Natives' super PAC meant new boost for Murkowski campaign

DECISION: Alaskans Standing Together leaped into campaign.

November 20, 2010 

If Sen. Lisa Murkowski's re-election survives her opponent's challenges, she will in no small measure owe her historic write-in victory to the U.S. Supreme Court's most contentious decision this year -- a ruling she herself described as troubling, but which led to massive Native corporation spending on her behalf.

In January, a divided court overturned several precedents and federal laws in declaring that corporations have First Amendment rights to support political candidates in the most important way they can -- by shelling out money for commercials and other activity.

The Citizens United decision, named after the advocacy nonprofit corporation that brought the case, tossed out long-standing bans on corporate and union contributions in elections.

The 2010 election was the first since Citizens United. National experts say big corporate spenders only "dipped their toes" in the new rules as they geared up for 2012.

But in Alaska, one independent group fully immersed itself in the new age of campaign spending, nearly doubling the amount of money marshaled in support of Murkowski's re-election bid: the "super PAC" called Alaskans Standing Together, created, managed and supported by Alaska's regional Native corporations.

The full measure of Alaskans Standing Together's effort won't become public until it files its next income and spending report on Dec. 2. But the PAC's three-week spending binge of $1.2 million, begun Sept. 27, came at a time when Murkowski's own campaign had about $1.7 million left to blast its message to voters around the state.

As important as the total dollars were, the head-spinning speed at which they were raised fit perfectly into the rapidly changing environment of the Alaska Senate campaign.

Murkowski and her supporters were stunned when conservative Fairbanks lawyer Joe Miller emerged from the Aug. 24 primary as the party's Senate candidate. He had been the beneficiary of a PAC himself -- about $600,000 was spent on his behalf by Our Country Deserves Better PAC, the California-based parent organization of the Tea Party Express.

Murkowski conceded defeat Aug. 31. After flirting with retirement or running via another party, she declared the start of her long-shot write-in campaign Sept. 17, six weeks and four days ahead of the general election.

Alaskans Standing Together quickly followed her move. It filed its registration with the Federal Election Commission Sept. 23, naming Cook Inlet Region Inc.'s senior vice president, Barbara Donatelli, as treasurer. Its chairman was Will Anderson, chief executive of Koniag Inc. of Kodiak and president of the association that represents all the Native regional corporations.

By Oct. 12, Alaskans Standing Together reported that 11 of the state's 12 regional Native corporations had anted up $920,000 in amounts ranging from $15,000 (Calista Corp. and Bristol Bay Native Corp.) to $140,000 (Arctic Slope Regional Corp.). Anderson said the 12th, the Aleut Corp., also contributed but missed the Oct. 13 cutoff date for the most recent reporting period.

Because of different reporting schedules, it's still unclear how the PAC raised the additional $100,000 to cover the $1.2 million it reported spending for Murkowski as of Oct. 20.

Before the Supreme Court decided the Citizens United case, Alaskans Standing Together would have had to hold massive fundraisers to attract that kind of money. Individual contributions to PACs are limited to $5,000 a year, so it would have taken at least 240 people with very fat wallets to get to $1.2 million.

John Havelock, the state's attorney general when the Native corporations were created by an act of Congress to settle indigenous land claims, said the companies had reason to fear a Miller victory. Miller had made a point of attacking the preferences they receive in federal contracts -- so-called 8(a) contracts.

"All of the regions have a big stake in 8(a) contracting, and Joe Miller said that was going to come to an end, along with other forms of earmarking which has been the lifeblood of the Denali Commission (a grant-giving agency) and rural Alaska generally," Havelock said. "Having Joe Miller as the U.S. senator would've been, from an economic perspective, a disaster, so I can understand the CEOs thinking, 'Oh my gosh, what are we going to do here, we can't have this happen.' "

AFN MEETING

Interior Secretary Ken Salazar was in town Sept. 3, and the president of the Alaska Federation of Natives, Julie Kitka, assembled a large contingent of Native leaders for a morning meeting with him on long-standing fishing and hunting issues. Present were chief executives, directors and leaders of a range of regional and village Native corporations, nonprofits, tribal groups and others -- about 50 people in all, Kitka said in a recent interview. They filled a big conference room at AFN headquarters on C Street in Anchorage.

A few days before the Salazar meeting, Kitka conceived a special afternoon program while the leaders were still around, and invited the U.S. Senate candidates to the conference room. Miller declined, she said. Democrat Scott McAdams and Murkowski accepted the offer and appeared back to back.

Only a couple of days before that, Murkowski had conceded to Miller and was at a loss about what to do next -- retire? Join another party? Anderson, the Koniag chief executive, said the people in the room suffered no doubts.

