Secretive groups spend millions to influence state elections

Groups that don't have to disclose their donors gain traction since 'Citizens United' court decision

Of the millions of dollars worth of ads aired in Kansas’ competitive gubernatorial race, most have not been paid for by the campaigns of Gov. Sam Brownback, a Republican, or his Democratic opponent, Paul Davis.
Instead, two vaguely named entities have dominated television airwaves there, spending more than $3 million to saturate commercial breaks from Topeka to Wichita with roughly 7,000 ads that boosted or bashed the incumbent governor.
Who funds these groups remains largely a mystery. The groups, nonprofits exempt from paying taxes, are not required to disclose their donors in Kansasand most other states.
One group called the Alliance for Freedom, a Virginia-based conservative nonprofit, sponsored ads touting Brownback’s accomplishments as governor. Kansas Values Institute, a group run by two former Republican state legislators but backed in part by a teacher’s union, began airing ads attacking Brownback’s record on education and economic policy soon after the August primary election. Neither group responded to requests for comment.
Four years ago, the last time Brownback ran, no such groups purchased ads in the governor’s race in Kansas, and only $713,000 was spent on TV ads overall. This cycle, non-disclosing groups paid $3.3 million of the $6.3 million spent on ads run in the state so far. And Kansans have seen more ads for state-level elections produced by these secretive groups than voters in any other state.
Since 2010, a year when the U.S. Supreme Court’s Citizens United vs. Federal Election Commission decision loosened restrictions on third-party political spending, such secretive groups have gained traction in state politics even beyond Kansas.
With less than a month to go until Election Day, more than two dozen of these political nonprofit groups have aired at least $9.3 million worth of ads to influence state elections in 16 states across the country this cycle. It’s a small slice of the $430 million spent on TV advertising overall for state-level offices, according to a Center for Public Integrityanalysis of preliminary data through Oct. 6 from media tracking service Kantar Media/CMAG. But it has already surpassed the $8.4 million spent by such groups during the entire 2010 election cycle, when a comparable number of governors’ seats were up for election.
Related: Big money is being spent in U.S. Senate elections, andDemocrats have an edge in the ad wars. 
Yet given the buffet of options donors can access to influence an election —including contributions to candidates, parties or political action committees — why have these secretive groups that are supposed to promote “social welfare,” not politics, become more active in the states?
“It’s because they can,” said Kenneth Mayer, a professor at University of Wisconsin-Madison who studies campaign finance.
Groups such as Kansas Values Institute may attract donors who seek the anonymity provided by many of these nonprofits.
“People believe that there is an important constitutional right to engage in anonymous spending,” Mayer said, referencing the view articulated by Supreme Court Justice Clarence Thomas in the 2010 Citizens United case. “If you don’t have to disclose, there might be some reasons why you would find it in your interests.”
However the ability of these nonprofit organizations to engage in political spending predates Citizens United by about 30 years, according to Marcus Owens, an attorney and former director of the IRS’s Tax Exempt Organizations Divisions.
Since 1981, groups such as the National Rifle Association, AARP and Planned Parenthood — sometimes referred to as “501(c)(4)’s” in shorthand for the section of Internal Revenue Code under which they are regulated —  have been legally permitted to purchase “issue ads,” which may name candidates but not urge viewers to “vote for” or vote against” a specific politician. Groups could engage in this narrow kind of election activity, without disclosing the source of their funds, so long as such politicking was not the group’s “primary purpose.”
Citizens United, combined with another 2010 ruling from a lower federal court, freed corporations and unions to spend limitlessly to directly advocate for the victory or defeat of candidates. For the nonprofit groups, which are technically corporations, the court rulings provided both new legal freedom and a symbolic boost.
“The rules were already there,” Owens said. Citizens United signaled to these groups that, “the sort of psychological impact of federal election law was lessened and the way was clear for more corporate-oriented money to flow in.”
Attempts by the IRS to regulate this new kind of political spending — and allegations that the agency was disproportionately targeting conservative groups with its audits — resulted in the resignation of a high-ranking  IRS official a year ago. Hobbled from the brouhaha, the IRS has been limited in its supervision of these groups, as the Center for Public Integrity has previously reported.

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