Pennsylvania lawmakers expect to consider legislation this fall that would prohibit corporations from making political contributions or otherwise engaging in election-related activity, a move that could significantly affect how businesses participate in the political process.

House Bill 2728, recently introduced by Rep. Joe Webster (D-Montgomery), would amend Pennsylvania’s corporate charter law to prohibit corporations from “directly or indirectly engag[ing] in election activity or ballot question activity.”

Corporations that violate the provision could lose their charter and business privileges and face civil action from the state Attorney General.

Webster and several of his co-sponsors said in a press conference last week that the bill is intended to address the growth of corporate political spending in the aftermath of the U.S. Supreme Court’s 2010 decision in the landmark Citizens United case.

This new proposal is similar in nature to (though significantly broader than) legislation the Pennsylvania House of Representatives passed in June.

That bill, House Bill 497 (also introduced by Webster), sought to prohibit corporations with certain levels of foreign ownership from contributing to independent expenditure committees or administering affiliated political action committees funded by employee contributions.

The PA Chamber vocally opposed H.B. 497 and raised concerns that its overly broad definition of a “foreign-influenced corporation” could sweep in organizations with deep roots in Pennsylvania that represent large segments of the state’s workforce.

Brian Rengert, the PA Chamber’s Director of Political Engagement, argued in a memo that any effort to protect elections from foreign interference must be balanced with protecting the freedom of businesses and other organizations to lawfully participate in the political process.

Notably, this new proposal goes beyond targeting corporations with foreign ownership and would instead apply to all corporations in Pennsylvania.

Companies and their employees participate in the political process in a variety of ways, including through affiliated PACs funded by voluntary employee contributions and independent expenditures on issues and candidates. Restrictions on those activities would limit businesses’ and their employees’ ability to have a voice in elections and public policy debates.

The legislation has been referred to the House State Government Committee. Its sponsors have expressed confidence that it could pass the House, yet acknowledged it is likely to face an uphill battle in the Republican-controlled State Senate.

The PA Chamber will continue to monitor the proposal and advocate for policies that protect Pennsylvania’s elections while preserving the lawful ability of businesses and their employees to participate in the political process.