Local Voters, Distant Donors

Part 6 of 6

Published — November 3, 2018

Why state attorneys general races are the next frontier for out-of-state influence

State attorneys general have risen to national prominence, drawing more media attention and more interest in their elections. Here, eight of them gather for a Democratic Attorneys General Association press conference on gun violence on Feb. 26, 2018, in Washington, D.C. (Andrew Harnik/AP)

This story was published in partnership with USA Today.


Alabama’s Attorney General Steve Marshall may coast to victory on Nov. 6, but not without the help of some powerful friends from up north.

Marshall, who was appointed to office in 2017, survived a dramatic primary challenge with an influx of $735,000 to his campaign from the political action committee of the Republican Attorneys General Association, a nonprofit based in Washington, D.C.

Those contributions are now the subject of a pending ethics complaint arguing the money violates Alabama’s campaign finance laws — and they are raising eyebrows because they came from across state lines.

“The people of Alabama need to know that their attorney general is not working for any out-of-state interests,” the Democratic challenger, Joe Siegelman, said in October. Siegelman and Troy King, one of Marshall’s primary opponents, are pressing for a ruling on the complaint.

The dispute over this hefty chunk of cash also illustrates the state of play in 2018 attorneys general races nationwide: more national money, more competition and more at stake.

Attorney general has always been a springboard to higher office — the “AG” of attorney general should stand for “aspiring governor,” to hear some tell it — but since 2014, when a comparable number of states chose their attorneys general, the once-staid campaigns have become growing targets for out-of-state influence.

Candidates for attorney general this year have raised a third more than at this point in the 2014 campaign cycle, according to a Center for Public Integrity analysis of data from the National Institute on Money in Politics. Thirty states are electing attorneys general this year, but races in states such as Wisconsin, Ohio and Florida appear especially close. Their resolution could shape the political landscape of the states and even the future of the Trump administration.

That’s because attorneys general have realized the power of banding together to file high-profile lawsuits to impact policy beyond their borders, especially since 1998, when over 40 state attorneys general reached a more than $200 billion settlement with four tobacco companies about cigarette marketing that downplayed health risks.

The practice matured during the Obama years, which saw 62 lawsuits involving multiple attorneys general against the federal government, including suits challenging Affordable Care Act fees and the Clean Air Act, according to data gathered by Paul Nolette, an associate professor of political science at Marquette University.

During the first two years of Trump’s presidency alone, attorneys general working together have already filed or joined 61 suits against the administration, challenging rules such as the EPA rollback of Clean Air Act regulations and child separations at the border.

Working together allows attorneys general offices to share resources and catapult issues onto the national stage. It’s made the job more visible and somewhat more partisan, says James Tierney, a Democrat who was Maine’s attorney general from 1980 to 1990 and now teaches a course at Harvard Law School on the role of state attorneys general.

Lawsuits challenging the federal government have risen sharply since the end of the Obama administration.

Source: Data gathered by Paul Nolette, Marquette University through Sept. 5, 2018.

“Ninety-five percent of what any attorney general does only affects their own state,” Tierney said, referring to responsibilities like overseeing criminal investigations. “The other 5 percent, whether it’s suing the president or not suing the president, that’s huge, and so that’s what attracts the media attention.”

Previous election cycles operated under a so-called “incumbency rule” where national attorneys general groups from both parties agreed not to lend resources to campaigns targeting incumbents during election years. The agreement helped maintain the goodwill needed to coordinate investigations across state and party lines.

Republicans did away with that rule in 2017, though, and unsuccessfully challenged Democrat Mark Herring in Virginia. In 2018, however, it’s Republicans who are on the defensive. Republicans make up 12 of the 18 incumbents running for re-election this year.

The D.C.-based heavyweights

This election marks the first cycle with attorneys general associations for the two major parties going head-to-head in many states.

Four years ago, Republican Attorneys General Association was a newly independent group, while the Democratic Attorneys General Association was headquartered in Denver, Colorado, with only part-time staff. Both groups operate as political nonprofits regulated by Section 527 of the IRS, which means they must report all donors who give $200 or more per calendar year. But they don’t indicate which donors’ money goes to which candidate they support, so the original source of the cash helping a specific candidate is often unclear.

