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‘Dark Money’ Groups Would be Forced to Disclose How They Spend on PA’s Elections Under Advancing Bill

Two bills would make small changes to the state’s notoriously lax campaign finance laws, which put no limit on the amount of money donors can give candidates and political committees.

Mar 29, 2024

by Stephen Caruso of Spotlight PA

Photo courtesy of Amanda Berg / For Spotlight PA

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The Pennsylvania House is advancing modest campaign finance reforms during an election year that will likely see a torrent of hard-to-trace political spending flood the state.

One bill would require legislative candidates to more frequently disclose which people and groups donate to their campaigns, while another would require so-called “dark money” organizations to disclose when they spend money to influence the outcome of Pennsylvania elections.

Collectively, the bills would make small changes to the state’s notoriously lax campaign finance laws, which put no limit on the amount of money donors can give candidates and political committees.

Supporters of stricter rules view the proposed bills as a start to creating a more transparent and accountable political system in a state where the legislature has failed to pass even uncontroversial changes in recent years.

“These aren’t giant steps forward, but they are steps forward,” said Michael Pollack, executive director of the good-government group March on Harrisburg.

Campaign finance reforms are popular. More than three in four registered voters — including majorities of Democratic and Republican voters — believe that money in politics is an issue and want to limit campaign donations and spending, according to an August 2023 Franklin & Marshall College poll.

Both bills recently passed a state House committee with bipartisan support and could receive floor votes in the coming weeks.

In an email, a spokesperson for state House Majority Leader Matt Bradford (D., Montgomery), who sets the chamber’s daily voting calendar, said he backs both pieces of legislation.

“In the near future, the caucus will move additional legislation to [rein] in billionaires’ spending [of] dark money to exercise outsized influence in our elections,” the spokesperson, Elizabeth Rementer, added.

What the bills would do

One bill, sponsored by state Rep. Robert Freeman (D, Northampton), would require candidates General Assembly candidates to file two additional campaign finance reports during each election cycle — one six weeks before the primary election and one six weeks before the general election.

These reports show how much money each candidate has raised, where it came from, and the size of the donations. Campaigns must also broadly describe how they spent those dollars.

The bill passed the lower chamber’s State Government Committee unanimously in March.

Currently, legislative candidates must file five reports each election cycle: one at the start of the year that sums up the previous year’s fundraising and spending, one on the second Friday before the primary, one 30 days after the primary, one on the second Friday before the general election, and another 30 days after the general.

The current schedule makes the full scope of each candidate’s fundraising hard to grasp until just before election day.

Candidates for statewide office — like those for governor, attorney general, and Pennsylvania Supreme Court — are already required to file additional reports six weeks before the primary and general elections.

Freeman said the goal is to force information on political donors to “come out into the public realm” earlier.

“The real thrust of this legislation is to make sure that the public has greater transparency and understanding of who’s contributing through the course of the campaign,” Freeman said.

The other bill was introduced by state Reps. Malcolm Kenyatta and Jared Solomon, Philadelphia Democrats who are respectively running for auditor general and attorney general. It passed the State Government Committee 17-9, with two Republicans joining Democrats in voting yes.

It would require a category of federally registered nonprofits, 501(c)4 organizations, to report to the state any political spending, including the amount and intended target. These nonprofits are not required by federal law to reveal their donors, which is why good-government organizations call them “dark money” groups.

Such nonprofits can fund political ads and other work as long as such spending is not their “primary activity.” They cannot coordinate with candidates and must spend without input from the campaign they’re supporting or opposing — an arrangement known as an independent expenditure.

Under current law in Pennsylvania, “a person” who pays for an independent expenditure must report it to the state. Some nonprofits already do so, including trade organizations like the PA Chamber of Business and Industry and other advocacy groups, like the ACLU.

However, the state’s campaign finance law doesn’t explicitly require nonprofits to file these reports, something the Kenyatta and Solomon bill would change.

“When you talk to anybody across the political spectrum, they’re concerned deeply about huge moneyed interests who are able to completely hide their identity while having massive influence on how people understand issues, and how they choose to engage and possibly support candidates,” Kenyatta told Spotlight PA.

State law also doesn’t require 501(c)4 organizations to disclose their donors. While the bill in its current form doesn’t change that, both Kenyatta and Solomon indicated that they would support making such information available to the general public.

“If we need to tighten up the language, we’ll do that,” Solomon said of the bill.

Dark money nonprofits proliferated after the 2010 Citizens United decision by the U.S. Supreme Court, which ruled that political spending can’t be limited if it is made independent of a campaign.

Because Pennsylvania does not limit campaign contributions, dark money groups haven’t been as popular among people attempting to influence elections here as they have at the federal level, where those constraints exist. Still, they have slowly started to seep into the state’s political infrastructure.

Last year, a 501(c)4 with ties to prominent state conservatives paid for a round of ads attacking state House Democrats for opposing private school vouchers.

Untraceable political dollars also influenced the latest state Supreme Court race, in which Democrats funneled money from state and national nonprofits, including 501(c)4s, into a campaign account that then bought millions of dollars in independent television ads attacking Republican candidates.

Two Republicans voted in favor of Kenyatta’s and Solomon’s bill, including state Rep. Tim Bonner (R., Mercer). While the attorney often offers legal-based opposition to state House Democrats’ proposals, he said he has no such concerns with the bill.

“There’s too much bad money in politics,” Bonner told Spotlight PA after the vote.

What’s next?

The bills now move to the state House floor, where they could be amended or voted on by the full body.

Advocates for increased disclosure, such as Patrick Llewellyn, director for state campaign finance for the Washington, D.C.-based Campaign Legal Center, argued that Kenyatta’s and Solomon’s proposal could be further strengthened.

The bill could be amended to include other IRS-designated nonprofits that can spend on politics, such as 501(c)6s, he said.

“States can and should require transparency for the sources of funding of big election spending, regardless of the type of entity that is spending big money on elections,” Llewellyn said in an email. “Voters have the right to know who is funding the political spending that is trying to influence their vote.”

Such an expansion, however, would likely draw more GOP opposition. During a recent hearing, the Pennsylvania House State Government Committee’s ranking Republican, state Rep. Brad Roae (R., Crawford), argued that attempts to regulate dark money were a lost cause, noting that in 2021 the U.S. Supreme Court struck down a California law requiring nonprofits to reveal their donors to state auditors for review.

“We shouldn’t be spending tax money to pass something that we know is going to lead to litigation,” Roae said.

How the GOP-controlled state Senate would respond is an open question. In an interview, state Senate President Pro Tempore Kim Ward (R., Westmoreland) didn’t commit to advancing or blocking campaign finance bills, saying her focus was on what’s possible in the divided legislature.

“We gotta see what [the state House] can carry first,” she told Spotlight PA.

In recent years, the state Senate has declined to consider even small campaign finance tweaks advanced by the state House.

In a 102-101 party-line vote, the state House last year passed a bill that would require campaigns to submit their finance reports online.

Under current law, campaigns can mail hard copies of their finance reports to the Pennsylvania Department of State on the deadline, which further delays the release of the information.

The upper chamber’s State Government Committee has not considered the bill.

A similar bill passed the state House without a dissenting vote in June 2022, when the chamber was under Republican control. That state Senate also did not consider that bill, and the legislation died at the end of the two-year session.

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