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Key Findings

  • More than one in three governors holding office as of January 31, 2017 can be linked to state-level dark money or shadow governance groups. In all, CREW identified 30 nonprofits associated with 19 governors.
  • Nearly half of all Republican governors and one quarter of all Democratic governors in office as of January 31, 2017 could be linked to a dark money or shadow governance nonprofit. Fifteen Republican governors (out of 33) and four Democratic governors (out of 16) can be connected to dark money or shadow governance nonprofits.[1]
  • Seventy percent of identified groups did not voluntarily disclose their donors to the public.[2]
  • Three state governors connected to dark money or shadow governance groups have declared their intention to run for re-election in 2018.[3] More than two-thirds of the governors connected to these types of nonprofits (68%) are currently serving their second or third term in office. Four governors that can be linked to these types of groups (21%) hold office in states with no term limits.[4]
  • Two governors holding office as of January 31, 2017 have resigned amidst scandals in which shadow governance groups played a role. Former Gov. Robert Bentley (R-AL) resigned after impeachment proceedings had begun regarding his use of public resources to conceal an affair with his senior adviser. That adviser was on the nonprofit Alabama Council for Excellent Government (ACEGov)’s payroll, and ACEGov was named as a co-defendant alongside the governor in at least two lawsuits. Former Gov. Eric Greitens (R-MO) resigned amidst an investigation by the Missouri legislature for a number of alleged offenses. A New Missouri’s records were subpoenaed by the Missouri House committee in the course of investigating these charges.

 

View the governors’ profiles:

Alabama

Robert Bentley

Georgia

Nathan Deal

Idaho

C.L. “Butch” Otter

Illinois

Bruce Rauner

Indiana

Eric Holcomb

Kansas

Sam Brownback

Louisiana

John Bel Edwards

Maine

Paul LePage

Michigan

Rick Snyder

Missouri

Eric Greitens

Montana

Steve Bullock

Nevada

Brian Sandoval

New Jersey

Chris Christie

New Mexico

Susana Martinez

New York

Andrew Cuomo

North Carolina

Roy Cooper

Ohio

John Kasich

Tennessee

Bill Haslam

Wisconsin

Scott Walker

Introduction

Why influence politics and policy publicly when you can do it in secret? Increasingly, nonprofit groups funded by anonymous donors are doing just that, and not just at the federal level — significant sums of untraceable money are being spent in states, both to elect governors and to push their agendas. Even more concerning, many of these nonprofits are run by close allies of those very same governors. This means these politicians likely know who is paying to promote and support them, even as voters and constituents are kept in the dark. As documented in this report, secret nonprofit spending is now widespread in the states: 19 governors in office as of January 31, 2017 have benefitted from 30 closely-aligned groups boosting their campaigns and agendas.

One way donors can secretly exert influence is through dark money groups: nonprofit organizations that, under campaign finance rules loosened in the aftermath of Wisconsin Right to Life v. FEC (2007) and Citizens United v. FEC (2010), are not subject to any contribution limits and can spend virtually unlimited amounts of money in elections without disclosing their donors. As such, dark money groups allow special interests to anonymously donate unchecked amounts of money that is then used to influence elections. This lack of transparency has in turn eroded accountability. In races where dark money groups are active, voters and constituents do not know who paid to support their elected representatives or, consequently, who their representatives are beholden to.

The rise of dark money spending has been well-documented at the federal level. Overall, political spending by section 501(c)(4) groups — the nonprofit type most commonly associated with dark money — was 115 times greater in 2016 than it was in 2006, the last year before Wisconsin Right to Life, and 45 times greater than it was in 2004, the last presidential election before Wisconsin Right to Life.[5] States have seen a similar influx of anonymous spending. The Brennan Center examined a subset of states and found that, on average, dark money spending was 38 times greater in 2014 than it had been in 2006.[6] Some of that money flowed through groups that are not only funded secretly, but also have close ties to the governors they worked to elect, potentially providing donors more direct influence.

