APOC commissioners find ‘reasonable cause’ to believe Gov. Dunleavy and Dunleavy PAC illegally coordinated, OK fast-track decision

Attorney Scott Kendall makes his case to APOC commissioners (Chair Anne Helzer, left) during an emergency hearing on Oct. 12, 2022.

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The commissioners of the Alaska Public Offices Commission have found “reasonable cause” to believe the campaign of Gov. Mike Dunleavy and a pro-Dunleavy political action committee illegally coordinated their campaigns, throwing the PAC’s past and future spending—which could total as much as $3 million—into question a month ahead of election day.

The finding came at the end of a hearing today over whether to grant expedited consideration—which commissioners approved with a hearing set for Friday—for a complaint that alleges the Dunleavy campaign and the pro-Dunleavy “A Stronger Alaska” campaign illegally coordinated because a Dunleavy ally was a member of both at the same time.

“The commission … has found that there is reasonable cause to believe that A Stronger Alaska has expended money that was not independent of the campaign based on Alaska Statute,” said APOC Chair Anne Helzer. “The public at large has a compelling need to know whether coordination occurred or continues to occur.”  

State law prohibits independent expenditure groups—the state’s term for Super PACs—from any form of coordination or cooperation with the candidates that they support. What’s supposed to be a firewall allows independent expenditure groups to raise and spend an unlimited amount of money, including from corporations, in support of their chosen candidates.

The complaint brought by the Alaska Public Interest Research Group and 907 Initiative argues A Stronger Alaska violated that law when it signed Dunleavy ally Brett Huber to an $80,000 consulting contract while Huber was still listed as a deputy treasurer for Dunleavy’s campaign. Huber, who previously worked in the governor’s office, also held a $50,000 contract with the state at the time.  

Scott Kendall, the attorney working with the complainants, argued to APOC commissioners that Huber’s simultaneous connection to both campaigns violates the definition of an independent expenditure group and undermines A Stronger Alaska’s claimed independence. He argued that means the group shouldn’t legally be able to spend money on the election without significant, immediate changes.

“Do we want to wake up in February and realize that $3 million has been illegally spent in Alaska’s elections?” Kendall argued.

A Stronger Alaska is funded with a $3 million infusion from the Republican Governors Association, a dark money group that delivered its funding just days before the state’s stronger disclosure requirements approved by voters in 2020 went into effect (Huber briefly left the Dunleavy administration to campaign against that voter initiative, which also saw the enactment of open primaries and ranked choice voting).

Attorneys for A Stronger Alaska, the Republican Governors Association and the Dunleavy campaign all argued against an expedited hearing, arguing that there was no meaningful coordination between the groups and that the complaint was just an attempt to hamper Dunleavy’s election. A Stronger Alaska attorney Richard Moses as well as the other attorneys argued Huber’s listing as a deputy treasurer for the Dunleavy campaign was an “oversight” and he hadn’t been involved in the campaign since fall 2021.

“Mr. Huber, yes, was mistakenly still listed as a deputy campaign treasurer for the Dunleavy election campaign but he had not accepted any donations on behalf of the campaign since at least Oct. 2021, which was many months before his involvement in A Stronger Alaska,” Moses said. “It is an oversight—as Mr. Kendall said we would say—but that’s not proof and not a ‘smoking gun.’ It’s nothing more than an oversight and a paperwork mistake.”

Kendall argued the state law doesn’t grant any leeway for oversight errors, noting that Huber was hardly a minor player in the Dunleavy orbit but instead is a key ally and confidant who’s worked with Dunleavy in both the Legislature and governor’s office.

“(They) attempted to minimize Mr. Huber’s role,” Kendall said. “Again, I go back to the statute says what it says. The statute says don’t coordinate with the deputy treasurer. It doesn’t say a deputy treasurer who’s more involved or collects money more often or anything like that. It just says don’t do it.”

Even the commissioners were skeptical about the claims that it being a simple oversight ought to shield the PAC from consequences.

Commissioner Dan LaSota asked Moses whether the “oversight” constitutes a loophole in the state’s laws and whether mistakenly violating a law would shield a person from consequences. Moses conceded there were some cases where mistakenly breaking the law would still be considered breaking the law, but reiterated that there was no intentional coordination between the Dunleavy campaign and the PAC.

While the APOC commissioner’s discussions on the matter occurred during an executive session, it appears that they agree with a stricter interpretation of the law that Kendall brought forward rather than the looser interpretation proposed by the attorneys for the pro-Dunleavy groups.

Whether that rises to serious consequences, though, will be determined at a Friday hearing at 1 p.m.

‘We’re not stonewalling!’ says the attorney refusing to reply to anything short of a subpoena

A Stronger Alaska attorney Richard Moses (left) with APOC Commissioners Lanette Blodgett and Anne Helzer.

It should also be noted that APOC investigators, whose work would inform the commissioners’ decision-making, were unable to complete their investigation by the Monday deadline this week because both A Stronger Alaska and the Republican Governors Association refused to participate with the investigators’ initial requests for information and documents. The groups both demanded that APOC issue them subpoenas, which likely further draw out the process.

Moses told commissioners that he wanted a “full, fair and thorough” investigation because he believed it would clear the group of any wrongdoing, but when asked why the groups have refused to participate in the investigation Moses said they were asking for too much information.

“From our perspective, they’re requesting privileged information, so a subpoena is going to be necessary,” Moses said, before adding, “We’re not stonewalling.”

Asked if they would participate with a more limited request from the investigators, Moses simply said, “We asked for a subpoena.”

Kendall told investigators that it was, in fact, a stonewalling tactic and told them to expect a prolonged battle over the scope of the subpoenas that would extend well past the election when it would’ve made a difference.

“We don’t do do-overs,” Kendall said. “You could get fined $10 million dollars and it doesn’t affect the outcome of the election.”

The proposed remedy

Kendall suggested to APOC commissioners that the group’s spending be put on hold and that the commissioners consider ordering the PAC be dissolved. He noted, though, it wouldn’t bar the RGA’s money from being spent because the group could form a new PAC free from the appearance of coordination created by Huber.

“They hold the keys to their own prison,” Kendall told the commissioners, noting that another PAC facing allegations of coordination voluntarily dissolved the previous week (a PAC supporting Rep. Harriet Drummond that was being run by her husband).

That the PAC, the Republican Governors Association and even Dunleavy’s campaign was arguing against what Kendall says is an easy remedy is evidence that there’s something fishy going on, Kendall argued. In his arguments today, Kendall suggested that A Stronger Alaska intentionally sought out Huber’s involvement because Huber is a close ally and confidant of the governor who would understand the governor’s campaign plan (Huber ran his 2018 campaign) and would maximize the spending.

And while it wasn’t discussed much during the hearing, renewing the PAC as a new entity would also require the $3 million contribution to be made again but this time under the stricter disclosure requirements that require dark money groups to disclose the true source of the money going into the race.

Moses, in his arguments before the commissioners, defended the timing of the initial contribution, which was made three days before the law went into effect.

“It was three days before the change in the law. Well, that was the law on that day,” he told commissioners. “There was nothing illegal about that. There’s nothing illegal about the expenditure of these funds.”

Splitting the complaint

The complaint filed by AKPIRG and the 907 Initiative also includes accusations that Gov. Dunleavy has largely been running his campaign with volunteers who are all on the state payroll either directly or through a litany of sole-sourced contracts. That is still part of the complaint but not, at this time, subject to the accelerated consideration.

Kendall said the main concern is how the $3 million in the hands of A Stronger Alaska should be treated.

Stay tuned.

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