House Bill 1 is an attempt to keep foreign nationals from contributing money directly or indirectly to state ballot initiatives by levying heavy penalties on non U.S. citizens who contribute to such issues and political organizations who accept such money.
H.B. 1 passed along party lines against Democratic opposition. The only person who voted against H.B. 2 was Sen. Niraj Antani, R-Miami Twp., who said “there is no reason we as Republicans in Ohio should be carving out a special exemption in Ohio law for President Biden, when they had years to prepare to meet this election deadline.”
Gov. Mike DeWine signed both bills without fanfare over weekend. The timing will put H.B. 1 into effect around the start of September, about two months before Ohioans potentially vote on constitutional amendments aimed creating a fairer, independent redistricting process and an increased $15 minimum wage this November.
Throughout the week, Republicans argued that foreign spending occurred extensively in 2023, when two statewide ballot initiatives drew millions of dollars — much of which came from a liberal dark money fund with ties to non-citizen billionaires.
Republicans, such as the bill’s primary drafter Rep. Bill Seitz, R-Cincinnati, argued that foreign money was an “evil construct” on Ohio’s elections. He and other proponents noted also that the bill could protect Ohio from foreign adversaries such as Russia or China, who might have a more nefarious intent behind pouring money into Ohio elections.
Democrats, meanwhile, questioned whether foreign money actually made its way into state ballot initiatives at all, given how difficult political money is to track when its been obfuscated behind dark money groups.
It’s unclear how enforceable the measure would be, given the ability for donors to funnel money through 501(c)4 “dark money” organizations, making the source of the funds hard to trace.
The proposal
H.B. 1 tries to prohibit, or at least dissuade, dark money groups, PACs and all other political organizations from accepting money from foreign nationals.
If either foreign nationals or political organizations are found to have broken this new law, they’d be subject to either a $10,000 fine or a fine equal to triple the illegal political contribution. Additional penalties include a first degree misdemeanor charge on the first offense and a fifth degree felony charge on all subsequent offenses.
The task of investigating these charges and prosecuting infractions falls on the Ohio Attorney General, a partisan office, without any input or assistance from the the Ohio Elections Commission, the state’s bipartisan board of election ethics regulators.
Green card red flag
Critics say the bill opens itself to legal challenges by changing Ohio’s definition of a foreign national.
Previously, the state mirrored federal law, which defined foreign nationals as non-citizens who were not granted permanent resident status (i.e., green card holders were not considered to be foreign nationals). Under H.B. 1, green card holders would be considered foreign nationals.
Antani voted for the measure but called the bill’s expanded definition a “big departure from longstanding federal law” that “presents an incredible issue to this bill.”
Antani reminded his colleagues that federal law considers political contributions to be an expression of free speech, and noted that federal law also guarantees that green card holders have protected freedom of expression.
“That is going to get sued over in this bill, and the entire thing is going to get struck down because we as a legislature are overreaching,” Antani argued on the Senate floor.
Democrats in both the House and the Senate made moves keep this provision in the bill, in the apparent hopes that it will make the bill flagrantly unconstitutional.
“Including that language in it, I think, rises that bill to the level of questionable, absolutely,” Senate Minority Leader Nickie Antonio, D-Lakewood, said when this news organization asked her to explain the Democrats’ calculus.
The bill does allow foreign nationals (and green card holders) to continue making independent expenditures toward local ballot initiatives.
AG powers concerns
Democrats’ stated opposition to H.B. 1 centered on the broad enforcement powers it gives the Ohio Attorney General.
House Minority Leader Allison Russo, D-Upper Arlington, told reporters earlier in the week that H.B. 1 ultimately “opens up nearly any campaign to any allegation, whether it be legitimate or not,” and argued that, by vesting the exclusive power to look into those allegations into a partisan office, would create a chilling effect for political organizations.
Ohio’s current Republican Attorney General Dave Yost released a statement characterizing Democrats’ dissent on the bill to be “indefensible.”
“Whether we’re talking Chinese money, Russian money or someone else’s money, it doesn’t belong in Ohio’s political system,” Yost said. “I did not ask for the authority in this bill, and I don’t care whether it is my office or someone else that does the work — but the work must be done. We need to put a stop to this and do it now.”
Common Cause Ohio Executive Director Catherine Turcer told this news organization that she was concerned that any Ohio attorney general could use H.B. 1 to open wanton investigations into political organizations and their contributors, which could create a broad chilling effect on political contributors, fundraisers, and the dark money groups who would otherwise hope to spend money on Ohio campaigns.
Senate President Matt Huffman, R-Lima, told this news organization that he thinks its “likely” that some dark money groups will just decide to stay away from Ohio altogether as a result of the bill.
“I think anytime that you clarify what the rules are...somehow there may be some form of inhibition,” Huffman said.
Dark money loophole
On both sides of the aisle, there are serious questions of the bill’s enforceability, centered largely on the fact that the bill does not explicitly create a system where money is easily traceable through 501(c)4, or dark money, organizations.
“I don’t know how this gets around the (501)(c)4 issue, but I think it at least prohibits a ballot issue campaign from (directly) accepting foreign national money, and that’s a good thing,” Antani said.
Dark money groups are nonprofits that are not required to disclose where they get their money from. They take contributions, and then pass it along to local political action committees to influence campaigns.
Money donated by a foreign national to a dark money group would be mixed in with domestic contributions before being legally transferred to a PAC of its choice.
“One of the challenges with rooting out dark money is that it’s secret money. And, unless you create a more transparent system, there are real challenges to figuring out what is actually happening and whether or not to begin an official investigation,” Turcer said. “If you don’t actually create greater transparency, it’s nearly impossible to root out the kinds of things that they’re worried about. Period.”
Bill proponent and member of the House committee tasked with overseeing the bill Rep. D.J. Swearingen, R-Huron, told this news organization that “it’s gonna be tough. I mean, that’s the reality of the situation.”
“The key is gonna be the enforcement — you (have to) give the appropriate authority and enforcement ability to go after people that do that kind of thing,” Swearingen said.
When this news organization asked Huffman about the enforceability of the law, he noted that the state simply needs to do more to prevent out-of-country billionaires from pouring money into Ohio elections.
“(For) the local actors who are taking that money and knowing that it’s against the law, if there’s no recompense from them, if there’s no penalty for doing anything, then it will continue,” Huffman said.
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Avery Kreemer can be reached at 614-981-1422, on X, via email, or you can drop him a comment/tip with the survey below.
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