Category Archives: campaign finance

Stand for Children PACs could face big fines

A pro-charter school organization and the four Nashville school board candidates it backed in August are subject to combined civil penalties potentially totaling $685,000, according to The Tennessean.

The Tennessee Registry of Election Finance on Tuesday sent a show cause letter to Stand for Children and candidates Miranda Christy, Thom Druffel, Jane Grimes Meneely and Jackson Miller.

The violations relate to the candidates coordinating with Stand for Children and its two political action committees to find campaign workers. The coordination, first reported by The Tennessean, stemmed from an email between Stand for Children’s political director, Dan O’Donnell, and the executive director of the Martha O’Bryan Center, a nonprofit group that operates two charter schools.

…According to the ethics bureau’s board of directors, that coordination caused the four candidates to eclipse campaign contribution limits. Each campaign is subject to a fine equal to 115 percent of the difference between the contribution cap of $7,600 and the amount of the unreported political help provided by Stand for Children. That comes out to about $70,000 in potential fines per campaign, and Stand for Children’s political action committee is subject to the same potential fine for each infraction.

Haslam hosts private fundraiser for Rubio at executive residence

Tennessee Gov. Bill Haslam hosted a private fundraiser for Florida U.S. Sen. Marco Rubio’s campaign for reelection at the state’s executive residence Monday, reports The Tennessean.

The event, which Rubio attended, was co-hosted by Tennessee’s Republican U.S. Sens. Lamar Alexander and Bob Corker. Corker was present for the fundraiser, but Alexander had to return to Washington D.C. from East Tennessee on Monday and was not in attendance, said an aide for the senator.

Haslam and Alexander endorsed Rubio’s Republican presidential primary bid days ahead of Tennessee’s March primary, just as Donald Trump had started to solidify himself as the GOP frontrunner. Their help fell short, however, as Rubio won only one of Tennessee’s 95 counties. Trump won the state in a landslide.

Rubio, after losing his presidential bid, opted to run for reelection and is now looking to stave off Democratic challenger Patrick Murphy, a two-term Florida congressman.

The Rubio fundraiser marks the second campaign fundraiser that Haslam has held in recent months at the governor’s mansion, which is located in Nashville’s Oak Hill neighborhood.

Haslam in July hosted a fundraiser for U.S. Rep. Diane Black, R-Tennessee, ahead of her primary election against challenger Joe Carr.

Tennessee state Democrats criticized the governor for holding that event, arguing that the taxpayer-funded governor’s home is not a place where campaign events should be held.

Five legislators hosted on seaside trip by voucher advocate

Five Republican state legislators were hosted on a three-day trip to the Alabama Gulf coast in 2014 by Mike Gill, a board director of Tennessee Federation for Children, a group that actively pushes school voucher legislation and has spent hundreds of thousands of dollars in legislative campaigns through its political action committee, according to The Tennessean.

Reps. Andy Holt, Mike Carter, Billy Spivey and recently ousted lawmaker Jeremy Durham stayed at Gill’s condo and left one morning for a half-day deep sea fishing trip paid for by Gill. They didn’t catch many fish, but the captain showed them how to filet the ones they did. Rep. Jimmy Matlock also made the trip but went to the beach instead of fishing because he gets seasick.

The group traveled to Gill’s Gulf Shores condo and ate seafood at local restaurants on their own dime. They discussed policy, but some say there was a rule not to do so when Gill was around.

Carter, who bunked on a couch in the condo for the three-day trip, thought he might have to take a quiz after watching the movie. He described the weekend as “intense training in integrity” involving “an odd duck.”

(Note: The referenced movie was “A Man for All Seasons,” a 1966 film on the final years of Sir Thomas More, the 16th-century Lord Chancellor of England who clashed with King Henry VIII on religious principles and was beheaded. The men watched the movie one night, then discussed it at length.)
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Harwell, Haslam back new rules on investing campaign funds

House Speaker Beth Harwell says she’s having legislation drafted to put some rules in place for legislators investing campaign funds in private companies, reports The Tennessean. Gov. Bill Haslam says he’d support additional disclosure of investments.

This comes as the Registry of Election Finance is investigating former state Rep. Jeremy Durham’s investment of campaign money in a company owned by Andy Miller, a well-known GOP donor who’s given money to Durham in the past.

“The governor believes it is good policy to disclose campaign investments just like personal disclosures made annually to the Tennessee Ethics Commission,” said spokeswoman Jennifer Donnals. The personal disclosures require public officials to report any investments worth $10,000 or more.

