full disclosure

Nonprofit that gave big to successful Jeffco school board recall effort broke state law, judge finds

PHOTO: Nicholas Garcia
Recall supporter Cecelia Lange waved signs at 52nd and Wadsworth Tuesday morning.

A nonprofit that launched in May broke state law when it made a large donation to the successful recall effort of three Jefferson County school board members and did not disclose its donors, a Colorado administrative judge decided Thursday.

As part of the decision, the nonprofit Jeffco United was fined $1,000 and ordered to register with the secretary of state as a political committee and disclose its donors within 10 days.

Under the administrative judge’s ruling, it’s unclear whether Jeffco United would be required to disclose its past donors or only those in future election cycles. The group could appeal the decision.

“Our legal team has the decision and is reviewing it,” said Lynea Hansen, spokeswoman for Jeffco United. She declined to comment further.

Nonprofits that are involved in political activities such as Jeffco United typically are not required to disclose donors.

However, Administrative Court Judge Robert N. Spencer said he found enough evidence to conclude that Jeffco United’s “major purpose” was to support the recall.

An El Paso County-based watchdog group Colorado Government Watch filed the complaints against Jeffco United and another nonprofit that supported the recall, Support Jeffco Kids. Spencer’s decision only applies to the pro-recall force Jeffco United.

In his decision, Spencer found Support Jeffco Kids did not violate state law because of the group’s work on other campaign issues and education work.

In July, Jeffco United donated $90,000 to a related political committee, which is required to disclose its donors, known as Jeffco United for Action. A third branch of the recall effort, Jeffco United Forward, also was created to support a slate of five candidates to reconfigure the entire school board of the state’s second largest school district.

“The disclosure by [Jeffco United For Action] that United was one of its major contributors provided little information to the electorate about who was actually funding the recall and defeated the transparency that is a primary goal of the fair campaign practice laws,” Spencer wrote in his decision.

Another group with the same tax-exempt status as Jeffco United operated similarly, but was not part of the complaint. Colorado Independent Action, run by the Independence institute, was created in January and its only donations were to the political committee Kids First Jeffco, which opposed the recall.

The transparency watchdog organization Colorado Ethics Watch earlier this month called on lawmakers to revisit the state’s campaign finance laws that govern school board races.

Deputy Secretary of State Suzanne Staiert said Spencer’s decision was a cautionary tale for future political committees.

“The groups that form just ahead of an election are going to have to be cautious about their formation and whether or not they’re going to meet the major purpose question,” she said. “… You can’t set up an organization solely to hide your donors.”

Judge Robert N. Spencer’s decision

Correction: An earlier version of this article labeled the organization Colorado Government Watch as having a conservative leaning. This is not the case, the director of the organization says.  

Lights - camera - action

Relive the Jefferson County school board recall in 12 minutes

PHOTO: Nicholas Garcia
Recall supporter Cecelia Lange waved signs at 52nd and Wadsworth Tuesday morning.

What can a school board election tell us about American democracy?

Well, if that school board race happens to be in Jefferson County, involve the nation’s largest teachers union and one of the country’s most influential conservative nonprofit groups … quite a bit, actually.

At least that’s the premise of a new documentary short film, “Million-Dollar School Board” by independent filmmakers Louis Alvarez, Andy Kolker and Paul Stekler. 

The film chronicles the high-profile school board race — which included debates about how history should be taught and how teachers should get paid — that ended with three conservative members being ousted by a coalition of teachers, parents and community members. More than $1 million was poured into the campaign from all sides, hence the film’s title.

The Jeffco film is part of a nine-part series of short documentaries, “Postcards from The Great Divide,” released in a digital partnership between PBS’ Election 2016 initiative and The Washington Post, funded by the Corporation for Public Broadcasting and Latino Public Broadcasting, with a PBS broadcast on the World Channel.

The goal is to answer this question:

As substantial interest group money flows down into even local races, does it also bring the same stark ideological and partisan divisions that mark our national politics today into debates that were once totally separate from Washington?

