America's Families First

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http://www.opensecrets.org/pacs/lookup2.php?strID=C00487744

AMERICA'S FAMILIES FIRST ACTION FUND
Location: WASHINGTON, DC 20036
Industry: <a href="http://www.opensecrets.org/pacs/industry.php?txt=Q02&cycle=2012">Democratic/Liberal</a>
Treasurer: RUDD, DAVID
FEC Committee ID: C00487744
(Look up <a href="http://images.nictusa.com/cgi-bin/fecimg/?C00487744" target="_blank">actual documents filed</a> at the FEC)
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<p>

An investigation by ProPublica, drawing on documents filed with the

Internal Revenue Service and the Federal Election Commission, offers the

most detailed picture to date of how 501(c)(4) groups have used their

tax status for purposes likely never intended.

Our examination shows that dozens of these groups do little or nothing

to justify the subsidies they receive from taxpayers. Instead, they are

pouring much of their resources, directly or indirectly, into political

races at the local, state and federal level.

The 2010 election functioned, effectively, as a dry run, providing a

blueprint for what social welfare groups are doing on a larger scale

today. Records on what is happening in the 2012 campaign will not be

available until well after the election.

For this story, ProPublica reviewed thousands of pages of filings for

107 nonprofits active during the 2010 election cycle, tracking what

portion of their funds went into politics. We watched TV ads bought by

these groups, looked at documents from other nonprofits that gave them

money, and interviewed dozens of campaign finance experts and political

strategists.

</p>

<div style="" class="flowchart_container c4_flowchart_container closed" data-id="american-future-fund"><a class="c4_flowchart_expand" href="http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare#">« Expand</a></div>

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<p>

We found that some groups said they would not engage in politics when

they applied for IRS recognition of their tax-exempt status. But later

filings showed they spent millions on just such activities.

On the <a href="http://www.propublica.org/documents/item/326775-1024-american-future-fund-part-1#document/p9/a64857">very day</a> in 2008 that the <a class="c4_open" data-id="american-future-fund" href="http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare#">American Future Fund</a> mailed its application to the IRS, checking the box for "no" on whether it planned to participate in politics, it <a href="http://www.youtube.com/watch?v=2oEz3lzgDsI">uploaded an ad</a> to YouTube praising a Republican senator. The group reported more than <a href="http://www.propublica.org/documents/item/331911-990-american-future-fund-2010#document/p13/a51700">$8 million</a> in political spending in 2010.

We also found that social welfare groups used a range of tactics to

underreport their political activities to the IRS, a critical measure in

determining whether they are entitled to remain tax-exempt.

Many groups told the IRS they spent far less on politics than they

reported to federal election officials. Some classified expenditures

that clearly praised or criticized candidates for office as "lobbying,"

"education" or "issue advocacy" on their tax returns.

</p>

<div style="" class="flowchart_container c4_flowchart_container closed" data-id="center-for-individual-freedom"><a class="c4_flowchart_expand" href="http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare#">« Expand</a></div>

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<p>

One group, the <a class="c4_open" data-id="center-for-individual-freedom" href="http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare#">Center for Individual Freedom</a>, told election officials that it spent $2.5 million on ads in 2010, when it paid for commercials criticizing <a href="http://cfif.org/v/index.php/press-room/786-cfif-launches-tv-issue-ads-in-10-congressional-districts-urging-end-to-excessive-spending-increases-to-national-debt-and-job-killing-agenda">Democrats in 10 districts</a>. But it reported to the IRS that it spent <a href="http://www.propublica.org/documents/item/351771-990-2010-center-for-individual-freedom#document/p3/a55018">nothing</a> to directly or indirectly influence elections, calling those same ads "education" or "legislative activities."

In several instances, nonprofits funneled much of their money to other

501(c)(4)s , which experts say is a way to meet, or appear to meet, IRS

requirements for promoting social welfare. Yet records show the

recipients of those grants spent much of their money on political

activities, whether ads or voter-registration drives.

For example, almost 70 percent of <a class="c4_open" data-id="america-s-families-first" href="http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare#">America's Families First's</a> 2010 expenditures went to grants to <a href="http://www.propublica.org/documents/item/325831-990-2010-americas-families-first#document/p20/a68532">five social welfare nonprofits</a>. Four spent money on ads supporting Democrats or criticizing Republicans, including one group that put <a href="http://www.propublica.org/documents/item/392149-990-2010-votevets-org#document/p28/a68370">almost half</a> of its expenditures into political ads.

