New Mexico S.B. 42: A Legally Dubious, Speech-Chilling Proposal

As passed by the Senate, S.B. 42 would make New Mexico’s already objectionable donor reporting requirement for independent expenditures (IEs) even worse. The bill doubles down on a law the Rio Grande Foundation (RGF) is currently challenging in court for being unconstitutionally overbroad.

  • Background and Ongoing Litigation. The existing law that RGF is challenging requires any organization that spends more than $3,000 on IEs in connection with a non-statewide race, or more than $9,000 on IEs in connection with a statewide race, to publicly report any source of “contributions” to the organization of more than $5,000 during an election cycle.

Importantly, IEs include not only election campaign ads, but also any messages that merely refer to a candidate within 30 days before a primary or within 60 days before a general election that are targeted “to the relevant electorate.” This includes messages asking elected officials to support or oppose legislation or take a stance on a policy issue.

  • Chilled Speech. The existing law already chills organizations’ speech about issues. Donors give to their favored causes with the expectation of privacy, and nonprofits shouldn’t have to choose between speaking out about issues that are important to their mission and their supporters and violating those individuals’ privacy. This is especially so in an age of “cancel culture” when Americans can be targeted for retaliation based on the causes they support.
  • Junk Disclosure. The existing law already results in junk disclosure by associating donors on public reports with messages they didn’t necessarily support or intend to fund. New Mexicans give to nonprofit causes for countless reasons and rarely give specifically for the purpose of paying for particular communications.
  • An Attack on Personal Privacy. S.B. 42 doubles down on existing New Mexico law by replacing the word “contribution” in the statute with the word “donation.” Current law defines a “contribution” as funds given “for a political purpose.” Therefore, an argument could be made that an organization making IEs is only required to report donors who give “for a political purpose,” even though the context in which the existing law uses this term argues for a broader and general requirement to report all donors. S.B. 42 makes it explicit that donors who give for any purpose – not just “a political purpose” – are required to be reported if an organization makes IEs.

This makes no sense. While the IE reporting requirements purport to be aimed at organizations engaged in some political activities, S.B. 42 makes it clear that donors who give for no political purpose have to be identified on political activity reports. The intent of the bill seems to be to name and shame donors to organizations that speak out about policy issues and to deter those nonprofits from voicing their opinion in public debates.

  • A Constitutional Quandary. If existing New Mexico law is held to be unconstitutional in the pending RGF litigation, S.B. 42 will be even more unconstitutional because it takes the existing law RGF is challenging and makes it worse. Even if the existing law is upheld, S.B. 42 may still be unconstitutional because it purports to require a broader scope of reporting than current law.
  • Why is freedom of speech important?