year.
“Political committee”
1.18.2 “Political committee” includes only a person or group of persons that
support or oppose the nomination or election of one or more candidates as its
major purpose. For purposes of this Rule, major purpose means:
(a) The organization specifically identifies supporting or opposing the
nomination of one or more candidates for state or local public office as
a primary objective in its organizing documents; or
(b) Annual expenditures made to support or oppose the nomination or
election of one or more candidates for state or local public office are a
majority of the organization’s total spending during the same period.
[Alliance for Colorado’s Families v. Gilbert, 172 P.3d 964, 970 (Colo. App. 2007)]
Political organizations. In the case of political organizations as defined in section 1-
45-103(14.5), C.R.S.:
7.2.1 For purposes of section 1-45-108.5, C.R.S., an entity is considered a
political organization only if:
(a) Has as its major purpose influencing or attempting to influence
elections as defined in Rule 1.10; and
(b) Is exempt, or intends to seek exemption, from taxation by the
[I.R.C. § 527(i)(5)(B) (2010)]
Rule 18.1.8
18.1 Requests for waiver or reduction of campaign finance penalties
18.1.1 A request for waiver or reduction of campaign finance penalties
imposed under Article XXVIII, Section 10(2) must state the reason for the
delinquency. The filer should provide an explanation that includes all
relevant factors relating to the delinquency and any mitigating
circumstances, including measures taken to avoid future delinquencies.
Before the Secretary of State will consider a request, the report must be filed,
and a request including the information required by this paragraph must be
18.1.8 Major Contributor Reports
(a) Penalties assessed for failure to timely file a Major Contributor
Report under section 1-45-108(2.5), C.R.S., stop accruing on the date
that the contribution is first disclosed, either on the Major Contributor
Report or the regularly-scheduled Report of Contributions and
Expenditures. Penalties will not accrue beyond the date of the general
election. [Section 1-45-108(2.5) C.R.S.]
Addendum B to the Secretary’s Opening Brief:
The District Court’s August 10, 2012 Order
COLORADO ETHICS WATCH; COLORADO
COMMON CAUSE; DAVID PALADINO, et al.,
SCOTT GESSLER, as Secretary of State for the State
Case No.: 2012CV2133
(consolidated with 2012CV2153)
THIS MATTER comes before the Court on Plaintiffs’ consolidated Complaints
challenging a number of rules promulgated by the Defendant in his capacity as Colorado’s
Secretary of State (“Secretary” or “Defendant”).
In 2002, the people of the state of Colorado passed Amendment 27, declaring
that . . . the interests of the public are best served by limiting campaign
contributions, encouraging voluntary campaign spending limits, providing for full
and timely disclosure of campaign contributions, independent expenditures, and
funding of electioneering communications, and strong enforcement of campaign
Colo. Const. Art. XXVIII § 1.
In November, 2011, the Secretary instituted a rulemaking process to promulgate new
rules to administer and enforce Colorado’s campaign finance and election laws. The new rules
became permanently effective on April 12, 2012.
Plaintiffs consist of numerous public interest groups, watchdog organizations, and
individuals, all of whom have an interest in the new rules. Plaintiffs filed two separate
complaints, which were consolidated in this action, challenging the following rules implemented
by the Secretary pursuant to the rulemaking process: 1.7; 1.10; 1.12; 1.18; 4.1; 4.2; 6.1; 6.2; 7.2;
14; and 18.1.8. The parties agree that in light of subsequent changes implemented by the
Secretary, the challenges to Rules 6.1; 6.2 and 14 are moot. Defendant does not challenge
Plaintiffs’ standing to bring this action.
Under the Colorado Administrative Procedure Act, C.R.S. § 24-4-101, et seq., a
challenged agency action must be held unlawful if the reviewing court finds:
that the agency action is arbitrary or capricious, a denial of statutory right,
contrary to constitutional right, power, privilege, or immunity, in excess of
statutory jurisdiction, authority, purposes, or limitations, not in accord with the
procedures or procedural limitations of this article or as otherwise required by
law, an abuse or clearly unwarranted exercise of discretion, based upon findings
of fact that are clearly erroneous on the whole record, unsupported by substantial
evidence when the record is considered as a whole, or otherwise contrary to
C.R.S. § 24-4-106(7). Upon such a finding, the court must “set aside the agency action and shall
restrain enforcement of the order or rule under review . . . and afford such other relief as may be
appropriate.” Id.
