Did a Group Tied to the Alaska Governor Break Campaign Finance Law?

by | November 11, 2015

By Nathaniel Herz

A group tied to one of Gov. Bill Walker's top aides is being charged with civil campaign finance violations connected to its support for Walker's campaign last year, including hiding the identities of its donors.

One of Walker's deputy chiefs of staff, Marcia Davis, was secretary for a group, Your Future Alaska, that spent $50,000 on Walker's behalf without directly coordinating with his campaign. The group was one of many to spring from the U.S. Supreme Court's 2010 Citizens United ruling, which authorized unlimited spending in such noncoordinated efforts.

But last month, officials at the Alaska Public Offices Commission, which polices state campaign finance laws, said it was investigating the group. And last week, it filed a formal complaint, alleging the group hid the identities of Walker's supporters and failed to file required reports on time.

It appears that the group's only purpose, APOC said, was to "sanitize" its contributions, which came from Native corporations and a prominent Democratic donor, by passing money to other groups. The recipients included one group that ran Internet, radio, and newspaper advertisements, and attacked former Republican Gov. Sean Parnell in a commercial posted on YouTube.

A legally required notice at the end of the anti-Parnell ad said Your Future Alaska was one of the top three contributors, but it didn't specify the identities of Your Future Alaska's donors.

The group violated state law by "using a third-party conduit to hide the true source of money," APOC's complaint said.

The complaint also includes allegations against another group, Alaskans First, which received $21,000 from Your Future Alaska.

The officers for the two groups were the same four people, including Davis and Vicki Otte, a former director of the group that represents Native corporation executives and who served on Walker's transition team.

Alaskans First also supported seven Democratic state legislative candidates. All lost their elections except Matt Claman, who now represents a West Anchorage House district after beating his Republican opponent by 90 votes.

Davis didn't respond to a phone message Tuesday afternoon. An attorney working with the two groups, Tom Amodio, said they're "working on resolving" APOC's complaint, but he declined to comment further.

Davis said in a phone interview in October that Your Future Alaska consulted with APOC and followed its advice as the group became involved in last year's election.

"We're proof that you can take their classes, that you can get outside legal help and you can have APOC call you and walk through the filing and you can still get burned," Davis said at the time. "We were adhering to the law as it was being dictated by APOC and our attorney."

Your Future Alaska maintains it was acting as a specific type of political group known as an "entity" rather than a "group," as APOC maintains, and therefore subject to different reporting requirements, according to the complaint.

APOC's director, Paul Dauphinais, wouldn't address Davis' comments, saying the matter was under investigation.

The Alaska Republican Party highlighted the APOC complaint in a prepared statement Tuesday, which called for Davis' resignation and said the two groups had engaged in "money laundering."

"This calls into question Gov. Walker's entire election," the statement quoted Peter Goldberg, the party's chairman, as saying.

Walker's spokeswoman, Grace Jang, said the APOC complaint had nothing to do with Davis' job as deputy chief of staff. The two groups being charged by APOC both spent money on the 2014 election independently of the candidates they were supporting. The Citizens United ruling struck down election spending limits placed on corporations and unions, allowing them to pour millions of dollars into presidential and Congressional elections.

Both Walker and Parnell benefited from independent spending in their 2014 race. A big chunk of the backing for Walker, a Republican-turned-independent who was running with Democratic support, came from a group primarily funded by unions that spent more than $500,000 on his behalf. Meanwhile, Parnell was buoyed by about $1.3 million in spending from another group that received most of its money from the Washington, D.C.-based Republican Governors Association.

Your Future Alaska, one of the groups being charged by APOC, collected a total of $75,000, $50,000 of which came from Barney Gottstein, a former grocer and frequent financial supporter of Democratic candidates and causes.

Bristol Bay Native Corp. contributed $20,000, and $5,000 more came from Ahtna Inc., a Southcentral regional Native corporation.

Your Future Alaska then gave $50,000 to a pro-Walker group, Walker Mallott 1, whose treasurer, Otte, was also the vice president of Your Future Alaska.

Another $21,000 went from Your Future Alaska to Alaskans First -- the other group subject to APOC's complaint. Alaskans First supported Democratic legislative candidates Wilson Justin, Matt Moore, Clare Ross, Sam Combs, Harry Crawford, Marty McGee, and Claman.

Other donors to Alaskans First included Calista Corp., where Davis was an attorney; attorney and Walker booster Robin Brena; and real estate developer Jon Rubini.

APOC's complaint says Your Future Alaska broke campaign finance laws by not reporting its spending until 20 days after the gubernatorial election, and by spending money before officially registering with APOC. The group's contributors also weren't revealed until 11 months after the election, when APOC asked about them, the complaint says.

APOC also alleges that Your Future Alaska broke another law by effectively hiding the identities of its contributors by passing their money to other groups -- though the fact that Walker had the support of Gottstein and the Native corporations was not a secret.

Bristol Bay Native Corp. also donated directly to Walker Mallott 1 and was named in its disclosures; Gottstein gave money to another pro-Walker group and was listed in its ads as a top contributor.

Alaskans First, meanwhile, broke campaign finance law by not disclosing its donors until nearly two months after the election, APOC said.

Dauphinais said the two groups have 15 days to respond to APOC's complaint while the commission's staff does an investigation -- a process that can take up to 30 days.

Penalties for the groups' alleged violations are not yet clear because the investigation isn't done, Dauphinais said.

(c)2015 the Alaska Dispatch News