Nonpartisan group’s tax status is under review
The Massachusetts Fiscal Alliance was careful in its wording on the fund-raising appeal, never explicitly saying which candidate it favored in this month’s special elections in Fitchburg and Peabody. As a nonpartisan, educational tax-exempt organization, it’s not allowed to take sides.
But its reference to waging “an all-out blitz” just seven days before the March 1 state representative contests caught the attention of state campaign finance regulators, who are now reviewing whether the group improperly crossed the line into partisan campaigning.
In previous mailings, MassFiscal — which is run by former GOP operatives and focused on fiscal conservatism — had painted the Democratic candidates in the two races as tax-raisers, and the Republicans as more aligned with their mission.
“It was clearly a partisan attack,’’ said Fitchburg Mayor Steven DiNatale, a Democrat.
After receiving a complaint about the “blitz” e-mail from the state Democratic Party, the Office of Campaign and Political Finance is now taking a serious look at whether it constitutes political activity, according to a person familiar with the agency’s review. The agency has declined to comment.
Paul Craney, the group’s executive director, takes strong exception to accusations that the “blitz” e-mail, from Jordanne Anderson, is evidence that MassFiscal’s activities are partisan. Anderson, who is the alliance’s finance director, is also a GOP operative.
“We are not the arm of either party,’’ he said. “We’re just concerned about the issues we feel passionate about — taxes, spending, the budget, and transparency at the State House.”
He said the organization carries out educational activities aimed at informing voters where candidates stand on issues and does not explicitly endorse or oppose specific candidates. That distinction, it says, gives it the right to protect its donors’ identities.
“We want voters to think about fiscal responsibility when they head to the polls,’’ Craney said. “Just like I am sure the Sierra Club wants voters to think about environmental issues when they head to the polls.”
MassFiscal spent close to $400,000 on the 2014 legislative races and has said it plans to double that amount this year. Because it is set up as a nonpartisan organization, it can claim a tax-exempt status, which permits it to hide its funding sources from the public — as long as it does not indulge in overtly partisan politics.
The group insists it has been careful not to cross that line. If regulators ruled otherwise, they could potentially force the group to file the sort of public disclosures required of political action committees, a decision that would pull back the veil of secrecy on the donations to MassFiscal.
On its website, the group, which has no official ties to the state GOP or Governor Charlie Baker, describes itself as devoted to fiscal responsibility, lower taxes, a simpler state budgeting process, and greater transparency in state government. It claims its “primary focus is to promote social welfare.’’
But its weighty presence in several closely contested legislative races in 2014 and its promises to spend far more this year have rattled Democrats.
Democrats say the organization has leveled unfounded attacks against targeted Democratic legislators and engages in partisan electioneering without being held to the normal transparency requirements about its sources of funds.
They have seized on Anderson’s e-mail, although it never explicitly said the money she was seeking would go to help specific candidates in the March 1 special elections.
“The plan is an all-out blitz,’’ Anderson wrote. “Your help is important to our success, and the sooner you can send your donation, the greater our chances are.”
Democratic Party officials are convinced that Anderson’s e-mail appeal gives campaign finance regulators a case to force the group to operate as a PAC, with full disclosure of its finances.
“We believe, as do our legal folks who looked at it, that the solicitation for funds for an ‘all-out blitz’ was intended directly for the two Republican candidates that [MassFiscal] supported,’’ said Matt Fenlon, the Democratic Party’s executive director.
Among MassFiscal’s major activities is getting deeply involved in competitive state legislative races, raising money to pay volunteers to make calls, canvass neighborhoods, and send mailings to voters.
In the 2014 legislative races and subsequent special elections, the effect of the group’s activities has been to paint Democratic incumbents’ records in a negative light — in favor of tax increases, “benefits for illegal immigrants,” and Obamacare.
One of MassFiscal’s most controversial mailings targeted a host of Democratic incumbents running for reelection in 2014, claiming they wanted to give preference to illegal immigrants over veterans in public housing — a charge the incumbents denied. It pointed to their votes against a GOP amendment to a veterans bill that was ruled out of order by the House clerk.
“I am appalled that this can go unchecked,’’ said state Representative Brian R. Mannal, a Barnstable Democrat, who came under MassFiscal’s attack in his 2014 reelection race for his vote upholding the clerk’s ruling.
Mannal has introduced legislation to require organizations like MassFiscal to disclose their donors.
“The conservative dark money is truly doing something that is . . . detrimental to the health of our democracy,’’ he said.
MassFiscal has given ammunition to its critics when it has at times been a cheerleader for Baker.
“Just a quick note to let you know how great things are going in 2016!’’ Anderson wrote in a fund-raising appeal earlier this year. “Governor Baker set the tone with a rousing State of the Commonwealth address. I hope you got a chance to see it.”
The MassFiscal staff is made up mostly of heavily connected Republican Party activists, a roster that underscores its image as an off-the-books GOP political operation.
The group, which emerged on the political scene in a major way in 2012, is chaired by Rick Green, a wealthy Pepperell businessman who led a conservative faction of the GOP state committee until he resigned from the committee last May. He narrowly lost his bid to be the GOP chairman in 2013 and has been a generous donor — close to $70,000 over the past five years — to state political figures, all of them Republicans.
Its finance chairman is Jim Rappaport, a former state GOP chairman who was the party’s nominee for the US Senate in 1990. He is a former Republican National Committee member and ran unsuccessfully for the GOP nomination for lieutenant governor in 2002.
Craney, the executive director, has made close to $5,000 in political donations — all to Republicans — since coming to Massachusetts from Washington, D.C., where he chaired the local GOP chapter.
The group’s political director, Carl Copeland, previously worked as chief of staff to Republican state Senator Ryan Fattman.
Anderson, the finance director, also worked for Fattman, as his 2014 campaign manager. In that job, she told a reporter that her “passion is for seeing change and reform within our party.”
The Democrats won both of the March 1 special elections.