Proponents defend Colorado ballot measure to bar corporate political spending; staff raise constitutional, practical questions

A representative for the initiative proponents defended a proposed Colorado constitutional amendment that would remove political‑spending powers from corporations and other "artificial persons," saying the measure addresses what powers the state grants rather than restricting individuals' free speech.

At a March 13 review‑and‑comment hearing, Alexa Kelly of legislative council staff opened the meeting and Allison Killen, staff attorney with the Office of Legislative Legal Services, asked detailed legal and practical questions about the proposal, which is listed in the record as initiative measure 2025–2026, No. 265. Ivana Dallas identified herself as a private citizen present to represent the initiative; a second, unnamed proponents' representative answered most substantive questions on behalf of the measure.

The proponents' representative summarized the initiative's core elements: add a new section to Article 15 of the Colorado Constitution to treat political‑spending power as an "artificial person power" that the state may or may not confer; declare any political spending by an artificial person that exceeds those conferred powers ultra vires and void; make an ultra vires exercise of political spending power trigger withdrawal of state‑conferred charter privileges; and permit reinstatement of charter privileges only pursuant to procedures the legislature enacts during its first regular session following 01/01/2027, conditioned on full restoration of expended amounts and any additional legislative requirements.

Staff asked whether the measure conflicts with the First Amendment and cited the U.S. Supreme Court's 2010 decision in Citizens United v. FEC. "Have the proponents considered whether prohibiting artificial persons from exercising political spending power conflicts with the First Amendment?" Killen asked. The proponents' representative replied, "This initiative is about power‑granting authority at the state level," arguing that Citizens United addressed whether government may restrict speech by a corporation that already possesses spending power, while the initiative addresses whether the state must include political‑spending power in the package of benefits it grants to artificial persons.

On scope, the proponents' representative said the amendment would apply to entities chartered in Colorado and to out‑of‑state entities that spend money to influence Colorado elections, explaining the initiative treats such spending as doing business in Colorado to prevent evasion. The representative told staff the provision would not alter an entity's home‑state charter if the entity is organized elsewhere but would strip state‑conferred protections—most notably limited liability—for activity the initiative deems ultra vires.

Staff pressed the mechanics of enforcement and consequences. The proponents' representative said the constitutional text establishes the legal consequence (withdrawal of charter privileges) and that the legislature must design procedures—potentially specifying whether courts or the secretary of state make determinations—when it enacts reinstatement rules. The representative said the initiative does not automatically dissolve an entity nor directly void its contracts or take property away; those implementation details are matters for the legislature.

On remedial measures, the initiative requires "full disgorgement of amounts expended" as a condition of reinstatement. The proponents' representative described that requirement as remedial rather than punitive—intended to restore the entity to the position it would have occupied had it not exceeded its conferred powers—and said the legislature would decide mechanics such as recipients, interest, or other conditions.

The measure's definitions drew further questions. The proponents' representative said "political spending power" and the phrase "anything of value" follow established campaign‑finance meanings and encompass in‑kind contributions such as goods, services, use of corporate facilities, and directed employee time; by contrast, genuinely voluntary employee time on an individual's own initiative would not be considered an expenditure by the artificial person. The proposal explicitly treats political committees as a defined exception—political committees remain able to exercise political‑spending power—but it bars artificial persons from donating to political committees because such a donation would itself be an exercise of political‑spending power through an intermediary.

The proponents' representative said the initiative includes a carve‑out for bona fide news, commentary and editorial content, modeled on the federal standard in 11 CFR 100.73(a); the exemption would not apply where an outlet is owned or controlled by a political party, political committee, or candidate. The representative said unions, nonprofits and homeowners associations chartered in Colorado would be covered if they receive state‑conferred legal benefits such as limited liability, though federal labor rights do not alter the state‑conferred privileges the measure addresses.

The hearing closed after staff finished substantive comments. Staff reiterated that questions about whether the measure satisfies the state's single‑subject requirement would be decided by the title board if the proponents submit the petition for a title, and the proponents were told the legislature would set detailed enforcement and reinstatement procedures if the measure became law.

The hearing record closes with staff noting that the title board, not legislative counsel, determines single‑subject compliance; the proponents were advised to consult the title board when they file the petition. The hearing concluded at the recorded time in the transcript.