Harwell, R-Nashville, state Sen. Doug Overbey, R-Marvylle, and Rep. Cameron Sexton, R-Crossville, said separately there should be more transparency and regulations when Tennessee public officials invest their campaign funds.

“I do not personally believe campaign contributions should be invested in private companies. I have directed our legal staff to research these issues and work with the Registry of Election Finance to identify the best remedy, so that legislation can be introduced to address it,” Harwell said in an email Monday.

“I believe in and support full disclosure and transparency in our campaign finance reports, and will always support legislation to that end. We should always strive to keep up to date on best practices, and I will be supportive of legislation seeking to address increased transparency or regulations on gift-giving or investments.”

…Lt. Gov. Ron Ramsey, R-Blountville, agreed there should be more transparency but didn’t go as far as to suggest legislation.
“I think it is entirely appropriate that we require full disclosure of a campaign’s investments and interests, just as we do for personal interests and investments,” the retiring lawmaker said.

“While investments in campaign accounts should be permissible, they should be limited to investments that are public and available to all — publicly-traded stocks, mutual funds, certificates of deposit, etc. — to eliminate even the appearance of undue influence.”

On the prescription painkiller lobby’s influence

(Note: The Associated Press and the Center for Public Integrity have produced a package of stories published this weekend on the politics of those involved in making prescription painkillers. One of them, focused on lobbying efforts and political contributions at the state level, is below and includes a substantial reference to Tennessee. ‘

The Tennessean has done a sidebar reporting that Tennessee politicians received more than $1.6 million in campaign contributions over the past decade from pharmaceutical companies and other members of the Pain Care Forum, a coalition that meets monthly to discuss opioid-related issues. That report is HERE.)

By Geoff Mulvihill, Liz Essley Whyte and Ben Wieder, Associated Press and Center for Public Integrity
The makers of prescription painkillers have adopted a 50-state strategy that includes hundreds of lobbyists and millions in campaign contributions to help kill or weaken measures aimed at stemming the tide of prescription opioids, the drugs at the heart of a crisis that has cost 165,000 Americans their lives and pushed countless more to crippling addiction.

The drugmakers vow they’re combating the addiction epidemic, but The Associated Press and the Center for Public Integrity found that they often employ a statehouse playbook of delay and defend that includes funding advocacy groups that use the veneer of independence to fight limits on the drugs, such as OxyContin, Vicodin and fentanyl, the narcotic linked to Prince’s death.

The mother of Cameron Weiss was no match for the industry’s high-powered lobbyists when she plunged into the corridors of New Mexico’s Legislature, crusading for a measure she fervently believed would have saved her son’s life.

It was a heroin overdose that eventually killed Cameron, not long before he would have turned 19. But his slippery descent to death started a few years earlier, when a hospital sent him home with a bottle of Percocet after he broke his collarbone in wrestling practice.

Jennifer Weiss-Burke pushed for a bill limiting initial prescriptions of opioid painkillers for acute pain to seven days. The bill exempted people with chronic pain, but opponents still fought back, with lobbyists for the pharmaceutical industry quietly mobilizing in increased numbers to quash the measure.

They didn’t speak up in legislative hearings. “They were going individually talking to senators and representatives one-on-one,” Weiss-Burke said.

Unknowingly, she had taken on a political powerhouse that spent more than $880 million nationwide on lobbying and campaign contributions from 2006 through 2015 — more than 200 times what those advocating for stricter policies spent and more than eight times what the formidable gun lobby recorded for similar activities during that same period.

The pharmaceutical companies and allied groups have a number of legislative interests in addition to opioids that account for a portion of their political activity, but their steady presence in state capitals means they’re poised to jump in quickly on any debate that affects them.

Collectively, the AP and the Center for Public Integrity found, the drugmakers and allied advocacy groups employed an annual average of 1,350 lobbyists in legislative hubs from 2006 through 2015, when opioids’ addictive nature came under increasing scrutiny.

“The opioid lobby has been doing everything it can to preserve the status quo of aggressive prescribing,” said Dr. Andrew Kolodny, founder of Physicians for Responsible Opioid Prescribing and an outspoken advocate for opioid reform. “They are reaping enormous profits from aggressive prescribing.” Continue reading

Six legislators went to Europe at Andy Miller’s expense

Investigations into Jeremy Durham’s finances reveal gaping holes in state campaign finance laws that allow lawmakers to receive overseas “education” trips from wealthy donors and use campaign money for investments not reported to the public, reports The Tennessean.