Another avenue for donors to influence governors using secretly-funded nonprofits has received comparably less attention: groups with close ties to a governor already in office that spend money to advance that governor’s policy agenda or pet projects. This is not dark money spending in the classical sense, as these organizations are not solely involved in influencing elections. Instead, they are also spending to advance the agenda and/or elevate the status of the governor with whom they are linked. However, these shadow governance groups are similar to dark money nonprofits in that spending is uncapped and does not legally have to be disclosed, aiding officeholders while preventing voters and constituents from knowing who their elected officials rely on for fiscal support. Additionally, since spending by shadow governance groups is not covered by rules surrounding political contributions, the individuals behind shadow governance nonprofits can coordinate with the governors they are supporting.

Dark Money Groups: Don’t disclose donors, spend to elect officeholders

Shadow Governance Groups: Don’t disclose donors, spend to support an already elected officeholder

Shadow Governors

A New Missouri, Inc., a nonprofit aligned with former Gov. Eric Greitens (R-MO), is an example of how closely and blatantly a shadow governance group can coordinate with a governor to bolster their political platform. The group was founded by Gov. Greitens’ campaign treasurer and run in part by his sister-in-law; Gov. Greitens’ senior adviser, Austin Chambers, also works with the group. In March 2017, Chambers told The Kansas City Star that there would be “coordination between ANM, the governor’s state office, and his campaign.”[1] The group ran ads supporting the governor’s budget proposal and attacked Republican lawmakers who were critical of Gov. Greitens or his legislative priorities.[2] The group also paid for travel to, and food and beverages for, a “campaign-style event” supporting Gov. Greitens, and provided Gov. Greitens’ airfare to travel between rallies.[3]

The group became embroiled in the Missouri state legislature’s investigation of then-Gov. Greitens after a former campaign staffer testified that the governor directed him to meet with donors who were interested in having their identities concealed.[4] Gov. Greitens announced his resignation on May 29, 2018.[5]

CREW investigated all 50 state governors holding office as of January 31, 2017 for connections to nonprofit groups involved in politics or policy. Specifically, from February to October 2017, CREW looked for organizations that directly benefited the governor — by either bolstering their election prospects or supporting agenda items that could be concretely connected to the governor — that could also be tied to the governor through a combination of timing (established during or after the governor’s initial campaign), scope (operated predominately at the state level), personnel (led by staffers and board members with established connections to the governor) and other shared logistics (used resources such as office space and contractors that were also used by the governor’s campaign), and publicly reported ties (the governor makes appearances on behalf of the nonprofit, media reports directly link it to the governor).

While individual governor-affiliated nonprofits have previously been scrutinized by the local media, there has not been a systematic review of these groups across all 50 states until now. CREW found 30 nonprofit groups connected to 19 state governors: 24 shadow governance groups, one classic dark money group, and five groups that spent both on elections and to advance a sitting governor’s agenda.

TABLE 1: 30 dark money and shadow governance groups with ties to state governors

CREW found that shadow governance groups were created for a variety of purposes. Fourteen shadow governance groups supported a governor’s overall agenda, including the New Energy to Reinvent and Diversify Fund (NERD), which essentially functioned as an off the books source for additional discretionary funding for Gov. Rick Snyder’s (R-MI) office, and New Mexico Competes, which defended Gov. Susana Martinez’s (R-NM) policies, praising her handling of a Medicaid defrauding scandal and attacking a school district superintendent who opposed her education platform.

Twelve other shadow governance groups targeted more specific goals. In Tennessee, for example, Tennesseans for Student Success, closely tied to Gov. Bill Haslam (R-TN), sponsored a $137,000 ad buy to support the state’s version of the Common Core State Standards, which the governor had helped pass in his first term as governor.[6] In New York, New Yorkers United Together advocated for Gov. Andrew Cuomo’s (D-NY) immigration policy, promoting his administration’s program that offers legal defense for immigrants.[7] Indeed, nonprofits with close ties to governors work on issues as diverse as budget and pension reform, term limits, and education (see Table 1).

