A state appellate court, siding with Gov. Arnold Schwarzenegger, struck down a regulation Friday that limited contributions to campaign funds set up to endorse or oppose ballot measures.
State campaign authorities last year sought to cap the size of such donations if the accounts were controlled by officeholders. In Schwarzenegger's case, donors could not have given more than $23,300 to a committee he helped establish to raise money to promote his initiatives on the 2005 special election ballot.
But a Sacramento Superior Court blocked the California Fair Political Practices Commission's rule from taking effect. On Friday, the state Court of Appeal in Sacramento affirmed that decision, saying that the commission overreached its authority.
The decision "is another step down the road toward gutting California's contribution limits," said Ned Wigglesworth of California Common Cause, a nonprofit watchdog group.
Several legislators and other officeholders have funds that take donations of any size to promote and oppose propositions.
Commission spokesman Jon Matthews said the panel would review the decision to determine whether to appeal.
Attorney Thomas Hiltachk, representing Schwarzenegger, said the ruling "certainly resolves any doubt about whether there are contribution limits to candidate-controlled ballot committees."