Hawaii Becomes First State to Ban Corporate Political Spending

On May 16, 2026, Governor Josh Green signed Senate Bill 2471, making Hawaii the first state to prohibit corporations operating there from contributing to any political campaign. Violations can trigger loss of tax privileges, suspension of business licenses, or corporate dissolution, with the law effective July 1, 2027.

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The law relies on the principle that corporations exist only by state charter, allowing states to define corporate powers. Supporters cite Marshall’s 1819 Dartmouth v. Woodward description of corporations as “artificial beings,” the Tenth Amendment’s reservation of powers, and an 1869 ruling requiring corporations to obey each state’s charter. It does not alter First Amendment protections under Citizens United.

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The bill was introduced by veteran Senator Karl Rhoads and championed by Senate Commerce and Consumer Protection Committee Chair Sen. Jarrett Keohokalole, who said electioneering exceeds powers granted by Hawaii’s charter. The idea originates in a 2025 paper by Tom Moore, former FEC counsel and fellow at the Center for American Progress, which traced the authority to limit corporate powers to state law and the 14th Amendment.

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Legislators cite polls showing about 75 percent of Americans favor overturning Citizens United. The bill passed the Senate unanimously (25-0) and cleared the House 41-9, indicating bipartisan legislative support.

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State officials say the measure clarifies that corporate charters do not include electioneering powers. Governor Green noted the law addresses public revulsion toward corporate spending while preserving individual free-speech rights. The Attorney General will enforce penalties, including tax-privilege removal and possible dissolution.

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Legal analysts point out that the statute challenges longstanding jurisprudence treating corporations as persons with First Amendment rights, as affirmed in the 1886 Santa Clara County decision. Critics warn of potential federal constitutional challenges and note the law does not curb individual donors’ spending.

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• “Two hundred and fifty years ago, Jefferson said that people’s rights are self-evident, endowed by their creator, preceding the establishment of governments,” — Sen. Jarrett Keohokalole, Chair, Senate Commerce and Consumer Protection Committee

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• “But corporations were, and continue to be, created by state law, as were their powers,” — Sen. Jarrett Keohokalole

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• “A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law.” — Chief Justice John Marshall (cited)

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• “The Supreme Court granted them 14th Amendment protections in 1886 in Santa Clara County v.” — Supreme Court (cited)

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The law takes effect July 1, 2027, when the Hawaii Attorney General may begin enforcement. The Center for American Progress notes similar bills in 14 states, and Montana is drafting a 2026 ballot initiative modeled on Hawaii’s approach, likely prompting litigation.

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