Federal court agreement allows corporations to pool money for political action committees

Under an agreement reached in federal court the Michigan Secretary of State will allow the Michigan Chamber of Commerce and other corporations and labor unions to pool funds for spending on political action committees as long as payments are not connected to campaigns for political office, the Grand Rapids Press reports.

In a May 21 opinion Secretary of State Terri Lynn Land said that the Chamber could spend any amount on independent expenditures for express advocacy, but could not collect money from other groups for the purpose of funding these ads.

“A corporation’s political speech,” she wrote, “must be funded exclusively by that corporation.”

In July the Chamber filed suit against the Secretary of State. The group said that Land’s interpretation of campaign finance law interfered with its right to free speech.

The Grand Rapids Press reports that the Chamber of Commerce and Secretary of State have entered a stipulation judgment and order for a permanent injunction in favor of the chamber.

Under the agreement, Land can restrict or prohibit corporations from making payments to political-action committees in connection with a campaign for government office.

The agreement came after [U.S. District Judge Paul Maloney] issued a 52-page ruling that said Land’s interpretation of the law infringed on the Chamber of Commerce’s right to free speech. Land had said in a declaratory ruling earlier this year that the Chamber could use its own money to back candidates, but could not set up a PAC to accept outside funding.

The chamber sought a declaratory ruling from Land after the U.S. Supreme Court, in a case known as Citizens United, said corporations, unions and other groups could buy unlimited political ads.