Su­per PACs with last-minute do­na­tions re­veal donors af­ter midterms

Dis­clo­sure ‘hole’ al­lows sources of cash spent to sway vot­ers to be hid­den

The Washington Post - - POLITICS & THE NATION - BY MICHELLE YE HEE LEE AND ANU NARAYANSWAMY

A mys­te­ri­ous Texas-based su­per PAC that re­ceived $2.3 mil­lion from undis­closed donors to run last­minute ads in sup­port of Demo­cratic Rep. Beto O’Rourke was funded by the Se­nate Demo­crat-aligned Se­nate Ma­jor­ity PAC (SMP), ac­cord­ing to new fed­eral elec­tion fil­ings made pub­lic Thurs­day night.

SMP do­nated the money to the su­per PAC, Texas For­ever, in a way that cir­cum­vented fed­eral elec­tion dead­lines that trig­ger donor dis­clo­sure — an in­creas­ingly com­mon tac­tic em­ployed by both Democrats and Repub­li­cans that, while le­gal, crit­ics say vi­o­late the spirit of dis­clo­sure re­quire­ments.

The O’Rourke cam­paign raised an­other $10 mil­lion in do­na­tions af­ter mid-Oc­to­ber — bring­ing his to­tal fundrais­ing for his failed Se­nate bid to a record-high $80.5 mil­lion and mak­ing him one of the most suc­cess­ful fundrais­ers in Amer­i­can pol­i­tics. Half of the $10 mil­lion came from do­na­tions un­der $200.

O’Rourke’s cam­paign spent nearly all that money, with less than $480,000 in cash on hand af­ter his cam­paign ended, new records show.

The flurry of last-minute ac­tiv­ity to sup­port O’Rourke in the Se­nate race re­flects the na­tional at­ten­tion and deep fundrais­ing base en­joyed by the 46-year-old con­gress­man, who con­sis­tently polled be­hind the in­cum­bent and ul­ti­mate win­ner of the race, Sen. Ted Cruz (R). Still, O’Rourke is now weigh­ing a 2020 pres­i­den­tial bid.

Texas For­ever is one of more than a dozen su­per PACs that emerged last-minute or ran ads for or against cam­paigns with­out dis­clos­ing their donors un­til a month af­ter the elec­tion, new fil­ings show. Some of these su­per PACs were tied to well-known na­tional groups, but oth­ers were funded by just a hand­ful of wealthy donors.

Michael Toner, for­mer Repub­li­can chair­man of the Fed­eral Elec­tion Com­mis­sion, said su­per PACs from both par­ties are tak­ing ad­van­tage of a “crit­i­cal hole in the dis­clo­sure regime” for su­per PACs.

“The gen­eral rule is that con­tri­bu­tions re­ceived by su­per PACs and ex­pen­di­tures made by su­per PACs are pub­licly dis­closed, and I think there’s broad con­sen­sus on the ap­pro­pri­ate­ness of that,” Toner said. “The value of dis­clo­sure af­ter Elec­tion Day is not nearly as per­ti­nent as it is be­fore Elec­tion Day.”

Cam­paign Le­gal Cen­ter, which ad­vo­cates for stricter reg­u­la­tion of money in pol­i­tics, es­ti­mated in a new re­port that such su­per PACs spent up­ward of $29 mil­lion in the fi­nal weeks of the 2018 elec­tion with­out dis­clos­ing their donors or re­port­ing the full ex­tent of their spend­ing be­fore Elec­tion Day.

Many of the groups ap­pear to have lo­cal ties, with a mail­ing ad­dress based in the dis­trict or the state, and a name that sug­gests lo­cal donors launched or funded the group, said Bren­dan Fis­cher, who di­rects the fed­eral reg­u­la­tory work of the Cam­paign Le­gal Cen­ter.

Yet many of these groups that were ac­tive in the pri­maries were re­vealed af­ter the pri­mary elec­tion to be tied to na­tional, par­ty­con­nected su­per PACs, mean­ing they may have given a mis­lead­ing im­pres­sion to vot­ers be­fore they cast their bal­lots, Fis­cher said.

“The tac­tics that we’ve seen su­per PACs use widely this elec­tion cy­cle un­der­mine the trans­parency that vot­ers should have a right to ex­pect from the groups spend­ing mil­lions of dol­lars try­ing to in­flu­ence their vote,” Fis­cher said.

