Civil Rights in America
September, 2007
The following is an election complaint filed by Ellen Lowe:
September 4, 2007
John Lindback
Director of Elections
Secretary of State
141 State Capitol
Salem, Oregon 97310-0722Re: Concerned Oregonians PAC/Restore America
Defense of Marriage and Family Again! Number 1 and 2
Complaint of Election Law Violations -- ORS 260.345
Our File No. 3468
Dear Mr. Neal:
I write on behalf of Ellen Lowe, an Oregon elector who has been a leader in efforts to ensure the integrity of the initiative process. Ms. Lowe was Chief Petitioner for Measure 26 (2002), which prohibited the practice of paying circulators per signature collected.
As set forth below, we believe that two groups related to the effort to refer HB 2007 and SB 2 are violating state election and tax laws. Both groups have misrepresented their status as a political committee under ORS 260.005(15). As a result, they have unlawfully solicited donations with the promise to donors that they can take a tax credit on their state taxes pursuant to ORS 316.102. It is unlawful for an organization to claim that it is a political committee when it is not. Accordingly, we are filing this complaint under ORS 260.345. We request that the Elections Division determine whether each of these organizations is or should be registered as a political committee under ORS 260.005(15). Assuming that the answer is "no," then we ask that you notify each group of this fact. In addition, we ask that you notify the Department of Revenue that these organizations are not "political committees" under ORS 260.005(15) and therefore contributions to them do not qualify for Oregon's political tax credit.
1. Factual BackgroundDuring the 2007 session, the Oregon Legislative Assembly passed HB 2007 and SB 2. HB 2007 authorizes domestic partnerships between same sex couples. SB 2 prohibits discrimination based on sexual orientation or gender identity. On May 18, 2007, a referendum petition was filed with the Secretary of State for each bill. Ref 303 and 304 respectively. The Chief Petitioners for both referenda are the same: Janice Bentson, Aleksandr Voronko and Carolyn Wendell. Ex. A (Statement of Organization for Chief Petitioner Committee for Referendum Petition 303), Ex. B. (Statement of Organization for Chief Petitioner Committee for Referendum Petition 304). The Chief Petitioner Committees for these two referenda is called Defense of Marriage and Family Again! Number 1 and 2, respectively.
The Defense of Marriage and Family Again! committees has a website at www.letoregonvote.com. That website prominently features solicitation of funds with promises of the tax credit. I attach a copy of the page, which was printed from their website on September 4, 2007.
In addition to the Chief Petitioner Committee, an organization called "Concerned Oregonians" is working to gather signatures. Its website, www.concernedoregonians.com, states that the organization is "sponsoring" the referenda, even though the organization is operating separately from Chief Petitioners. The effort appears to be targeted primarily at churches. Notably, the website for Concerned Oregonians provides no further information about the group, nor does it provide a mechanism for making donations. However, the group has registered with the Oregon Secretary of State under the assumed business name of Concerned Oregonians PAC. This registration occurred on June 1, 2007. Donna Butler is the authorized representative and David Crowe is the registering agent.
Concerned Oregonians also appears to be closely tied to Restore America, a 501(c)(3) non-profit organization. The Executive Director of Restore America is David Crowe. Materials relating to the referenda that are posted on its website, www.restoreamerica.org, are identical to those posted on the Concerned Oregonians website.
Like the Defense of Marriage and Family Again! Committees, Concerned Oregonians has solicited contributions with the promise of receiving the political tax credit. In an email dated May 19, 2007 - one day after the referendum petitions were filed and before Concerned Oregonians even registered its name with the Corporations Division - David Crowe asked supporters to contribute to Concerned Oregonians by taking advantage of their Oregon political tax credit. A copy of the email is attached as Ex. __ to this complaint. The solicitation spends six paragraphs describing the tax credit and urging supporters to give money to this effort rather than pay taxes. It includes the following:
The Oregon Political Tax Credit allows an individual to give $50.00 and a married couple $100.00 to a Political Action Committee (PAC) such as ours, b. [sic] WITHOUT COSTING THEM ANYTHING, except the postage on a first class letter.
