Michigan Utilities Sue to Halt Voter-Approved Campaign Finance Law

DTE Energy and Consumers Energy are asking a federal judge to stop Michigan from enforcing Proposal 2, a campaign finance measure approved by voters two days earlier with more than 80% support. The case was filed in federal court in Michigan’s western region, in its southern division, and names state election officials and Attorney General Dana Nessel as defendants.

The law prohibits utilities and businesses holding over $250,000 in state contracts from giving money, either directly or through intermediaries, to Michigan politicians. Its restrictions also cover certain company leaders, board members, substantial owners, immediate family members and others connected to the companies.

The utilities argue the measure violates First Amendment rights to free speech and association, as well as Fourteenth Amendment protections, including due process and equal protection. They say the law unfairly singles out utilities and is unclear about which people it covers. The complaint warns that without a court order, the companies face a choice between giving up political association or risking penalties.

Consumers Energy says voters and policymakers benefit from hearing its views on reliability, affordability and clean energy. A company spokesperson called the law unfair to a Michigan business and said people should not lose constitutional rights because of their employer. The complaint also points to an 86-year-old mother of DTE’s treasurer who, it says, would be barred from donating despite having no utility role.

The campaign behind Proposal 2 said it expected the lawsuit and is prepared to defend the measure, which it says will curb corporate influence and pay-to-play politics. The Mackinac Center for Public Policy has filed its own challenge to portions of the initiative. The measure includes a provision that says unaffected sections should remain in force if a court invalidates part of it.

Utilities Move to Undo Voters’ Push Against Political Money

Michigan voters approved Proposal 2 by more than 80%, but DTE Energy and Consumers Energy are now asking a federal judge to prevent the state from enforcing it. The November 5 lawsuit challenges a measure designed to limit political giving by utilities and companies holding large state contracts.

The law bars utilities and firms with more than $250,000 in state contracts from giving money, directly or through intermediaries, to Michigan politicians. It also reaches certain executives, board members, substantial owners, relatives and other people connected to those businesses. The campaign supporting it says the restrictions can help end pay-to-play politics and reduce the influence of major corporations in Lansing.

The utilities claim the law violates constitutional speech, association, due process and equal protection rights. They say its reach is unclear and unfairly targets their businesses and the people associated with them. Their legal challenge seeks to stop enforcement before they face penalties for political activity.

Consumers Energy argues that voters and policymakers should be able to hear its views on reliability, affordability and clean energy. But the measure’s supporters say they anticipated the legal challenge and are ready to defend a voter-approved effort to limit corporate political influence. The Mackinac Center for Public Policy has filed a separate challenge to parts of Proposal 2.

Voter-Approved Michigan Law Faces Constitutional Test

A measure approved by more than 80% of Michigan voters would restrict political contributions by utilities and some people linked to companies with state contracts. DTE Energy and Consumers Energy are asking a federal judge to halt enforcement, arguing the law puts constitutional rights at risk.

Proposal 2 bars utilities and businesses holding over $250,000 in state government contracts from giving money, directly or indirectly, to Michigan politicians. Its restrictions extend to certain executives, board members, substantial owners and family members. The utilities argue that the law’s broad and unclear reach sweeps in people with no meaningful role in a company’s political activity.

The companies say the restrictions violate First Amendment protections for speech and association, along with Fourteenth Amendment guarantees. Their complaint says they could face substantial penalties for exercising political rights, and argues the measure improperly singles out utilities and associated people.

Consumers Energy says its perspective on reliability, affordability and clean energy belongs in public debate. Supporters of Proposal 2 counter that curbing corporate political contributions is necessary to reduce pay-to-play influence, and say they are prepared to defend the measure in court. The Mackinac Center for Public Policy has brought another challenge to portions of the law.