A business coalition is challenging a recently enacted state law that limits how much developers and other business interests can contribute to local politicians.

Senate Bill 1439 limits anyone with business before a local government agency from contributing more than $250 to a political campaign of a member of the board. The rule mainly applies to home developers — who frequently have business in front of local governments and are frequent campaign funders, especially in Fresno.

However, the law’s campaign donation cap doesn’t apply to unions. Nor does the law apply to legislators or other state-level politicians, including the governor.

The coalition filed a legal action in Sacramento County Superior Court on Feb. 22, asking for declaratory and injunctive relief. The defendant is the Fair Political Practices Commission, the state agency in charge of enforcing campaign finance law. A hearing is scheduled for Dec. 22.

The group includes the California Restaurant Association, the California Building Industry Association, and California Retailers Association. Two elected officials are also plaintiffs — Rancho Cordova City Councilman Garrett Gatewood; and Sacramento County Supervisor Pat Hume.

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Opponents Say Law Violates State, Federal Constitutions

The challengers call SB 1439 a violation of the state and federal constitutions.

“It is also unworkable from a practical standpoint, and unfairly applies to California businesses while specially exempting other interest groups. Making and receiving campaign contributions is an exercise of a constitutional right to free speech. Our coalition of businesses and elected officials looks forward to presenting its case in court to protect and restore this constitutional right,” coalition spokesperson Hilary McLean said via email.

Jon Coupal, president of the Howard Jarvis Taxpayers Association, calls the law unfair.

“Examples of California politicians protecting those who protect them are too many to list. Regrettably, SB 1439 is just the latest example,” Coupal wrote in the Orange County Register.

The coalition is asking for a preliminary injunction, which has not been granted yet.

It is too early to know the impact on local Fresno/Clovis politics. There have been no known recusals by elected leaders. In non-election years, campaign financial disclosures are due every six months. The next deadline is July 31, covering January-June 2023.

(Disclosure: Darius Assemi — publisher of GV Wire — is president and CEO of homebuilder Granville Homes.)

Senator, Government Groups Defend SB 1439

The law passed last year with relatively little fanfare. The law applies to local government officials. If an official receives in excess of $250 from a contributor — with business in front of the body — in the prior 12 months, the money has to be returned or the elected official must recuse him or herself.

“Business” is defined as a license, permit, or other entitlement. It does not apply to labor contracts or contracts that are publicly bid. Labor unions are exempt from the $250 limit.

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State Senator Steve Glazer, D-Orinda, wrote the bill last year as an anti-corruption measure.

“We have become numb to the legal corruption that has enveloped our democracy. Pay-to-play is antithetical to an honest and ethical government, and it should be rooted out and killed like a cancer that has affected the body politic,” Glazer said at a virtual news conference Monday defending the law.

Supporters say the law helps prevent shady land corruption votes. Fresno is not immune, as exemplified by the Operation Rezone pay-to-play and bribery scandal of the 1990s.

“California’s local governments have been plagued by scandals in which special interest entities pump campaign cash to the local government officials who determine their fate on licenses, permits, and contracts. The examples are endless – SB 1439 is a common sense, narrowly tailored solution to an acute and documented problem to protect our communities,” said Jonathan Mehta Stein, executive director of California Common Cause.

Read the Lawsuit