Congressional candidates and the PACs that donate to them can only legally take a few thousand dollars from individual donors. But PACs that tell the Federal Election Commission that they won’t donate to or coordinate with candidates are allowed to take unlimited amounts of money from donors.
Since the contribution limits for outside spending groups were eliminated by a 2010 D.C. Circuit court ruling that came in the wake of the Supreme Court’s Citizens United decision, many PACs have tested the limits of how closely they can affiliate with candidates without being considered to be acting in coordination and, thus, no longer allowed to raise unlimited sums from donors. Now, the latest attempt to push the limits has emerged in the race between Rep. Alexandria Ocasio-Cortez (D-N.Y.) and her Democratic primary challenger, former CNBC correspondent Michelle Caruso-Cabrera.
An organization called Fight for Our Communities PAC reported its first expenditure to the FEC on Tuesday—$28,000 paid to a Pittsburgh video production company called Phenomenon Post for digital media and mailers opposing Ocasio-Cortez. The mailers and digital media were publicly distributed on Tuesday, according to the FEC filing.
As of its most recent disclosure covering receipts made prior to April 30, Fight for Our Communities PAC is funded primarily by Caruso-Cabrera’s husband, Stephen Dizard, who donated $30,000 to it in April. Dizard’s donations make up more than 70% of the PAC’s total funding, according to FEC records, and it is more than ten times the amount he would be allowed to give to the Caruso-Cabrera campaign. Fight for Our Communities is required to file an updated donor disclosure on June 20.
Next to nothing is known about who is behind Fight for Our Communities PAC. The organization was formed in Delaware on March 18, less than a month after Caruso-Cabrera entered the race. Its treasurer, an unknown individual named John Gorman, does not appear to have ever worked with other political committees. The group has no public profile and no internet presence, and it has not made expenditures in any other races. Sludge asked the Caruso-Cabrera campaign if it knew how her husband was aware of the group to make his donation, but was told by a spokesperson that it had “no information” on the matter.
The Caruso-Cabrera has sent multiple mailers attacking Ocasio-Cortez and is currently running attack ads in New York City.
While Dizard’s funding raises questions about whether the group is fully independent from the Caruso-Cabrera campaign, it is unlikely to face FEC scrutiny, which does not proactively conduct investigations. To be considered illegal under the FEC’s definition of coordination, the PAC would have to be found to have produced communications at the request or suggestion of the Caruso-Cabrera campaign, with material involvement from the campaign, or after one or more substantial discussions with the campaign in which the communications were mentioned.
Dizard, a managing partner at financial firm Wood Capital, has donated primarily to Republicans. His largest donation prior to his donations to Fight for Our Communities PAC was to a joint fundraising committee in 2014 that benefited the campaigns of six congressional Republicans. Other Republicans he has donated to in recent years include Sen. Tom Cotton (R-Ark.), Sen. Cory Gardner (R-Co.), and Sen. Marco Rubio’s (R-Fla.) 2016 presidential campaign.
The campaign of Caruso-Cabrera, who authored a 2010 book calling for Social Security and Medicare to be replaced with privatized voucher systems, has been heavily backed by Wall Street donors. Her more than $2 million received from contributors include maximum donations from executives at firms including Blackstone, Oaktree Capital Management, Goldman Sachs, and The Carlyle Group. Caruso-Cabrera is also supported by the U.S. Chamber of Commerce, the powerful business association that generally backs Republicans. Several of Caruso-Cabrera’s donors are also big donors to President Trump, the New York Post recently reported.
The primary election between Ocasio-Cortez and Caruso-Cabrera in New York’s 14th Congressional District is on Tuesday, June 23, with early voting locations available through June 21. Previously-requested New York absentee ballots must be postmarked by June 23 or hand delivered to a BOE office by close of polls on June 23, as instructed by the New York City Campaign Finance Board.
Read more from Sludge: