Rules of the Game: Obama's Nonprofit Carries on Dubious Tradition

• By Eliza Newlin Carney
• Roll Call Staff
• March 10, 2013, 7:30 p.m.

A Democratic rising star who campaigned on a platform of sweeping ethics changes draws fire once in power, after his top campaign donors bankroll a secretive nonprofit promoting his agenda.

Sound familiar? It’s a story that should ring a bell for New York Gov. Andrew M. Cuomo, who’s weathered a storm of bad press since he took office in 2011 over a tax-exempt group known as the Committee to Save New York that’s spent some $17 million touting his policies on TV.

Like Organizing for Action, President Barack Obama’s controversial nonprofit advocacy arm, the Committee to Save New York is organized as a (501)(c)(4) social welfare group, and it has drawn fire from watchdogs complaining about transparency and special interest access. The New York group’s receipts include some $2 million from gambling interests with a stake in Cuomo’s casino policies.

But unlike Obama’s group, the Committee to Save New York is sitting out its hero’s latest round of budget fights. Instead, Cuomo has reportedly turned to the New York Democratic Party to help him raise some $5 million to push his budget priorities.

It’s a turnabout that Susan Lerner, executive director of Common Cause New York, touted as “a model for how things should be handled.”

Cuomo’s story serves as both an example and a cautionary tale for Obama, whose nonprofit arm carries on a long, if dubious, tradition of politically connected nonprofit groups that have heaped trouble on the elected officials who ran them.

These range from the Citizens for the Republic Education and Research Foundation, a nonprofit that grew out of Ronald Reagan’s 1976 presidential campaign that eventually ran afoul of the Federal Election Commission, to Celebrations for Children, a charity that provided a convenient vehicle for House Majority Leader Tom DeLay, R-Texas, to raise big money at the 2004 GOP Convention. DeLay set out to reward the charity’s donors with parties and yacht cruises, but he dropped that plan amid public outcry.

Organizers for Obama’s group attempted to mollify critics last week when they announced that the nonprofit would take no corporate or foreign donations and would report all contributions of $250 or more every quarter. Far from promoting special interest access, the group’s “mission is to put the power back in the hands of the American people,” National Chairman Jim Messina insisted in an email to OFA supporters.

But watchdogs remain unconvinced and have continued calls for the group to close down. Organizing for Action is “a national scandal waiting to happen,” Democracy 21 President Fred Wertheimer said. The group is unprecedented as an official outgrowth of a presidential campaign, he noted. It’s run by former Obama aides and will leverage his campaign’s massive email list and sophisticated organizational apparatus.

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