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Candidates running for the Hawaii County Council next year likely won’t be able to tap into “equalizing” public funds for their campaigns in light of this week’s U.S. Supreme Court ruling on a similar Arizona law.

In a [pdf], the high court found that “Arizona’s matching funds scheme substantially burdens protected political speech without serving a compelling state interest and therefore violates the First Amendment.”

Kristin Izumi-Nitao, executive director of the Hawaii Campaign Spending Commission, says the ruling will likely signal the end for a public financing pilot project approved by Hawaii lawmakers in 2008. That pilot program — separate from the 31-year-old statewide partial public funding program — offered full public financing to qualified candidates in the Hawaii County Council elections for 2010, 2012 and 2014.

Like Arizona’s law, the idea was to provide extra public money to candidates who were being outspent by privately funded candidates and independent groups. The purpose was “to create a comprehensive public funding system that will offer a viable and competitive alternative to private funding sources, thereby substantially reducing or eliminating the deleterious effects of private financing,” according to the , which became law without Gov. Linda Lingle‘s signature.

Free Speech ‘Substantially Burdened’

“Who would want to have people contribute knowing that your competitor, who is publicly financed, will get a match for match?” Izumi-Nitao told Civil Beat. “Donors’ free speech rights to a private candidate are substantially burdened.”

Under the law, the Big Island pilot program will be triggered if by September 1 the has a minimum balance of $3.5 million. The fund, which is filled by taxpayers who check off on their state income tax filings to have $3 go to the fund, had a balance of $4.6 million as of June 30, 2010.

“Should we have the money, in light of the ruling, we cannot run the equalizing funds part of the program,” Izumi-Nitao said. “The statewide partial financing program — that’s fine. It’s a very, very specific piece that would end.”

Here’s how the voluntary program works.

2 Parts to Pilot Project

Part one: To qualify for public funds, candidates have to opt in to participate and raise 200 individual $5 contributions ($1,000 total) from people registered to vote in their district (the council covers nine districts on the Big Island). If the candidate achieves that, he or she receives a so-called base amount from the Hawaii Election Campaign Fund.

The base amount varies for each of the nine districts. It’s calculated by averaging how much the winner in each district spent in the previous two county council elections, less 10 percent. For example, the base amount for District 1 for the 2010 election was $5,674; for District 6 it was $37,795. The candidate cannot accept additional contributions after receiving the base public funding.

Part two: In addition to the base amount, a participating candidate can receive “equalizing funds” if he or she is outspent by an opponent who does not participate in the public funds program. A candidate can get a maximum up to their original base amount.

Both the base funding and equalizing funding are subject to a $300,000 total cap for all participating county council candidates.

“That equalizing piece is part two that’s impacted by the Supreme Court ruling,” Izumi-Nitao said.

Of note, none of the 2010 Hawaii County Council candidates received equalizing funds because their opponents’ spending did not reach the thresholds. did, however, receive a total of $147,716 in base funds using public financing.

Partial Funding Program OK

Izumi-Nitao said the statewide , which first launched in 1980, won’t be affected.

This program is meant to encourage so-called grassroots campaigning by using public money — again from the Hawaii Election Campaign Fund — to match dollar for dollar contributions by Hawaii residents of $100 or less.

For the 2010 primary election, received matching funds totaling $188,286.

“With the partial funding program, it’s a true matching program,” said Tony Baldomero, associate director of the Hawaii Campaign Spending Commission. “You can potentially raise above and beyond your opponent.”