Republican Attorneys General Association contributors Amount
Judicial Crisis Network$5,100,000
U.S. Chamber Institute for Legal Reform$2,995,825
National Rifle Association of America$946,175
Citizens for a Working America$930,000
Koch Industries$680,000
Democratic Attorneys General Association contributors Amount
American Federation of State, County and Municipal Employees$350,000
International Brotherhood of Electrical Workers$350,000
Donald Sussman$300,000
Planned Parenthood Action Fund$260,000
Vin Ryan$200,000

Source: Center for Public Integrity analysis of IRS records filed as of Nov. 2, 2018.

RAGA was founded in 1999 by a group of conservative attorneys general, including Alabama’s Bill Pryor, who were frustrated by what they considered activist litigation pursued by their colleagues in the tobacco case. It operated under the umbrella of the Republican State Leadership Committee from 2002 until 2014.

The group’s largest funder is the Judicial Crisis Network, which has given RAGA $7.2 million since RAGA’s founding. As a 501(c)(4) “social welfare” group, Judicial Crisis Network doesn’t disclose its donors but IRS documents show it has received around $4 million from the Wellspring Committee, another conservative “dark-money” group. The network spent $1.5 million to support the confirmation of Justice Brett Kavanaugh to the Supreme Court in September and also supports conservative judicial candidates at the state level.

“We proudly support the Republican Attorneys General Association, an organization that has had enormous positive impact on our public policy landscape by fighting for the rule of law and the constitutional principles that protect every American,” Judicial Crisis Network’s Chief Counsel and Policy Director Carrie Severino said in a statement to the Center for Public Integrity.

Other conservative megadonors such as the National Rifle Association ($1.13 million) and Koch Industries ($1.05 million) are among RAGA’s top patrons. Neither responded to requests for comment.

Corporate donors that have been targets of large-scale multistate lawsuits are also among the largest donors to RAGA. Purdue Pharma, manufacturer of the drug OxyContin, gave RAGA over $600,000 since 2014, and health insurer Anthem Inc. gave more than $500,000 since 2015.

“Purdue provides funding to organizations who share our commitment toward addressing the nation’s opioid crisis,” said Bob Josephson, Purdue’s executive director for communications.

“Elected officials make decisions that directly affect our ability to make quality health care coverage affordable and to improve the health of the communities we serve,” Anthem’s website explains. “Our active participation in the political process is essential to ensure that we have a voice in those decisions.”

This year alone, RAGA has raised over $15 million, according to IRS filings.

Not every Republican is happy about RAGA’s clout. “Over time, it’s gone from being an ideological entity and has become more of an extension of the Chamber of Commerce,” said King, a former Alabama attorney general who came within a percentage point of Marshall in the June primary before losing a runoff election in July.

The association raises money from corporate donors to elect Republicans, he said, “and then you don’t see a lot of Republicans who go and file suit against these big companies.”

But the group has been undeniably successful in helping to elect Republican attorneys general. Since 1999, the ranks of Republican attorneys general grew from 12 to 27. More Republican attorneys general meant more firepower to push back on Obama-era policies. That, in turn, caused more national Republican donors to start looking at the position as a role that needed to be cultivated.

For Democrats, the need for a national organization to counter RAGA was clear. DAGA moved its headquarters from Denver to D.C. and hired its first full-time staff members in 2016.

“There’s been a sea change in how attorneys general have been perceived, and we have Donald Trump as our president,” said DAGA Executive Director Sean Rankin. “These factors are all changing the way this committee is operating.”

That means not only more money, but more money from progressive sources.

DAGA went from bringing in no more than $4.6 million a year to raising $7.6 million in 2017. This year, it has already raised more than $7 million before Election Day according to the group’s most recent filings with the IRS. The most generous donors in recent years are progressive groups such as Planned Parenthood Action Fund, which has given it $260,000 since 2016.

“Most Democratic donors haven’t known why they would want to give to an attorney general office before,” said Rankin. “It just wasn’t an office that garners that type of limelight.”

The Democratic group has received contributions from many of the same corporate interests as RAGA but so far in lesser amounts. Purdue Pharma has given DAGA about $185,000 since 2014, for example. DAGA says it counts 37,000 small dollar donors this cycle, its first time running a program to encourage contributions in all sizes.

Wisconsin challenge to a GOP incumbent

These groups are facing off in states such as Wisconsin, where incumbent Republican Brad Schimel is defending his post against Democrat Josh Kaul.

Kaul prosecuted drug traffickers and murderers as a former assistant U.S. attorney in Baltimore, where he handled seven trials over four years, a number Schimel says makes Kaul inexperienced for the job of state attorney general. Kaul, the son of former Wisconsin Attorney General Peg Lautenschlager, most recently worked in private practice at Perkins Coie in Madison.

