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Political Mutual Funds

Due to a lawsuit filed by three ousted Democratic legislators, there has been a lot of attention given recently to the political activity of certain not-for-profits (subscription):

Officials for the Center for Civic Policy said in May they had sent out literature for the Legislative Accountability Project in conjunction with several other nonprofits, including the SouthWest Organizing Project.

They said they sent the materials out as mailers starting after the end of the last legislative session as educational materials for voters based on the legislators’ voting records, not as campaign materials intended to unseat lawmakers.

The mailers, which criticized the losing officials for their voting records and campaign contributors, were stopped more than a month before the primary to avoid the appearance of any partisanship, they said.

“Our organizations have a long and proud history of working for ethics reform, good government, health care and a clean environment,” [
Center for Civic Policy Director Eli Il Yong] Lee said in an e-mail Saturday. “As nonpartisan, not-for-profit organizations, it is our responsibility to educate the public about the votes and contributions of our elected officials.”

Okay, let’s start with the obvious. Eli Lee has been involved in politics for quite some time now as the CEO and President of Soltari, a political consulting firm, with an impressive list of clients who went on to win their elections. Mr. Lee knows what he is doing when it comes to running winning political campaigns.

The problem here is that Mr. Lee is now supposedly running a “nonpartisan, not-for-profit organization,” the Center for Civic Policy, but his actions and his alliances indicate otherwise. First, consider the Center for Civic Policy’s ties to the New Progressive Coalition (NPC). What does the NPC do?

NPC acts as a political giving advisor by providing you with products and services to target your political and charitable time and money more effectively.

Think Charles Schwab for politics.

In other words, NPC raises money to be distributed and used in political campaigns. They try to make “political giving easy and strategic,” and they funnel money to organizations like Center for Civic Policy and Act Blue. Now, the latter, unlike the former, does not try and skirt campaign finance laws. Act Blue is organized as a Federal PAC and like all PACs the contributions to and from the PAC are governed by campaign finance laws and are not tax deductible.

As a former not-for-proift executive, it’s that last part that really irks me. Mr. Lee is conducting political activity, and he is doing it to benefit a certain wing of the Democratic Party – a strictly partisan endeavor. Yet, his donors are able to write off their political contributions as charitable deductions and remain hidden from exposure during the election cycle.

The irony in all this is that Matt Brix, the former Executive Director of Common Cause and champion for campaign reform in New Mexico, is the Executive Director of the Center for Civic Policy. Matt and I have often had dialogue regarding campaign limits. Matt has consistently lobbyied for campaign contribution limits, and my position has always been that they are unneccessary and full and timely discolusre is prefereable.

Not-for profits have no contribution limits nor do they have to disclose donors in a timely manner. If this were a Star Wars movie, I believe Matt would now officially be a member of “the Dark Side.” And, I’m sure someone conviced him it is all in the name of a greater good.