Question 2: What you need to know about the foreign campaign spending ban

Second of four stories

Question 2: Do you want to ban foreign governments and entities that they own, control, or influence from making campaign contributions or financing communications for or against candidates or ballot questions?

What is Question 2?

Question 2 on the Nov. 7 state ballot asks voters if they want to prohibit foreign governments and entities they control or influence from spending money on state and local referendum campaigns.

Federal and state election laws already prohibit foreign nationals from contributing to candidates seeking office in Maine, but they do not ban foreign entities from spending money to influence state and local referendums or elections.

If passed, Question 2 would require news outlets, including newspapers and television broadcasters, cable and satellite television broadcasters, and social media companies, to establish due diligence policies to ensure that campaign ads comply.

Why is it on the ballot?

The referendum is being proposed in response to record spending during a 2021 referendum aimed at halting a controversial power transmission corridor in western Maine.

Hydro-Quebec, which is wholly owned by Quebec and would use the transmission line to send power from Quebec into New England, spent more than $23.3 million to try to defeat the measure and protect the project. And Avangrid, the Spain-based parent company of Central Maine Power Co., was part of a group that spent more than $42 million to oppose the measure.

In response, state lawmakers voted to ban foreign spending in Maine referendum campaigns in 2021 and again this year, but Gov. Janet Mills vetoed the legislation both times, saying it would be unconstitutional.

Unable to get the governor’s signature, supporters collected signatures to force a citizen-initiated referendum, setting the stage for the Nov. 7 vote.

What is a foreign government-influenced entity?

A foreign government-influenced entity is defined as any business or organization that is controlled or directed by a foreign government or is partly owned by a foreign government. A government must own at least 5% of the entity for it to be prohibited from campaign spending under the proposal.

Would it affect Maine’s electric utilities?

It would apply to Versant. Versant is owned by Enmax, which is owned by and headquartered in the city of Calgary, Canada. So far, Enmax has contributed $8.4 million to the campaign to defeat Question 3, the Pine Tree Power proposal.

It’s unclear whether it would apply to Central Maine Power Co. CMP is owned by Avangrid, a subsidiary of the Spanish energy giant Iberdrola, in which the Qatari government owns a stake. A spokesperson for Avangrid acknowledged that both Norway’s central bank and the Qatari government have an ownership stake in the company, but said it does not exceed the 5% threshold and would not affect the company’s ability to participate in elections here.

What other companies would be affected?

That’s not clear. Critics say the definition of foreign-influenced entity is written so broadly and the 5% threshold is so small that it could impact other Maine businesses.

The Maine Forest Products Council raised similar concerns, saying some publicly traded, U.S.-based companies could easily have foreign investment of 5% or more in their pension programs. Had the law been on the books in the late 1990s, the group said, its members would not have been able to spend money on citizen referendums aimed at ending clearcutting, which had been used to harvest trees being threatened by spruce budworms.

Who are the major players?

Protect Maine Elections, which supports the proposal, spent more than $572,000 through July advocating for the passage of Question 3. One of the leaders for the group is state Sen. Rick Bennett, R-Oxford, who also supports the creation of Pine Tree Power.

Although no opposition group has formed to spend money to defeat Question 2, the proposal is opposed by Mills, the Maine Forest Products Council and the Maine State Chamber of Commerce. It’s also opposed by the Maine Association of Broadcasters and the Maine Press Association, of which the Portland Press Herald and its sister publications are members.

Why are publishers and broadcasters opposed?

Both say it violates the First Amendment, which guarantees a right to free speech and freedom of the press, because media outlets would be required to develop a “due diligence policy and controls” to ensure that any foreign government-influenced entity does not purchase or place ads on their platforms. Failure to identify ads that violate the law could lead to fines of up to $5,000.

Tim Moore, president and CEO of the Maine Association of Broadcasters, said in testimony this year that “this law would essentially require broadcast outlets to become detective agencies, tasked with investigating the source of funding for any and all campaigns.”

How do supporters respond?

Kaitlin LaCasse, a spokesperson for Protect Maine Elections, said in a written statement that the law would simply require news media to take reasonable steps to prevent foreign governments from running prohibited ads.

“These provisions are cut from the same cloth as long-standing laws designed to protect against foreign interference and foster compliance,” she said. “For example, the federal foreign interference ban prohibits a person from knowingly taking contributions from a foreign national, but also provides a safe harbor for groups that conduct a reasonable inquiry into the source of the contributions.”

Have other states done this?

Only Minnesota has passed a law banning foreign spending on state referendums or candidate races, according to Ron Fein, the legal director at Free Speech for People, a national nonprofit that fights the influence of big money and corporate influence in politics.

That state’s ban applies to all foreign contributions made through U.S.-based companies, not just contributions from foreign government-influenced entities. It was passed this year and already is facing a court challenge, but similar laws are being considered in other states, including California, Hawaii, Massachusetts, New York and Washington.

Coming tomorrow: Question 4