Schimel was elected Wisconsin’s attorney general in 2014, and his tenure has been marked by a backlog of untested rape kitsdelays at state crime labs and what his challenger calls a weak response to the opioid crisis.

These missteps and his participation in ideological lawsuits over national issues led The Capital Times to label Schimel “the worst attorney general in Wisconsin.”

“Only a massive inflow of money from outside special-interest groups and wealthy self-interested donors keeps Schimel, a scandal-plagued political careerist, in the running,” The Capital Times editorial board wrote in September.

RAGA originally gave the Schimel campaign $44,337, according to an ethics complaint filed by the state’s Democratic Party. This exceeded Wisconsin’s $44,000 contribution limit. RAGA spokesman Zack Roday said the excess donation was “a mistake that has been corrected.”

Kaul, on the other hand, has received slightly less than $26,000 from DAGA.

Wisconsin’s Republican Attorney General Brad Schimel, left, is running for re-election against Democratic challenger Josh Kaul in a close race that has attracted attention from national donors. (AP/file)

“There’s no doubt that outside spending has impacted the AG’s race in Wisconsin,” said Kaul campaign spokeswoman Gillian Drummond. “Brad Schimel has repeatedly put special interests ahead of the interests of Wisconsinites, and now RAGA is spending big to support his campaign.”

The Schimel campaign has not responded to multiple requests for comment. But Campaign Manager Johnny Koremenos said in a statement on the Schimel campaign website last month that “Josh Kaul’s record is weak, thin and blatantly partisan. That’s why every day our team grows, while the Kaul campaign relies on help from out-of-state special interests.”

Both have attracted attention from other deep-pocketed out-of-state donors. California-based billionaire environmental activist Tom Steyer gave Kaul $10,000. Schimel has received $20,000 from Illinois-based Richard Holson III, CEO of Guarantee Trust Life Insurance, and $17,500 from Dick Uihlein, the wealthy conservative activist from Illinois. None responded to requests to comment.

Both RAGA and DAGA have spent money on the Wisconsin race outside of the candidates’ campaigns as well. RAGA planned to commit $3 million to an ad campaign, Roday said, and DAGA will spend $2 million on ads backing Kaul. DAGA’s most recent ad accusing Schimel of being too lenient on child molesters while serving as Waukesha County prosecutor was pulled from one station after lawyers for Schimel called it inaccurate. DAGA stands by the ad and wrote its own letter to TV stations in response.

The rancor is a clear shift from the days when the incumbency rule largely would have shielded an incumbent such as Schimel from such campaign brush fires.

“Is it a little bit more contentious? Maybe,” said DAGA’s Rankin. “But they’ve been dropping bombs on Democratic AG candidates for years and we have the ability to fight back, and we’re aggressive with it. Because winning a seat matters.”

Ohio’s tight race for an open seat

One of the highest profile attorney general races in the country — and among November’s most expensive — is taking place in Ohio, where Democrat Steve Dettelbach faces Republican Dave Yost for an open seat. The Yost campaign did not respond to requests for comment.

State Amount raised by candidates
Texas$10 million
California$6.9 million
Ohio$6.6 million
Florida$5.8 million
Illinois$4.7 million

Source: National Institute on Money in Politics, analyzed as of Nov. 2, 2018

The opioid crisis, which has hit the Buckeye State hard, looms large over the campaign. Yost has received $10,000 from drug manufacturer Pfizer’s PAC, while Dettelbach has sworn off its cash.

“Our support for Dave Yost is based on his commitment to defend the rights of Ohio patients and consumers,” Pfizer’s Senior Director of Media Relations Sharon Castillo said in a statement.

Dettelbach’s large out-of-state donations include about $16,700 from the United Food and Commercial Workers and roughly $12,700 from DAGA’s federal PAC.

Democrat Steve Dettelbach, left, faces Republican state Auditor Dave Yost in Ohio’s attorney general election, one of the most high-profile races in the country. (AP)

“Steve Dettelbach will be an attorney general who protects good jobs and better wages across Ohio. We endorse him with enthusiasm and look forward to helping him win this race,” the UFCW’s local chapters said in a statement.

RAGA and DAGA are both funding advertising in Ohio, including a $2 million ad buy from DAGA and a $1.4 million commitment from RAGA.

Yet another, more mysterious group called the Center for Individual Freedom funded more than $300,000 worth of TV ads in support of Yost, the GOP nominee, according to contracts filed with TV stations in Dayton and Columbus. Based in Alexandria, Virginia, it “seeks to focus public, legislative and judicial attention on the rule of law as embodied in the federal and state constitutions,” according to its website.

