Tuesday, November 10, 2015

How Non-Coordination between Candidate and super PACs is Working


Ted Cruz enjoys millions of dollars in super PAC money but he may have to wait until after the first round of primaries before he can reap the benefits of that unlimited cash.

The Keep the Promise set, four super PACs which have collected more than $38 million to independently support Cruz's surging bid, is struggling to show signs of life that can satisfy budding external pressure from both the official campaign and other Cruz allies.

Keep the Promise I, funded by Long Island billionaire Robert Mercer and run by Kellyanne Conway, a well-regarded GOP political operative, is focusing a $1 million radio campaign on Christian channels in Iowa, where Cruz is increasingly polling well. The $11 million group is also diversifying its portfolio and hiring organizers in the states. Jeff King, an Iowa political operative and son of powerful Rep. Steve King, is leading a growing field team in the Hawkeye State, and there are plans to staff up in South Carolina as well to supplement the official campaign field team, which it's bumping into on the trail.

Keep the Promise II, the group funded with $10 million from Houston investor Toby Neugebauer, has not reserved any television time and has no plans to air advertisements until March or April, according to a leader of the super PACs.

The group was intended to be the main super PAC that purchased television spots, while the other two groups focused on radio and digital advertising. But right after Neugebauer, a controversial figure in some Cruz circles, delivered a PowerPoint presentation to Cruz donors during an exclusive campaign retreat at The Broadmoor resort this summer in Colorado, he abruptly pulled back on a planned major television campaign.

The buy, which would have been for a substantial series of 9,600 60-second biographical spots, or a biopic, across South Carolina, a critical stop coming as the first southern state after the Iowa caucuses and New Hampshire primary. The source said the sudden decision came after a non-profit affiliated with Marco Rubio's campaign made its own purchase, jacking up television rates statewide. Other sources dispute that, saying the abandoned TV campaign was scuttled by legal questions about the perception of coordinating with the campaign.

The super PACs are staffed in part by a few individuals with no formal political experience, including Neugebauer, who has been the groups' main fundraiser and formerly its chief executive officer, in addition to one of its lead donors. The groups have only recently begun hiring their first political professionals, including a new professional fundraiser: Campbell Smith, a finance official at the National Rifle Association. And amid increasing questions about the super PAC, campaign officials are coming to the defense of Neugebauer, who left his role at the super PAC in a shake-up, and are praising his ability to incentivize two more eight-digit donations with a $10 million check of his own.

Cruz himself expressed his support. "Toby is a close friend and someone I admire and respect greatly," he said in a brief interview outside the Senate chamber this week.

Keep the Promise III, backed solely by $15 million from Texas fracking giants Farris and Dan Wilks, is breaking through in digital organizing via its Reigniting the Promise project, with a months-old Facebook page that has quickly earned more than 350,000 likes. That group is advised by Jon Francis, a Wilks family member and the manager of their philanthropic giving, along with a coterie of anti-abortion activists from a group called Online for Life, who have no prior experience in partisan politics.

Meanwhile, Cruz continues to attract deep-pocketed backers. His campaign and super PACs have executed list swap agreements, and Cruz continues to be one of the few favorites of most of the major fund-raising circles: the Republican Jewish Coalition, the Club for Growth, and the Koch Brothers' political network.

One of those Koch donors, Darwin Deason, may soon create another Cruz super PAC, potentially Keep the Promise IV, pending a final donation from the family.

Cruz has praised his campaign for its cheapness, saying its low spending positioned it to have more cash on hand at the beginning of October than any other Republican campaign. And despite not having spent nearly any money on paid media, Cruz now sits in the top four in national polling, on top of candidates such as Jeb Bush, whose super PACs have spent millions of dollars that hasn't translated to increased support. That's another reason why super PAC officials have been reluctant to pull the trigger: there's no need, at this point, they say.

But given emerging calls from Cruz headquarters for the super PACs to begin making purchases, the South Carolina buy seems to be a commitment the campaign maybe wishes had been made. "For someone like Cruz who spends a lot of time in Iowa, it's not all that unusual for them to spend less on TV and then to be saving money for later states," said Carl Forti, a top unaligned super PAC operative who produced television to support Mitt Romney in 2012. "Looking at super PACs as a whole, I'm not sure there's anything traditional this cycle -- so this fits right in."

It remains unclear why the group, at one point, discarded its plans. The defense of Neugebauer's group does not square with advertising records, which show that the Rubio non-profit group, Conservative Solutions Project, only made a big advertising purchase in South Carolina in the third quarter. It did reserve millions of dollars in spots around the time of the retreat at The Broadmoor, but those advertisements were to air in the opening months of 2016, not this fall.

But the source who disagreed cautioned that there may be another reason why the Neugebauer plan was abandoned: The campaign's uploading of hours of unedited B-roll footage to a little-known YouTube account, which was discovered by BuzzFeed. After filming Cruz events and splicing the video with footage from the YouTube account, lawyers got skittish over what is ordinarily a common practice for outside groups: Would it appear that the super PAC was coordinating with the campaign by launching TV ads so soon after the YouTube upload?

The three groups tied to the three anchor families all have religious tones.

Campaigns and super PACs frequently read one another’s messages in the press with a fine-toothed comb to learn thinking that they cannot legally directly share with one another.

It’s a reflection of the divided campaign finance world, where super PACs are allowed to raise unlimited amounts of cash, donations must still be reported to the Federal Election Commission, but the catch is that campaign and super PAC officials aren’t allowed to coordinate.











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