Sometimes, bills move through the Legislature for questionable reasons. Lawmakers may introduce legislation simply for the campaign headline, keep legally flawed measures alive to make a symbolic point, or push proposals that are more press release than public policy.

Senate Bill 2471, which would make clear that corporations’ state-granted powers do not include political spending, is not that kind of bill.

It’s something much rarer: a serious attempt to confront a longstanding problem using a novel yet coherent legal theory. It may fail in court or prevail in whole or in part. But it deserves to be judged for what it is: the first real opportunity in years to challenge the architecture that Citizens United left behind.

That’s an opportunity worth taking.

A Special Commentary Project

Civil Beat is focusing on transparency, accountability and ethics in government and other institutions. Help us by sending ideas and anecdotes to sunshine@civilbeat.org.

Read More

The theory behind this bill begins with a well-established legal premise: corporations are artificial entities created by state law. Unlike natural persons, corporations are not born with inherent abilities. States decide what corporations can and cannot do.

For more than a century, those powers have been broadly defined. Hawaiʻi law currently grants corporations “the same powers as an individual to do all things necessary or convenient to carry out its business and affairs.” Sweeping mandates like these are standard across most states. Yet when states have chosen to narrow those powers, the Supreme Court has affirmed their authority to do so.

Senate Bill 2471 does exactly that, removing the power to spend money in elections from the list of things corporations are authorized to do. In doing so, it highlights a distinction that matters. The powers a state grants to artificial persons are fundamentally separate from the rights natural persons possess. Rights govern what the government can restrict you from doing with the abilities you have; powers determine what abilities you have in the first place. For corporations, those are different questions.

Citizens United addressed rights, not powers. The court decided that a corporation, which Virginia had already broadly empowered to act as an individual, could not be barred from spending on political speech.

But what if the corporation was never granted those powers in the first place? The First Amendment right would have nothing to attach to.

The legal framework, known as the Corporate Power Reset, was developed by the Center for American Progress, a progressive policy organization. It rests on more than two centuries of Supreme Court precedent affirming that states have near-absolute authority to define and withdraw the powers they grant to corporations. That authority, however, has never been applied to election spending.

It’s a novel approach, but not a frivolous one. More than a dozen other states are developing similar legislation, and the reason is not hard to understand: the problem is only getting worse.

In April, the Minnesota Reformer published commentary supporting a corporate powers reset, reporting that Meta has committed $65 million this election year to back legislative candidates opposed to state regulation of artificial intelligence, spending directly from its corporate treasury. The same dynamic plays out wherever industries with large financial stakes in public policy can also spend heavily to shape the lawmakers who set it.

At the moment, Hawaiʻi is better positioned than any other state to do something about it. Senate Bill 2471 passed the Senate unanimously, cleared two House committees, and passed the full House.

The bill is now in conference with the session ending May 8. At the first conference convening on Friday, the Senate conference committee co-chair Jarrett Keohokalole announced he is working on a conference draft and hopes the two chambers can reach an agreement. The bill is scheduled for another public hearing on Monday afternoon.

House co-chair Scot Matayoshi was less certain. Consulting legal scholars about potential flaws in the bill, he explained, “What I don’t want is for us to pass this bill and to put Hawaii in a worse position than it is already in,” adding, “I’m also concerned that we’re going to get a bad federal ruling that’s going to make the Citizens United case pale in comparison.”

The Attorney General’s Office shares those concerns. It moved from raising questions to formally opposing the bill at each successive hearing this session, and at the most recent committee hearing, called the approach legally fatal and the mechanism unprecedented.

Supporters of the bill believe the legal risk is much more limited than its detractors suggest. As the Center for American Progress explains, a court that strikes down the law can remove it, but it cannot create new corporate spending powers. States have exercised authority over corporate powers for more than two centuries, and this bill was crafted with the courts in mind.

Whether it gets that far is up to our legislators.

But let’s be clear about the choice they’re facing. It’s not between blind caution and reckless experimentation. It’s between doing nothing and presenting a serious, carefully framed constitutional argument worthy of judicial review.

Maybe the courts will reject it. Maybe they will narrow it. Maybe Hawaiʻi will help open a new path for states seeking to protect democratic self-government from the concentrated power of corporate money.

But legislators shouldn’t be afraid to test a substantial legal theory in service of a substantial public purpose.

That is not recklessness or grandstanding.

That is the role of the Legislature.