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Consider the Source

Harold Simmons, owner of Contran Corp. and Valhi, Inc. YouTube

GOP super donor's foundation leans left

By Paul Abowd and Dave Levinthal

Republican mega-donor Harold Simmons considers President Barack Obama to be “the most dangerous man in America,” and in a bid to unseat him, fueled conservative political groups with tens of millions of dollars.

But the Dallas-based billionaire’s recent philanthropic giving has been anything but right-leaning, a Center for Public Integrity review of new Internal Revenue Service documents indicates.

The Harold Simmons Foundation in 2011 most notably contributed a combined $600,000 to an arch political foe of Republicans, Planned Parenthood, and its North Texas affiliate, IRS records show.

Simmons’ foundation also bolstered several other organizations rarely associated with political conservatives or partisan Republicans, including public television, the League of Women Voters and even a Washington, D.C.-based organization dedicated to curbing the influence of big money in elections.

The foundation’s 2011 funding came exclusively from the billionaire’s personal fortune and that of his holding company, Contran Corp. Together, they contributed more than $9.8 million in 2011 — the foundation’s only income aside from $5.6 million in investment and capital gains income. The foundation ended 2011 with nearly $52 million in reserve after distributing about $17.4 million during the year, IRS records show.

Simmons and his holding company, Contran Corp., provided major funding for Republican super PACs, including $23.5 million to Karl Rove’s American Crossroads. Simmons was second to casino magnate and fellow Republican-backing billionaire Sheldon Adelson among top donors to super PACs in the 2012 election.

Consider the Source

Donors use charity to push free-market policies in states

By Paul Abowd

In 2009, a network of online media outlets began popping up in state capitals across the nation, each covering the news from a clearly conservative point of view. What wasn’t so clear was how they were funded.

“The source is 100 percent anonymous,” said Michael Moroney, a spokesman for the Franklin Center for Government and Public Integrity, the think tank that created the outlets.

In fact, 95 percent of Franklin’s revenue in 2011 came from a charity called Donors Trust, according to Internal Revenue Service records.

Conservative foundations and individuals use Donors Trust to pass money to a vast network of think tanks and media outlets that push free-market ideology in the states — $86 million in 2011 alone. The arrangement obscures the identity of the donors wishing to keep their charitable giving private, especially “gifts funding sensitive or controversial issues,” according to the group’s website.

The $6.3 million donation to the Franklin Center was the second-largest gift made in 2011 by the group, a tax-exempt “public charity” that takes tax-deductible donations from donors “dedicated to the ideals of limited government, personal responsibility, and free enterprise,” according to its website.

Donors Trust includes 193 contributors, the majority of whom are individuals. “A lot of donors are flying totally under the radar,” says president and CEO Whitney Ball.

Consider the Source

A scene from the Americans for Job Security's "Darker Future" ad. Screengrab

Non-political nonprofit's spending spikes in election years

By Dave Levinthal

Pro-business powerhouse Americans for Job Security cannot, by federal law, make politics its primary purpose.

But as contentious federal elections and state-level ballot initiatives raged during 2012, the nonprofit organization’s income spiked at least tenfold compared to 2011, a non-election year, records show.

The cash windfall fueled tens of millions of dollars of overtly political spending, much of it in the form of relentless advertisements skewering President Barack Obama.

New IRS Form 990 filings show Americans for Job Security raised $2.5 million during fiscal year 2011 and carried just $727,000 in reserve through October 2011. IRS records for 2012 are not available and likely won’t be until the year’s end.

But Federal Election Commission filings show in 2012 the group spent $15.2 million to attack Obama and another $650,000 to oppose Eric Hovde, a U.S. Senate candidate in Wisconsin, during a Republican primary.

The organization, which was founded and run by a Republican political operative, also spent $11 million to help support passage of an anti-union California ballot proposition, the state’s campaign finance regulators revealed.

Unlike super PACs, which must disclose their donors, Americans for Job Security is a 501(c)(6) tax-exempt trade organization that keeps its funders secret, even when it’s engaging in the same kind of overt candidate bashing that super PACs of all political stripes so often do.

Its ties to Republican politicians and political operatives are well documented.

In 2010, another election year, the group also saw a big bump in fundraising, showing $12.4 million, IRS filings indicate.

