Fat Cats Dominate List of State Donors to 527s

$2 out of every $3 raised comes from just 24 wealthy donors

September 8, 2004

Madison - Most of the Wisconsin contributions to national groups that can accept and spend unlimited amounts of cash to influence the November elections come from wealthy contributors who also give generously to state candidates, a Wisconsin Democracy Campaign analysis shows.

A WDC review of Wisconsin contributions to 527 groups shows that 203 contributors gave the groups $1,002,340 between January 2003 and June 2004. Of that amount, $858,637, or 86 percent, came from 102 Wisconsin contributors who gave to state candidates between 1998 and 2003.

527 groups are named for the U.S. Internal Revenue Service law that governs them and include the more popularly known Swift Boat Veterans for Truth, America Coming Together, Club for Growth, MoveOn.org and the Media Fund. These groups can use these unlimited and unregulated contributions, which are also known as soft money, to fund negative broadcast advertising and mailings and voter registration drives.

The contributors include individuals, and unions and corporations which can contribute to 527s directly from their treasuries. Federal and state laws forbid direct contributions to candidates from union and corporate treasuries, however, a number of these entities have political action committees that legally contribute to state and federal candidates.

On average, the 102 contributors to 527s who also gave to state candidates contributed $8,418 apiece to 527s during the 18-month period, more than four times the $2,000 limit on direct contributions to federal candidates during the entire 2003-04 election cycle. Meanwhile the remaining 101 contributors to 527s who did not contribute to state campaigns gave $143,703, or an average of $1,423 apiece.

Contributions to 527s from Wisconsin sources who gave $1,000 or more to state candidates came from only 60 contributors who gave the groups $819,913, or 82 percent of their total Wisconsin take (see Table). If the threshold of contributions to state candidates is raised to $10,000 or more, that leaves 24 contributors to 527s that gave the groups $686,977, or 69 percent, of their Wisconsin take.

"It’s a myth that 527 groups are places where the little guy is getting involved and is making a big difference in the political process. These groups are getting $2 of every $3 they raise in Wisconsin from just two dozen wealthy contributors. They are not grassroots organizations. They are made of AstroTurf," WDC executive director Mike McCabe said.

Leading the list of Wisconsin contributors to 527s was the Wisconsin Laborers District Council, which used two funds to contribute $190,039 between January 2003 and June 2004 to its Washington-based 527 group. The union’s state PAC contributed $154,448 to Wisconsin candidates and legislative committees between 1998 and 2003.

Second to the union was Milwaukee brewing heiress Lynde Uihlein who gave more to 527s during the 18-month period than any other individual - $151,000. She contributed $25,675 to state Democratic candidates between 1998 and 2003.

Two Milwaukee companies, Johnson Controls and Miller Brewing, have contributed $116,945 and $42,074 respectively, to 527s through June of the 2003-04 election cycle. Johnson Controls’ PAC and employees contributed $68,350 and Miller’s PAC and employees contributed $269,900 to state candidates and committees between 1998 and 2003.

Conservative Sheboygan businessman Terry Kohler, his wife, Mary, and their Windway Capital Corporation contributed $76,500 to 527 groups between January 2003 and June 2004. The couple also gave generously to state campaigns - $63,050 from 1998 through 2003.

527 contributors who also contributed to state campaigns contributed to the unregulated groups at a comparatively faster pace than they have to state campaigns that have contribution limits. Their $858,637 in 527 contributions over 18 months translates into a 69 percent greater contribution rate than the $2.03 million they gave to state campaigns from 1998 through 2003.

2003-04 Wisconsin Contributors to 527s