Five groups were created to fund a governor’s inaugural celebrations or to cover other transition costs. These types of groups provide an easy channel for special interests to donate tens of thousands of dollars to newly-established governors, often with limited or no disclosure. For example, in 2011, Real Georgia raised over $1.7 million for Gov. Nathan Deal’s (R-GA) first gala and disclosed its donors to the press.[8] Of the 170 donors, at least 100 were affiliated with lobbyists at the state level. Utilities gave over $200,000 and insurance companies contributed $240,000. The group also received $25,000 from Koch Companies Public Sector, a lobbying arm of Koch Industries.[9] Real Georgia did not disclose its donors for Gov. Deal’s 2015 inaugural festivities.

Once these types of groups are established, there is also little stopping them from pivoting to support the governor in other ways. In Michigan, for example, the group Celebrating the Power of Michigan was initially established to fund Gov. Rick Snyder’s (R-MI) 2011 inauguration. However, it also funneled money to other nonprofits working to support Gov. Snyder’s policy agenda and provide additional outside funding to his office. Similarly, in Maine, the group Maine People Before Politics was initially set up to fund Gov. Paul LePage’s (R-ME) transition into office, but later launched a series of ads to generate support for several of the governor’s policy proposals.

Some governors are actively and publicly involved with shadow governance groups. Gov. Bruce Rauner (R-IL) and Gov. John Bel Edwards (D-LA) appeared in advertisements paid for by shadow governance groups; Gov. Edwards, Gov. Chris Christie (R-NJ), and Gov. Roy Cooper (D-NC) have appeared at events and fundraisers held by them. Additionally, the staff of these nonprofits often have clear ties to the governor. For example, Tennesseans for Student Success, Education Voters of Idaho, and Real Georgia were run by campaign managers for Gov. Haslam, Gov. Butch Otter (R-ID), and Gov. Deal, respectively.

While shadow governance groups come in a variety of different shapes and sizes, what they have in common is a troubling lack of transparency while maintaining close ties to sitting governors. Seventy percent of identified groups did not voluntarily disclose any donor information to the public. Those that did disclose released their records with plenty of caveats: Early Edge Action, aligned with Gov. Steve Bullock (D-MT), listed names and amounts for some donors, but not others; Maine People Before Politics, the transition committee for Gov. LePage, originally disclosed its donors (though not amounts), but stopped after the inauguration and its subsequent rebranding; and while Moving Michigan Forward (MMF) fully discloses its donors every quarter, much of its funding comes from other nonprofits connected to Gov. Snyder, including Making Government Accountable, which does not disclose its donors. Indeed, the inconsistency of these organizations with respect to their voluntary disclosures only underscores the importance of full transparency to ensure the accountability of public officials.

All in all, dark money groups and shadow governance groups alike allow state governors to gain from unlimited spending by anonymous sources. This unchecked spending means that special interests and deep-pocketed donors can exert more influence than ever before.

View the methodology.

 

View the shadow governance and dark money groups:

Alabama: Governor Robert Bentley
Alabama Council for Excellent Government (ACEGov)

Georgia: Governor Nathan Deal
Coalition for Georgia’s Future, Inc. (CGF), Real Georgia, Inc., Georgia Leads, Inc. (GL)/Georgia First, Inc. (GFI),  Georgia Leads on Education (GLoE)

Idaho: Governor C.L. “Butch” Otter
Education Voters of Idaho, Inc. (EVI)

Illinois: Governor Bruce Rauner
Turnaround Illinois, Inc. (TI)

Indiana: Governor Eric Holcomb
Imagine Indiana, Inc. (II)

Kansas: Governor Sam Brownback
Road Map Solutions, Inc. (RMS)

Louisiana: Governor John Bel Edwards
Rebuild Louisiana

Maine: Governor Paul LePage
Maine People Before Politics (MPBP)

Michigan: Governor Rick Snyder
Celebrating the Power of Michigan, Inc. (CPM), New Energy to Reinvent and Diversify Fund (NERD), Making Government Accountable (MGA), Moving Michigan Forward (MMF)

Missouri: Governor Eric Greitens
The Committee for a New Missouri, Inc. (CNM)
A New Missouri, Inc. (ANM)

Montana: Governor Steve Bullock
Early Edge Action (EEA)

Nevada: Governor Brian Sandoval
Nevada Can Do Better, Inc. (NCDB)

New Jersey: Governor Chris Christie
Committee for Our Children’s Future, Inc (COCF), Reform Jersey Now, Inc. (RJN)