An adopted agency rule is presumed to be valid, and the burden to establish its invalidity
rests on the party challenging the rule. Colorado Ground Water Comm’n v. Eagle Peak Farms,
919 P.2d 212, 217 (Colo. 1996). An agency is presumed to have expertise in the substantive
arena in which it operates, and a court may give certain deference to the agency that adopts a rule
pursuant to its authorizing statute. Tivolino Teller House v. Fagan, 926 P.2d 1208, 1215 (Colo.
The actual level of deference varies based upon the circumstances surrounding the
enacted rule. Where rules are based on “judgmental or predictive facts,” “some deference to
administrative expertise is appropriate.” U.S. West Commc’ns, Inc. v. Colorado Public Util.
Comm’n, 978 P.2d 671, 675 (Colo. 1999). If a rule seeks to address the precise issue that the
legislature – or the people acting pursuant to their reserved legislative power as specified in
Article V, section 1 of the Colorado Constitution – has already addressed, the courts will
“‘construe the statute accordingly and afford no deference to the agency’s interpretation.’” City
of Boulder v. Colorado Public Util. Comm’n, 996 P.2d 1270, 1277 (Colo. 2000) (citation
Legal interpretations of a rule, a statute, or a constitutional amendment are reviewed on a
de novo basis. Cerbo v. Protect Colo. Jobs, Inc., 240 P.3d 495, 500 (Colo. App. 2010) (citations
omitted). Where an agency misconstrues or misapplies the law in executing in its regulatory
function, the courts have no cause to defer to the agency’s approach. See Sclavenitis v. Cherry
Hills Village Bd. Of Adjustment & Appeals, 751 P.2d 661, 664 (Colo. App. 1988). “An agency
rule may not modify or contravene an existing statute, and any rule that is inconsistent with or
contrary to a statute is void.” Independence Institute v. Gessler, __ F. Supp. 3d __, 2012 WL
1439167 at *8 (D. Colo. April 26, 2012) (citing Suetrack USA v. Indus. Claim Appeals Office,
902 P.2d 854 (Colo. App. 1995)) (brackets omitted). Likewise, where an agency official
reinterprets a statute in a way that is contrary to that of his predecessor, the new construction is
owed no deference. Common Cause v. Meyer, 758 P.2d 153, 159 (Colo. 1988).
In promulgating rules, the Secretary cannot redefine a term already defined in the
Constitution or statutes or in such a way that the definition imposes additional restrictions on a
statute or constitutional provision. Sanger v. Dennis, 148 P.3d 404, 412 (Colo. App. 2006). Any
rule must be reasonable and consistent with purposes of Article XXVIII. Id. at 412 – 13. In
When a court reviews an agency’s construction of the statute which it administers,
it is confronted with two questions. First, always, is the question whether [the
legislature] has directly spoken to the precise question at issue. If the intent of
[the legislature] is clear, that is the end of the matter; for the court, as well as the
agency, must give effect to the unambiguously expressed intent of [the
legislature]. If, however, the court determines [the legislature] has not directly
answer is based on a permissible construction of the statute . . . . If [the
legislature] has explicitly left a gap for the agency to fill, there is an express
delegation of authority to the agency to elucidate a specific provision of the
statute by regulation. Such legislative regulations are given controlling weight
unless they are arbitrary, capricious, or manifestly contrary to the statute.
Sometimes the legislative delegation to an agency on a particular question is
implicit rather than explicit. In such a case, a court may not substitute its own
construction of a statutory provision for a reasonable interpretation made by the
administrator of an agency.
Wine & Spirits Wholesalers v. Colo. Dep’t of Revenue, 919 P2d 894, 897 (Colo. App. 1996)
(quoting Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-43
(1984)) (emphasis added).
A. Rule 1.7, Definition of “Electioneering Communications.”
“Electioneering communication” is any communication that (1) meets the
definition of electioneering communication in Article XXVIII, Section 2(7), and
(2) is the functional equivalent of express advocacy. When determining whether a
1.7.1 A communication is the functional equivalent of express advocacy only if
it is subject to no reasonable interpretation other than an appeal to vote for or
against a specific candidate.