The group was formed by former tobacco executives in 1998, the same year as the giant tobacco settlement, to fight government restrictions on smoking, but its scope has since widened. It doesn’t disclose its donors and advocates against transparency measures, but tax records have revealed contributions from groups such as the National Cable and Telecommunications Association and Karl Rove’s Crossroads GPS. Issue briefs on CFIF’s website call Democratic positions on health insurance for people with pre-existing conditions “a big lie” and claim “climate alarmism” harms consumers.

The group also funded over $900,000 worth of TV ads during the 2014 election cycle attacking one candidate for Arkansas attorney general while supporting two members of the Michigan Supreme Court. It did not respond to requests for comment.

Alabama faced a heated GOP primary for attorney general this year. In this April 14, 2018, photo, Alabama attorney general candidates, from left, Chess Bedsole, Troy King, incumbent Steve Marshall and Alice Martin wait to speak at a forum in Vestavia Hills, Alabama. Marshall won after a runoff with King and now faces Democrat Joe Siegelman on Nov. 6.
 (Kim Chandler/AP)

Alabama fight over out-of-state money

In Alabama, this year’s attorney general candidates have raised about 75 percent more than when Luther Strange ran for re-election in 2014. Marshall alone has raised more than $3.8 million, according to state campaign finance records.

Aside from the $735,000 contribution from RAGA, Marshall’s largest contributor is the PAC of the Business Council of Alabama, a group that represents the state’s business community, most notably Regions Bank and Alabama Power. The council’s $355,100 to Marshall is more than three times what it contributed to the re-election campaign of Alabama’s Republican Gov. Kay Ivey. Alabama Power’s Employees State PAC also gave Marshall $85,000 independently of the council, according to filings with the Alabama Secretary of State.

A spokesperson for Alabama Power said its PAC donates to candidates who understand the concerns of its customers, employees and shareholders. The Business Council of Alabama did not respond to requests for comment, and Regions Bank declined to comment.

His GOP primary challenger, King, raised $2.2 million, while Marshall’s Democratic opponent in the general election, Siegelman, has raised more than $606,000, much of it via small donations. About 83 percent of Siegelman’s campaign funds come from within the state, compared with 74 percent for Marshall’s, according to a Center for Public Integrity analysis of state campaign finance data.

DAGA has yet to invest serious money into the race.

Marshall is expected to win the general election handily.

RAGA’s contribution represents about 20 percent of Marshall’s total fundraising. King sought a temporary restraining order barring the Marshall campaign from spending the RAGA money, arguing Alabama’s Fair Campaign Practices Act of 2010 banned political action committees active in the state’s elections from taking contributions from other PACs. Filings with the IRS show RAGA accepts contributions from super PACs such as the General Electric PAC and JP Morgan PAC.

The lawsuit was dismissed. But King and Siegelman continue to press the Alabama Ethics Commission to issue a ruling. Two Alabama lawyers have also asked the Montgomery district attorney to investigate the transaction.

RAGA spokesman Roday said that it was proud to support Marshall’s primary campaign and it complied with Alabama and federal law.

The Marshall campaign denies any wrongdoing, arguing that RAGA Action Fund is a federal PAC subject to federal law, not Alabama’s ban on PAC-to-PAC transfers.

“Every contribution to Steve Marshall for Alabama has been received in a legal manner, consistent with the guidelines set forth from the Alabama Secretary of State’s Office,” said Julia Mazzone, a spokeswoman for the Marshall campaign.

Previous attorney general campaigns, including King’s in 2006, have had trouble with RAGA contributions. In 2014, Strange’s campaign returned a $50,000 donation from a RAGA-affiliated PAC within 24 hours of his opponent’s complaint that it violated the state’s ban on PAC-to-PAC contributions.

And a complaint was filed against King’s own 2006 re-election campaign for accepting $100,000 from the Republican State Leadership Committee while it still housed the RAGA super PAC, because his opponent claimed it broke the state’s then-cap on corporate contributions. That complaint was dismissed and the corporate contribution limit was removed in 2010.

RAGA’s contribution to Marshall’s campaign is more than seven times what it gave King.

To King, it’s clear why RAGA and its corporate backers would support Marshall over him this time around. “When I was attorney general I sued 76 drug companies and I sued BP,” King said. “That’s not a Republican thing to do in their minds.”

Chris Zubak-Skees and Joe Yerardi contributed.

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