You can view the roughly 12-minute film in its entirety here:

Then reread a sampling of our coverage:

 

full disclosure

Teachers unions gave huge sums of seed money to Jeffco recall, new records show

PHOTO: Nicholas Garcia
Organizers of a school board recall effort in Jefferson County, from left, Michael Blanton, Wendy McCord, and Tina Gurdikian, spoke at the campaign kick off event in July.

National and local teachers unions provided more than $265,000 to a nonprofit group that served as a catalyst to recall three conservative school board members in Jefferson County.

That is according to campaign disclosures filed Thursday in response to a judge’s order that the group, Jeffco United, disclose its donors.

The organization, a social welfare nonprofit with tax-exempt status, was established in May and received its first donation — $25,000 — from the Colorado Education Association, the state’s largest teachers union. In total, the CEA gave $113,500 to the group, records show.

The national union was even more generous. The National Education Association gave $150,000 to Jeffco United in late August.

Complete Colorado — an arm of the free-market think tank The Independence Institute, supported the recalled school board members — first reported the NEA contribution.

The disclosures shed significant new light on who bankrolled the high-profile recall, which opponents of the conservative board majority repeatedly described as a broad community-based effort. But the full picture of the financial forces on both sides of the campaign remains incomplete, because of lax state and federal reporting requirements.

Who gave to Jeffco United? |
• National Education Association, $150,000
• Colorado Education Association, $113,500
• Jefferson County Education Association, $20,000
• All other individuals, $3,115

“This is all we asked for,” said Dede Laugesen, director of Colorado Government Watch, the El Paso County-based organization that filed the complaint against Jeffco United. “It is only too bad voters did not have this information before the election.”

Lynea Hansen, spokeswoman for Jeffco United, said it would be a mistake to say the recall was “union-led.”

“This was a parent-led and parent-organized recall,” Hansen said. “But parents can’t raise the kind of money to compete with the kind of out-of-state money that keeps coming into Colorado. This is the way the game is set up. We’re playing by the rules that we’re given.”

Kerrie Dallman, president of the Colorado Education Association, did not immediately respond to a request for comment.

Jeffco United eventually launched two sister political committees to finance the recall and the election of a five-candidate slate. Most of that money — more than $200,000 — was raised locally.

Those committees raised and publically disclosed hundreds of thousands of dollars, including a large donation from Jeffco United early in the campaign.

An administrative court judge last week ruled that Jeffco United violated the state’s campaign finance laws. The judge found there was enough evidence to suggest that Jeffco United’s “major purpose” was to spearhead the recall of Ken Witt, Julie Williams and John Newkirk.

Typically, social welfare nonprofits — such as One Colorado, Progress Now and Americans For Prosperity — are allowed to raise money without disclosing their donors and then donate a portion to political committees, which are required to disclose donors to the secretary of state.

It’s common practice for advocacy organizations to operate multiple fundraising and spending apparatuses including 527s, independent expenditure committees and issue committees.

However, under Colorado law if an organization’s “major purpose” is to act only on a singular political issue, it must file as a political committee with the secretary of state and not as a nonprofit.

Judge Robert N. Spencer, in his decision, found Support Jeffco Kids — another group named in the original complaint — had an established track record of work on a variety of issues, therefore it did not violate the “major purpose” law.

Spencer’s decision only applies to Jeffco United.

Other nonprofits, including Colorado Independent Action, which acted similarly to Jeffco United, came to the aid of the recall targets. Independent Action, like Complete Colorado, is an arm of the Independence Institute, which does not disclose its donors.

Ousted board chairman Witt said the institute has a long track record for supporting politicians who champion for expanding school choice.

“I don’t think there was any surprise in those organizations being strong advocates for what we’re doing,” Witt said. He added, “I’m delighted that the truth has finally come out.”

The transparency watchdog organization Colorado Ethics Watch earlier this month called on lawmakers to revisit the state’s campaign finance laws that govern school board races.