"A very broad spectrum of Native leaders, each speaking in turn, were very adamant, very passionate that 'we really need you to run, we really want you to run,' " Anderson recalled.

There were more Democrats in the room than Republicans, he said, and while most thought McAdams was a "nice guy," he said, they wanted Murkowski to continue her campaign. They thought Miller was "demonizing" the Native corporations, while Murkowski had been a strong ally in Washington, he said.

Murkowski, in an interview at her victory celebration Wednesday, remembered the afternoon event as a decisive, emotional break from her loss to Miller.

"I spoke for just a couple minutes about this (losing the primary) is a tough place to be, but it's where we are," Murkowski said.

Then the leaders circled around the perimeter of the room began to talk.

"I think just every person in the room spoke," she said. "And they spoke about different initiatives, whether it was what I had done to advance the dental health therapist program, what I've done to help with the Village Safe Water (Program)."

When the talking stopped, Murkowski said, she was moved -- but it wasn't enough.

"It's good to hear all this, I know what it is that you need," she recalled telling the leaders, "and I know why it's so important that you have somebody in Washington, D.C., who understands the issues. But you're asking me to do something that is really a very heavy lift and I cannot do this alone. It's not enough for you as CEOs to stand up and give me your support. I would need to know that it goes out into every village."

That's when Georgianna Lincoln, a former Democratic state senator, rose from an end table. She had served in the Alaska Legislature when Murkowski was there, but Murkowski wasn't sure what to expect -- the two had never been particularly close. Murkowski remembers her as being "strident."

"She stood up and she said, 'I pledge to you that I will get out in my region and I will talk to all my people and I will go to my villages and I will work with you.' She turned to everybody else in the room, and she said, 'Who else will stand with me?' And every person in the room stood up. It was pretty powerful. In fact, it was so powerful that when I left, it was like, 'Whoa. Write-in.' "

Buoyed by the meeting and the warm early-September afternoon, Murkowski and two aides stopped for cookies and coffee at an outdoor table at the Fire Island Bakeshop on G Street. A woman biked by with six baguettes in a basket and three bottles of wine in a sling around her shoulders, as though she were in Paris. The woman stopped halfway down the block and peddled back.

"I just realized who you are," the woman told Murkowski. "You must run. I am a Democrat, I've never voted for a Republican in my life, but I need to know that there is somebody like you that will be there for me."

They talked for about three minutes, the woman never getting off her bike. Then she went on her way.

"It was like, this is like something out of a movie. We kind of just looked at one another," Murkowski said. "After the impact of this really powerful meeting and then have this total stranger -- it was emotional. It made me realize it's not going to be so easy to get out of this, to step down."

NEW ENVIRONMENT

The Citizens United decision stemmed from an effort by the conservative nonprofit to distribute a video attacking Hillary Clinton during the 2008 Democratic Party primaries. It could, the court held in a 5-4 decision that also meant a corporation couldn't be barred from spending its money on elections. Two months later, in March, in a case involving another nonprofit, Speechnow.org, the U.S. Court of Appeals for the D.C. Circuit extended the reach of Citizens United to cover groups.

The two cases gave authority to Alaskans Standing Together to raise money from Native corporations, Koniag's Anderson said.

Neither decision allowed corporations to give directly to a candidate's campaign -- that part of federal law is still intact. But corporations could now raise unlimited funds for an independent effort, as long as it wasn't coordinated with the candidate.

Alaskans Standing Together's Anchorage-based media consultant, MSI Communications, produced at least 10 television and five radio commercials, four newspaper ads, buttons, bumper stickers and a seemingly unending river of mailers to Alaska addresses supporting Murkowski or attacking her opponents.

But one more unresolved issue still remains for the organization and its Native corporation benefactors. Neither of the court decisions killed the ban imposed by Congress on political contributions by federal contractors.

Nearly all of the Alaska regional corporations and several large village corporations have many millions of dollars in federal contracts through a special Small Business Administration program that gives them advantages over other businesses. The name "8(a) contracts" comes from the section of law providing the break.

Republican candidate Miller, who hired the head of Citizens United as a campaign consultant, has attacked 8(a) contracting as unfair and wasteful. On Oct. 20, he filed a complaint with the Federal Election Commission accusing Alaskans Standing Together of violating the federal contractor ban. He's described the PAC's efforts for Murkowski as corrupting -- payback for her support of the 8(a) program. In effect, he argued, the Native corporations are laundering taxpayer money from the contracts into campaign contributions on her behalf.

