On Monday morning, the Supreme Court of the United States announced that it will hear a challenge to the constitutionality of Arizona's system of offering voluntary public financing to candidates for election to state office.
As you may recall, the Ninth Circuit Court of Appeals had deemed the system constitutional in May 2010, but the Supreme Court nevertheless moved weeks later to block its implementation for this year's elections, ordering the state of Arizona not to release further matching funds to candidates who were running for state offices this year while seeking public financing.
Arizona's system allows qualified candidates (based on initial low-dollar fundraising) to choose to refuse private fundraising and instead receive an initial grant and supplemental matching funds from the state to have a fair opportunity to campaign, with additional subsidies available based on the amount of the opponents' (and any independent) expenditures against the publicly-financed candidate.
The question before the Court is whether this violates the First and/or Fourteenth Amendments by implicitly "penalizing" parties spending beyond the limits by forcing them to help subsidize the publicly-financed opponent, and whether this equalization constitutes a sufficiently compelling state interest to justify such a program.
A ruling against the Arizona system would be a logical extension of the less-publicized end of the Citizens United decision, in which the 5-4 majority held that only the threat of quid pro quo corruption was a sufficient justification for suppressing election-related speech. [Such a ruling could nevertheless keep intact those public financing systems premised on multiplier effects for small-dollar contributions raised by the candidate rather than basing public subsidies on the amount of opposition spending.]
The argument in favor of Arizona's system, on the other hand, is that all private campaign contributions present the risk of quid pro quo corruption, compared to which public financing is a reasonable solution for states to pursue.
Expect oral argument in March and a ruling by June. SCOTUSblog has the opinion below and the briefs on whether the Court should hear the case.