The New York Times reports:
Interviews with a half-dozen campaign finance lawyers yielded an anecdotal portrait of corporate political spending since the Citizens United decision. They agreed that most prominent, publicly traded companies are staying on the sidelines.
But other companies, mostly privately held, and often small to medium size, are jumping in, mainly on the Republican side. Almost all of them are doing so through 501(c) organizations, as opposed to directly sponsoring advertisements themselves, the lawyers said.
“I can tell you from personal experience, the money’s flowing,” said Michael E. Toner, a former Republican F.E.C. commissioner, now in private practice at the firm Bryan Cave.
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The I.R.S. division with oversight of tax-exempt organizations “is understaffed, underfunded and operating under a tax system designed to collect taxes, not as a regulatory mechanism,” said Marcus S. Owens, a lawyer who once led that unit and now works for Caplin & Drysdale, a law firm popular with liberals seeking to set up nonprofit groups.
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the I.R.S. It’s a farce.”
A report by the Treasury Department’s inspector general for tax administration this year revealed that the I.R.S. was not even reviewing the required filings of 527 groups, which have increasingly been supplanted by 501(c)(4) organizations.
Social welfare nonprofits are permitted to do an unlimited amount of lobbying on issues related to their primary purpose, but there are limits on campaigning for or against specific candidates.
I.R.S. officials cautioned that what may seem like political activity to the average lay person might not be considered as such under the agency’s legal criteria.
“Federal tax law specifically distinguishes among activities to influence legislation through lobbying, to support or oppose a specific candidate for election and to do general advocacy to influence public opinion on issues,” said Sarah Hall Ingram, commissioner of the I.R.S. division that oversees nonprofits. As a result, rarely do advertisements by 501(c)(4) groups explicitly call for the election or defeat of candidates. Instead, they typically attack their positions on issues.
Steven Law, president of Crossroads GPS, said what distinguished the group from its sister organization, American Crossroads, which is registered with the F.E.C. as a political committee, was that Crossroads GPS was focused over the longer term on advocating on “a suite of issues that are likely to see some sort of legislative response. ” American Crossroads’ efforts are geared toward results in this year’s elections, Mr. Law said.
Fresh off a strong fundraising kick, American Crossroads, a conservative 527, is launching an ad blitz in key Senate races on Tuesday.
American Crossroads is spending nearly $1.9M on the ads, which includes keeping ads in Colorado and Missouri on the air and going up with new ads in New Hampshire and Nevada, sources tell Hotline On Call.
The ads are significant because they indicate that American Crossroads, which has already had a large impact on airwaves in Senate battleground states, now has the resources to play through the election. On Monday, the group reported having raised $2.6M in August and having $7.1M in its war chest.
The blitz also shows that American Crossroads appears to be going on both offense and defense. Missouri and New Hampshire are GOP held seats. The group's sister, issue-based organization -- Crossroads GPS -- has also spent significantly on holding onto Kentucky.
Meanwhile, targeting Senate Majority Leader Harry Reid (D) in Nevada and Sen. Michael Bennet (D) in Colorado, show the group is also going after Democrat held seats.
American Crossroads and Crossroads Grassroots Policy Strategies have spent millions on ads boosting Republicans in some of the most closely contested Senate campaigns headed into the midterm elections and intend to use their swelling coffers to get involved in as many as two dozen House races soon.“Playing in House races is a priority for us,” said American Crosswords spokesman Jonathan Collegio. “Those races develop much later than Senate races, so we’re still making strategic decisions on which to engage in.”
A report filed Monday afternoon with the Federal Election Commission showed that American Crossroads, a political action committee, raised $2.6 million, the bulk of which came from a pair of $1 million donations from Robert Rowling, a major George W. Bush bundler, and Trevor Rees-Jones, president of a privately held Dallas energy company, who had previously contributed another $1 million to Crossroads.
