The Battleground 2012: The Public Financing of Judicial Candidates in North Carolina after Arizona Free Enterprise v. Bennett

November 6, 2012

by Justin Moore

In 2002, North Carolina passed the Judicial Campaign Reform Act (JCRA). A major part of this law created a system for the public financing of all statewide judicial races in North Carolina. The fund is paid for by a combination of state bar licensing fees and a voluntary income tax check off. By agreeing to very low “qualifying contribution limits” from donors (generally $500 per person and about $80,000 overall), statewide judicial candidates can qualify for public funds. If they raise around $40,000 from 350 or more North Carolina residents between the filing deadline and the primary election, they receive about $165,000 to $240,000 (depending on the office sought) in campaign funds from the state. If an opponent or opposition groups spends more than the amount given by the fund, candidates are entitled to receive rescue funds of up to double the amount they initially received. The availability of these “rescue funds” most notably played a pivotal role in assisting the current Chief Justice Sarah Parker win her 2006 re-election campaign against a challenger who did not take public financing.

This system has been placed in serious doubt after Arizona Free Enterprise v. Bennett in 2011, where the U.S. Supreme Court struck down a nearly identical rescue fund provision in Arizona. A federal district court judge has already struck down North Carolina’s rescue fund provision in May in N.C. Right to Life PAC v. Leake. Without a rescue fund provision, it is debatable whether the public finance system for North Carolina statewide judicial campaigns will continue to be viable after the November elections. It is worth looking at what effect the loss of rescue funds will likely have on judicial campaign finance in North Carolina, and what the North Carolina legislature can do if it wants to keep the public funding system in place without a rescue fund in a post-Bennett world.

While several statewide judicial races are on the ballot in 2012, the most important is the Supreme Court of North Carolina race between incumbent Republican Justice Paul Newby, and Democrat Court of Appeals Judge Sam Ervin IV. Given the 4-3 Republican majority on the court, this race is critical in determining (among other things) if the state’s Republican-drawn redistricting maps are constitutional under North Carolina law. Both candidates are formally participating in the public financing fund, and have received $240,100 each. But the absence of rescue funds means that they will not receive additional money if outside groups get involved in the race. This occurred in 2008 when the Democratic Party ran ads against several judicial candidates, and those judicial candidates received around $13,000 in rescue funds in response. This provision limited the ability of outside groups to game the public finance system, and is now banned as unconstitutional after Bennett.

Post-Bennett, the gaming of the system by outside groups has begun. The former Chairman of the North Carolina Republican Party, Tom Fetzer, started a political interest group called the “North Carolina Judicial Coalition”. This group (a so-called “SuperPAC”) can spend unlimited amounts of money, does not have to file any paperwork with North Carolina, and their target would only have a little over $300,000 to respond to any ads against them or for their opponent – due to the public financing limits. This group has already spent $1.3 million on a pro-Newby ad, while another outside group has begun to run an ad linking Judge Ervin to a convicted felon. Any future judicial candidate agreeing to take public financing will easily have their message swamped by a well-funded opponent or outside group spending millions of dollars to defeat them, with no real way to respond on their own. Statewide judicial candidates in North Carolina will have no choice but to either opt out of the public financing system, or have their campaigns effectively farmed out to outside groups who are subject to far fewer legal limitations.

What can North Carolina do if it wants to maintain a public financing system for judicial elections? The major risk is that well funded groups will spend millions of dollars to run ads against candidates who, due to the fundraising caps in the public financing system, will be massively outspent. Most limitations on “independent expenditures” by outside groups like those discussed above are constitutionally suspect after Citizens United, and Bennett effectively bans rescue funds. The only option likely to be both effective and constitutional is to substantially increase the amount of funds awarded to each qualifying candidate. While far from perfect, this would give each candidate more resources to get their message out and refute the claims of outside groups that enter the race. If more speech means a more informed electorate, this would also have the beneficial effect of informing voters about state judicial races that few voters traditionally know anything about. Giving more public money to subsidize political campaigns will be a tough sell in a time of budget cuts and economic turmoil, even if it does come from voluntary check-offs and attorneys.

Justin Moore is a third-year student at William & Mary Law School.

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