Durham invested his campaign funds in the company of well-known Republican donor Andy Miller, who is the leader of an organization described as a hate group by the Southern Poverty Law Center. Miller also paid for six lawmakers — one Democrat and five Republicans — to take a trip in fall 2011 to Europe to learn about “radical Islam.”

The trips and the investments involved thousands of dollars, and raised concerns among ethics and open government advocates about the influence of money on the lawmakers. But none of these transactions or travel are required to be reported on any state campaign finance document, said Drew Rawlins, executive director of the state Bureau of Ethics and Campaign Finance.

…Miller is a prominent tea party-aligned donor and leader of the Tennessee Freedom Coalition. The Southern Poverty Law Center says the group is opposed to Islam and those who practice it, landing the organization on the SPLC’s list of hate groups for years, said Stephen Piggott, a senior research analyst at the SPLC.

…The “gift” loophole in state law allowed Miller to pay for six lawmakers to go on a five-day “fact-finding” trip to Europe. Because Miller isn’t a registered lobbyist, Rawlins said, there’s no violation of law, and there is nothing Miller or the lawmakers on the trip would need to report to his agency.

“They can’t accept a gift from a lobbyist or an employer of a lobbyist. So if it was paid for by a lobbyist or employer of a lobbyist, then it would be a prohibited gift. Otherwise, there’s no prohibition on taking a — and I’ll use the term gift, but a trip in this case — there’s no prohibition on that,” Rawlins said.

Miller’s trip included stops in Dearborn, Mich. — a city with a large Arab-American population — London, Brussels, Antwerp and Amsterdam. Those on the trip include: Sens. Reginald Tate, D-Memphis; Bill Ketron, R-Murfreesboro; Rep. Judd Matheny, R-Tullahoma; Rep. Matthew Hill, R-Jonesborough; and then state Rep. Joe Carr, a Lascassas Republican who unsuccessfully challenged U.S. Sen. Lamar Alexander and U.S. Rep. Diane Black in recent primaries.

“The purpose of the trip was to discuss immigration issues with their peers in parliaments there that I had met on previous encounters,” Miller said in an email, also confirming paying for the trip.

“It may be hard for some to understand that I went to this expense simply out of love and concern for my country,” he said. “But that is the fact.”

Carr said Miller paid for flight and hotel costs. When asked is he was concerned about possible criticism of Miller financing an international trip for lawmakers, Carr said: “I don’t give a rat’s ass.”

Registry board votes to review activities of Stand for Children PAC

The Registry of Election Finance board has taken the first step toward a hearing on allegations against the Stand for Children political action committee and several Nashville school board candidates it supported violated campaign finance laws, reports The Tennessean.

A complaint against the PAC was filed by Tennessee Citizens Action, which bills itself as promoting consumer rights and civic action.The complaint contends Stand for Children illegally coordinated its activities with several pro-charter school candidates during the election.

“My gut feeling is there is enough smoke to open up and look at it,” said Tom Lawless, chairman of the registry board. He added: “If they violated (the law), we need to be consistent. We don’t have to be punitive, we can be constructive.”

The complaint was filed Aug. 4, a day before Nashville’s school board elections, and cites a story by The Tennessean that details emails sent by the head of a prominent Nashville nonprofit that appear to show she coordinated with Stand for Children to find campaign workers for the four school board candidates.

It also cites a July 29 WSMV report that says Stand for Children Director Daniel O’Donnell met with candidate Thom Druffel during a 10-day mandatory blackout period before the election. Stand’s attorney said O’Donnell took a day off from work that day and was not in violation of the law.

Stephen Zralek, an attorney with Nashville law firm Bone McAllester Norton PLLC who represents Stand for Children, said the organization takes election ethics issues seriously and consistently follows the law.

“The Registry’s order is standard procedure whenever a complaint is filed. We look forward to answering the Registry’s questions and providing an accurate account of the facts,” he said in a Wednesday email.

Gerard Stranch, the attorney who filed the complaint, told the registry he thought it was clear that there was evidence Stand for Children exceeded campaign contribution limits by coordinating with candidates, and violated laws banning donations by a PAC within a “blackout period” in the days immediately leading up to the election.

