Handful of Democratic 527s Raise $22 Million

Posted February 3, 2004 at 6:05pm

The eight major Democratic-affiliated organizations formed in 2003 to harvest soft-money donations banned from the national party committees brought in $22 million from July 1 to Dec. 31, according to an analysis of reports filed this week with the Internal Revenue Service. Known collectively as the “shadow Democratic Party,” the groups drew heavily from organized labor and a handful of extremely wealthy individuals to seed their activities.

“Our fundraising is extremely strong,” said Jim Jordan, a spokesman for America Coming Together, the Media Fund and America Votes, the largest and most lavishly financed organizations, which are pooling their efforts.

“Aside from the healthy cash flow in the door we have tens of millions more in dependable pledges,” Jordan added.

Republicans have been significantly less active on the soft-money front.

Only the Leadership Forum, a group fronted by former New York Rep. Bill Paxon (R) and Susan Hirschmann, the former chief of staff to House Majority Leader Tom DeLay (R-Texas), actively fundraised in 2003.

As of press time Tuesday, the Leadership Forum’s year-end financial report had still not been posted on the IRS Web site despite the fact that it was due Jan. 31.

All eight Democratic committees as well as the Leadership Forum are governed by Section 527 of the IRS tax code. As such, they may collect unlimited soft-money contributions but must document their financial activities with the IRS twice yearly.

The Federal Election Commission is set to meet Thursday to rule on how politically active 527s can be in federal elections.

For the moment, the Democratic 527s are going strong as they seek to meet their goal of raising several hundred million dollars to spend on voter registration, turnout and a nationwide ad campaign in the 2004 presidential election.

Leading the pack is ACT, which raised $13 million combined between their soft-money 527 committee and their federal PAC.

ACT President Ellen Malcolm, who is also the president of EMILY’s List, has said the group hopes to raise $85 million for an extensive grassroots turnout operation in 17 states.

ACT’s major contributors were a handful of wealthy individuals.

Billionaire financier George Soros donated $5 million while Progressive Corp. Chairman Peter Lewis chipped in $3 million.

The Media Fund, which was founded by former Clinton administration official Harold Ickes and has a budget of roughly $80 million, brought in $3 million in the last six months of 2003 — all of which came in the form of a transfer from a separate fund known as Joint Victory 2004.

Joint Victory 2004 is a joint-fundraising committee for ACT and the Media Fund, which allows the two groups to hold a single fundraising event, splitting both the costs and the profits.

It raised $7.9 million in 2003, transferring $3 million each to the Media Fund and ACT.

Its largest contributor was the Houston-based Sustainable World Corp., which ponied up $3.1 million.

Other high dollar contributors included movie mogul Steve Bing ($1.9 million), investor Linda Pritzker ($900,000), biologist Nancy Burnett ($400,000), and Telosa Software founder and CEO Susan Orr ($400,000).

The final arm of the tripartite organization — America Votes — brought in $1.2 million in the period; it has a much smaller budget ($3 million) and a simple goal of ensuring that the Media Fund and ACT do not duplicate activities.

The two major labor groups — Partnership for America’s Families and Voices for Working Families — brought in $1.8 million and $781,000 respectively.

Begun early in 2003, the Partnership has been effectively subsumed within the broader activities of ACT; the groups even share some staff members including ACT and Partnership Executive Director Steve Rosenthal, the former AFL-CIO political director.

The Partnership received 11 total donations ranging from $5,000 to $1.2 million. The largest donation came from the Service Employees International Union while the New York-based SEIU Local 1199 gave an additional $250,000.

Voices for Working Families is a separate labor 527. Of the $781,000 the organization raised, all but $52,000 came from the AFL-CIO and AFSCME.

The AFL-CIO donated $478,000 while AFSCME gave $250,000. It accepted two contributions from individuals totaling $300.

Further down on the Democratic 527 feeding chain, Grassroots Democrats, a group that combines trial lawyer and labor interests, raised $412,000 in the final six months of 2003.

The group — which boasts Communications Workers of America President Morty Bahr and Linda Lipson, the senior director for public affairs of the Association of Trial Lawyers of America as board members — aims to help state parties with party building and turnout efforts by channeling money to them.

It received $100,000 from ATLA and the AFL-CIO as well as $78,000 from CWA.

The campaign account of former New Jersey Sen. Bob Torricelli (D) also donated $20,000 to the group.

Grassroots Democrats Executive Director Amy Chapman said that “for any group starting out you have to establish yourself and what you are doing to donors. We have begun to do that.”

Environment 2004, a group fronted by former Environmental Protection Agency head Carol Browner, raised $197,000 from July to December, relying solely on small dollar individual donations.