Montana Gov. Steve Bullock said Wednesday he's backing state legislation that aims to prevent foreign money from influencing state elections by closing a loophole created by the U.S. Supreme Court's Citizens United ruling that allows corporate spending in elections.
Bullock said the bill will outlaw foreign spending in Montana elections by preventing foreign corporations, governments and nationals from hiding behind domestic shell companies to make such contributions. A hearing for the bill sponsored by Sen. Nate McConnell, D-Missoula, not been set.
Federal law prohibits foreign contributions to political campaigns, but Bullock said foreign nationals have evaded it by setting up shell corporations in the U.S. The bill would ban political spending by corporations considered to be "foreign influenced," which is determined by ownership.
"The risk of foreign governments and foreign corporations using this loophole to influence our elections is not speculative," Bullock said. "It's real, and it's happening right now."
This week it was announced that the super PAC Right to Rise, which supported Jeb Bush's bid to become the Republican candidate for president, solicited $1.3 million in illegal donations from Chinese nationals. A California business, controlled by a majority Chinese-owned company, was fined $550,000 for making the donation. Right to Rise was fined $390,000, according to the Campaign Legal Center, which filed the complaint.
The proposed bill says that if the shell corporation's owners can't make donations in Montana elections, neither can the corporation. It gives the commissioner of political practices the authority to investigate unless the donations may violate federal law, in which case the investigation would be turned over to the Federal Election Commission.
Colorado's constitution and Hawaii law have similar prohibitions on foreign campaign spending.
After the 2010 Supreme Court ruling in the Citizens United case, which allows corporate campaign spending, the high court overturned a 100-year-old Montana law that banned corporate contributions to electioneering.
In January, the U.S. Supreme Court left in place a 1994-voter passed initiative that set inflation-adjusted monetary limits for individual, political party and political action committee donations to Montana candidates.
Last month, the U.S. Supreme Court declined to take up an appeal of Montana's Disclose Act, a law passed in 2015 that requires any group intending to spend money to influence an election within 90 days of an election to disclose the source of the money and how they are spending it.