Durham tax returns facing subpoena

The state Registry of Election Finance plans to subpoena expelled Rep. Jeremy Durham’s federal tax returns as part of an investigation into whether he used campaign funds for personal expenses, according to The Tennessean.

The state must obtain more records to learn about any potential violations and to uphold the integrity of the organization, said board Chairman Tom Lawless during a meeting Wednesday.

“This organization stands for making them do it right. And I’ve got some real serious, serious concerns — as we all have — that he may not have done it right. Or he was so mixing and matching his personal finances, business finance, whatever proclivities he might have had out there,” Lawless said.

The state House of Representatives expelled Durham by a 70-2 vote on Tuesday, only the second expulsion since the Civil War … Few representatives referenced the ongoing state campaign finance investigation, also spurred by the attorney general after a former Durham employee said Durham asked him to take money from his campaign account and put it into his title company.

Durham refutes that claim, pointing to a recent state registry memo that notes that an expenditure to the former employee may not have come directly from Durham’s campaign account. But Durham did acknowledge, in a wide-ranging eight-page letter sent to colleagues on Monday, that the $191,000 discrepancy between his campaign finance report and campaign bank accounts discovered by the state is due to large investments.

Recently, prominent GOP donor Andy Miller confirmed that Durham invested campaign funds into his account. Durham also recently closed his title company. Drew Rawlins, executive director of the Bureau of Ethics and Campaign finance, said the closure would have no affect on the registry’s ability to obtain Durham records.

Lawless and the rest of the state registry said there’s still more that needs to be investigated, and that the tax returns could potentially shed new light on how Durham may have or have not used campaign funds.

…”I’d like to get this sordid detail finished, to the end, and close the chapter of Mr. Durham,” Lawless said.

…Rawlins said he anticipates the investigation will be complete by October or November.

Donald Trump Jr. holds TN fundraiser

Donald Trump Jr. swung through Franklin on Wednesday for a private campaign fundraiser at the home of a Franklin couple, Sandy and Mike Stresser, reports The Tennessean.

Money raised went to the Trump Victory Committee, the joint committee fundraising effort of the Republican National Committee and the Trump campaign.

Trump, the eldest of Republican presidential candidate Donald Trump’s children, addressed the reception for about 20 minutes and then spoke individually to attendees at an event that lasted more than an hour.

Among the 75 or so in attendance were multiple Republican state lawmakers, including Rep. Charles Sargent, R-Franklin; Sen. Jack Johnson, R-Franklin; and Sen. Mark Green, R-Clarksville; as well as Bill Hagerty, former Economic and Community Development commissioner under Gov. Bill Haslam.

Hagerty serves as Tennessee’s finance chairman of the Trump Victory committee and was recently tapped to be a member of Trump’s transition team.

“I felt that Don Jr.’s visit was very successful,” Hagerty said. “His message was well received. And I’ve enjoyed the time that I’ve spent with Don Jr., Ivanka and Eric. They represent their father very well.”

Durham closes business tied to campaign investigation

State Rep. Jeremy Durham has closed the title company business that ties into an investigation over whether the Franklin Republican diverted campaign money to personal use, reports the Tennessean.

In addition to serving as a lawmaker, Durham is an attorney. Until recently, he operated a title company called Battleground Title & Escrow LLC, a company used for real estate transactions that was founded in November 2014, according to documents from the secretary of state.

But on Aug. 15, the status of his business went from active to dissolved to terminated, according to state records. Adam Ghassemi, a spokesman for the secretary of state’s office, said a “notice of dissolution” and “articles of termination” were filed by Durham with the office Aug. 15. That means Durham can’t continue to legally conduct business under the name Battleground Title & Escrow.

“The voluntary dissolution is filed on behalf of the entity by an authorized party when the entity is winding down a business,” Ghassemi said. “Articles of termination mean the entity will be legally terminated.”

…In May, Tennessee Attorney General Herbert Slatery announced a former Durham employee named Benton Smith had given his office a signed statement accusing Durham of using campaign funds for his title company. The announcement came before Slatery released his final report from the investigation that revealed allegations of sexual misconduct by Durham.

…Durham has adamantly denied the allegations from Smith, calling him a disgruntled employee, but the findings were turned over to the registry. The registry announced it would investigate Durham’s actions…Earlier this week (Durham’s attorney, Peter) Strianse said U.S. Attorney David Rivera has issued two subpoenas related to Durham’s campaign finances, possibly to explore whether any tax violation occurred.