Consider the Source

AP

Why 2013 matters: covering money in politics during the off-season

By The Center for Public Integrity

With Election 2012 behind us, and Elections 2014 and 2016 still a long way off, you may be wondering what is left to say about money in politics. Consider the Source reporters Dave Levinthal and Michael Beckel will answer that, and any other campaign finance-related questions you may have in a live chat February 4, at 1:00pm ET. In the meantime, please feel free to leave your question in the comments section below, and visit Dave and Michael's new money-in-politics blog, Primary Source.

Consider the Source

Democratic super PACs start year with cash advantage

By Michael Beckel and Dave Levinthal

Update (Feb. 1, 4:30 p.m.): This story has been updated to include comment from Brad Martin of Fair Share Action.

Prominent super PACs are already preparing for their next act — the 2014 midterm elections — with Democratic-aligned groups leading the way.

Of the five super PACs with the most money in the bank through the end of 2012, all support Democrats, according to a Center for Public Integrity analysis of campaign finance reports released Thursday.

The United Auto Workers’ super PAC, launched last September, reported the most money in the bank at $8.9 million. The group spent almost $2.7 million ahead of Election Day.

Priorities USA Action, the main super PAC that backed the re-election of President Barack Obama, ranks second, ending the year with $3.7 million in the bank after spending $65 million on ads that pounded Obama’s GOP rival, Mitt Romney.

Rounding out the top five: the super PAC of the Service Employees International Union, which reported $3.2 million on hand; Fair Share Action, which reported $1.8 million; and American Bridge 21st Century, a Democratic-aligned super PAC that specializes in opposition research, which reported $1.3 million.

Consider the Source

When a political committee aired ads praising Proposition 32 in the 2012 elections, each advertisement included the disclaimer “with major funding by the American Future Fund.” Screengrab

Nonprofit spends big on politics despite IRS limitation

By Michael Beckel

Last fall, a cadre of wealthy business executives and conservative groups tried to sell California voters on new campaign finance reforms.

Couched in lofty rhetoric about the importance of cutting off money from special interests to politicians and other regulations favored by reformers, their proposal sought to ban the practice of using payroll deductions for political expenditures — a popular method of union fundraising.

Once alerted to the true nature of Proposition 32, the unions and political left rose up against it.

An innocuously named nonprofit, the Iowa-based American Future Fund, proved to be one of the biggest backers of the initiative, sinking more than $4 million into the ballot measure that voters ultimately rejected.

As a “social welfare” organization, the American Future Fund is not required to publicly disclose its donors. But to maintain its tax-exempt status under Sec. 501(c)(4) of the U.S. tax code, influencing elections cannot be its primary purpose.

The American Future Fund’s investment in California was part of a nationwide, political advertising spree in 2012 that exceeded $29 million, according to a Center for Public Integrity analysis of state and federal records.

That amount included more than $19 million on efforts designed to oust President Barack Obama, as well as millions more to oppose Democratic candidates for Congress and even two state attorneys general. Now the group is funding ads opposing Obama’s nomination of former Republican Sen. Chuck Hagel of Nebraska for defense secretary.

Consider the Source

About half of the year’s top 100 lobbying organizations showed an overall increase in spending for 2012. Ben Schumin/Wikimedia

Fiscal cliff, elections boost spending on lobbying

By Dave Levinthal

Congress’ fiscal cliff fiasco, a flurry of lame duck legislation and election-season politics drove some of the nation’s most powerful lobbying forces to double down on their governmental influence efforts late last year, newly filed reports show.

Such an uptick foreshadows what could be ever-more-aggressive lobbying on federal finances, taxation, energy and social issues like immigration and gun ownership as President Barack Obama enumerated in his inaugural address Monday.

The trend may end a prolonged lobbying spending slowdown largely prompted by Capitol Hill gridlock and a dearth of meaningful legislation receiving consideration during much of 2011 and 2012.

In all, about half of the year’s top 100 lobbying organizations spent more on lobbying in the fourth quarter of last year than in the third quarter. About half also showed an overall increase in spending for 2012, a Center for Public Integrity analysis of congressional disclosure reports and Center for Responsive Politics data indicates.

The U.S. Chamber of Commerce’s year-over-year lobbying spending skyrocketed more than 88 percent, from $66.4 million to more than $125 million, to easily lead all other organizations.

