IS SECRETIVE INDEPENDENT EXPENDITURE GROUP VIOLATING CAMPAIGN COORDINATION LAWS?
S.C. Gov. Nikki Haley’s proximity to a secretive “super” political action committee – a.k.a. “Super PAC” – is being questioned after a source familiar with its operation alleged extensive coordination between the organization, the governor’s campaign and her taxpayer-funded office.
“The Movement Fund” was formed in March 2011 by a former Haley campaign official with the stated purpose of “shaping the policy debate to support conservative candidates for federal, state and local office in a manner consistent with Section 527 of the Internal Revenue Code.”
These “527s” can accept unlimited contributions and spent unlimited sums on “issues advocacy.” They are, however, prohibited from expressly advocating for the support or defeat of specific candidates – and from coordinating with campaign organizations.
Has Haley been coordinating with this fund, though? Our sources say “yes.” In fact, they say Haley chose the name for the organization herself – a nod to her 2010 “Join the Movement” slogan.
Beyond its name, Haley’s fingerprints are all over the fund. For starters her campaign treasurer – Kurt Grindstaff – is listed as the “Treasurer and Director” of the organization according to documents filed with the Internal Revenue Service. Also Chad Walldorf – a key Haley donor, contribution “bundler” as well as the governor’s appointee to lead the S.C. Board of Economic Advisors (BEA) – is listed as the group’s “Secretary and Director.”
Walldorf, FITS readers will recall, was involved in an effort to trade Haley’s endorsement in a congressional race for passage of her favored “government restructuring” legislation.
Through March of this year the fund has paid $72,000 to Jon Lerner – Haley’s Maryland-based political consultant. And last September it cut a check for $1,357 to Haley’s chief of staff Tim Pearson as “reimbursement” for his travel expenses.
Another $20,000 was doled out to Hahn Group, an organization run by the finance director of the Republican Governor’s Association. That’s the group that spent more than $900,000 on Haley’s 2010 election.
So … now that we know who’s getting rich off of this “Movement Fund,” who’s paying its bills?
As of the latest financial disclosure, the group has received two contributions of $250,000 that together comprise the vast majority of its incoming revenue.
One of these $250,000 contributions came on September 26, 2011 from Bob J. Perry – a billionaire Texas homebuilder and key financial supporter of Rick Perry’s presidential campaign. If the former Perry’s name sounds familiar, it should. He’s given millions of dollars to groups like “Swift Boat Veterans for Truth” and “Americans for Honesty on Issues.” He’s also the founder of the “Economic Freedom Fund,” another GOP independent expenditure group.
Perry contributed $3,500 to Haley’s gubernatorial campaign on September 26, 2011 – presumably as part of a controversial Texas fundraiser held by Haley’s governor’s former Budget and Control Board Director, Eleanor Kitzman (who had just been appointed Insurance Commissioner of the Lone Star State).
Haley was criticized for that fundraiser – which many viewed as an effort by Kitzman to shake down Texas interests. She was also criticized for her travel practices related to this, and other, political events.
The other $250,000 contribution to the Movement Fund was made on April 7, 2011 by Foster S. Friess, a Wyoming-based investment manager who contributed hundreds of thousands of dollars to the “Red, White and Blue Fund,” which supported the presidential campaign of former U.S. Sen. Rick Santorum.
Friess – whose name is misspelled as “Fries” on the Movement Fund’s filing – created a major embarrassment for Santorum’s campaign earlier this year on the issue of contraception (which we suppose makes him a perfect fit with Haley).
“You know, back in my days, they used Bayer Aspirin for contraception,” Friess said during an interview with Andrea Mitchell back in February. “The gals put it between their knees and it wasn’t that costly.”
Santorum quickly moved to distance himself from Friess’ remarks.
In addition to Perry and Friess, the Movement Fund has also accepted a $5,000 contribution from New York real estate mogul (and reality TV star) Donald Trump as well as a $50,000 contribution from Kris Singh, president and CEO of New Jersey-based energy technology company Holtec International.
THE MOVEMENT FUND IRS FILING (.pdf)
(Staff writer Colleen MacMillan contributed to this report).