</p>

<div style="left: 678px; width: 240px;" class="flowchart_container c4_flowchart_container closed" data-id="america-s-families-first"><a class="c4_flowchart_expand" href="http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare#">« Expand</a></div>

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<p>

No one from the Center for Individual Freedom or the American Future

Fund responded to phone calls and emails from ProPublica asking for

comment. In a written statement, America's Families First said its

primary purpose was "issue advocacy" but did not answer specific

questions about grants.

Campaign-finance watchdogs say the IRS has not clarified rules for social welfare groups or enforced them vigorously.

"The tax laws are being ripped off and the public is being denied

information to which they are entitled — namely, who is financing ads

that are being run to influence their votes," said Fred Wertheimer, the

president of <a href="http://www.democracy21.org/">Democracy 21</a>, a watchdog group that has filed repeated complaints about 501(c)(4)s to regulators.

</p>

===
http://electionlawblog.org/?p=13453

<h2 class="entry-title"> <a href="http://electionlawblog.org/?p=13453" title="Permalink to “Election Lawyers Cite D.C. Circuit Ruling In Calling for Resolution of Black Rock AO”" rel="bookmark">“Election Lawyers Cite D.C. Circuit Ruling In Calling for Resolution of Black Rock AO”</a>

</h2>

           <div class="entry-meta">

<span class="meta-prep meta-prep-author">Posted on</span> <a href="http://electionlawblog.org/?p=13453" title="12:59 pm" rel="bookmark"><span class="entry-date">September 23, 2009 12:59 pm</span></a> <span class="meta-sep">by</span> <span class="author vcard"><a class="url fn n" href="http://electionlawblog.org/?author=3" title="View all posts by Rick Hasen" rel="author">Rick Hasen</a></span>

        </div>

       <p>BNA offers <a href="http://news.bna.com/mpdm/MPDMWB/split_display.adp?fedfid=15120262&vname=mpebulallissues&fn=15120262&jd=a0c0n5d6x2&split=0">this interesting report</a> which notes how the <a href="http://electionlawblog.org/archives/014469.html">Emily’s List decision</a> is already being felt at the FEC.  The report notes that a new letter in the <a href="http://saos.nictusa.com/saos/searchao?SUBMIT=ao&AO=2933">Black Rock AO</a>

controversy “came from prominent election lawyers, including some

linked to Democratic candidates, unions, and liberal nonprofits

generally supportive of Democrats. Signers included Michael Trister,

Holly Schadler, and Laurence E. Gold of the firm Lichtman, Trister &

Ross; Joseph Sandler, Neil Reiff, and James Lamb of Sandier, Reiff,

& Young; and Patricia Fiori, Eric Kleinfeld, <font color="#FF0000">Margaret McCormick, Lyn

Utrecht, and Karen Zeglis of Utrecht & Phillips.</font> The letter from

the lawyers identified with Democratic causes and candidates noted that

their position was at odds with that taken in earlier comments filed by

the national committees of the Democratic Party, as well as the reform

groups <font color="#FF0000">Democracy 21 and Campaign Legal Center. </font>The letter also noted

concerns that the appeals court decision in the EMILY’S List case could

provide much greater fund-raising clout to <span style="background-color: rgb(255, 255, 102);">independent groups by

allowing them to fund their activities with unlimited ‘soft money.</span>’

Meanwhile, political parties continue to be governed by rules requiring

them to use limited “hard money” contributions to finance their

activities.”

You can find the letter <a href="http://saos.nictusa.com/saos/searchao?SUBMIT=ao&AO=2933&START=1082802.pdf">here</a>.

UPDATE: I understand that these links are not working (this is often a

problem with the structure of the FEC website). To find these materials

go to www.fec.gov, then go to “Law and Regulations” on the left side,

then choose “Advisory Opinions,” and then choose “pending Advisory

Opinions” near the bottom of the Advisory Opinions page. Black Rock

(AO-2009-13) is at the top, and the letter I’ve referred to is currently

the second to final item listed. </p>
<a href="http://influenceexplorer.com/organization/utrecht-phillips/010fd3f47fe0421fbc62dc19e3410f8d">http://influenceexplorer.com/organization/utrecht-phillips/010fd3f47fe0421fbc62dc19e3410f8d</a>