Prominent business and financial lobbies, meanwhile, rank among organizations that spent significantly more during the fourth quarter of 2012 than they did during the third quarter, including the National Association of Realtors ($15.4 million from $9.8 million), the Business Roundtable ($4.8 million from $4 million), JPMorgan Chase and Co. ($3.2 million from $1.4 million) the American Bankers Association ($2.1 million from $1.8 million) and Visa ($1.7 million from $1.1 million), records show.

Consider the Source

Video: Looking back on three years of 'Citizens United'

By Dave Levinthal and Sarah Whitmire

The Center for Public Integrity interviews Citizens United President David Bossie on the third anniversary of the Citizens United v. Federal Election Commission decision, which prompted major changes to the nation's campaign finance rules. Speaking from Citizens United's Washington, D.C., headquarters, Bossie says President Barack Obama is a "hypocrite" for embracing super PACs and outside political money after relentlessly criticizing the Citizens United decision.

Consider the Source

Bank of America, unions among newly named inauguration sponsors

By Dave Levinthal

Add Bank of America, Coca-Cola, FedEx and a collection of labor unions to the growing list of powerful lobbying forces underwriting the second inauguration of President Barack Obama — long a vocal critic of the influence industry and corporate political power.

The new inaugural bankrollers, the names of which the Presidential Inaugural Committee released this weekend, have together spent $124.3 million lobbying the federal government since Obama took office, a Center for Public Integrity review of federal disclosures shows.

Lobbying forces donating to Obama’s inaugural have spent nearly $283 million to influence the federal government since 2009 when including previously disclosed corporations, such as AT&T Inc., Microsoft Corp. and energy giant Southern Co.  — a figure likely to grow as the inauguration committee releases the names of more new contributors.

(Read: Corporate backers poured $160 million into lobbying since 2009.)

FedEx has spent more than $64 million on federal lobbying since 2009, while Coca-Cola has spent nearly $25 million and Bank of America more than $12.8 million, federal disclosures show.

The Forest County Potawatomi Community, a Native American tribe based in Wisconsin that operates casinos, also donated to the inaugural committee and has spent $1.5 million on lobbying during the past four years. Another inaugural donor, financial investment firm Ariel Investments, has spent $200,000.

Lobbying expenditures by newly disclosed union entities donating to the inaugural committee include:

Consider the Source

Expenditure Profile: Waterfront Strategies

By Reity O'Brien

 

Rank: 3

Clients’ expenditures: $81 million*

Website: None

Principals:

Raeylnn Olson (president)

Clients:

Background:

Pages

Writers and editors

John Dunbar

Managing Editor, Politics The Center for Public Integrity

John is director of Consider the Source, the Center's ongoing investigation of the impact of money on state and federal politic... More about John Dunbar

Michael Beckel

Reporter The Center for Public Integrity

Michael Beckel joined the Center for Public Integrity as a politics reporter in February 2012, where his focus is super PACs and the infl... More about Michael Beckel

Reity O'Brien

James R. Soles Fellow The Center for Public Integrity

Reity O’Brien is the Center’s 16th James R. Soles Fellow.... More about Reity O'Brien

Chris Young

American University Fellow The Center for Public Integrity

Chris Young is an American University Fellow currently working as a member of the Center’s Consider the Source team.... More about Chris Young

Dave Levinthal

Senior reporter The Center for Public Integrity

Dave Levinthal joined the Center for Public Integrity in 2013 to help lead its Consider the Source project investigating the influence of... More about Dave Levinthal

Ben Wieder

CAR Reporter The Center for Public Integrity

Ben Wieder is the Computer Assisted Reporter for the Consider the Sourc... More about Ben Wieder

Alison Fitzgerald

Senior reporter The Center for Public Integrity

Alison Fitzgerald is a finance and investigative reporter who joined the Center in April 2013 to help lead its financial reporting projec... More about Alison Fitzgerald

Alan Suderman

Reporter The Center for Public Integrity

Alan Suderman is a reporter for the Consider the Source project, where he focuses on the influence of money in state politics.... More about Alan Suderman

Dan Wagner

Reporter The Center for Public Integrity

Daniel Wagner came to the Center in 2013 from The Associated Press in Washington, D.C.... More about Dan Wagner