1.7.2 In determining whether a communication is the functional equivalent of
express advocacy, it shall be judged by its plain language, not by an “intent
(b) Does not take a position on any candidate's or officeholder’s character,
qualifications, or fitness for office, and
(c) Merely urges a candidate to take a position with respect to an issue or
urges the public to adopt a position and contact a candidate with respect to
Plaintiffs complain that this new rule adds a “functional equivalence” test that
substantially narrows the definition of “electioneering communication” contained in Article
XXVIII § 2(7), and therefore improperly restricts the universe of those who must make the
required disclosures. Further, Plaintiffs argue that the cases upon which the rule is based
(primarily F.E.C. v. Wisconsin Right to Life, 551 U.S. 449 (2007)) were rendered obsolete by
Citizens United v. F.E.C., 558 U.S. __, 130 S. Ct, 876 (2010). In essence, Plaintiffs argue that
Citizen’s United placed few, if any, First Amendment restrictions on contribution disclosure
requirements, and that therefore the application of Wisconsin Right to Life to disclosure
requirements is unwarranted.
However, new Rule 1.7 is similar in most respects to the rule it replaces, former Rule 9.4.
Former Rule 9.4 stated:
Pursuant to the decisions of the Colorado Court of Appeals in the case of
Harwood v. Senate Majority Fund, LLC, 141 P.3d 962 (2006), and of the United
States Supreme Court in the case of F.E.C. v. Wisconsin Right to Life, 127 S. Ct.
2652 (2007), a communication shall be deemed an electioneering communication
only if it is susceptible to no reasonable interpretation other than as an appeal to
vote for or against a specific candidate. In making this determination, (1) there
can be no free-ranging intent-and-effect test; (2) there generally should be no
discovery or inquiry into contextual factors; (3) discussion of issues cannot be
banned merely because the issues might be relevant to an election; (4) in a
debatable case, the tie is resolved in favor of not deeming a matter to be an
The new rule adds no substantive additional terms and imposes no additional restrictions
over the old rule. While it may be that Citizens United renders both new and old rules obsolete,
prior Rule 9.4 was in effect and unchallenged until it was superseded by Rule 1.7.
Plaintiffs rely on In re Interrogatories Propounded by Governor Ritter, Jr., Concerning
the Effect of Citizens United v. Federal Election Comm’n, 558 U.S. __ (2010) on Certain
Provisions of Article XXVIII of The Constitution of the State of Colorado, 227 P.3d 892 (2010)
(“Interrogatories”). There, the Colorado Supreme Court ruled that Citizens United invalidated
Colorado Constitution Article XXVIII §§ 3(4) and 6(2); these sections made it unlawful for a
corporation or labor organization to fund electioneering communications. Plaintiffs point out
that Interrogatories left the disclosure requirements of Article XXVIII undisturbed. But
Plaintiffs read too much into that decision. The Colorado Supreme Court was not asked about
the disclosure requirements of Article XXVIII and therefore did not render a decision about
corporate or union disclosures. Moreover, I agree with Defendant that Colorado Ethics Watch v.
Senate Majority Fund, 269 P.3d 1248 (Colo. 2012) reaffirms Wisconsin Right to Life’s
applicability to the Colorado Constitution’s definition of “Electioneering Communication.” E.g.,
Colorado Ethics Watch v. Senate Majority Fund, 269 P.3d at 1257-58 and 1258 n.8.
Here, it appears that the Secretary did not modify or contravene an existing statute.
Independence Institute v. Gessler, __ F. Supp. 3d __, 2012 WL 1439167 at *8 (D. Colo. April
26, 2012); Sanger v. Dennis, 148 P.3d 404, 412 (Colo. App. 2006). Further, the challenged rule
is similar to the rule enacted by Defendant’s predecessor, and it therefore is entitled to deference.
Ingram v. Cooper, 698 P.2d 1314 (Colo.1985). Accordingly, I conclude that the Secretary has
acted within his authority under C.R.S. § 24-4-101 in promulgating Rule 1.7.
B. Rule 1.12, Reporting Threshold for Issue Committees
Among other things, Art. XXVIII § 2(10)(1)(I) defines an “issue committee” as a group
that “has a major purpose of supporting or opposing any ballot issue or ballot question.”
Challenged Rule 1.12.3 relates to the phrase “major purpose,” and states as follows:
For purposes of determining whether an issue committee has “a major purpose”
under Article XXVIII, Section 2(10)(a)(I) and section 1-45-103(12)(b)(II)(A),
C.R.S., a demonstrated pattern of conduct is established by:
(a) Annual expenditures in support of or opposition to ballot issues or ballot questions
that exceed 30% of the organization’s total spending during the same period; or
(b) Production or funding of written or broadcast communications in support of or
opposition to a ballot issue or ballot question, where the production or funding
comprises more than 30% of the organization’s total spending during a calendar year.
