Minnesota businesses prepare for new political spending rules

With every statewide constitutional office and legislator on the ballot in 2010, political spending in Minnesota was already expected to skyrocket.

But now campaign finance experts say they expect even more money to flow, because the U.S. Supreme Court has ruled that corporations and unions can spend unlimited amounts of money on ads.

The ruling means basically one thing for Minnesotans.

"They're probably going to have to put up with more ads. More newspaper ads. More radio ads. More TV ads," said Charlie Weaver, executive director of the Minnesota Business Partnership, a coalition of the state's largest businesses.

Weaver praised this week's Supreme Court ruling, which allows businesses to spend unlimited sums of money on political ads. He said it levels the playing field in Minnesota, because state law allows unions to spend on campaigns but barred corporations from doing so.

Weaver said he's already talking with business leaders in Minnesota about the decision.

Weaver said he doesn't expect individual corporations to directly target lawmakers. Instead, he said businesses will likely pool their resources and run ads through his organization and others like the Minnesota Chamber of Commerce.

Weaver said he expects businesses to focus on core issues like taxes, labor issues and government spending.

"I think you will see more money in the system, but I don't know if it's going to be a landslide that everybody is talking about," said Weaver. "Businesses are still pretty conservative with how they spend their money in politics."

Gary Goldsmith, executive director of the Minnesota Campaign Finance Board, said his agency will meet in February to talk about the ruling.

"If things go the way everybody expects, there will be more money coming in -- there will be a lot more money," he said.

Goldsmith said special interest groups tripled their spending on "independent expenditures" from 2002 to 2006, which makes it the fastest growing portion of campaign spending.

Since candidates have mostly agreed to spending limits, Goldsmith predicts the court ruling will mean spending will balloon even more when businesses start to weigh in.

"The costs of the campaigns to the candidates themselves have been relatively low -- in fact, really low compared to other states. Because of the low cost of campaigns, the money goes to independent expenditures," said Goldsmith. "Up to this point, those have been done by political committees and funds, or PACS and party units. Now we have a third group participating, and that will be corporations."

Goldsmith said groups won't be allowed to mix corporate and individual donations if they intend to contribute directly to candidates. He said mixing those funds will violate another state law that forbids corporate contributions to candidates. The U. S. Supreme Court upheld a federal law prohibiting those contributions.

The court ruling won't impact just business groups. The executive director of the abortion opposition group, Minnesota Citizens Concerned for Life, said he expects his nonprofit corporation to spend directly on Minnesota races in 2010. That's a change from traditional spending from the group's political action committee.

Other political observers predict the Republican Governors Association and the Democratic Governors Association may also start buying ads in Minnesota. Those groups couldn't spend in the past because they took corporate contributions.

The increased spending won't be seen just in statewide races. Corporations can also now spend in local campaigns, and that worries State Rep. Ryan Winkler, DFL-Golden Valley. He said the threat of retaliation to an individual lawmaker could have a chilling effect on the entire Legislature.

"Now corporations can spend as much money out of their profits as they want to, to influence any election that they want to influence," said Winkler. "So if there's a state legislator who went the wrong way on a bill that a corporation really cared about, they can spend as much money as they want to defeat that state legislator directly."

Winkler said he'd like to increase reporting requirements for all political spending. He also wants to allow individuals to make larger contributions to decrease corporate influence.

Winkler said he's worried that businesses will push an anti-consumer, anti-regulatory agenda.

But Charlie Weaver, with the Business Partnership, said Winkler's prediction hasn't been a major problem in states like Utah, Virginia and Missouri, which already allow corporations to spend unlimited funds on political ads.

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