The Shadow Money Game
Unraveling Political Nonprofit Funding
Russ Choma Money-In-Politics Reporter
OpenSecrets.org
CRP/OpenSecrets.org
A business story?
A business story? ● Federal government’s actions are a major
factor in every businesses bottom line -- understanding how businesses manipulate Washington is crucial.
● Business reporters have some unique skills to work on this.
● Cutting edge is corporations -- the dark money LLC.
What we’ll talk about ● What is dark money? ● What does OpenSecrets.org do to help you
understand dark money? ● How to look for dark money stories and
make them relevant. ● What’s the next big story to look for? ● Resources
What is dark money? ● Hard money vs. soft money ● Citizens United
o What did it not do? ▪ Make corporations people. ▪ Allow corporations to give politicians money.
o What did it do? ▪ Enabled corporations (which were already people)
to spend money on campaigns -- indirectly. ▪ Unleashed the nonprofits.
Independent expenditures vs. issue ads
● Independent EXpenditures are EXplicit
● Anyone can make them
● Reported to the FEC
https://www.youtube.com/watch?v=frzHJlsUmdE ADVERTISEMENT:
Independent expenditures vs. issue ads ● Issue ads can be
explicit ● Theoretically
about issues ● NOT reported to
the FEC* ● Reported to the
FCC*
https://www.youtube.com/watch?v=t7qoOYC-QE0 ADVERTISEMENT:
Super PACs vs. 501(c)(4) ● Super PACs
o Independent expenditure only o Report donors o Report ALL spending
● 501(c)(4) o nonprofit corporation o One of many types of 501(c) groups o Don’t disclose donors o Don’t usually disclose spending
Why do you/your editor care?
$1.05 Billion
Why do you/your editor care? • Citizens United allowed corporations to spend on political campaigns – but they’re not doing it publicly.
• Aetna accidentally disclosed $7.8 million to anti-Obamacare groups, while publicly backing it.
• Reynolds American, cigarette maker, gave to Americans for Tax Reform and others
• Lobbying: • Intuit’s opposition to simple tax filings.
What does OpenSecrets.org do? • Cory Booker: $12.2 million, over 5,000 pages of campaign filings, tens of thousands of donors.
What does OpenSecrets.org do?
What does OpenSecrets.org do?
What does OpenSecrets.org do?
What does OpenSecrets.org do? • Campaign finance
• Candidates, PACs (corporate, labor, etc.) and parties • 14,200+ organizations
• Lobbying • 4,100+ organizations
• Personal finances • Outside spending
What does OpenSecrets.org do?
OpenSecrets.org and dark money
http://www.opensecrets.org/outsidespending/
OpenSecrets.org and dark money
http://www.opensecrets.org/outsidespending/
OpenSecrets.org and dark money
]
OpenSecrets.org and dark money
Finding dark money stories – 990s • Sources:
• Guidestar • CitizenAudit • OpenSecrets.org
• Key Information: • Revenues • Contacts • Directors • Top vendors • Grants
Finding dark money stories – FCC
Finding dark money stories – FCC
● All stations must keep this public file, all political spending must be included -- local, state, federal and “issue” ads.
Finding dark money stories – FCC
Finding dark money stories – FCC
Finding dark money stories – FCC ● TV lobby is powerful, so currently only
available for the top 50 markets -- that’s changing this summer.
● Does not include cable ads. ● Does include local races. ● Every filing is different, and different stations
may require different information, but it’s a start.
Finding dark money stories – SOS Filings
● Non-profits ARE corporations -- not only do they file 990s, they file annual reports with states.
● Increasingly, dark money groups are reporting links with LLCs (more on this later). ○ Most political reporters have no idea what to
do about this. ○ Disregarded entities/loans/consultants, etc.
What’s the next big story? ● 2012 was the year of the super PAC, with
501(c) groups making an appearance. ● 2014 will have heavy activity by 501(c)
groups, but… ● The smart money has already moved on to
“new fangled vehicles” -- LLCs. ● The for-profit political company?
Resources ● OpenSecrets.org ● Sunlight Foundation.com ● CitizenAudit.org -- 990s ● FCC -- political files ● SEC filings ● State filings
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