New Mexico: Governor Susana Martinez
New Mexico Competes, Inc. (NMC)

New York: Governor Andrew Cuomo
New Yorkers United Together, Inc. (NYUT), Committee to Save New York, Inc. (CSNY)

North Carolina: Governor Roy Cooper
Moving NC Forward (MNCF)

Ohio: Governor John Kasich
Balanced Budget Forever (BBF), Two Paths America (TPA)

Tennessee: Governor Bill Haslam
Tennesseans for Student Success, Inc. (TSS), Tennessee Business Partnership (TBP)

Wisconsin: Governor Scott Walker
Wisconsin Club for Growth, Inc. (WCG)

 

[1] Amber Phillips, “These 3 maps show just how dominant Republicans are in America after Tuesday,” The Washington Post, Nov. 12, 2016.  https://www.washingtonpost.com/news/the-fix/wp/2016/11/12/these-3-maps-show-just-how-dominant-republicans-are-in-america-after-tuesday/?utm_term=.37f7419a622e

[2] Seven of the 30 nonprofits identified have not yet disclosed any financial information, as section 501(c) organizations are only required to submit annual reports.

[3] See Kenneth Lovett, “Gov. Cuomo plans to seek reelection despite considered possible 202 presidential candidate,” New York Daily News (New York), Nov. 15, 2016. http://www.nydailynews.com/news/politics/gov-cuomo-seek-reelection-run-president-article-1.2874698?cid=bitly; Tina Sfondeles, “Rauner quietly confirms re-election bid,” Chicago Sun-Times, Jun. 20, 2016.  http://www.chicago.suntimes.com/news/rauner-quietly-confirms-re-election-bid/; Patrick Marley, “Scott Walker makes clear he’ll seek a third term as Wisconsin governor,” Journal Sentinel (Milwaukee), May 12, 2017. ahttp://www.jsonline.com/story/news/politics/2017/05/12/scott-walker-names-campaign-chief/318614001/.

[4] “States with gubernatorial term limits.” Ballotpedia. https://ballotpedia.org/States_with_gubernatorial_term_limits (Accessed February 2, 2018).

[5] “Political Nonprofits (Dark Money).” Center for Responsive Politics. https://www.opensecrets.org/outsidespending/nonprof_summ.php?cycle=2016&type=type&range=tot (Accessed February 2, 2018).

[6] Chisun Lee, Katherine Valde, Benjamin T. Brickener, and Douglas Keith, “Secret Spending in the States,” Brennan Center for Justice, accessed January 2, 2018, https://www.brennancenter.org/sites/default/files/analysis/Secret_Spending_in_the_States.pdf.

[7] Jason Hancock “Nonprofit linked to Missouri governor raises new questions about ‘dark money,’ ethics,” The Kansas City Star, Mar. 8, 2017., http://www.kansascity.com/news/politics-government/article137209643.html

[8] Jason Hancock, “Gov. Eric Greitens’ nonprofit plans to run TV ads across Missouri,” The Kansas City Star, Jul. 12, 2017. http://www.kansascity.com/news/local/news-columns-blogs/the-buzz/article160993954.html; see also Will Schmitt, “Gov. Eric Greitens’ nonprofit has prepared attacks on several state senators,” Springfield News-Leader, May 4, 2017. https://www.news-leader.com/story/news/politics/2017/05/04/gov-eric-greitens-nonprofit-has-prepared-attacks-several-state-senators/101264250/

[9] Hancock, “Gov. Eric Greitens’ nonprofit plans to run TV ads across Missouri”; see also Crystal Thomas, “Greitens, Mike Huckabee pump up Joplinites for Missouri’s second special session,” Joplin Globe, Jun. 9, 2017. http://www.joplinglobe.com/news/local_news/greitens-mike-huckabee-pump-up-joplinites-for-missouri-s-second/article_8e14926b-166a-5ce6-a557-f148257f84fd.html

[10] Andy Sher, “‘Student Success’ group spending big money to defend Gov. Bill Haslam,” Times Free Press (Chattanooga, TN), Feb. 19, 2015. http://www.timesfreepress.com/news/politics/state/story/2015/feb/19/groups-spending-supports-governor/289060/; Grace Tatter, “Commercial about state educational standards makes Super Bowl splash,” Chalkbeat, Feb. 3, 2015, https://tn.chalkbeat.org/posts/tn/2015/02/03/commercial-about-state-educational-standards-makes-super-bowl-splash/.

