Vermont Attorney General William Sorrell is suing two political groups – the Republican Governors Association and Green Mountain Future, an organization largely funded by the Democratic Governors Association. The lawsuits were filed in Washington County Superior Court on Monday.
Sorrell alleges that both 527 nonprofits, which have paid for advertising during the gubernatorial campaign, are violating the state’s campaign finance laws.
Under state law, any organization that receives contributions of more than $500 and spends more than that for the purpose of supporting or opposing candidates, or influencing an election, must abide by campaign finance rules that impose certain disclosure requirements and limit contributions.
The RGA rejects the premise of Sorrell’s complaint and has countered with a lawsuit of its own that would prohibit the AG from investigating the RGA’s activities in Vermont. The Vermont law firm, Downs, Rachlin and Martin, filed the case for the Washington, D.C.-based organization in U.S. District Court in Burlington on Monday.
In yet another investigation, Sorrell determined on Tuesday that the Vermont Trooper’s Association did not violate campaign finance law when its members attended a press conference held for Democrat Sen. Peter Shumlin. The complaint, lodged by Republican Lt. Gov. Brian Dubie’s campaign, alleged that the VTA compensated members for attending the conference and that that pay should have been counted as an in-kind donation by Shumlin’s campaign.
Megan Shafritz, an assistant attorney general, said the lawsuits against RGA and Green Mountain Future are similar in nature. The two groups, which have filed with the IRS, she said, are essentially acting as political action committees in Vermont and are therefore subject to state campaign finance law.
In its countersuit, the RGA not only disputes all three allegations posed by Sorrell, but also rejects the idea that the AG has the right to investigate its activities.
The AG’s office contends that as PACs, the RGA and Green Mountain Future must register with the Vermont Secretary of State’s office and file campaign finance reports in September and October. In both cases, Sorrell is seeking civil penalties of up to $10,000 for each violation.
Though these basic charges are similar, each group has been accused of other violations as well.
The RGA is accused of accepting contributions that exceed the maximum limit allowable under Vermont law: $2,000.
In its countersuit, the RGA not only disputes all three allegations posed by Sorrell, but also rejects the idea that the AG has the right to investigate its activities.
Repeated calls to Mike and Chris Schrimpf, spokesmen for the RGA, were not returned.
Shafritz said Green Mountain Future has not abided by certain electioneering communication requirements – the group failed, for example, to include its name and address on one of the ads.
“The Vermont law sets the definition of activities that make an organization … a PAC,” Shafritz said in an interview. “We feel Green Mountain Future’s activities place them squarely within that definition under Vermont law.”
Sorrell calls into question the use of Dubie’s likeness in the ad, the highly critical nature of the lieutenant governor’s “positions and record on the Vermont Yankee nuclear power plant,” and quotes from newspaper articles and individuals criticizing Dubie’s stance, in arguing the ads are not soley issue-oriented and are therefore in the realm of a PAC activity.
The AG says the ad affirms one of the principal positions of Dubie’s opponent, Democrat Sen. Peter Shumlin, who has cited many of the same claims made in the commercial.
“Our position is, we’re a federal 527 in how we’re regulated, and we’ve followed the proper paperwork,” Hudson said.
Drew Hudson, executive director of Green Mountain Future, which has raised more than $500,000 and spent most of that total on ads questioning Dubie’s support for Vermont Yankee, said Sorrell is putting his group in the wrong classification.
“Our position is, we’re a federal 527 in how we’re regulated, and we’ve followed the proper paperwork,” Hudson said. “We’re saying we’re a 527, we’re an issue-based campaign that’s focused on Vermont energy issues.”
Hudson said Green Mountain Future had made an extra effort to satisfy Vermont regulators and included its address on its Web site and on ads, even though he said they “weren’t necessarily required to do so.”
“We’ve actually done that voluntarily already because we want to cooperate with the AG as much as we can,” Hudson said.
Hudson said the ads are “advocacy” commercials meant to “change Dubie’s mind” about the state’s power mix. “This is about Vermont Yankee, not about defaming Dubie’s character or coordinating with the (Shumlin) campaign or anything like that,” Hudson said.
Paul Ryan, an attorney with the Campaign Legal Center said national political organizations, including 527 nonprofits, are obliged to follow state campaign finance laws when they spend money in states.
“Fed law doesn’t govern spending in state campaigns,” Ryan said. “Federal campaign finance law neither provides a shield nor imposes burdens for organizations active in state elections.”
In the RGA case, Sorrell has taken a riskier strategy. Ryan says the courts tend to uphold lawsuits that force organizations to meet disclosure requirements, but the AG’s assertion that the RGA is violating the state’s contribution limits of $2,000 per election cycle is a “dicey” strategy.
According to news reports, the RGA has raised $59 million in contributions this year to spend on gubernatorial races nationwide.
That’s because courts have struck down contribution limits. The Supreme Court’s decision in the Citizens United case last winter, and the D.C. district court decision in the recent Speech Now case, have thrown out state and federal limits on independent expenditures, such as issue ads.
PACs and 527s must disclose how much they receive and spend, but there is now no ceiling for contributions or expenditures, according to Ryan.
PACs and 527s must disclose how much they receive and spend, but there is now no ceiling for contributions or expenditures, according to Ryan.
Sorrell alleges that the RGA’s “Vision for Vermont” features Dubie and Gov. Jim Douglas in various Vermont locales, and the ad encourages “viewers to adopt a favorable impression” of Dubie. It is not, according to the lawsuit, an issue ad because it doesn’t “attempt to encourage viewers to adopt a particular position on a particular issue.”
The RGA, in its case against Sorrell, alleges that Vermont has overstepped its authority and has violated its First, Fifth and Fourteenth Amendment rights. “Under the First Amendment, political speech constitutionally cannot be regulated unless it expressly advocates the election or defeat of a candidate or is the functional equivalent of such advocacy,” the RGA argues in its suit.
The plaintiff asserts that it is “not under the control of any candidate and its major purpose is not the election of Vermont state or local candidates.”
The RGA also points to Sorrell’s position as an elected official who is in the middle of a race for his seat, and claims that the AG has a conflict of interest because he is a member of a statewide slate of Democratic nominees, including Peter Shumlin. The lawsuit declares that the AG’s investigation into RGA’s activities is “specious,” “giving rise … to a well-founded suspicion that the Defendant’s actions are politically motivated.”
The RGA argues that not only Sorrell, but also the senior employees of the Office of Attorney General, have been “tainted” by the AG’s personal conflict of interest. The office, so the argument goes, should therefore be disqualified from investigating RGA’s activities.
Ryan, of the Campaign Legal Center, urges state AGs to enforce the law, even in cases where the line between state and federal interests aren’t clear. “Unless state AGs go after people who ignore that law, voters won’t know who is influencing elections,” Ryan said. “Enforcement is a critical component of all of our laws.”
The Vermont Democratic Party filed a complaint with the AG last week alleging that the RGA coordinated efforts with the Dubie campaign when it shared polling information. See related story.
Editor’s note: The following clarifier was added at 8 a.m. Oct. 27, 2010: Sorrell is “arguing the ads are not solely issue-oriented and are therefore in the realm of a PAC activity.”
