Millions spent on Measure 4 advertising

Battle over mining reveals strange bedfellows

August 17, 2008 

The ads are everywhere.

Turn on a TV or radio or open a newspaper. Somebody is gunning for a yes or no vote on Alaska's Ballot Measure 4.

Soft music plays. Vaguely familiar Alaskans warn that the proposed law will save jobs or destroy them. Fix environmental rules or ruin them. Keep Bristol Bay pristine or snuff out the mining industry.

The ads cost millions. Who is paying for them?

On one side, it's clear.

Alaska Native corporations and foreign-owned mining companies are shelling out millions to convince voters to say "no" on Measure 4.

The law would bar large metal mines from discharging harmful amounts of certain pollutants into drinking water and salmon streams. But its opponents say the law is badly written and could end up shutting mines down.

One of the biggest donors to the "no" campaign is the companies pushing the controversial Pebble copper and gold mine in Southwest Alaska. They've paid more than $4 million so far to fight the initiative.

NANA Regional Corp., which receives royalties from the state's largest mine, Red Dog, estimates it has spent roughly $140,000 so far on "no" ads.

A political action committee formed by the state's regional Native corporations says it has spent $270,000 to fight Measure 4.

The "yes" side is another story.

While more than 100 people from Alaska and the Lower 48 have donated, most of the campaign cash for the "yes" vote is from a national "stealth PAC" that refuses to say where the money comes from, keeps its members secret and stirs up controversy wherever it goes.

Despite the secrecy, one thing is clear: It's not a green group.

THE MACHINE

The group, Americans for Job Security (AJS), is a well-known conservative-oriented ad machine.

Organized as a nonprofit business league, AJS began about 10 years ago with two $1 million donations from the American Insurance Association and the American Pulp and Paper Association.

Its main function is producing soft-money TV and radio ads and mass mailings.

The group's mission, according to IRS filings, is "educating the public on economic issues with a pro-market, pro-paycheck message." Most of those ads air during Senate and presidential races. The group is less frequently involved in ballot initiatives such as Measure 4.

Federal and state election laws allow the group to lobby voters on "issues," but its tax status bars it from making politics its "primary activity."

In many states, citizen watchdog groups and those targeted by AJS -- typically Democrats -- have filed legal complaints accusing AJS of flagrant electioneering.

The group Public Citizen last year demanded that the IRS revoke the group's nonprofit tax status and asked the Federal Election Commission to force it to register as a political action committee.

Most of those complaints, including Public Citizen's, have gone nowhere.

The group was cited twice for violating election law: for not reporting its spending on TV ads that attacked former Gov. Tony Knowles and Lt. Gov. Fran Ulmer in 2002, and for telemarketing calls one day before a 2006 primary election in Oklahoma.

In Alaska, state regulators waived the $1,900 fine. In Oklahoma, the group paid $3,000.

POLITICAL CONNECTIONS

The members of AJS may be a secret but its leaders have close ties to key Republicans.

One of the group's long-time leaders, David Carney, a New Hampshire Republican consultant, has worked on political campaigns all over the country. Recently, he's been advising Sen. Ted Stevens' re-election campaign.

The group's former president, Michael Dubke, worked on the 1992 George Bush presidential campaign. He runs a Virginia company that is now producing $200,000 in mass mailings on behalf of a "yes" vote.

The group's former lawyer, Benjamin Ginsberg, was an attorney for former U.S. Senate Majority Leader Trent Lott and a chief legal counsel to the 2004 Bush campaign. Ginsberg stepped down from the Bush campaign when press accounts revealed that he was giving legal advice to the Swift Boat Veterans for Truth, a group working to discredit the war record of presidential candidate Sen. John Kerry.

Newsweek reported in 2000 that Lott asked a group of lobbyists to pay for ads attacking a Michigan Democrat, Debbie Stabenow, who was running for the U.S. Senate. He told them to send the money through AJS, the magazine said.

In 2002, when the Alaska Public Offices Commission investigated whether AJS ads attacking Knowles and Ulmer broke the law, Ginsberg filed a response alleging that the APOC was being influenced by the Knowles administration and needed to be investigated itself.

Ultimately, the APOC ruled the ad spending should have been reported.

MINING INTERESTS

AJS has taken on mining and fish-related issues in other elections in other states.

In 2006, it aired ads in Montana urging against the creation of a fund to pay health costs for people exposed to asbestos. Doing so, it said, would create "bigger government" and bankrupt the companies involved, according to contemporary media reports.

At least 200 people died in Montana from asbestos exposure at a vermiculite mine. The fund would have provided large payments to those who remained ill. But the fund fizzled due to opposition on both sides of the political spectrum.

In 2004, Americans for Job Security placed ads in West Virginia coal country accusing Kerry of threatening hundreds of mining jobs. The ad charged that the presidential candidate wanted a ban on the controversial practice of extracting Appalachian coal by removing mountaintops.

Also in 2004, the group paid for an attack ad aimed at a Democratic U.S. Senate candidate, Ken Salazar, claiming a state agency under his watch was partially responsible for the worst cyanide spill from a mine in American history. Environmentalists and Colorado newspapers decried the ad as false.