This was not the first time SMP, which is aligned with Se­nate Mi­nor­ity Leader Charles E. Schumer (D-N.Y.) and works to elect Democrats to the Se­nate, was the pri­mary funder of a “pop-up” su­per PAC.

It was the pri­mary donor to Red and Gold, a su­per PAC that was ac­tive in the Ari­zona Se­nate pri­maries at­tack­ing Repub­li­cans. It was the main giver to High­way 31, con­tribut­ing $3.1 mil­lion of the $4.5 mil­lion the su­per PAC spent to help Demo­crat Doug Jones win the Alabama Se­nate race in 2017. In both cases, the su­per PACs were struc­tured so that donors would not be dis­closed un­til af­ter the elec­tion. SMP de­clined to com­ment. In Ohio, a new su­per PAC named MeToo Ohio spent hun­dreds of thou­sands of dol­lars on in­de­pen­dent po­lit­i­cal ads at­tack­ing Sen. Sher­rod Brown (D). In Thurs­day’s fil­ings, the group dis­closed that its ma­jor funder was an­other su­per PAC funded by a hand­ful of wealthy Repub­li­can donors and a po­lit­i­cally ac­tive non­profit or­ga­ni­za­tion that does not dis­close its donors.

De­fend Ari­zona, a su­per PAC ac­tive in the Se­nate race in Ari­zona, dis­closed about $300,000 in cash on hand on Oct. 17, about three weeks be­fore the Nov. 6 elec­tion. Then, on Thurs­day, the FEC re­ports showed it spent $7.7 mil­lion on in­de­pen­dent po­lit­i­cal cam­paigns in those fi­nal weeks in sup­port of Rep. Martha McSally (R).

Of that amount, $1.9 mil­lion came from Se­nate Lead­er­ship Fund, the su­per PAC aligned with Se­nate Repub­li­can lead­er­ship, the Thurs­day FEC re­ports show. Ken Grif­fin, a ma­jor Illi­nois-based GOP donor and chief ex­ec­u­tive of hedge fund Ci­tadel, gave $2 mil­lion.

The last pub­lic fil­ings be­fore Elec­tion Day were due Oct. 17. The fil­ings made pub­lic Thurs­day evening cover do­na­tions and ex­pen­di­tures from Oct. 18 through Nov. 26.

The new fil­ings also showed the last-minute rush among donors to in­ject mil­lions into es­tab­lished su­per PACs sup­port­ing con­gres­sional can­di­dates from both par­ties.

Amer­ica First Ac­tion, the su­per PAC sup­port­ing Pres­i­dent Trump’s agenda, brought in $4.8 mil­lion be­tween Oct. 18 and Nov. 26. Don McGill Toy­ota, a Toy­ota deal­er­ship in Katy, Tex., gave $1 mil­lion of that sum. An­other $1 mil­lion came from Dar­win Dea­son, a ma­jor Texas GOP donor and chief ex­ec­u­tive of Dea­son Cap­i­tal Ser­vices.

Se­nate Demo­crat-aligned Se­nate Ma­jor­ity PAC re­ceived $14.1 mil­lion dur­ing the pe­riod, with $1.1 mil­lion from Ma­jor­ity For­ward, a non­profit group that does not dis­close its donors, and $1 mil­lion from heavy­weight Demo­cratic donor Ge­orge Soros.

The House Ma­jor­ity PAC, the Demo­cratic su­per PAC sup­port­ing House can­di­dates, saw a last-minute fund­ing of $19.2 mil­lion, with the most money — $4 mil­lion — com­ing from bil­lion­aire hedge fund man­ager James Si­mons.

The Con­gres­sional Lead­er­ship Fund, the House GOP-aligned su­per PAC, re­ported $14 mil­lion, with $5 mil­lion com­ing from bil­lion­aire Repub­li­can donors Shel­don and Miriam Adel­son, bring­ing their to­tal po­lit­i­cal giv­ing in the 2018 elec­tion cy­cle to $117 mil­lion. An­other $4.5 mil­lion came from the Amer­i­can Ac­tion Net­work, a po­lit­i­cally ac­tive non­profit group that is con­nected to the Con­gres­sional Lead­er­ship Fund.

MICHAEL ROBINSON CHAVEZ/THE WASH­ING­TON POST

A su­per PAC re­ceived $2.3 mil­lion from undis­closed donors to run last-minute ads in sup­port of Rep. Beto O’Rourke (D-Tex.).

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