Circuit Judge Tim Fox has dismissed the city of Little Rock‘s lawsuit attempting to stop two candidates for mayor for using exploratory committees to raise money in advance of the July 1 starting date in city ordinance for contributions to candidates for city office.

He ruled from the bench after a hearing this morning.

The state Ethics Commission had earlier approved the use of exploratory committees under state law. The City Board voted to seek a declaratory judgment that the city ordinance on fund-raising should prevail against candidates Warwick Sabin and Frank Scott, announced opponents to Mayor Mark Stodola. At the same time, the city said state law overrode a part of the same ordinance that would otherwise prohibit Stodola from using $78,000 in carryover money from previous campaigns. The judge said the city lacked standig

City Attorney Tom Carpenter notified the City Board of the decision in this memo:

Although the time to respond to various motions and counterclaims filed by the defendants had not yet run, Judge Timothy Davis Fox dismissed all of the claims in the City’s action. The Court held the City did not have standing to raise certain issues because it was not a candidate or an exploratory committee. The Court found all but one of the various statutory definitions the City relied upon to be relevant. The one not mentioned was Ark. Code Ann. § 7-6-201 (4)(A) which defines contribution. Without this statute being held relevant, there was no way the City could prevail since it refers to a contribution as something given directly, or indirectly, to a committee on behalf of a candidate. The Court also ruled that the neither Mr. Sabin nor Mr. Scott are candidates.

All actions, including the motion to intervene that some persons filed, are denied with prejudice. The Court declared that this is an election issue which, among other things, provides an avenue for expedited review. In short, based upon the pleadings the Court has made all the factual determinations to get both the issue of sovereign immunity, and the factual and legal issues in the case, before the Arkansas Supreme Court. The policy questions for the Board of Directors are twofold: (1) Whether to appeal this matter; (2) Whether to forego appeal and make amendments to the ordinance. As to the second, in light of the Court’s finding that the statutes will set forth the jurisdiction of the Ethics Commission do not apply to ordinances passed by the City pursuant to the election statutory regimen, an amendment will be of limited value. In terms of prosecutions pursuant to the ordinance, knowing that the Court’s order is not final if appealed, and that it does not consider several relevant factors, I do not believe the City should prosecute pursuant to the ordinance.

So, the policy question is whether to appeal during this election cycle, or to simply ignore or repeal the ordinance now and attempt to achieve legislation in 2019 that clarifies any issue that may exist. If so, then that would be the time to amend the ordinance or pass a new one.

I will try to provide a memorandum in the PONY on Friday, and if not then next week, which discusses these issues in more detail. But, I wanted to get this information to you as quickly as possible. Please let me know if you have any questions. By agreement, I have not gotten certain FOIA requests if I would let some of the news departments get this information quickly. Therefore, some of them are included as being copied on this email.

Tom

My suggestion to the City Board, which was voting self-interest in fighting exploratory committees, drop the lawsuit. If the city needs stronger ordinances, ask the legislature for enabling legislation.

The mayoral candidates are essentially on even ground. If Stodola feels burdened, he can form an exploratory committee too.

Though the judge ruled Sabin and Scott were not candidates and thus able to operate exploratory committees, Carpenter said Fox had said the ordinance was facially neutral insofar as a five-month limit on fund-raising was concerned.

Statement from Sabin:

I am pleased that Judge Tim Fox dismissed the lawsuit brought by the Mayor and the City of Little Rock and confirmed all of the arguments set forth by our legal team. Our position has been consistent from the beginning, and Judge Fox clearly agreed that under state law I have the right to have an exploratory committee as I consider running for Mayor of Little Rock. This matter is now finally resolved and we will continue our exploratory campaign. I am very grateful to our legal team for their diligent work to have this politically-motivated lawsuit thrown out of court.

Statement from Scott:

“I am pleased that Judge Fox dismissed the City’s claims and cleared me of any wrongdoing. This case was an inappropriate attempt by Mayor Mark Stodola to use city resources to compel the Arkansas Ethics Commission to enforce a misguided ordinance, which the Court rightfully dismissed. It feels great to finally be vindicated, however, I am even more excited for the residents of Little Rock. Now that this frivolous lawsuit is behind me, I can focus my efforts on engaging with more families across the city that are in desperate need of bold mayoral leadership.”

Statement from Stodola:

Twenty years ago, the City of Little Rock Board of Directors utilized a state initiated act that gave them the authority to establish a good government ordinance that prevented perpetual fundraising around a legislative body that meets every week. Today’s ruling allows would-be candidates to continue to intentionally circumvent the laws of the city that they are seeking to lead, including the ordinance in question which the court stated was valid on its face.

This and the unresolved questions on the scope of the recent Supreme Court decision on sovereign immunity may be good reason for an appeal to the Supreme Court. Judge Tim Fox’s ruling set it up so that it could be appealed.

Contrary to the exaggerated comments by Frank Scott and Warwick Sabin that this lawsuit was an action prompted by me, it was not. I have intentionally been silent on the matter. The City, by a motion of the Board of Directors did the responsible thing by asking the court for a declaratory judgement on a good government ordinance that has been in place for 20 years.

No one is trying to prevent Scott and Sabin from running for mayor. That is laughable.

While I am prohibited by city ordinance from fundraising until June and an Ethics Commission regulation prevents me from creating my own exploratory committee if I too wanted to skirt the ordinance, I would not do so because of our ordinance. The court’s decision, plus the fact that the candidates have been raising campaign funds for months will have no bearing on my ability to adequately fund my campaign. We will be fine. Instead perhaps, one should ask if either get elected, what other ordinances of the city they will choose to ignore when the city attorney advises them about what the law prohibits.

Stodola apparently still intends to use the carryover money, though it was prohibited by the ordinance he defends.

UPDATE: On that point, he responds further:

As for your position that carryover funds are prohibited by city ordinance, please see the opinion [by City Attorney Carpener] that was requested by Director Michael Keck back in 2010 within 30 days of the November 2010 election. Based on this ruling I along with others at the city level have had carryover funds.

I have mentioned this to you before that I attempted to return campaign contributions to all who gave to my campaign and wrote to every single contributor. I have given charitably and have given funds to the city to provide for extra fence security at Hindman Park. Sabin had carryover funds and chose to spend them on various matters including campaign software. The Governor has carryover funds as well as several officeholders. It is not a new issue. If candidates have viability, the 5 months allowed is more than adequate. Vic Snyder didn’t start raising money until 90 days out. When I first ran for mayor, I raised nearly $350,000 against 3 other all established candidates.

The integrity of the reason for the limitation is not being given adequate attention by those of you writing about this matter. Just the other day the mayor of Hallendale, Florida was indicted for taking money related to proposed developer requested land use decisions.