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The controversy over the $500,000 donation shed new light on what became known as “DeLay Inc.,” and helped spur the DCCC to file a civil racketeering lawsuit against DeLay in June 2000. That suit was later dropped, but not before DeLay ran up hundreds of thousands of dollars in legal bills defending himself.
Meanwhile, Ellis has recently become caught up in another legal flap involving DeLay. Ellis helped start up and later worked for Texans for a Republican Majority PAC, a Lone Star State version of DeLay’s federal PAC.
TRMPAC has been sued by Texas Democrats over its handling of $600,000 in corporate donations that it raised during the 2001-02 cycle. Corporate and union funds cannot be spent on state races in Texas.
With help from TRMPAC and allied business groups, Republicans were able to win control of the state Legislature in November 2002 for the first time since Reconstruction and forced a new round of redistricting, which could result in a pickup of five seats by House Republicans, further cementing DeLay’s status as Majority Leader.
Democrats charge that TRMPAC and the Texas Association of Business illegally spent soft money on behalf of GOP state candidates.
Democrats have also raised questions about a $190,000 swap between TRMPAC and the Republican National Committee. That money ended up in the campaign treasuries of state candidates, even though it began as corporate donations given directly to TRMPAC.
A Travis County grand jury is looking into the case to see if there were any criminal violations. Ellis, DeLay and TRMPAC have all denied any allegations of wrongdoing, with Ellis even disputing whether he even can be sued in Texas.