California had a plethora of propositions on their ballot this fall Two in particular, Proposition 30 and Proposition 32, attracted the most attention, in terms of media coverage and money.
Proposition 30 was sponsored by Governor Jerry Brown, to extend several taxes for an additional 6 to 7 years to finance public education, which has been on the receiving end of devastating cuts the last several years:
Proposition 32 was disguised by big oil and Wall Street as campaign finance reform but was actually an anti-union effort to ban payroll deductions in the state:
Prop 30 was approved by voters by a comfortable margin – see map here: http://vote.sos.ca.gov/returns…
Prop 32 was defeated by voters by a comfortable margin as well – see map here: http://vote.sos.ca.gov/returns…
But the big news regarding these two propositions is really about Stephen DeMaura, President of Americans for Job Security, based in Alexandria, Virginia and former head of the Republican Party of New Hampshire.
First, some background:
On October 15, 2012, a nonprofit in Arizona called Americans for Responsible Leadership made a $11 million donation to a committee in California dedicated to defeating Prop 30 and passing Prop 32, but didn’t disclose where that money came from. The lack of disclosure violated a brand new rule in California mandating that even 501(c) nonprofits disclose the source of their donations.
On October 18, 2012, Common Cause filed a complaint with the California Fair Political Practices Commission asking for an inquiry. The commission, a state campaign finance regulator that puts the Federal Election Commission to shame with its aggressive pursuit of the public interest, took up the case and on October 25, 2012, advised Americans for Responsible Leadership that it had 25 hours to comply with a request for information about the source of that $11 million check.
Americans for Responsible Leadership then hired Holtzman Vogel, a DC-area law firm retained for years by Karl Rove and other Republican leaders, to try to quash the FPPC’s requests, claiming at one point to a local judge that the Supreme Court’s Citizens United decision protected the group from having to disclose its donors. As the Sacramento judge accurately observed, the Citizens United decision did no such thing. An appellate judge ruled last week and agreed with the Arizona group in preventing the FPPC from action, which then forced a last minute appeal that led to an emergency decision by the California Supreme Court, ruling 7-0 last Sunday to force disclosure.
Forced by the California State Supreme Court to disclose the source of the $11 million dollars, Americans for Responsible Leadership stated they received the $11 million from Americans for Job Security, based in Alexandria, Virginia. Americans for Job Security, founded by two Republican operatives who now handle media-buys for Karl Rove’s American Crossroads Super PAC, is just another coin-operated front group. In the past, corporations have given it large sums in exchange for negative advertising in campaigns and lobbying efforts.
In a letter to regulators, Americans for Responsible Leadership conceded that Americans for Job Security in turn received the $11 million from yet another nonprofit group, called Center to Protect Patients’ Rights.
The FPPC’s chair, Ann Ravel, says the trail of dummy nonprofits is a clear sign that the Arizona nonprofit behind the $11 million donation was engaged in “campaign money laundering.” It’s obvious to anyone that Americans for Responsible Leadership is still playing shell games. The two nonprofits it disclosed do not give any real information about the individuals or corporations that provided the money for the $11 million check.
The scandal may quickly evolve into a criminal investigation that could rock the foundations of Capitol Hill. It’s all up to Kamala Harris, California’s attorney general, who was elected two years ago on a platform of getting tough on white-collar crime. Her office told reporters that she is laying out the options for either a criminal or civil investigation into this major secret money group.
Stephen DeMaura, head of Americans for Job Security, reported in their FEC quarterly filing with the FEC dated October 11, 2012, that their independent expenditures totalled $8,878,339.02.
Based on the reports filed with the FEC, I couldn’t find any other quarterly reports filed by Stephen DeMaura on behalf of Americans for Job Security in 2012:
But I did find this:
So, there is no reporting of the $11 million dollar expenditure to the FEC, which begs the question, were they required to do so? But I guess the $11 million dollar contribution could have been made after October 11, 2012 so it wouldn’t be reported until their next quarterly report, if they were required to file another one.
The New York Times performed an extensive investigation into the activities of Americans for Job Security in Alaska in 2010:
Alaskans grew suspicious two years ago when a national organization called Americans for Job Security showed up and spent $1.6 million pushing a referendum to restrict development of a gold and copper mine at the headwaters of Bristol Bay.
Americans for Job Security has deep connections to the Republican Party:
The group’s Republican connections begin with location: While its public address is a drop box at a United Parcel Service store in Alexandria, Va., Mr. DeMaura actually works out of space that is sublet from a Republican consulting shop, Crossroads Media, whose other clients include the national Republican Party, the Republican Governors Association and American Crossroads, a Karl Rove -backed group raising millions to support Republican candidates.
Crossroads Media is run by Michael Dubke and David Carney, who along with several business groups helped start Americans for Job Security in 1997. Mr. Carney had been political director for President George Bush, and Mr. Dubke was the first executive director and then president of Americans for Job Security until April 2008, when Mr. DeMaura, recruited by Mr. Carney, took over.
Americans for Job Security has also had additional charges filed against them with the IRS and FEC:
Other aspects of the group’s operations have come under scrutiny as well. In 2007, Public Citizen filed complaints with the Internal Revenue Service and the Federal Election Commission, contending that Americans for Job Security spent the vast majority of its resources electioneering – running ads close to elections – contrary to I.R.S. guidelines for tax-exempt, nonprofit business groups.
The Center for Public Integrity also did an investigation into Americans for Job Security regarding their activities in the Colorado Senate race in 2010:
Among Carney’s critics is Charlie Black, star GOP lobbyist and strategist. Black met with Carney in late 2009 after Black’s sister-in-law, Jane Norton, announced she was going to seek the Republican Party’s nomination to run for the Colorado Senate seat now held by Democrat Michael Bennet.
Black, who was also an adviser to Norton’s campaign, told the Center for Public Integrity that Carney and Stephen DeMaura, president of Americans for Job Security, came to chat with him one day in autumn 2009 at his lobbying firm, Prime Policy Group, in Washington. Carney “suggested in a meeting with me that if any long-time donors in Colorado wanted to give Americans for Job Security large contributions that they would know what to do with it,” Black recalled.
“If my sister-in-law wanted to send large donors from Colorado their way, the implication was that they would use the money to benefit her candidacy,” Black said.
Carney’s message “sounded like it would be pushing the envelope on the rules against coordination,” Black said, referring to Federal Election Commission rules barring candidates’ campaigns from working with outside groups that spend money to support them.
Neither Carney nor DeMaura returned multiple calls seeking comment.
Nothing ever came of the meeting, Black says. But, this spring and summer, Americans for Job Security ran hundreds of thousands of dollars worth of ads in a drive that helped to sink Norton and make her opponent, Ken Buck, the party’s Senate nominee.
Complaint filed with FEC
Americans for Job Security ultimately spent $976,000 on Colorado ads to help Buck in the primary, according to Public Citizen. The group’s name also surfaced in a May complaint filed by a Norton supporter with the Federal Election Commission . In the complaint, Charles Grice, a former Colorado state official, accused Buck’s campaign of coordinating with wealthy Colorado businessman Jerry Morgensen, who allegedly pledged at least $1 million to finance independent expenditure ads by Americans for Job Security and two other smaller groups.
In late summer, Grice announced he wanted to withdraw his complaint, saying he preferred Buck to the Democratic incumbent. Asked by the Center about FEC procedures for withdrawing complaints, an FEC press staffer said that “there’s no provision in our regulations for withdrawing a complaint once it has been filed.” Sources familiar with the complaint say it is almost certainly still pending.
Let all hope California Attorney General Harris can nail this group once and for all.