Suppose the North Carolina General Assembly is considering a bill that would affect cities, and suppose the town council of a particular city decides to lobby against the bill. Can the council spend money from its tax resources for that purpose? Can it, for example, send the city manager to Raleigh to talk to legislators and pay for his expenses? Could it send a busload of city employees to Raleigh to fan out through the legislative halls?
Based on precious little North Carolina case law, the answer appears to be “Yes.” As long as the city is not using tax money to influence the outcome of an election, it probably can use the money to influence legislation. And the same applies to other units of government—counties, school units, and others.
Three North Carolina cases appear to be controlling. North Carolina ex rel Horne v. Chafin, 62 N.C. App. 95 (1983), aff’d 309 N.C. 813, (1983) appeal dismissed, 466 U.S. 933 (1984), Bardolph v. Arnold, 112 N.C. App. 190 (1993), disc. rev. denied, 335 N.C. 552 (1993), and Dollar v. Cary, 153 N.C. App. 309 (2002).
In Horne, the city council and county commissioners jointly spent $8,000 in taxpayer money on a reception to honor (and influence) legislators (an amount equivalent to about $24,000 in 2011). A taxpayer sued, alleging that the expenditure violated the Public Purpose Doctrine, which provides that tax money may be spent, in the words of the North Carolina Constitution “for public purposes only.” Article V, Sec. 2(1). The Court of Appeals found no violation. It held that lobbying the General Assembly serves a public purpose:
“The purpose of the reception was to influence the General Assembly to pass legislation which, as seen by defendants, was favorable to Charlotte and Mecklenburg County residents. . . Local government officials have a duty to represent their constituents, and presenting local interests to the state legislators in hope of getting favorable bills passed in the General Assembly is obviously a public and not a private purpose.”
The remedy for someone opposed to such expenditures, the court said, “is to air his opinion at the ballot box.”
In Bardolph, the county commissioners spent $35,000 in taxpayer money (about $57,000 in 2011 dollars) to publish pamphlets and run advertisements about upcoming referendums, one on a redistricting proposal for election of commissioners and one on the merger of two public school systems. Taxpayers sued, alleging that the expenditures were for a private political purpose, and asserting that the commissioners who voted for the expenditures should be held personally liable to reimburse the county for the expense. Noting that “lobbying by local government to create support for local issues is permissible,” the Court of Appeals held that “the commissioners were vested with appropriate authority to expend the funds in question and plaintiffs’ allegations that the information provided was slanted for political purposes does not sufficiently state a claim for relief.”
In Dollar, the city council spent $200,000 in taxpayer money ($250,000 in 2011 dollars) on advertisements in a print, radio, and television campaign to inform citizens about the “managed growth” policies of the council. The court said that the expenditures would be appropriate as long as they were informational (“Local government advertising on particular issues is allowed where the advertising is of an informational nature”), but in this case the timing of the advertisements made it clear that the council was impermissibly attempting to influence the results of the upcoming city council elections (“Where the advertising, however, is designed to promote a viewpoint on an issue in order to influence an election, it is impermissible”).
So, it appears, local governments may use public funds to try to influence the General Assembly in a particular direction and to put out informational materials regarding issues. They may not, however, use public funds to try to influence the outcome of an election—either an election for office or a referendum on a public issue.
Is there a point at which the use of funds is excessive to the point of impermissibility? Presumably yes, but we do not have cases telling us what that point is. In Horne, the court said, “The alleged extravagance of the reception does not convert the public purpose into a private one.”
Note: Dealing with General Assembly is never uncomplicated. One more consideration must be kept in mind. If a city (or other unit of local government) has engaged the services of a registered lobbyist (or makes that kind of work a principal activity of an employee), special rules apply. In that case, the city would be subject to a whole host of restrictions and requirements under our state government ethics and lobbying laws. A full explanation of this subject can be found in a September 2010 local government law bulletin from School of Government.