Any amount contributed up to the above amounts can be taken as a direct credit off the bottom line of your 2007 Oregon Tax Filing. If you do not use this Tax Credit, you will lose it to the state, for whatever purposes they choose, including tax payer funded abortions. Why not apply those dollars to stopping these bills?
Emphasis in original.
More recently, in response to an inquiry from a donor to Concerned Oregonians PAC, a worker confirmed that the "one time tax credit" is available for donations, and all that the donor need do is provide a copy of a receipt (which would be forthcoming) and the cancelled check.
2. Analysis
Neither the Defense of Marriage and Family Again! Chief Petitioner Committees, nor Concerned Oregonians PAC are "political committees" as defined by ORS 260.005(15).
A. Defense of Marriage and Family Again!
The Defense of Marriage and Family Again! committees are organized under ORS 260.118 as Chief Petitioner Committees. While there are some similar reporting requirements as political committees, their role in the process is different. Chief Petitioner committees relate to the signature gathering process only. Thus, Chief Petitioners are responsible for the misconduct of signature gatherers, ORS 260.561. In contrast, political committees relate to the process of influencing an election. ORS 260.005(15) (defining a "political committee" as two or more persons who either solicit contributions or make expenditures "for the purpose of supporting or opposing a candidate, measure or political party.")
This distinction extends to the political tax credit. Under ORS ORS 316.102, the Legislature has determined that political engagement relating to elections is good public policy. Thus, it has authorized a political tax credit for donations to political committees organized and registered under ORS 260.005(15). It has not made the same determination with regard to the initiative and referendum process. That is, state will not subsidize the activities of Chief Petitioners, until such time as they have demonstrated sufficient support to have their petition qualify for the ballot.
What this means is that the Defense of Marriage and Family Again! Committees have unlawfully held themselves out as "political committees" under ORS 260.005(15). The Elections Division should notify them that they are not "political committees" and should also notify the Department of Revenue that contributions to the committees do not qualify for the political tax credit.
B. Concerned Oregonians PAC
The unlawfulness of Concerned Oregonians PAC's statements to donors is even more flagrant and troublesome than the false statements made by the Chief Petitioner committees. There are two related concerns. First, Concerned Oregonians PAC is a "PAC" in name only - it is not a "political committee" under Oregon election laws, nor could it be, so long as the referenda are still petitions and not "measures" on the ballot. It is not a Chief Petitioner Committee and has no other formal status under Oregon's election laws.
Notwithstanding this fact, David Crowe sent a solicitation to 9000 members he day after the referenda were filed, in which he claimed that the organization was a political committee. He certainly knew - or should have known - that he needed to register as a political committee with the Secretary of State in order to (1) claim to be a political committee and (2) promise donors that they could take the political tax credit. In other words, calling your organization a "PAC" and registering the name with the corporations division is not enough.
The second problem is that the organization has falsely claimed that it is "sponsoring" the referenda, and solicited funds based upon that representation. Under this scheme, donors could contribute money anonymously and get a tax credit. But, because Concerned Oregonians held itself out as the "sponsor" of the initiative," it is essentially acting as an agent for the Chief Petitioner committees and any funds that it collected should have been transferred to those committees within seven days of receipt. ORS 260.044(4)(c); ORS 260.055. The Defense of Marriage and Family Again! committees would then report the contributions. We request that the Elections Division determine whether this has occurred.
3. Conclusion
Oregon law allows qualified political committees organized under ORS 260.005(15) to receive contributions for which donors can take a dollar-for-dollar tax credit. The Defense of Marriage and Family Again! Chief Petitioner Committees and Concerned Oregonians PAC are not qualified political committees. Therefore, they have unlawfully promised donors with a benefit that, it taken, would constitute tax fraud. The Elections Division should find that these organizations are violating the elections law by holding themselves out as "political committees." It should also notify the Department of Revenue that contributions to these organizations do not qualify for the tax credit. Finally, the Elections Division should audit the Chief Petitioner accounts to ensure that donations designated for the referenda petitions were reported as such.
Thank you for your prompt attention to this matter.
Sincerely,
SMITH, DIAMOND & OLNEY
Margaret S. Olney
MSO/lcs
Enclosures
cc: Ellen Lowe
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