"The Alaskan Native Corporations have reaped billions from questionable set-asides and federal contracting programs and Sen. Murkowski has fought efforts to reform them. We now know why," Miller said in a statement when he filed his complaint.

Anderson argues the contribution ban applies only to the corporate subsidiaries that actually do the contracting, not to the parent regional corporations.

Several experts agree.

"I have a feeling that (the complaint) is not going to go very far with the FEC," said Virginia attorney Jason Torchinsky, an expert in election and campaign law who has represented the National Republican Senatorial Committee in previous elections.

"I saw the complaint and the problem is, this federal contractor restriction is read pretty narrowly," Torchinsky said. "If the overall parent entity doesn't have the direct contract, the FEC probably isn't going to touch it. Even if they did, it would be a ways down the road and it wouldn't impact the outcome of the election."

Bradley Smith, an Ohio law professor and former FEC commissioner who chairs the nonprofit advocacy group Center for Competitive Politics, said Alaskans Standing Together has a strong case -- as long as the parent corporations can show they have enough income from non-federal sources to cover the amount of their contributions. In the 1990s, the FEC allowed the owners of a partnership that in turn owned federal contracting firms to make political donations, as close an example as exists to date, Smith said.

'A TASTE OF POWER'

Murkowski said she won't be able to tell exactly how big a role Alaskans Standing Together played in her victory until she's able to talk to the organization. That can't happen until after the election is certified because of the laws that require the PAC to operate independently, she said.

"Could we have done it without them? I'd like to think that yes we could have, but that's a lot of money. It's a lot of reach-out. I can't wait to find out," she said.

Still, she said she's concerned about the Citizens United decision and how much more money it will add to politics. She's also concerned about the anonymity of donations -- if a nonprofit uses less than half of its income on elections, it doesn't have to disclose its donors. (That provision doesn't apply to Alaskans Standing Together, which must report all its large donations because it was created mainly to affect elections.)

"The amount of money that ends up being spent in these campaigns is absolutely wrong," Murkowski said. "I was back in Washington on Monday and Tuesday, and people are already raising money for their campaigns for 2016. Crazy. I'm trying to fight to get $3 million for Buckland for a water and sewer project, and we (all three candidates) spent $3 million in the last weekend of the campaign with just this Senate race, forget what went on in the governor's race or anybody else's race."

Torchinsky, the Virginia lawyer, said it's only just beginning.

"This was the first election cycle where people were dipping their toe in the water, post-Citizens United, and now that people understand the power of these outside groups to speak, I think you're going to see more of them speaking, more regularly," he said.

"We don't like what's happening, not just in Alaska, but all over the country," said Melanie Sloan, director of the nonprofit advocacy organization Citizens for Responsibility and Ethics in Washington. But Sloan said that given the makeup of the nation's courts and Congress, not much can be done to reduce the flow of money into elections, though she'd like to see more disclosure of the sources of money.

University of Alaska Fairbanks political science professor Gerald McBeath said the changing landscape "is a very important shift and it will affect Alaska campaigns from now until whenever the Supreme Court changes its mind." And that won't be anytime soon, he said.

Alaskans Standing Together has opened the door, he said, and Alaskans shouldn't be surprised to see a similar group from the oil industry trying to elect people who support tax breaks, or environmental groups "gathering together in some neutral-sounding organization" to halt some developments.

Havelock, the former attorney general, said that when Congress was debating the creation of the Native corporations in 1971, U.S. Sen. Ted Stevens was concerned about the political clout they might achieve. Stevens rejected the idea of a single Native corporation covering the entire state for just that reason -- it would be too big and powerful, much more so than the 12 regional corporations eventually created, Havelock said.

But now, Alaskans Standing Together has shown it can be just that kind of statewide force, he said.

"This is a taste of power -- it becomes a precedent," he said "They've done it this once; why would it not be done again?"

Anderson said there are no plans to disband Alaskans Standing Together, though he believes it will only be used for federal elections in the future, not state or local ones.

"Certainly this election proved that we really can make a difference and I'm excited by that," he said.

But he said he also expects Native leaders to be very cautious with their newfound power. In some cases, regional differences or conflicts between corporations will prevent the organization from acting with a single voice, he said. And corporate boards and executives will have to be careful to not get too far in front of shareholders back home, or they may find themselves sued or voted out of office.

More important than spending money, Anderson said, is ensuring that Alaska Natives vote in large numbers.

"The worst thing that could happen is that our impact is marginalized and that opinions aren't respected," Anderson said. That would happen "if the candidates don't believe that we'll vote or that we'll move in a way that can tip an election."


Find Richard Mauer online at adn.com/contact/rmauer or call 257-4345.

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