UPDATED: Democratic Party of Wisconsin helps billionaires channel donations to Clinton campaign

April 7, 2016 by Rebecca Kemble and Barbara With

Democratic presidential candidate Hillary Clinton address the Democratic National Committee’s summer meeting in Minneapolis on August 28, 2015. (Pioneer Press: Jean Pieri)

Documents obtained from the Federal Election Commission (FEC) website show that the Democratic Party of Wisconsin (DPW) has been used as a conduit to pass $207,000 from the Hillary Victory Fund (HVF) back to the Democratic National Committee (DNC) as a way to allow Clinton’s billionaire donors to skirt federal election limits.

At the 2015 Democratic National Convention in Minneapolis last August, the DNC set up joint fundraising agreements with the Hillary Clinton campaign and 32 state Democratic Party organizations. Thanks to the McCutcheon v. FEC decision in 2014 that struck down the limit on the total amount that a single donor can contribute to all federal candidates, parties, and political action committees combined, these joint fundraising agreements provide another avenue for wealthy donors to pump even more money and influence into elections.

According to instructions on Hillary Clinton’s website, donors can give up to $356,100 distributed accordingly: The first $2,700 goes to Clinton’s campaign, the next $33,400 goes to the DNC, and what remains—up to $10,000 per state—is equally divided between the 32 state Democratic parties who signed agreements with the HVF.

In order for state parties to benefit from the fund, a donation of at least $36,132 needs to be made for a minimum $1 return to each of the state parties. These figures make sense of the upcoming April 16th Clinton fundraiser, where the price of admission is $33,400, and the cost of a seat at George Clooney’s table is $353,000.

The HVF is taking advantage of the stable of billionaire donors built up over the past 40 years by the Clinton fundraising organization. The same handful of Forbes World Billionaires repeatedly show up as top donors to the Clintons’ political and philanthropic organizations. People like Alice Walton, Haim and Cheryl Saban, J.B. Pritzker and George Soros have all contributed close to the maximum yearly limit for the HVF, in addition to pouring millions into outside spending groups on Clinton’s behalf.

Last December the Alaska Dispatch News reported that the state Democratic Party received $43,500 on behalf of the state party from the HVF, which turned around gave it back to the DNC on the same day:

In the same report, the Alaska Democratic Party said it transferred an equal amount of money, $43,500, to the Democratic National Committee — a move that, while legal, helps to effectively “obliterate” federal limits on donations to the national committee, according to one campaign finance expert.

“It just becomes a way to give more to the DNC to support the Clinton campaign,” said Paul S. Ryan, deputy executive director of the Campaign Legal Center, which advocates for campaign finance reform. “It’s effectively Hillary Clinton’s team soliciting Hillary Clinton’s supporters for much bigger checks than they can give to the campaign — knowing that every penny could be spent on the Clinton campaign.”

Earlier this month Counterpunch published an account of a similar scheme with the Montana Democratic Party. Cenk Uygur of The Young Turks explains the scheme in this video:

Federal Election Commission filings show the same arrangement at work in Wisconsin. The DPW reported receipt of $207,278.19 from the HVF on January 4, 2016:

On the same day, the DPW reported a disbursement to the DNC of $207,000:

This means that the Democratic Party of Wisconsin has made $278.19 from their fundraising partnership with the Hillary Victory Fund so far.

At the time of publication, neither DPW Chair Martha Laning nor Executive Director Kory Kozlowski have returned our call for comment.

Yesterday Scott Bauer reported that earlier this election season Laning told the AP that she would give her super delegate vote to whomever won Wisconsin’s primary. Yesterday she said it would go to the “presumptive nominee.”

Hillary Clinton and Sen. Tammy Baldwin (D-WI) at a campaign stop in Milwaukee, WI, April 4, 2016 (AP)

The close ties between the state party and the Clinton campaign have sparked heated debates amongst progressive and DPW activists, and Bernie Sanders’ decisive victory in Tuesday’s primary has put a finer point on these debates.

During the 8 O’clock Buzz radio show on WORT, Tom Neale, a progressive activist from northern Wisconsin commented, “Democratic Party leadership is locked into the Empire, while the electorate has a very different vision of the future.”

He continued:

They stick to issues that are comfortable to the elites that fund them. And until that changes, you are not going to engage and energize the majority of the American people. The Democratic Party is stuck because they decided that corporate donors are more important than the electorate, and they’re going to be increasingly irrelevant unless they change direction.

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April 8, 2016 by Rebecca Kemble and Barbara With

Since this story was published yesterday, DPW Communications Director Brandon Weathersby responded to our inquiry:

The reason those funds were passed to the DNC is because that is how the agreement works. The money raised through the fund goes to the DNC who provide all state parties with funds, resources, and infrastructure needed to support candidates in 2016.

Earlier today DPW Chair Martha Laning sent out a newsletter with this message:

Last year, the Democratic Party of Wisconsin, along with 32 other state parties, entered into a joint finance agreement with the Democratic National Committee and the Hillary Clinton campaign to raise funds that help to support state parties and Democratic candidates in 2016. We have offered, and would gladly partner with Sen. Sanders as well if he is interested in creating a similar joint fundraising agreement. These funds have helped us to maintain a top-notch state voter file, work with the DNC to combat the effects of Photo ID, and begin to build the infrastructure for our turnout efforts in the fall.  These funds are not being used to support any one particular presidential candidate, and in fact, by helping to update our data and address legal issues around Photo ID, they are helping all candidates in Wisconsin.

Laning’s assertion that Hillary Victory Funds “are not being used to support any one particular presidential candidate” is false. According to FEC filings, as of December 31, 2015, a total of $4,904,430 had been deposited directly into Hillary Clinton’s campaign fund from the Hillary Victory Fund, while $4,126,036 was disbursed to the DNC directly and indirectly through state parties.

DPW pays the DNC $1,506 every month for access to the voter files. On a Facebook thread earlier this weak, Laning said that the DPW spent $12,000 on voter file “updates.” Those expenses are paid separately from the $207,000 transfer made on 1/4/16.

Weathersby has not addressed the specific follow up questions we put to him several times:

1) We understand about the joint fundraising agreement and how the DNC supports state parties. That’s presumably why the largest portion of donations to the HVF – $33,400 – goes to them before signatory states get their share. The information on Hillaryclinton.com says that any monies raised above the $33,400 + $2,700 to HRC’s campaign are divided equally amongst the signatory states. So the question is, why did the DPW give up control of its share of the funds?

2) If you are saying that the terms of the joint fundraising agreement explicitly state that the funds raised in the name of the state parties – any amount over the $33,400 + $2,700 – are to be redirected back to the DNC, why did the DPW agree to these terms and why isn’t the information on Hillaryclinton.com letting donors know that all of the funds raised in the name of the state parties go directly back to the DNC?

So the question still remains, why did the DPW give up control of its share of the joint fundraising monies? What specific items related to “work(ing) with the DNC” are paid for with the $207,000, and why do those items cost nearly exactly the same amount of money that was raised in the DPW’s name by the HVF?

Unless the DPW can give specific answers to these questions, the transfer of money, while legal, still has every appearance of being a scheme to help billionaire donors avoid the $33,400 donation limit to the DNC and the $2,700 limit to Clinton’s campaign, while delivering no specific value to the Democratic Party of Wisconsin.