Kentucky 'dark-money' group grew rapidly in 2014 election cycle

Conservative nonprofit spent $14 million on ads supporting Mitch McConnell

The Kentucky Opportunity Coalition, a conservative political nonprofit group, wasn’t very busy before last year. It didn’t raise or spend a single dollar in all of 2012. When the year ended, it had just $904 in its bank account.

But its fortunes changed fast in 2013, when six- and seven-figure checks started flowing in to the group, whose listed address is a Louisville post office box. By the end of the year, it had raised nearly $6 million. That money, and at least $8 million more, helped to squash a Democratic challenge to Republican Sen. Mitch McConnell, who was easily reelected this month and is poised to become Senate majority leader.

The information on the coalition’s finances was contained in a new tax document filed with the Internal Revenue Service and provided to the Los Angeles Times. It shows how the nonprofit organization, all but moribund before last year, quickly grew into one of the biggest "dark-money" groups in the 2014 election.

One donor wrote a $2-million check to the group in 2013, the filing shows. There were two other checks of $500,000 each, and one of $400,000. All told, the organization raised more than $5.9 million in 2013 and spent about $1.2 million, according to the return.

None of the donors are identified. Like other such politically active nonprofit groups, the coalition has to report the names of big donors to the IRS, but not to the public.

Formed in 2008, the organization’s chairwoman is Kristen Webb, a lawyer and former McConnell intern. She did not return a phone call seeking comment. The group spent money in 2009 fighting a prevailing wage bill for school projects, but went quiet afterward.

In its initial filing to the IRS in 2008, obtained by the Center for Public Integrity, the group said it did not plan to engage in politics.

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For the Record

9:07 a.m., Nov. 19: An earlier version of this post incorrectly stated that the Center for Investigative Reporting had obtained the Kentucky Opportunity Coalition's 2008 IRS filing. The filing was obtained by the Center for Public Integrity.

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“These sorts of organizations reserve the right to change their mind,” Scott Jennings, the coalition’s advisor, said in an interview. “And the initial filing was pre-Citizens United, which obviously changed a lot of things about the world we’re discussing.”

Jennings was referring to the Supreme Court decision in the Citizens United case in 2010. That and other decisions cleared the way for unlimited political spending by corporations, and spending by these groups have skyrocketed in their wake.

The coalition is perhaps the most striking example of a campaign finance trend that blossomed during the 2014 election: outside spending groups, not subject to contribution limits, set up to help one candidate. Critics say such groups allow big-money donors to buy access to politicians in secret.

There were at least 92 such groups active in 2014, according to the nonpartisan Center for Responsive Politics. Unlike the coalition, most were political action committees that disclosed their donors.

The coalition spent more than $14 million on television advertising, starting in 2013, nearly all of it either praising McConnell or attacking his Democratic opponent, Alison Lundergan Grimes. Many of the ads lauded McConnell for helping the state’s coal industry, which it portrayed as under siege by federal environmental regulations. Others attacked the Affordable Care Act.

The week before the Nov. 4. election, the coalition put down $320,000 for television commercials that said Grimes “should be ashamed of herself” for trying to downplay her ties to President Obama.

“Obama needs Grimes. And she’ll say anything to hide it,” the commercial said.

Democratic outside groups spent money on Grimes’ behalf, but she ended up outspent by McConnell, who won by a wide margin. Grimes, Kentucky’s secretary of state, did not return a request for comment.

Outside groups like the coalition can’t legally coordinate with campaigns. But the coalition and a related "super PAC," Kentuckians for Strong Leadership, have strong ties both to McConnell and to the American Crossroads super PAC run by Karl Rove, advisor to former President George W. Bush. Jennings, who formerly served as McConnell’s political director, is advisor to both groups; Steven Law, Crossroads president and a former McConnell chief of staff, is on the board of Kentuckians for Strong Leadership.

Caleb Crosby, who was paid $13,500 in 2013 as the coalition’s treasurer, also serves as treasurer for American Crossroads.

In a follow-up email, Jennings said the coalition sprang to life again because "President Obama's war on coal has galvanized people in our state." Asked about the Crossroads connections, Jennings said in an email that the coalition consults with "a number of other issue advocacy organizations."

"It will continue to be active on issues of concern to Kentuckians," he wrote.

joseph.tanfani@latimes.com

Twitter: @jtanfani

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