Plaintiffs challenge this rule arguing that the addition of a revenue percentage
requirement (30%) is arbitrary, and that such a limitation is not provided for in C.R.S. § 1-45-
103-12(b)(I)-(III) which already defines the term “major purpose” without resorting to an annual
revenue percentage of any kind. The Defendant responds that he is providing a clear, bright line
test that brings certainty to those groups which may qualify as issue committees.
C.R.S. § 1-45-103-12(b)(I)-(III) defines “major purpose.” Plaintiffs are correct that the
statute does not include an annual income percentage in its definition. Prior to the enactment of
the statute, two cases had already held that the term “major purpose” as used in Article XXVIII
was not ambiguous. Cerbo v. Protect Colo. Jobs, Inc., 240 P.3d 495 (Colo. App. 2010);
Independence Institute v. Coffman, 209 P.3d 1130 (Colo. App. 2008). Subsequent to these cases,
the legislature passed a statute essentially codifying the holding of these two cases. C.R.S. § 1-
45-103(12)(b).
The additional 30% requirement adds a restriction not found in the statute and not
supported by the record. The revenue requirement works further mischief in that it appears not
to be income neutral. In other words, issue committees with very little income, which
presumably spend most of that income on election-related matters, will be required to report.
But large corporations or wealthy individuals could spend substantial sums of money on issues
and yet not have to report because they are spending less than 30% of their revenue on these
activities. Certainly this is contrary to the intent of the electorate, which has expressed an
interest in compelling more disclosure, not less. Colo. Const. Art. XXVIII § 1.
Regardless of the consequences of the 30 percent requirement, its addition to the major
purpose definition inappropriately modifies and contravenes an existing statute, C.R.S. § 1-45-
103(12)(b). Independence Institute v. Gessler, __ F. Supp. 3d __, 2012 WL 1439167 at *8 (D.
Colo. April 26, 2012). Moreover the revenue test clearly is at odds with the express intent of the
legislature, which has enacted a definition without use of such a test. For these reasons, Rule
1.12.3 is invalid as it exceeds the Secretary’s delegated authority under C.R.S. § 24-4-103(8)(a).
Wine & Spirits Wholesalers v. Colo. Dep’t of Revenue, 919 P.2d 894, 897 (Colo. App. 1996);
Sanger v. Dennis, 148 P.3d 404, 412 (Colo. App. 2006).
C. Rule 1.18.2, Expenditure Threshold for “Political Committee”
Challenged Rule 1.18.2 defines “political committee” as follows:
“Political committee” includes only a person or group of persons that support or
oppose the nomination or election of one or more candidates as its major purpose.
For purposes of this Rule, major purpose means:
(a) The organization specifically identifies supporting or opposing the nomination of
one or more candidates for state or local public office as a primary objective in its
organizing documents; or
(b) Annual expenditures made to support or oppose the nomination or election of one
or more candidates for state or local public office are a majority of the organization’s
total spending during the same period.
Plaintiffs object to this rule because it adds the further limitation that a “majority of the
organization’s total spending” be directed towards supporting or opposing candidates. Plaintiffs
point out that this definition radically narrows the definition of “political committee” set forth in
Art. XXVIII § 2(12)(a). There, “political committee” is defined as any group that spends or
receives more than $200 to support or oppose candidates. Defendant argues that the rule’s
“major purpose” test is clearly required in light of Alliance for Colorado’s Families v. Gilbert,
172 P.3d 964 (Colo. App. 2007) and Colorado Right to Life Comm., Inc. v. Coffman, 498 F.3d
1137, 1154-55 (10th Cir. 2007). Both of these cases held that, as applied to the parties in those
two cases, the “political committee” test now articulated in Rule 1.18.2 was required by Buckley
v. Valeo, 424 U.S. 1 (1976).
Both Alliance for Colorado’s Families v. Gilbert and Colorado Right to Life Comm., Inc.
v. Coffman undeniably required application of the Buckley test to determine whether the
plaintiffs in these cases were subject to regulation as political committees. Nevertheless, the
Secretary’s proposed definition is clearly contrary to the “political committee” definition in
Amendment XXVIII. Courts “cannot re-write state laws to conform [to] constitutional
requirements where doing so would be inconsistent with legislative, or here, the state citizenry’s
intent. . . .” Alliance for Colorado’s Families v. Gilbert, 172 P.3d 964, 972 (Colo. App. 2007)
(quoting Colorado Right to Life Comm., Inc. v. Coffman, 498 F.3d 1137, 1154-55 (10th Cir.
