ICYMI: AEA Fires Energy ‘Jump Ball’ for 2012 President Election

The Washington Post
By Dan Eggen
April 25, 9:28 AM

Nearly all of the independent advertising aired for the 2012 general-election campaign has come from interest groups that do not disclose their donors, suggesting that much of the political spending over the next six months will come from sources invisible to the public.

Politically active nonprofits that do not reveal their funding have spent $28.5 million on advertising related to the November presidential matchup, or about 90 percent of the total through Sunday, a Washington Post analysis shows.

Most of the ad spending has come from conservative groups criticizing the policies of President Obama in key swing states, the data show. Tens of millions more have been spent by secretive groups targeting congressional races, again primarily in support of Republicans.

The numbers signal a shift away from super PACs, which are required to disclose their donors to the Federal Election Commission and which have dominated political spending in the Republican presidential primary contest. Instead, the battle between Obama and presumptive GOP nominee Mitt Romney appears likely to be dominated by a shadow campaign run by big-spending nonprofits that do not have to identify their financial backers.

The pattern underscores the growing influence of corporations and wealthy individuals in the wake of a Supreme Court decision that made it easier to spend unlimited money on elections. The numbers also suggest that many wealthy donors are increasingly opting for the confidentiality of nonprofits rather than allowing the public scrutiny that comes from giving to super PACs or candidates.

“I think there is a potential to see a tremendous amount of money flowing through these nonprofit groups,” said Bill Allison, editorial director at the Sunlight Foundation, which advocates greater disclosure for political organizations and candidates. “For an awful lot of donors, it’s a very attractive way to give without leaving any kind of footprint.”

Crossroads GPS, the largest of the independent pro-Republican groups, said it raised nearly $40 million from unidentified donors in the first three months of this year, compared with less than $10 million by its affiliated super PAC, American Crossroads, which discloses contributions, according to documents and officials.

The Crossroads groups have run nearly $12 million in anti-Obama ads this cycle, nearly all of them paid for by the secretive nonprofit arm, according to data from Kantar Media/Campaign Media Analysis Group, which tracks ad spending. Recent tax records showed that 90 percent of the $76 million raised by the nonprofit arm through 2011 came from unidentified donors who gave $1 million or more, including two who gave $10 million each.

Many of the spots aired by groups such as Crossroads GPS are considered “issue ads” because they do not specifically urge viewers to vote for a particular candidate. The strategy allows them to conform to Internal Revenue Service rules for “social welfare” groups, which do not have to disclose their donors as long as their “primary purpose” is not politics.

One Crossroads GPS spot currently running in Virginia, for example, castigates the president for high energy costs. “No matter how Obama spins it, gas costs too much,” the female narrator says. “Tell Obama: Stop blaming others and work to pass better energy policies.”

Despite its anti-Obama message, the ad is not considered an election-related message under FEC and IRS guidelines. That means the money spent to air the spot — about $204,000 in the Richmond, Charlottesville and Washington markets — will not count as part of the group’s political budget, experts say.

“We are still very early in the cycle, with virtually all of last year and the first quarter dedicated to framing legislative and regulatory issues with conservative messaging,” said Jonathan Collegio, a spokesman for the Crossroads groups. “As we approach the elections, more of our expenditures will be political and election focused.”

In addition to Crossroads, top expenditures on anti-Obama issue ads include $7 million from Americans for Prosperity, a conservative group with ties to oil billionaires Charles and David Koch; $3 million from the American Future Fund, a nonprofit conservative group based in Iowa; and at least $3.3 million from the American Energy Alliance, a group supported in part by the energy industry.

Liberal groups have spent little in comparison. The Environmental Defense Fund and the American Federation of State, County and Municipal Employees have each spent about $1.1 million on ads related to the general presidential election, the data show. Most of the money on the left, particularly from labor unions, is expected to be spent on grass-roots organizing rather than advertising.

Benjamin Cole, communications director for American Energy Alliance, said the estimated $4 million the group has spent on television, radio and Internet ads “is just a fraction of what we’re expecting to spend” by November. He said the group is proud that it “fired the jump ball for the general election” with an ad running in 10 swing states that criticizes Obama’s energy policies and warns of $9-a-gallon gasoline.

“Almost overnight it became Barack Obama and Mitt Romney on energy,” Cole said. “There’s no problem with that. We want the conversation about energy and we’re happy to keep that conversation going.”

Nonetheless, Cole said, the group’s aims are primarily educational and nonpartisan. He noted that the group has criticized Romney, giving him its “Dim Bulb Award” last week for saying in 2003 that coal energy “kills people.”

Watchdog groups have long complained about a lack of disclosure by tax-exempt advocacy organizations, and Democrats have pushed for stronger requirements. Last month, a federal judge in Washington ordered the FEC to require tougher disclosure rules for nonprofits that run ads within 60 days of an election, but it’s unclear whether the agency will act on the matter before November.

Much of the advocacy spending related to the presidential election will go undocumented until 2013, when interest groups file their annual reports with the IRS.

Super PACs also have come under fire for transparency because many donations to the groups are from entities that are hard to trace. Restore Our Future, a pro-Romney super PAC that has raised $52 million, said it would revise its FEC disclosures this week after news organizations raised questions about a $400,000 donation linked to a defunct company address.

Spokeswoman Brittany Gross said the listing was the result of a “clerical error.” She said the filing will be updated to show a pair of $200,000 contributions from Gerald and Darlene Jordan, who hosted a recent fundraiser for Romney at their home in Palm Beach, Fla.

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