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In Debate Over Foreign Influence On Maine Politics, Echoes Of Citizens United's Corporate Speech Decision

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The Daniel-Johnson Dam in Quebec, Canada, is the largest arch and buttress dam in the world.

For the past month Maine lawmakers have been considering a slate of bills that could sideline Hydro-Quebec from an upcoming referendum on Central Maine Power's highly controversial transmission project.

The legislation centers on whether a company wholly owned by the Quebec provincial government should be allowed to spend money to influence Maine voters in the campaign. But the debate is actually bigger than that, and it has drawn the attention of national groups seeking to beat back the tidal wave of corporate election spending that was unleashed by the U.S. Supreme Court's decade-old Citizens United decision.

When the Legislature's Veterans and Legal Affairs Committee held a public hearing last month on bills that would limit foreign influence in Maine ballot campaigns, business and industry groups from around the state lined up to oppose them all.

Many of those groups also support the New England Clean Energy Connect, the 145-mile transmission project by CMP that would bring Quebec hydropower into the region through its contract with Massachusetts.

"But if that project did not exist, we would still be here opposing these bills," said Steven Hudson, a lobbyist for the Industrial Energy Consumer Group, or IECG.

IECG supports the transmission project, but Hudson said barring foreign-owned companies, or those with foreign investment, from ballot campaigns would potentially sideline its members.

That's because Twin Rivers Paper Co. is Canadian owned. Woodland Pulp is owned by a Chinese firm; so is ND Paper. Sappi Paper is owned by a South African firm.

Hudson told lawmakers that the foreign-influence bills would have the effect of Maine telling those companies thanks but no thanks for the local investment.

"We're going to prevent you from protecting your investments when someone seeks to interrupt them through a referendum process," he said.

Gerald Petruccelli, an attorney representing the Maine State Chamber of Commerce, says the foreign-influence bills might also silence American companies with foreign investors.

"What about their rights?" he asked.

If these arguments sound familiar to arguments made in the landmark Citizens United Supreme Court decision, they should. That ruling scuttled federal limits on campaign spending, allowing corporations to spend unlimited amounts of money to influence elections.

Opponents of that decision have unsuccessfully fought to overturn it. But now they're targeting local ordinances and bills in state legislatures that seek to ban election spending by foreign governments and corporations with foreign ownership.

The mission statement on Free Speech for People's tax filings describes it as a group seeking to limit the influence of big money in politics by overturning Citizens United with a constitutional amendment.

More recently, Free Speech for People has been supporting local ordinances and state legislation that bar corporations with foreign investors from influencing ballot and candidate campaigns.

And that includes the three foreign-influence bills in the Maine Legislature, which Ron Fein, the Free Speech for People's legal director, has been lobbying lawmakers to pass even though his organization has no position in the CMP corridor fight.

"Our position is that the (referendum) decision should be made by the people of Maine and that funding for the ballot measure campaign should be predominately from the people of Maine, and not from the foreign-influenced corporations on both sides of the funding of the ballot measure campaign right now," Fein says.

Fein is right that the foreign-influence bills could affect not only government-owned Hydro-Quebec, but also its corporate opponents in the corridor campaign.

NextEra Energy is an American company and 2% of its ownership is the Norwegian government's sovereign investment fund; Canadian investment companies hold about a 10% stake in Texas-based Vistra, while Houston headquartered Calpine's ownership includes the Canadian Pension Plan Investment Board.

Fein says the foreign ownership of those companies contradicts former Supreme Court Justice Anthony Kennedy's Citizens United opinion that said corporations have a right to spend money in elections because they're "associations of citizens."

Foreign owners, he says, are not American citizens.

"And that's not consistent with the notion of democratic self-government when corporate political spending is driven, even in part, by considerations of what would appeal to foreign investors," Fein said.

A sticking point for Maine lawmakers while evaluating the foreign-influence bills is at what percentage of foreign ownership should companies be barred from electioneering?

Fein, as well as the group Maine Citizens for Clean Elections, argue the threshold should fall between 1% and 5%.

According to a 2019 analysis by the Center for American Progress — a liberal advocacy group and partner for Free Speech for People — found those thresholds would include between 74% and 98% of roughly 100 corporations among the S&P 500 stock index.

Fein was asked whether such a prohibition at the national level would effectively stymie the election spending by corporations unleashed by Citizens United.

"This type of legislation would take a large bite of Citizens United," he said. "It would undo a substantial amount of the damage that Citizens United caused."

That might make some Maine lawmakers nervous, but Fein says doing nothing is worse.

Last year, California residents overwhelmingly defeated Proposition 22, a ballot initiative that would have forced ride-sharing companies like Lyft and Uber to treat drivers as employees.

Saudi Arabia has invested $3.5 billion in Uber, which helped opponents of Prop 22 outspend supporters by 12-to-1 margin.

That might not have happened had California adopted a foreign-influence ordinance like the one the city of Seattle did last year after Amazon, which also has foreign investors, attempted to pack the city council with business-friendly candidates.

Seattle's ordinance is accompanied by another in St. Petersburg, Florida.

Several states, including Maine, are considering their own legislation.

Fein said some of the legislation is a response to big spending by corporations with foreign investments, but, "in cases where it hasn't happened yet in a particular city or state, it's only a matter of time."
Maine lawmakers will soon decide if they want to take that step. If they do, it's likely to be challenged in court, and Fein said his group will join the legal effort to defend it.

Journalist Steve Mistler is Maine Public’s chief politics and government correspondent. He is based at the State House.