Because the Rule 1.18.2’s limitation is contrary to the intent of Art. XXVIII § 2(12)(a) as
passed by the citizens of Colorado, the Secretary cannot read the “major purpose” limitation into
the definition. Doing so would result in the addition of a new, strict, limitation into Section
2(12)(a). Both Alliance for Colorado’s Families v. Gilbert and Colorado Right to Life Comm.,
Inc. v. Coffman hold that such a narrowing is impermissible (though, paradoxically, also required
to pass constitutional muster as applied in those cases). But Section 2(12)(a) has never been
declared facially unconstitutional, so there still may be circumstances where it can apply as
Ultimately, it comes down to this: Can the Secretary add a “major purpose” limitation to
Section 2(12)(a) to save the provision, or is it a matter for a the legislature or the citizens,
through referendum, to fix it? While the Secretary’s pragmatism is to be respected, removing a
critical element of 2(12)(a) by rule goes beyond the Secretary’s powers. Sanger v. Dennis, 148
P.3d 404 (Colo. App. 2006); Wine & Spirits Wholesalers v. Colo. Dep’t of Revenue, 919 P.2d
894, 897 (Colo. App. 1996). He assumes a solution without legislative or voter input, and
thereby exceeds his delegated authority. C.R.S. § 24-4-103(8)(a). For these reasons, Rule 1.18.2
D. Rule 1.10 and 7.2.1, Definition of “political organization”
Challenged Rule 7.2.1 states:
Political organizations. In the case of political organizations as defined in section
1-45-103(14.5), C.R.S.:
political organization only if [it]:
(a) Has as its major purpose influencing or attempting to influence elections
as defined in Rule 1.10; and
(b) Is exempt, or intends to seek exemption, from taxation by the Internal
(Punctuation in the original.)
Challenged Rule 1.10 states:
communications that expressly advocate the election or defeat of a clearly
identified candidate or candidates.
Plaintiffs maintain that these two rules impermissibly narrow the definition of “political
organization” which already is defined in C.R.S. § 1-45-103(14.5). The result, according to
Plaintiffs, is that that “political organization” as defined by these rules becomes indistinguishable
from “political committee” which in turn results in a loophole that allows organizations to avoid
reporting at all. The Secretary responds that Rule 7.2.1 merely echoes the definition of Section
527 of the Internal Revenue Code, and that Rule 1.10 is supported by “forty years of First
Amendment Jurisprudence.”
C.R.S. § 1-45-103(14.5) defines “political organization” as
a political organization defined in section 527(e)(1) of the federal “Internal
Revenue Code of 1986”, as amended, that is engaged in influencing or attempting
to influence the selection, nomination, election or appointment of any individual
to any state or local public office in the state and that is exempt, or intends to seek
any exemption, from taxation pursuant to section 527 of the internal revenue
To this, the Secretary’s rule adds a “major purpose” requirement and further narrows the
phrase “influence or attempting to influence” to “express advocacy.” Thus, under the challenged
rules, “an entity is considered a political organization only if [it] . . . has as its major purpose
influencing or attempting to influence elections as defined in Rule 1.10.” Rule 1.10 in turn
defines “influencing or attempting to influence” as “making expenditures for communications
that expressly advocate the election or defeat of a clearly identified candidate or candidates.”
Read in combination, as intended, the two rules define a “political organization” as an entity
which has as its major purpose making expenditures for communications that expressly advocate
the election or defeat of a clearly identified candidate or candidates.
Thus, the Secretary’s rules improperly narrow the definition of “political organization.”
Under the statute, it is an organization that “is engaged in” influencing elections or appointments
of individuals to public office. Under Rule 7.2.1, this is narrowed to organizations with a “major
purpose” in influencing elections. Rule 1.10 further narrows the definition to groups which
“expressly advocate” for or against candidates. These narrowing rules effectively eliminate
distinctions between “political organization” and “political committee.” Political committees,
subject to a constitutional contribution reporting limit of $200, could switch to a “political
organization” and avoid this restriction under the challenged rules. Such a result is contrary to
the clear terms of the statute and the intent of the legislature. See Letter from State Senator
Morgan Carroll to Secretary of State Scott Gessler (Dec. 14, 2011) (Record at Tab 5.11).