[11] Brian M. Rosenthal, “No Links to Cuomo? Their Ad Was Labeled ‘Client: Andrew Cuomo,’” The New York Times, Jul. 26, 2017.  https://www.nytimes.com/2017/07/26/nyregion/watchdogs-say-cuomo-is-skirting-campaign-finance-rules.html?mtrref=t.co

[12] Aaron Gould Sheinin, “Deal raises more than $1.7 million for inaugural,” Atlanta Journal-Constitution, May 27, 2011. http://www.ajc.com/news/local-govt–politics/deal-raises-more-than-million-for-inaugural/BWNsSPoXdn4tQhbO04AXDM/

[13] Ibid.

[1] Jason Hancock “Nonprofit linked to Missouri governor raises new questions about ‘dark money,’ ethics,” The Kansas City Star, Mar. 8, 2017., http://www.kansascity.com/news/politics-government/article137209643.html

[2] Jason Hancock, “Gov. Eric Greitens’ nonprofit plans to run TV ads across Missouri,” The Kansas City Star, Jul. 12, 2017. http://www.kansascity.com/news/local/news-columns-blogs/the-buzz/article160993954.html; see also Will Schmitt, “Gov. Eric Greitens’ nonprofit has prepared attacks on several state senators,” Springfield News-Leader, May 4, 2017. https://www.news-leader.com/story/news/politics/2017/05/04/gov-eric-greitens-nonprofit-has-prepared-attacks-several-state-senators/101264250/

[3] Hancock, “Gov. Eric Greitens’ nonprofit plans to run TV ads across Missouri”; see also Crystal Thomas, “Greitens, Mike Huckabee pump up Joplinites for Missouri’s second special session,” Joplin Globe, Jun. 9, 2017. http://www.joplinglobe.com/news/local_news/greitens-mike-huckabee-pump-up-joplinites-for-missouri-s-second/article_8e14926b-166a-5ce6-a557-f148257f84fd.html

[4]  Bryan Lowry and Steve Vockrodt, “Greitens campaign sought to conceal donors’ identities, former staffer testifies,” Kansas City Star, May 2, 2018. “http://www.kansascity.com/news/politics-government/article210313194.html; Jason Hancock, “Missouri lawmakers subpoena Greitens’ top political adviser,” Kansas City Star, May 14, 2018. http://www.kansascity.com/news/politics-government/article211103584.html

[5] Mitch Smith and Julie Bosman, “Eric Greitens, Missouri Governor and Rising Republican Star, Resigns Amid Scandal,” New York Times, May 29, 2018. https://www.nytimes.com/2018/05/29/us/eric-greitens-resigns.html

[6] Andy Sher, “‘Student Success’ group spending big money to defend Gov. Bill Haslam,” Times Free Press (Chattanooga, TN), Feb. 19, 2015. http://www.timesfreepress.com/news/politics/state/story/2015/feb/19/groups-spending-supports-governor/289060/; Grace Tatter, “Commercial about state educational standards makes Super Bowl splash,” Chalkbeat, Feb. 3, 2015, https://tn.chalkbeat.org/posts/tn/2015/02/03/commercial-about-state-educational-standards-makes-super-bowl-splash/.

[7] Brian M. Rosenthal, “No Links to Cuomo? Their Ad Was Labeled ‘Client: Andrew Cuomo,’” The New York Times, Jul. 26, 2017.  https://www.nytimes.com/2017/07/26/nyregion/watchdogs-say-cuomo-is-skirting-campaign-finance-rules.html?mtrref=t.co

[8] Aaron Gould Sheinin, “Deal raises more than $1.7 million for inaugural,” Atlanta Journal-Constitution, May 27, 2011. http://www.ajc.com/news/local-govt–politics/deal-raises-more-than-million-for-inaugural/BWNsSPoXdn4tQhbO04AXDM/

[9] Ibid.