This story was cross-posted at The Daily Beast.
If hypocrisy is the coin of the realm in politics, then spending by a Democratic dark money group in New Hampshire’s Senate race could be Exhibit A.
For years, Democrats have blasted Republicans’ use of unlimited secret money in elections. Senate Minority Leader Harry Reid has very publicly tangled with the billionaire industrialists Charles and David Koch, whose network of dark money groups has spent hundreds of millions of dollars trying to influence races over the last five election cycles. And in New Hampshire, Democratic Gov. Maggie Hassan, running to unseat incumbent GOP Sen. Kelly Ayotte, is selling herself to voters as someone who has stood up to “dark money groups like the Koch Brothers’ Americans for Prosperity.”
There’s one problem: Hassan herself is receiving millions of dollars in ground support from a 501(c)(4) social welfare organization called Majority Forward, which is run by Democratic operatives close to Reid. Not only has the group not disclosed its donors to the public, but it’s also timing its spending to avoid reporting the New Hampshire electioneering to the Federal Election Commission.
The only difference between Majority Forward and many of the groups linked to the Koch Brothers or Karl Rove is that Democrats are the beneficiaries, and that seems enough to quiet progressive calls for transparency.
FEC data shows Majority Forward has spent a sizable $2.7 million in the two tightly contested Senate races in Pennsylvania and Nevada. But nowhere in the records is there mention of the New Hampshire outlays.
Majority Forward’s investment in the Granite State dates at least 
That buyer, Waterfront Strategies, is also the primary vendor for Senate Majority PAC, the super PAC that shares staff, legal team, and office space with Majority Forward.
The super PAC was founded by former aides to Reid in 2011 in response to the 2010 wave of Republican wins in Congress. It hit up megadonors such as Newsweb Corporation chairman Fred Eychaner and Saban Entertainment’s Haim Saban for million dollar donations with the aim of regaining control of the Senate. Majority Forward was incorporated in June 2015 after years of Democrats’ railing against dark money and its use by Republicans.
The same key players who manage Senate Majority PAC’s operations also run Majority Forward. J.B. Poersch, the cofounder and general strategist for Senate Majority PAC, is recorded on Majority Forward’s FCC filings as the 501(c)’s treasurer. Poersch is the managing director at the political consulting firm SKDKnickerbocker, having been executive director of the Democratic Senatorial Campaign Committee and chief of staff for Sen. Jack Reed (D-R.I.) earlier. And then there’s Rebecca Lambe, former senior advisor at Cassidy & Associates, who is listed as Senate Majority PAC’s treasurer and Majority Forward’s co-chair. Lambe was said to be indispensable to Democrats’ success in 2008, serving as chief political strategist and campaign manager for Harry Reid. The two groups even share the same spokesperson, Shripal Shah.
Further illustrating how intertwined the two groups are, they have paid a combined $27 million to Waterfront Strategies to run ads in five states; four of them have been targeted by both groups, though only two have been mentioned in Majority Forward’s filings with the FEC.
The shared staff, offices, and vendors of the super PAC and (c)(4) raise big questions about the social welfare status of the latter. Whether or not the nonprofit has spent more than half of its funds politicking, which won’t be known until it files its tax returns with the IRS more than a year after the election, the other question is whether the group has provided excessive benefit to a particular group — in this case, the Democratic Party.
“Section 501(c)(4) organizations have to be primarily operated for a community or public benefit, rather than a private benefit,” said Marcus Owens, partner at Loeb & Loeb and former director of the IRS exempt organizations division. “The overlap of the two groups suggest they have a common goal, electing Democrats – a private benefit – which would disqualify the (c)(4) for exemption.”
“The difficulty is the IRS has not defined…with mathematical precision” how much private benefit is too much, Owens said.
In order to pass muster, theoretically, with the IRS, Majority Forward would have to spend most of its time on other programming that benefited the public. When asked about the group’s activities, a Majority Forward spokesman said it is running nonpartisan voter registration programs “in key states across the map” and declined to comment further when OpenSecrets Blog requested materials produced for those efforts. The group’s website didn’t offer any clarity either: It’s a single page, with two paragraphs of text.
“That’s the legal way you cover your tracks,” said Jessica Levinson, a professor at Loyola School of Law in Los Angeles. “The IRS rules allow and almost invite this kind of activity, where a 501(c)(4) looks, acts and quacks like a political committee, but can still be categorized as a (c)(4) by doing nonpartisan activities.”
As for Hassan, the beneficiary of this spending? The fact that outside spending by super PACs and dark money groups is supposed to occur independently of candidates allows her to stand firm. “Governor Hassan, in contrast [to Ayotte], has long fought to stand up to special interests and take action to ensure that money does not control our politics,” wrote Aaron Jacobs, Hassan’s campaign communications director, in an email to OpenSecrets Blog. “She strongly supports a constitutional amendment to overturn Citizens United and, as governor, she has worked to strengthen reporting requirements for political committees in New Hampshire.”