In 2000, the group paid for ads praising a former Republican senator from Washington for his stance against removing dams on the Snake River. The Clinton administration considered removing them to revive the region's failing salmon runs. Removing the dams would destroy jobs, the ads warned.

This summer, the group sent out a soft-money mass mailing to Alaskans accusing the "foreign mining industry" in Alaska of "blowing a lot of hot air" regarding one of their claims about Measure 4. The ad was carefully worded to avoid actually mentioning the ballot measure.

A pro-mining ballot group advocating for a "no" vote recently filed an APOC complaint over the mailer, saying it was illegal electioneering. The APOC is still investigating.

SECRET MONEY

Proponents of a "yes" vote say they don't care about the group's secret donors.

"I'd welcome money from any source that we can get to fight this," said David Atcheson, a sport fisherman and outdoors writer who is acting director of the Renewable Resources Coalition, which has donated $150,000 so far to the "yes" campaign.

The mining industry and its supporters are outspending the "yes" side by at least three to one, state records show.

"We're begging for money for this fight, whereas the other side is getting money from giant, foreign conglomerates," he said.

Taking money from AJS is justified because, "It's really a David and Goliath battle," Atcheson said.

Does the group have members in Alaska? Yes, said AJS president Steve DeMaura, but he declined to say how many or identify any.

Despite their opposition to Pebble, some major players in the Bristol Bay fishing industry contacted by the Daily News said they aren't contributing any money to the "yes" campaign. All denied giving money to Americans for Job Security.

Bob Gillam, an Anchorage financier who opposes Pebble and has funded the anti-Pebble Renewable Resources Coalition, did not respond to Daily News queries. He has reported donating $270,000 so far to the "yes" campaign, public records show. It is unclear why he would chose to donate undisclosed money as well.

Though Sen. Ted Stevens says on his Web site he opposes Measure 4, at least three people leading his campaign have had key roles in the push for a "yes" vote. Two of them have direct ties to Americans for Job Security.

WHY PEBBLE?

After all this, the question remains: Why did Americans for Job Security, based in Alexandria, Va., decide to dump more than a million dollars into an Alaska ballot measure, and why did it choose the anti-Pebble side?

After more than a week of investigating, the Daily News was unable to come up with a complete answer.

When asked, DeMaura said fighting to protect Bristol Bay salmon runs from mining falls squarely within the group's pro-jobs mission.

Another part of the answer involves the group's long-standing relationship with Art Hackney, an Anchorage political consultant and co-sponsor of Measure 4. Hackney, who is working on Stevens' reelection campaign, has served on the AJS board for about two years.

His Anchorage firm, Hackney & Hackney, Inc., is handling most of the $1.6 million spent on advertising so far on the "yes" vote. For developing the ads, his firm gets a commission of roughly 10 percent to 15 percent, he said.

Hackney said he talked to his AJS colleagues about the ballot measure and the fight against Pebble, but claims he didn't expect the group to get involved.

"I just mentioned it in passing, thinking they had a lot bigger fish to fry," he said.

Hackney got entangled briefly in the APOC's investigation of the anti-Ulmer ads because he worked for the committee to elect Frank Murkowski, which was accused of colluding with AJS on the ads.

The APOC rejected the charges.

An attorney who defended the Murkowski election committee against the charges was Tim McKeever, treasurer of Stevens' current Senate campaign, McKeever also helped defend Measure 4 in a court fight this year over its constitutionality.

Although he had contact with AJS a few years earlier, Hackney says he got to know Dubke, the former AJS president, personally when he lived in Washington, D.C., for a few years.

Hackney said his first major project with AJS was in 2003, when the group asked him to assist in an ad campaign to defeat the McCain-Feingold campaign finance law.

Hackney claims he doesn't know the identity of the group's members or its source of money for the Measure 4 fight.


Big donors to the 'yes' vote

Americans for Job Security

$1.2 million

Bob Gillam

$270,000

Renewable Resources Coalition

$150,000

Sources: Alaska Public Offices Commission and the donors

Big donors to the 'no' vote

Council of Alaska Producers*

$6.4 million

Alaska Native corporations PAC

$235,000

NANA Regional Corp.

$140,000

*Includes donations from all of the state's metal mines and the companies advancing the Pebble and Donlin mineral projects.

Who are the Americans for Job Security?

Steve DeMaura, president: DeMaura recently replaced AJS' long-time president, Michael Dubke. DeMaura is the former executive director of the New Hampshire Republican Party.

Art Hackney, treasurer: Hackney is an Anchorage political consultant and co-sponsor of Ballot Measure 4.

Jean Cottington, director: Cottington is a governmental affairs officer for the Association of Credit and Collection Professionals and is based in Minneapolis.

Kirk Miller, director: No information is available.

Source: The Commonwealth of Virginia's State Corporation Commission and Daily News research.

Coming Wednesday

Sorting out the claims -- what happens if Measure 4 passes? What if it fails?

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