LANSING — Consumers Energy and DTE Energy are suing to block the adoption of a newly approved ballot proposal that would bar monopoly utilities and some state contractors from political contributions.

The monopoly utilities filed the lawsuit Thursday, Nov. 5, arguing Proposal 2, billed as a way to get “money out of politics,” would compromise First Amendment rights.

“This proposal unfairly targets a Michigan business, its Michigan employees and their family members from exercising their constitutionally protected rights to participate in the political process, while allowing out of state special interest groups and billionaires to continue flooding Michigan with political spending,” said Katie Carey, a spokeswoman for Consumers Energy. “Michiganders should not lose their First Amendment rights because of where they work.”

The suit, filed in the U.S. District Court for the Western District of Michigan, is the second one to target the proposal. The suit’s plaintiffs include Consumers, DTE and their political action committees.

The Midland-based think tank, the Mackinac Center for Public Policy, filed a federal lawsuit against the ballot proposal on Tuesday, Nov. 3, before Michigan completed or certified its vote count.

The free-market-oriented Mackinac Center for Public Policy argued the Proposal 2’s “money out of politics” plan would “burden protected speech, discourage public debate, and threaten financial supporters'” privacy and safety.

The prohibition on political giving applies to political action committees, principals, board members, key executives, lobbyists and their family members.

Critics have noted that the ban doesn’t apply to labor unions or out-of-state or independently wealthy donors, allowing political contributions to continue flowing through those groups.

Another provision in the proposal would require nonprofits running more than $5,000 worth of ads that target candidates or ballot questions to file spending and donor reports related to those expenses. Currently, nonprofit groups can run issue-focused ads without disclosing donors so long as they don’t directly advocate for or against a candidate or ballot question.

A Detroit News review of state contractor data from fiscal year 2025 indicates more than 900 businesses and nonprofits with more than $250,000 in annual work for the state would be affected by the ban.

The utilities’ suit asks the court to strike down the section of the proposal related to utilities as violating the First and 14th amendments, and to enjoin the state from enforcing it. The defendants include Michigan Bureau of Elections Director Jonathan Brater, Attorney General Dana Nessel and Secretary of State Jocelyn Benson, or their successors in office.

The Michiganders for Money Out of Politics committee that introduced the initiative “has long opposed utilities’ policy positions,” the lawsuit said, and used the proposal “as a means of excluding plaintiffs from critical aspects of the political debate.”

But the First Amendment, the utilities argued, “forbids the government form silencing disfavored speakers or viewpoints in this fashion.”

“The First Amendment does not permit one side of a policy dispute to legislate the other side out of the debate,” the lawsuit said.

The lawsuit argued the ban is too broad, when federal case law only allows for narrow contribution bans where there may be “quid pro quo corruption or its appearance.”

“There is no evidence of such corruption in Michigan’s utilities – no scandal, no exchange of official acts for money, no examples whatsoever,” the lawsuit said. The utilities have been frequent and large contributors to political candidates in Michigan.

The lawsuit also argued the measure includes individuals without a connection to utilities’ decision making and ignores existing disclosure mandates, contribution limits and ethics rules currently in place.

“Plaintiffs will be forced to choose between surrendering their rights to political association and risking substantial penalties for exercising them,” the lawsuit said.

eleblanc@detroitnews.com

This article originally appeared on The Detroit News: Consumers Energy, DTE seek to block ‘Money Out of Politics’ proposal

Reporting by Beth LeBlanc, The Detroit News / The Detroit News

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