DENVER – In a precedent-setting ruling that changes reporting practices for political committees, a Colorado administrative law judge (ALJ) held that the Committee for the American Dream (CAD) violated Colorado campaign finance law.

Last month, Ethics Watch filed suit against CAD after learning that during the 2006 election cycle, CAD had purchased $28,435 of television time to air ads that attacked now State Representative John Kefalas (D-52), but had failed to file a single electioneering communication report with the secretary of state’s office.

State law requires anyone who spends over $1,000 on ads that refer to a candidate and are broadcast to voters within 60 days before a general election to file “electioneering communication” reports with the secretary of state’s office no later than 30 days after the election.

CAD argued that, as a matter of practice, political committees don’t file electioneering communication reports because expenditure reports already list money spent on advertisements. Electioneering communication reports, however, also require disclosure of the name of the candidate referred to in an ad and the name and address of any person who contributes more than $250 to the person making the ad. The ALJ agreed with Ethics Watch’s argument that the two reports are not the same and, therefore, that political committees must file both reports.

CAD also argued that political committees are excused from filing electioneering communication reports under the so-called “business exemption,” which allows committees not to disclose communications made in the normal course of business. The ALJ rejected this argument, agreeing with Ethics Watch that allowing political committees, which are in the business of influencing elections, to claim this exemption would undermine the purposes of campaign finance disclosures.