The Independent View: SD’s Ban on Out-of-State Contributions for Ballot Measure Campaigns Ruled Unconstitutional

In 2018, South Dakota became the First State to Approve a Ban on Contributions to Ballot Measure Campaigns from Outside of the State.

Voters Approved the Citizen Initiative—Initiated Measure 24, 55.5% to 44.5%.

A Federal District Court Overturned Initiated Measure 24 in a Decision that Applies to Two Lawsuits filed against the Measure.

The Ruling, by Justice Charles Kornmann of the United States District Court for the District of South Dakota, Declared that Measure 24 Violated the First Amendment by Impeding Political Free Speech Rights and the Commerce Clause of the U.S. Constitution by Interfering with the Transfer of Money from One State to Another.

Kornmann joined the Court in 1995 after being Nominated by President Bill Clinton. The Decision Blocks South Dakota from Enforcing the Initiative, which was set to become Effective on July 1st, 2019.

In 2016, $12.5 Million in Campaign Contributions in Support of or Opposition to Ballot Measures was spent in South Dakota.

Out-of-State Donors accounted for 75% or $9.4 Million of Ballot Measure Campaign Contributions.

Kornmann said the Evidence in the Case “demonstrates how important out-of-state contributions are for the ballot question committees to pursue political speech. The State cannot enact restrictions that so completely prevent those pursuing unpopular laws from amassing the resources necessary for effective advocacy.”

Tim Bormann, Chief of Staff for Attorney General Jason Ravnsborg (R), said in an Email to the Associated Press that the Attorney General’s Office was considering the Ruling and “examining the avenues available to our office that best coincide with protecting the best interests of the people and the State of South Dakota.”

When the Measure was originally proposed in 2017, Paul S. Ryan, a Vice President at Common Cause, told the U.S. News & World Report that he did Not expect the Initiative to Survive a Court Challenge. He stated that a 1981 U.S. Supreme Court Decision, Citizens Against Rent Control v. City of Berkeley, held that Contributions to Ballot Measure Committees Cannot be Limited under the First Amendment.

In 2017, Bills to Prohibit or Restrict Out-of-State Spending on Ballot Measure Campaigns were Introduced, but ultimately Not Approved, in Arizona, North Dakota, and South Dakota.