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How Dark is “Dark Money”?

Jun 29 | 2015  by

On behalf of Fausone Bohn, LLP on Monday, June 29, 2015.

Dark money, money used by lobbyists to skew elections in their favor has begun to sweep the United States elections. The New York Times stated that this past November the “Senate was elected on the greatest wave of secret, special interest money ever raised in a congressional election”.

Mitch McConnell, the Senate majority leader, is a long-time advocate of unlimited campaign spending. His own campaign received about $23 million in unlimited spending from independent groups this past November.

It seems that Michigan is one of the biggest players in the dark money saga, if not the biggest. Director of the Michigan Campaign Finance Network Rich Robinson called Michigan the “dark money capital of the world”.

In the 2014 election cycle, Michigan’s top 150 PACs raised $68 million. $3 million of this record amount was used in independent expenditures to influence the November 2014 election.

These instances are not outliers, but a trend. State lobbyists’ spending was over $37 million in 2014, a 4.1% rise from 2013. Politicians are calling what we saw in 2014 a “dress rehearsal” for what is to come in 2016. The matter-of-fact is dark money is more relevant than ever in the United States.

Michigan has passed the Michigan Campaign Finance Act. Through this act, corporations both for-profit and non-profit alike, can establish a Separate Segregated Fund (SSF). A SSF allows a business or nonprofit to survey which candidates will advocate for their policy stances, and also give them a chance to educate candidates on their issues.

A SSF allows you to avoid having to spend money on lobbyists and thus losing control of the candidates in which your money goes to. For anyone looking for a way to assist a political candidate, while avoiding the phenomenon of dark money, an SSF is the way to go.

Paul Bohn of Fausone Bohn, LLP specializes in the areas of environmental, real estate & land use, and municipal law. He also advises clients, including those running for elected office, on the establishment of SSFs and their compliance requirements.