EXCLUSIVE: Democracy Alliance Network Revealed

Funding ‘snapshot’ details nearly $40 million in Alliance support for 20 groups this year
Jim Messina, David Brock, Neera Tanden

Jim Messina, David Brock, Neera Tanden / AP, americanprogress.org

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A secretive dark money group backed by George Soros and other liberal mega-donors is looking to steer nearly $40 million to left-wing groups in 2014 to support high-profile political and policy efforts, according to documents obtained by the Washington Free Beacon.

The documents reveal for the first time the Democracy Alliance’s full portfolio of supported organizations, a large network of powerful liberal groups looking to win key electoral and legislative victories.

The Democracy Alliance connects major Democratic donors with some of the largest and most influential liberal activist groups in the country. Previous beneficiaries, such as the Center for American Progress and Media Matters for America, are set to get millions more in 2014.

The list also reveals DA support for newer organizations, such as Organizing for Action, the advocacy group that succeeded President Barack Obama’s reelection campaign. That group has received official sanction from the White House, and operates websites and social media accounts branded with the president’s name.

In all, the document reveals, the Democracy Alliance hopes to provide $39.3 million to 20 organizations this year. If it meets those fundraising targets, it will likely be responsible for one out of every five dollars in those groups’ 2014 budgets.

Alliance-supported organizations will spend more than $175 million in 2014, according to budget projections contained in the document.

The Democracy Alliance is highly secretive in all of its operations. The donors it solicits and the organization to which it directs their financial support are prohibited from speaking publicly about its operations.

Security was tight at its recent conference in Chicago where reporters from the Free Beacon and Politico were rebuffed by attendees who would not answer questions about their involvement with the group.

The Free Beacon obtained and recently published a list of new Alliance “partners”—individuals and organizations that must pay $30,000 in dues and contribute at least $200,000 to DA-aligned groups each year—providing previously unreported details on its financial backing.

A document titled “Spring 2014 Democracy Alliance Portfolio Snapshot” offers details on the other side of the fundraising equation: the organizations to which the group’s partners will contribute millions this year.

The Democracy Alliance does not actually accept those contributions. Instead, it connects donors to a network of groups that it has vetted and strategically endorsed. The goal is to create a collaborative fundraising apparatus that maximizes the effectiveness of large contributions to left-wing groups.

Some of the groups that DA supports are established organizations with large budgets. The Center for American Progress, slated to get up to $5.5 million from DA donors this year, has a projected 2014 budget of more than $44 million, according to the funding snapshot. Media Matters will get up to $3 million, or more than a quarter of the group’s $11.67 million projected budget.

Other groups are set to receive an even larger portion of their revenue from Alliance donors. If the Alliance meets its fundraising targets, its partner contributions will be equal to 100 percent of the projected 2014 budget of New Media Ventures, 68 percent of the Youth Engagement Fund, 59 percent of Progressive Majority, and nearly half of the projected budgets of America Votes, the Black Civic Engagement Fund, and the Latino Engagement Fund.

Funding goals are broken down into “baseline” targets and “stretch” targets. They refer, respectively, to “the minimum level of continued support needed from the DA in order to maintain their current size” and “the level of meaningful support needed in order to enhance [recipients’] independent and [DA-]aligned efforts.”

Alliance-supported groups fall into two categories: “aligned network organizations” and “dynamic investments.”

The group did not respond to requests for additional information about how its support is broken down.

Total baseline funding for both aligned network organizations and dynamic investments in 2014 will be $27.1 million. Its cumulative stretch funding target for the year is $39.3 million.

Those funds will finance eleven “core functions” carried out by the various organizations the DA supports. They range from “fighting the right” to “perfecting data and tools” to “supporting progressive candidates.”

According to the snapshot, DA backs five organizations that “support progressive candidates”: America Votes, Catalist, the Center for American Progress, the New Organizing Institute, and Progressive Majority. CAP and NOI, unlike the other three, are nonprofit groups (each has a 501(c)(3) and a 501(c)(4) arm), and hence cannot devote a majority of their resources to political activities.

ThinkProgress, the blog of CAP’s 501(c)(4) Action Fund, has written approvingly of efforts to “mitigat[e] the damage caused by the Supreme Court’s 5-4 Citizens United ruling,” as the blog put it in an interview with Rep. Chris Van Hollen (D., Md.).

The Center for American Progress has warned that laws protecting the anonymity of (c)(4) groups can obfuscate the sources of political influence, and has called for laws that “require information on the source of funding for independent spending so that citizens know whose money is influencing their elections.”

Democracy Alliance critics say that speaks to a larger disconnect among groups that it supports: many of those groups decry secretive political spending while benefitting from a fundraising apparatus that discloses nothing about the millions in political and nonprofit contributions it facilitates.

The Alliance hopes to raise $1.6 million in 2014 for a group called the Fund for the Republic, which is critical of the prevalence of political dark money. The Fund does not publicly post information about its financiers. It makes the names of its donors available to those who request them, but will not say how much money they have donated.

Other DA-supported groups have employed that style of partial donor disclosure and been criticized by transparency advocates who say they are paying lip service to good government while shielding as much financial information as possible from public scrutiny.

The Sunlight Foundation scoffed at Organizing for Action (OFA) in 2013 when it released the names of high-dollar donors but refused to disclose information about their professional affiliations, which could make it easier to spot attempts at influence-buying.

