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Judge agrees to audit of $11M Arizona donation to ballot measure committee

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POSTED October 30, 2012 9:13 p.m.

Judge agrees to audit of $11M Arizona donation to ballot measure committee

SACRAMENTO (AP) — A Sacramento County Superior Court judge issued a tentative ruling Tuesday allowing California's political watchdog to investigate the donors behind an $11 million contribution from an Arizona nonprofit to a California ballot measure committee, saying that Californians would suffer "irreparable harm" if it were not investigated.

The Fair Political Practices Commission filed a lawsuit earlier this month after the Phoenix-based Americans for Responsible Leadership made the $11 million contribution to the Small Business Action Committee PAC, which opposes Gov. Jerry Brown's November tax initiative and supports another initiative that would restrict unions' ability to raise money.

In Tuesday's ruling, Judge Shelleyanne Chang said ARL will have 24 hours to comply with the FPPC's request to review its financial documents. The ruling is considered tentative until a hearing set for Wednesday.

The judge says the FPPC has authority to audit the group's records to see whether it triggers any California election laws that require disclosure of the funding sources.

"The court finds that the people of the state of California will suffer irreparable harm," if the FPPC is not allowed to investigate the source of the donation, Chang wrote. "Without the FPPC's audit and review of appropriate records, potential disclosure of information prior to the general election critical to the public in deciding how to vote for Propositions 30 and 32 may not be made."

Americans for Responsible Leadership had argued that the contribution was protected by the Supreme Court's 2010 Citizens United decision, but the judge said that was irrelevant to the current case.

A spokesman for ARL, Matt Ross, did not immediately respond to a request for comment Tuesday.

Brown, who signed the law establishing the FPPC when he was first governor, said the state's campaign finance laws clearly require donors to reveal the source of their contributions.

"This is the biggest campaign violation ever since FPPC became operative in 1975 and it is heartening that the FPPC is going to court, that the judge has given this tentative ruling and it all points in the direction of full disclosure of these secret donors ostensibly from Arizona," Brown told The Associated Press by telephone Tuesday.

Three Phoenix-area men are listed on documents as directors of Americans for Responsible Leadership: Steven Nickolas, president of Silver Sky Capital; Robert Graham, president of RG Capital Investors; and Eric Wnuck, an unsuccessful Arizona congressional candidate in 2010.

 

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