If you thought Montana has seen and heard the last of the 527 political groups—once referred to as “stealth PACs” because of their ability to fly below the federal campaign disclosure radar—guess again. A new 527 group calling itself People for Montana has begun an assault on the airwaves by running issue-advocacy ads throughout the state that are critical of the economic plan being proposed by Democratic gubernatorial candidate Mark O’Keefe.
Under federal law, 527 groups (so named because of the section of the Internal Revenue Service code that defines their status) may spend as much money as they like to influence elections, but may not endorse one specific candidate over another. Although contributions to 527 groups are not tax-deductible, there are no restrictions placed on corporations or unions that contribute to them.
A change in campaign disclosure laws signed by President Clinton July 1 does require 527 groups to report their expenditures, contributors and other information to the IRS. That said, a recent IRS filing by People for Montana reveals how vague and uninformative those disclosures can be. “People for Montana is a private, non-profit organization that seeks to educate and inform citizens about issues important to the economic future of Montana families,” the group’s report states.
More revealing is the list of principals associated with People for Montana, which includes representatives from major timber, mining, railroad, oil, natural gas and utility companies such as the Washington Corp., BP Amoco, Golden Sunlight Mines, Plum Creek, Stimson, Smurfit-Stone and Qwest. Those corporate contributions to the group range from $10,000 to $50,000 apiece.
People for Montana is not the first 527 group to operate in Montana, though it appears to be the first one to be locally grown. Voters are perhaps more familiar with the issue attack ads aired by Citizens for Better Medicare—a 527 funded by major pharmaceutical firms, research universities and other health groups—which has spent millions of dollars attacking congressional candidates such as Democratic senatorial candidate Brian Schweitzer, who supports price control measures for prescription drugs.