Understanding the argument -
Many state legislatures are considering proposals to the effect that certain policies should be determined not by the legislature itself but by public referenda in which every voter can take part. - Fact
Critics of the proposals argue that the outcomes of public referenda would be biased, since wealthy special-interest groups are able to influence voters’ views by means of television advertisements. - Conclusion + supporting premise
Option Elimination - Strengthen
The scope of the argument is to Strengthen the conclusion, which is that "the outcomes of public referenda would be biased."
(A) Many state legislators regard public referenda as a way of avoiding voting on issues on which their constituents are divided. - the view of legislatures is out of scope. The scope of the argument is to Strengthen the conclusion, which is that "the outcomes of public referenda would be biased" and not what legislatures regard.
(B) During elections for members of the legislature, the number of people who vote is unaffected by whether the candidates run television advertisements or not. - "elections" is out of scope.
(C) Proponents of policies that are opposed by wealthy special-interest groups are often unable to afford advertising time on local television stations. - ok. Then certainly, the outcomes would be biased as people don't evaluate the policies that are opposed by the wealthy.
(D) Different special-interest groups often take opposing positions on questions of which policies the state should adopt. - They take opposing or same viewpoints, is out of scope. Our scope is to Strengthen the conclusion, which is that "the outcomes of public referenda would be biased."
(E) Television stations are reluctant to become associated with any one political opinion, for fear of losing viewers who do not share that opinion. - if they are reluctant and share both sides, then it can't be biased, and at best, it's the opposite of what we need.