Sunlight Foundation Reporting Group

Money to burn? Flush GOP-linked groups host swanky D.C. forum

Not all dark money flows in the same direction. That was one lesson that could be drawn this week as two deep-pocketed sister nonprofits, Crossroads GPS and American Action Network, provided a forum for Sen. Orrin Hatch, R-Utah, to highlight his conservative credentials. 

Hatch is facing a primary challenge on his right in a June primary that also seems to pit the two center-right outside money behemoths, American Action Network and Crossroads, against FreedomWorks, a Tea Party-affiliated super PAC that's backing the six-term incumbent's GOP opponent, state Sen. Dan Liljenquist.

The event where Hatch appeared Tuesday demonstrated the potential impact Crossroads and American Action could have on the 2012 election as well as how little is known about their activity. The groups had enough funds to throw a policy conference at one of D.C. most fashionable venues, the W Hotel, featuring Hatch, House chief deputy whip Peter Roskam, R-Ill., former attorney general Ed Meese, and former ambassador Boyden Gray. Plans for the 2012 election weren't on the agenda, even though ads from both groups have already begun hitting the airwaves in battleground states.

The nonprofit groups can take unlimited, anonymous donations, and spent a combined $43 million influencing the 2010 election. Steven Law, president of Crossroads GPS and its partner super PAC, American Crossroads, told Sunlight the two organizations plan to spend $300 million on this year’s presidential, House and Senate elections -- an amount that's almost equal to the total spent by all independent groups in 2010. Crossroads backers seem to prefer anonymity. Crossroads GPS, which doesn't have to report donors, raised about $32 million in 2011. American Crossroads, a so-called super PAC which must report its donors to the FEC, garnered $18 million.

Crossroads GPS plans to run "issue ads" supporting Republicans and opposing Democrats on some of the issues discussed by the panel Wednesday. The Crossroads "New Majority Agenda" calls for: reducing government regulations and spending; undoing President Obama's health care law and increasing domestic energy development. Earlier this month, Crossroads launched a $500,000 ad criticizing the Obama administration's grant to the solar energy company Solyndra, which filed for bankruptcy and received backing from an Obama bundler.

American Action chair Norm Coleman would not say how much his group plans to spend, but the outfit has already placed a four-week advertisement backing Hatch. In recent months, the senator has faced a $250,000 campaign of opposition ads, mailings and other spending underwritten by FreedomWorks. Embodying the schism on the right: One of Hatch's copanelists at the Tuesday event, Boyden Gray. The former envoy to the European Union is a board member of the American Action Network and FreedomWorks. He has publicly offered his support to Hatch.

The finances of Crosswords and American Action, known as 501c4s after the section of the tax code under which they were organized, remain murky. Only now is the American Action filling out its Internal Revenue Service tax forms for the 2010 tax year, where the public will be able to see how much money it raised for that election, according to Coleman, who is also former senator from Minnesota.

Coleman said he has “no idea” how much the group will spend and won’t know until the states have finalized their redistricting plans but that its focus will be on the House of Representatives. In addition to the pro-Hatch spot, the group produced ads late last year decrying Washington spending, and encouraging voters to call upon two Democrats expected to be in close races to vote for a balanced budget amendment.

At the event, Hatch criticized the president for enacting “unprecedented shifts in labor policy,” referring to recent regulations issued the independent National Labor Relations Board, and healthcare regulations handed down by a “non-transparent czar.”