[S]en. Bernie Sanders is building a political organization that will be able to avoid financial disclosure and influence policy from the shadows, a “dark money” strategy he has railed against for years, including on the presidential campaign trail.
The organization, called Our Revolution, will operate as a nonprofit 501(c)(4) — a designation that does not require disclosure of donors or spending because of its status as a social welfare organization. Political action committees, on the other hand, are under the authority and disclosure requirements of the Federal Election Commission rather than the Internal Revenue Service, which oversees nonprofits.
Sanders outlined the group’s charter in a July interview with USA Today. He also outlined the formation of two organizations in addition to Our Revolution. The other two are The Sanders Institute — which will focus on policy research and education — and a yet-unnamed organization that may focus on helping candidates craft media strategy.
Although Our Revolution’s mission is not explicitly clear, a major goal appears to be electing leaders with policy positions similar to Sanders’.
That goal was demonstrated in an email the democratic socialist sent to supporters to raise money on behalf of Tim Canova, a lawyer who is challenging Rep. Debbie Wasserman Schultz, D-Fla., in the Aug. 30 primary for her seat. Wasserman Schultz formerly chaired the Democratic National Committee, an institution Sanders criticized during the presidential primaries as siding with Hillary Clinton.
“This race is very important for Our Revolution because if we can win this tough fight in Florida, it will send a clear message about the power of our grassroots movement that will send shockwaves through the political and media establishments,” Sanders recently told supporters in the fundraising email.
Many political organizations work to elect progressives, including MoveOn.org and Democracy For America, both of which are political action committees that endorsed Sanders’ presidential bid and offered institutional support.
Jim Dean, the chair of Democracy For America and brother of former Vermont Gov. Howard Dean, said at the Democratic National Convention in Philadelphia last month that his staffers were advising Sanders’ people on how to organize Our Revolution.
“They have a lot of questions, so we are there to answer them,” Dean said, adding that he welcomed Our Revolution into the growing number of groups promoting progressives.
“Our feeling is that we are in a really collaborative phase,” he added. “It’s not just Our Revolution, but it’s a whole ton of other movements and political groups.”
But while some of Our Revolution’s goals seem to overlap with those of MoveOn.org and Democracy For America, the Vermont senator’s group is — by its designation — generally prohibited from working in connection with federal elections like Canova’s. Sanders has helped other political candidates though the framework of his presidential run.
Because MoveOn.org and Democracy For America steer money and resources to federal races, both are registered as political action committees with the FEC. This designation means they must file publicly available reports that show where money is coming from and where it’s going.
Our Revolution, whose 501(c)(4) status means it is a nonprofit organization focused on social welfare issues, is not considered primarily a political entity and is therefore not required to file reports with the FEC.
The group’s articles of incorporation, which are filed with the IRS, are not publicly available. The only public window into Our Revolution will be its Form 990 filings with the IRS, which won’t be available for at least a year and will not contain the kind of detail in an FEC report.
In recent years, 501(c)(4)s have been used by political interests to skirt disclosure rules while influencing public policy. While roughly $10 million was funneled into politics through 501(c)(4)s in the 2010 election, more than $50 million has flooded into the system this year, according to the Center For Responsive Politics.
Sanders frequently railed against this type of influence — often called “dark money” — during his presidential bid, including during a CNN debate in April when he questioned Clinton’s ties to such groups.
“Let’s talk about judgment,” Sanders said then. “Let’s talk about super PACs and 501(c)(4)s, money which is completely undisclosed. Where does the money come from? Do we really feel confident about a candidate saying that she’s going to bring change in America when she is so dependent on big-money interests? I don’t think so.”
The danger, according to Sanders, is that even though the money from a 501(c)(4) cannot be used to promote a particular candidate, the groups can produce “issue ads” to attack an opponent or influence legislation.
Paul S. Ryan, the deputy executive director of the nonpartisan Campaign Legal Center, said Sanders’ decision not to register Our Revolution as a PAC was “a bit of an enigma.”
“To the extent that Sanders wants to get involved in candidate elections, it seems a very odd choice to set this up as a 501(c)(4),” Ryan said.
Ryan said that because of its designation, a majority of Our Revolution’s work needed to be focused on issue advocacy, not candidate promotion.
President Barack Obama, after his election in 2008, set up a 501(c)(4) organization called Organizing for America. The nonprofit and its successor groups have advocated for political stances held by Obama and Democrats but have not become overtly involved in federal elections, and Obama has not been directly involved in what the group does.
In 2013 The New York Times reported that the most generous donors to Organizing for America were granted special access to Obama. The group has voluntarily disclosed the donors.
Ryan, the legal expert, said that because Our Revolution is closely aligned with Sanders, the disclosure requirements for federal officeholders in the McCain-Feingold Act could apply.
If applied, the rules would mandate disclosure of donors who give more than $200 and place a cap on donations solicited by Sanders of $2,700.
“We are in uncharted waters here,” Ryan said regarding Sanders’ close involvement with Our Revolution. “I don’t know of any other officeholder that has done this before.”
In addition, Our Revolution could be required to register as a political action committee if the FEC finds evidence that the group spent more than $1,000 in connection with a federal election. It is unclear what, if any, cost was associated with Sanders’ email pitch on behalf of Canova.
FEC officials said there was little legal guidance on what exactly constituted inappropriate actions by a 501(c)(4) in federal elections. Rulings would be made by the agency’s advisory board if there were an outside complaint or internal investigation.
In a complaint filed with the state attorney general’s office last week, Vermont Republican Party official Brady Toensing alleges that Sanders broke state campaign finance law through a fundraising email for Burlington Rep. Chris Pearson in his state Senate race. Toensing estimated the value of Sanders’ donor list at $5 million.
Michael Briggs, a Sanders spokesman, did not return phone and email requests for comment regarding the status of Our Revolution. Shannon Jackson, a Sanders campaign aide who is now the executive director of Our Revolution, declined to comment in an email.
A simple website for Our Revolution has been set up, but it currently acts only as a vehicle for collecting donations and email addresses. It is unclear how much money the organization has raised, though it could see an infusion of cash if Sanders transfers his residual campaign funds to Our Revolution, a move allowed under FEC rules.
The most recent FEC report for Sanders’ presidential campaign shows he had $6.1 million on hand at the end of July, though FEC officials said campaign coffers often shrink after a campaign pays its outstanding debts.
Sanders is scheduled to address supporters Wednesday in a live-streamed message that will more thoroughly explain the role of Our Revolution.
