Pro-Dunleavy group and Republican Governors Association violated Alaska’s campaign finance laws

The Alaska Public Offices Commission has ruled against the Republican Governors Association and its proxy group Families for Alaska’s Future, finding that the two violated the state’s campaign finance laws.

The complaint was brought by Gov. Bill Walker’s campaign and was heard by the commission during an Oct. 4 hearing. The decision was released the following day, charging both the RGA and Families with $4,450 fines and requiring the RGA to register as its own independent expenditure group. The fine was initially double that figure but was reduced because the commission decided both the groups were “inexperienced filers.”

The case revolves around whether television advertising time reserved in April 2018 before either the Republican Governors Association (which hasn’t registered as a group) or Families for Alaska’s Future (which wasn’t registered as a group at the time) should count as expenditures for the purpose of influencing the governor’s race.

Ad time was reserved for the run-up to the election under the name of the national Republican Governors Association, but later transferred to the Alaska-based Families for Alaska’s Future, which has so far received 99.7 percent of its funding from the RGA. The RGA even boasted about the air time in a news release put out in April.

The Walker campaign spent much of Thursday’s hearing establishing that those agreements carry considerable value, pointing out that the Republican Governors Association was slow to commit to ad buys in Alaska during the 2014 race and missed out.

“This is the biggest single expenditure in this election,” argued Walker/Mallott campaign manager John-Henry Heckendorn argued during last week’s hearing. “The RGA has contributed more to this election than the Toien campaign, the Begich campaign, the Walker and Mallott campaign and the Dunleavy campaign have raised.”

Stacey Stone, the attorney representing the RGA and Families, argued that the reserved ad time shouldn’t count as expenditures because no money had changed hands at the time they were reserved. And because there was no penalty for backing out, she argued that the reservations had no monetary value.

“We’d all be in a lot of a world of hurt if a contract handed to us without our agreement meant we were obligated and we just made an expenditure,” she said, arguing that the expenditure only becomes an expenditure when the bill for the air time is paid.

APOC disagreed.

It found that promises for air time, particularly limited television air time, holds value.

“The definition of ‘expenditure’ is broader than RGA claims. The statute encompasses ‘a promise or agreement to purchase or transfer money of anything of value,’ which, in the case of a promise or agreement, does not require payment nor does it require a contract. An air time reservation, even if it is subject to potential cancellation, is an agreement to purchase air time, and both the air time and reservation have value.”

APOC continues to smash the RGA defense apart, noting that the reservations were made with the professional assistance from a media placement company.

“If the reservations for air time during an election had no purpose and did not constitute any sort of agreement, there would be no reason to make them,” explains the decision. “Engaging a media placement company to perform this professional service for the purpose of influencing an Alaska election constitutes an ‘expenditure’ requiring registration. Indeed, the commission has previously ruled that even sending an email, which had minimal value constituted an ‘expenditure’ requiring registration.”

APOC also found that Families was operating as a group well before it ever registered as one and also omitted certain expenditures made by the RGA from its reports, both of which were more cut-and-dry issues.

The penalty

For all of this, APOC has levied $4,450 fines against both the RGA and Families. That figure was initially double, but characteristically reduced by APOC because it found the two were “inexperienced filers.”

The fine itself could and will likely be appealed by the Walker/Mallott campaign, arguing against labelling the Republican Governors Association as an “inexperienced filer” and against lumping the multiple ad buy violations into a single fine.

What’s more notable, however, is the requirement that the RGA file as its own expenditure group. That would submit the RGA, a national and well-funded Republican political group, to Alaska’s campaign finance laws, which would include the full disclosure of every one of its contributors.

That’s precisely the sort of thing the RGA–and every other big money organization–hoped to avoid when it formed Families for Alaska’s Future.

Families has so far received more than $2.7 million in campaign contributions with a vast majority coming from just the Republican Governors Association. In fact, the day before everyone was in front of the APOC commission the RGA gave Families a $1.45 million contribution to its campaign. The only other named financial backers of Families for Alaska’s Future are the PAC for the Associated Builders and Contractors of Alaska, which gave $5,000, and former Alaska GOP chair Randy Ruedrich, who gave $2,000. Together, the two account for just 0.26 percent of the Families’ funding while the rest comes from the Outside organization.

Alaska’s campaign laws for independent expenditure groups require that the groups disclose their donor list, but that requirement only goes as far back as its donors. Alaska doesn’t require donors to disclose their donors. It’s a move utilized by plenty of independent expenditure groups on both sides of the political spectrum to essentially mask their contributors.

Now because of its rush to get into Alaska’s gubernatorial elections, the RGA may have to disclose its donor list. We say “may” because just as the penalties are subject to appeal, so too is the entire decision.

Salmon complaint

This complaint isn’t the only major action in front of the Alaska Public Offices Commission. The commission was also brought a significant complaint against the groups working in favor of the salmon habitat initiative, but decided to remand the issue to staff and delay a decision.