“If OFA’s structure were motivated by accountability, we’d see a coherent policy about campaign finance disclosure, empowering public oversight of [the] group’s finances and donors,” wrote Sunlight policy director John Wonderlich. “Instead, we see conflicting messages about what kind of access a $50K donor can expect, and a disclosure policy that exists only in proportion to public outrage about Obama’s dark money.”

Jim Messina, Obama’s former campaign manager, founded OFA after the president’s reelection to serve as a perpetual campaign apparatus promoting the president’s legislative agenda. It has been criticized since its inception as a vehicle to sell White House and administration access to high-dollar Democratic donors.

OFA is slated to get up to $1 million from Alliance donors in 2014, but a number of those donors are already top OFA supporters. Amy Goldman and Philip Munger, both heirs to billion-dollar fortunes, recently signed on as DA partners. They have already donated a combined $1 million to the group.

It is not clear whether OFA contributions from Munger and Goldman came by way of the Alliance, because the group does not disclose that information. It serves as a “pass through” for donations to supported groups, so there is no public documentation revealing DA’s role in the fundraising process.

Instead, donations from DA partners simply show up as individual (or institutional, as the case may be) contributions to the organizations it supports. Because 16 of the 20 groups the Alliance is supporting this year are 501(c)(4) groups or have a (c)(4) arm, few contributions made through the Alliance will be public.

As CAP complained in its paper on laws governing such groups, “citizens have to search elsewhere to find the ultimate source of money for independent spending.” Anonymity of donors to (c)(4) organizations means there are often no available means of revealing DA-facilitated donations to top left-wing groups.

It is just that sort of opacity that many DA-supported groups ostensibly exist to fight, said John Perazzo, managing editor of Discover the Networks, a site that tracks left-wing donors and political organizations.

“Its members justify this hypocrisy by maintaining that their own donations are intended to advance a selfless, high-minded, moral crusade to improve America as a country, whereas conservative donors are allegedly motivated only by a desire to enrich themselves by supporting groups that promote policies like tax cuts and reduced business regulations,” Perazzo said in an email.

However, some Alliance donors benefit from policies that its supported organizations advance.

Rick Segal is a new DA “partner,” according to the list recently published by the Free Beacon. Segal, who bundled between $250,000 and $500,000 for Obama’s reelection effort, runs a financial services firm, Seavest Inc., that is expected to benefit from Obamacare, the Washington Examiner recently reported.

Other new partners are top officials at major labor unions, including the Communications Workers of America and the American Federation of Teachers. Alliance-supported groups regularly advocate for policies that boost union membership and finances.

Two new DA partners are top officials at the union-owned Amalgamated Bank. The bank’s finances are deeply entwined with those of the Democratic National Committee, which still owes Amalgamated more than $8 million from loans taken out during the 2012 campaign season.

The Alliance funding snapshot also reveals 21 groups that received DA support over the past nine years. They include some of the left’s leading campaign finance reform voices, such as Citizens for Responsibility and Ethics in Washington, which frequently warns of the corrosive effect of secret money in the political process.

Other organizations previously backed by the Alliance include the radical environmentalist group the Sierra Club, the pro-abortion EMILY’s List, and the hard-left Hispanic advocacy group La Raza. A full list of supported groups in 2014 and prior is below.

Democracy Alliance Network, 2014 (baseline funding target/stretch funding target):

America Votes ($3.5 million / $4 million)

American Constitution Society ($1.2 million / $1.5 million)

Black Civic Engagement Fund ($1.5 million / $2 million)

Brennan Center ($2.4 million / $2.7 million)

Catalist ($500,000 / $750,000)

Center for American Progress ($3.23 million / $5.5 million)

Center for Community Change ($2.2 million / $3 million)

Center for Budget and Policy Priorities ($1.8 million / $2.5 million)

Common Purpose Project ($150,000 / N/A)

Fund for the Republic ($1.2 million / $1.6 million)

Latino Engagement Fund ($1.5 million / $2 million)

Media Matters for America ($2.4 million / $3 million)

New Media Ventures ($250,000 / $400,000)

New Organizing Institute ($750,000 / $1 million)

Organizing for Action ($600,000 / $1 million)

Progressive Majority ($650,000 / $800,000)

Progress Now ($1.6 million / $1.9 million)

State Voices ($1.4 million / $2 million)

Women’s Equality Center ($1.5 million / $2 million)

Youth Engagement Fund ($750,000 / $1.5 million)

Previously supported:

Advancement Project

Brave New Films

Campaign for America’s Future

Center for Social Inclusion

Citizen Engagement Laboratory

Citizens for Responsibility and Ethics in Washington

Democracy Now

Economic Policies Institute

EMILY’s List

Free Press

Gamaliel Foundation

League of Young Voters

National Council of La Raza

National Security Network

Sierra Club

Sojourners

Third Way

USAction

Voter Participation Center

Young Democrats of America

Young People For (YP4) and Young Elected Officials (YEO) Network

Spring 2014 Democracy Alliance Portfolio Snapshot by Washington Free Beacon

Lachlan Markay   Email | Full Bio | RSS
Lachlan Markay is a staff writer for the Washington Free Beacon. He comes to the Beacon from the Heritage Foundation, where he was the conservative think tank's first investigative reporter. He was also a contributing editor for Newsbusters.org. His work has appeared in the Wall Street Journal, the Washington Times, and the Washington Examiner. He graduated from Hamilton College in 2009, and currently lives in Washington, D.C. His Twitter handle is @lachlan. His email address is markay@freebeacon.com.