Dubious Expenditures at Political Action Committees

For Immediate Release

Contact: 

Randy Barrett (202) 481-1256 or Steve Carpinelli (202) 481-1225

Dubious Expenditures at Political Action Committees

WASHINGTON -  Political
action committees are supposed to spend their money helping to elect
like-minded candidates to state and federal offices. But some appear to
be little more than slush funds for their proprietors, a new investigative story by the 20-year-old Center for Public Integrity reveals.

Center journalists Josh Israel, Aaron
Mehta, and Gabriel Debenedetti sifted through the public records of
5,200 PACs. While the majority of the groups appear to be spending funds
appropriately on their missions, some PACS spend most of their donated
budgets on overhead and other questionable items. For example, Black
America’s PAC, founded by perpetual presidential candidate Alan Keys,
spent barely 1 percent of its $2 million budget since 2007 on supporting
state, local, and federal candidates. Ten percent of that money went to
paying the group’s president, Alvin Williams. The rest went to
fundraising expenses and overhead.

PACs are tax-exempt under Section 527
of the U.S. tax code, though contributions to them are not
tax-deductible. Campaign law places virtually no restrictions on how
PACs spend money, but their tax-exempt status with the IRS requires that
their function be “influencing or attempting to influence the
selection, nomination, election, or appointment of any individual” to
public office.

That doesn’t seem to be the case at the Committee for a Democratic Future, the PAC run by Rep. Rosa DeLauro, D-Conn.

About two-thirds of the PAC’s spending
from 2007 to 2010 ($200,000) went to pay for food and drink for what
DeLauro spokeswoman Kaelan Richards termed informal “policy dinners” for
the congresswoman, academics, policy experts, and all interested
members of the House Democratic Caucus.

The Lyndon LaRouche PAC spent a
stunning $13 million since the start of 2007, but just $3,855 (0.03
percent) of it went to political donations. Almost $6 million went to
LaRouche Youth LLC, a for-profit led by people affiliated with the PAC,
for grassroots lobbying and advocacy. No expenditure details are
disclosed. Nearly $500,000 of the PAC’s spending went to “petty cash,”
also un-itemized.

Read and link to the Center story, “Political Inaction Committees: How Political Action Committees are Spending Your Donations.”

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The Center for Public Integrity is a nonprofit organization dedicated to producing original, responsible investigative journalism on issues of public concern. The Center is non-partisan and non-advocacy. We are committed to transparent and comprehensive reporting both in the United States and around the world.

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