This Week In Local Dark Money News

When it comes to dark money — money spent trying to influence voters by groups that do not disclose their donors — the focus is often on the federal level. But a considerable amount of dark money is also going to state and local elections. Our weekly roundup looks at dark money spending at the local, state and federal levels.

The donors behind a nearly $2 million contribution to Missouri’s Republican gubernatorial candidate Eric Greitens are still unknown, according to U.S. News and World Report. A super PAC known as SEALs for Truth gave the money to Greitens’ campaign during the primary season, but after June 30th, which meant the source of the donation would not have to be reported until October 15. Last week, however, SEALs reported to the Federal Election Commission that the money came from an organization known as American Policy Coalition, Inc. There is very little publicly available information about either group. The FEC filing lists Washington, D.C. post office boxes as the addresses for the groups.

The top dark money spender this cycle, the U.S. Chamber of Commerce, is working to defeat one of its former employees, Evan Bayh, in a hotly contested U.S. Senate race, The New York Times reports. The Indiana Democrat had worked for the Chamber from 2011, when he first left the Senate, until earlier this year. Republicans have used Bayh’s job as evidence that he is out of touch with the voters of his home state. And the Chamber has paid for ads attacking Bayh for his support of the Affordable Care Act. While Democratic leaders accuse the Chamber of playing partisan politics, the group says Bayh’s voting record did not qualify him for its endorsement.

New York’s Attorney General Eric Schneiderman is accusing a “dark money empire” — including Americans for Prosperity, the Heritage Foundation and the Competitive Enterprise Institute — of running a campaign to try to discredit an investigation into claims that Exxon deliberately misled investors about the effects of climate change, Politico reports. Schneiderman and Massachusetts Attorney General Maura Healey are looking into whether the oil giant committed fraud. Exxon says the two Democrats’ investigation is politically motivated and aimed at limiting the company’s right to free expression. Schneiderman, who has argued repeatedly that the First Amendment doesn’t cover fraud, claims he has been attacked in “60 or 70 op-ed columns or editorials” since the investigation was announced. He said, “It’s like they pulled a lever on the dark money machine.”

An investigation by MLive and the Michigan Campaign Finance Network found that a majority of nonprofit and administrative accounts linked to sitting state lawmakers have received donations from corporations or special interest groups, including those with business before the legislature. Although state law prohibits politicians from accepting money directly from companies, these accounts are legal because they don’t directly fund campaign work. In general, the nonprofits don’t have to disclose their donors; the administrative accounts are required to do so only if they have raised over $25,000. As part of their investigation, MLive and MCFN said they “examined hundreds of public filings with the IRS and self-disclosures on political giving made available by companies, as well as contacted fund administrators to determine their connections to state lawmakers.”

Groups from outside South Dakota are pouring hundreds of thousands of dollars into a ballot measure race that could reshape the state’s campaign finance laws, the Center for Public Integrity reports. Measure 22 would create a mechanism for providing some public funding for elections, establish an independent ethics commission to oversee state lawmakers, limit campaign contributions, and increase donor disclosure requirements. Two 501(c)(4) groups are playing a prominent role in the race. Represent.Us, a nonpartisan pro-transparency group based in Massachusetts, is running the campaign for the measure. A Virginia-based organization, Americans for Prosperity, which was founded by billionaires Charles and David Koch, is leading the fight against the initiative.

A complaint filed earlier this month with Montana’s Commissioner of Political Practices has revealed tensions between two outside spending groups — and their leaders — involved in a state Supreme Court election, The Billings Gazette reports. The head of one of the groups, John Heenan, also serves as legal counsel for the Commissioner, without compensation, according to the Gazette. Heenan’s organization, Montanans for Experienced Judges, supports Judge Dirk Sandefur for the state’s highest court. Jake Eaton, a Republican political operative who filed the complaint, said that Heenan’s group failed to disclose that it gets nearly all of its money from attorneys. Eaton’s group, “Set Em Free Sandefur,” has attacked the judge for being soft on criminals. The Gazette reported that in response to the complaint, Heenan for a time on Wednesday changed the name of his organization to “Lawyers and Montanans for Experienced Judges,” until ten new donors who were not lawyers contributed money, allowing him to use the group’s original name again.

This Week In Local Dark Money News

When it comes to dark money — money spent trying to influence voters by groups that do not disclose their donors — the focus is often on the federal level. But a considerable amount of dark money is also going to state and local elections. Our weekly roundup looks at dark money spending at the local, state and federal levels.

The Texas Ethics Commission has voted to end its four-year investigation into the state’s largest politically active nonprofit, according to the Texas Tribune. The commission had been investigating complaints filed in 2012 by two Republican officials against Empower Texans, a conservative 501(c)(4) organization. The complaints alleged that the group had been acting more like a political action committee and therefore should be required to disclose its donors. The commission, which voted 7-0 to dismiss the cases, did not comment on its decision. But the head of Empower Texans, Michael Sullivan, promised to hold the Ethics Commission accountable for the lengthy investigation.

A Michigan social welfare organization amended its tax return, after a political watchdog group filed a complaint with the IRS alleging it had failed to report its spending on political activities, the Detroit Free Press reported. Michigan Citizens for Fiscal Responsibility amended its 2014 tax return to include more than $500,000 in political contributions, after Citizens for Responsibility and Ethics in Washington lodged its complaints in June. Much of that money went to Republican political groups in the state. Under federal law, social welfare organizations can maintain their tax-exempt status if they report their political spending to the IRS and if political activity is not their primary purpose.

An election to fill three seats on the Arizona commission that regulates public utilities could determine whether the state’s largest power supplier will be forced to disclose its political contributions. The supplier, Arizona Public Service, and its parent company, Pinnacle West, have not publicly stated whether they directed contributions to a 501(c)(4) group that helped elect two candidates to the Arizona Corporation Commission in 2014. Currently, only one of the five members of that commission — all of whom are Republican — has said he would vote to require the disclosure. That commissioner, Bob Burns, has issued a subpoena for the firm’s records. Two Democratic commission candidates say that if elected, they will join Burns and vote to require the power supplier to disclose its spending. This week, The Arizona Daily Star reported that an outside group supporting Burns and one of those candidates has received $140,000 from SolarCity, a major supplier of rooftop solar in the United States. Burns has said he wished the company would stay out of the commission races altogether. Next year, the agency will decide how to structure rates for rooftop solar customers.