Removing or limiting critical elements of C.R.S. § 1-45-103(14.5) by rule goes beyond the
Secretary’s powers. Sanger v. Dennis, 148 P.3d 404 (Colo. App. 2006); Wine & Spirits
Wholesalers v. Colo. Dep’t of Revenue, 919 P.2d 894, 897 (Colo. App. 1996). He thus has
exceeded his delegated authority under C.R.S. § 24-4-103(8)(a). For these reasons, Rules 1.10
and 7.2 are invalid.
E. 18.1.8(a), Major Contributor Reporting Penalties
Challenged Rule 1.18.1 provides as follows:
delinquency. The filer should provide an explanation that includes all relevant
factors relating to the delinquency and any mitigating circumstances, including
measures taken to avoid future delinquencies. Before the Secretary of State
will consider a request, the report must be filed, and a request including the
information required by this paragraph must be submitted
(a) Penalties assessed for failure to timely file a Major Contributor Report under
section 1-45-108(2.5), C.R.S., stop accruing on the date that the contribution is
first disclosed, either on the Major Contributor Report or the regularly-scheduled
Report of Contributions and Expenditures. Penalties will not accrue beyond the
date of the general election.
Plaintiffs challenge this rule claiming that it sets a definite cut off for the accrual of fines
for failure to file required reports. Plaintiffs maintain that certain wealthy organizations simply
will decline to file knowing that the fine for failing to do so will be fixed on Election Day.
Defendant maintains that he simply is setting forth what constitutes good cause for failing to file
C.R.S. § 1-45-108(2.5) specifies when a major donor report must filed. C.R.S. § 1-45-
111.5(c) sets the penalty for failing to do so: “fifty dollars per day for each day that a report
[required to be filed] is not filed.” There is no limit, and no cutoff date. Rule 18.1.8 abrogates
the fifty dollar per day penalty once a contributor is identified in any report, either the Major
Contributor Report or the regularly-scheduled Report of Contribution and Expenditures. But the
rule goes too far and cuts off all penalties as of the date of the general election.
This substantially denudes the statutory penalty and raises the possibility that those
subject to the penalty simply will not report knowing that the fine amount will be fixed on
Election Day. The Secretary does not address the effect of the cutoff date in his brief. Stopping
accrual of the fine on Election Day is contrary to the stated interests of “strong enforcement of
campaign finance requirements” as stated in Art. XVIII § 1. Furthermore, the rule removes an
enforcement element from C.R.S. § 1-45-111.5(c) by setting an ultimate limit on fines for lack of
reporting. As such, this rule is beyond the Secretary’s powers under Sanger v. Dennis, 148 P.3d
404 (Colo. App. 2006); Wine & Spirits Wholesalers v. Colo. Dep’t of Revenue, 919 P.2d 894,
897 (Colo. App. 1996). He thus has exceeded his delegated authority under C.R.S. § 24-4-
103(8)(a). For these reasons, Rule 18.1.8 is invalid.
F. Rules 4.1 and 15.6
Rules 4.1 and 15.6 increase the reporting limits for issue committees to $5,000. Both
rules contain a disclaimer indicating that they will not be enforced unless Colorado Common
Cause v. Gessler, No. 2011CV4164 (Denver Dist. Ct. Nov. 17, 2011) is overturned by a higher
court. Colorado Common Cause held that the $5,000 limit in Rule 4.1’s predecessor, Rule 4.27,
was invalid. The Secretary has indicated in Rules 4.1 and 15.6 that they will not be enforced in
light of the trial court’s ruling in Colorado Common Cause.
Under the doctrine of ripeness, a claim must be real and immediate. With this
requirement in mind, we must refuse to consider uncertain or contingent future
matters that suppose speculative injury that may never occur. We determine
ripeness on the basis of the situation at the time of review, not the situation
existing when the trial court acted.
Developmental Pathways v. Ritter, 178 P.3d 524, 534 (Colo. 2008) (citations and internal quotes
omitted). Here, the Secretary has expressly stated that Rules 4.1 and 15.6 will not be enforced
pending a ruling in Colorado Common Cause. Because there is no real and immediate threat of
enforcement, I conclude that Plaintiffs’ claims with respect to these two rules are not ripe for
For the reasons set forth above, Rule 1.7 is valid. Rules 1.10; 1.12; 1.18; 7.2; and 18.1.8
are invalid. Rules 4.1 and 15.6 are not yet ripe for determination.
ENTERED this 10th day of August, 2012.