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CAP Complaint

The letter requests an investigation into Citizens Alliance of Pennsylvania (CAP) and its related PAC regarding compliance with campaign finance laws. It notes that CAP relies heavily on corporate contributions but does not disclose donors, raising questions about whether coordination between CAP's campaign efforts and funds violates its 501(c)(4) status. The letter also questions whether CAP is improperly coordinating with a state senate candidate in violation of limits on coordination between independent expenditures and individual candidates. The investigation is hoped to ensure no corporate money is being illegally used for campaign purposes and that CAP is complying with its tax-exempt obligations limiting political activities to 50% of revenues.

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5K views2 pages

CAP Complaint

The letter requests an investigation into Citizens Alliance of Pennsylvania (CAP) and its related PAC regarding compliance with campaign finance laws. It notes that CAP relies heavily on corporate contributions but does not disclose donors, raising questions about whether coordination between CAP's campaign efforts and funds violates its 501(c)(4) status. The letter also questions whether CAP is improperly coordinating with a state senate candidate in violation of limits on coordination between independent expenditures and individual candidates. The investigation is hoped to ensure no corporate money is being illegally used for campaign purposes and that CAP is complying with its tax-exempt obligations limiting political activities to 50% of revenues.

Uploaded by

Ryan Briggs
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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MATTHEW H.

HAVERSTICK 
MHAVERSTICK@KLEINBARD.COM 
Direct Dial 215.496.7225

May 2, 2018

VIA EMAIL

Timothy E. Gates, Chief Counsel Jonathan M. Marks, Commissioner


PA Department of State PA Department of State
Office of Chief Counsel Bureau of Commissions, Elections
306 North Office Building and Legislation
401 North Street 210 North Office Building
Harrisburg, PA 17120-0500 401 North Street
tgates@pa.gov Harrisburg, PA 17120-0500
RA-BCEL@pa.gov

RE: Citizens Alliance of Pennsylvania (CAP)

Dear Messrs. Gates and Marks:

We represent the Senate Republican Campaign Committee.

Please consider this letter a request for a full investigation of Citizens Alliance of Pennsylvania
(CAP) and its related political action committee.

The most vital aspect of campaign spending is disclosure. After a review of the limited public
information available, we think it is important to determine whether CAP is improperly circumventing
several disclosure laws. By refusing to disclose any information regarding the monies CAP garners to
fund its operations, there is little way to ensure its compliance with campaign finance laws. CAP
heavily relies on corporate contributions to fund its operations, which, in part, seeks to affect that the
outcome of campaigns. Coordination between the campaign efforts and operational funds, however, is
totally exempt from public disclosure.

CAP has exerted a heavy hand in the State senate primary race in the 38th Senatorial District.
Notably, identical staff and consultants have been utilized by CAP and Mr. Shaffer, who is a candidate
for that seat. This raises the critical question of whether CAP is violating established law regarding

{01406446;v2 }
Timothy E. Gates, Chief Counsel
Jonathan M. Marks, Commissioner
May 2, 2018
Page 2

CAP’s 501c(4) status that limits the amount it may expend on campaign effort. This issue deserves a
full investigative audit.

Further, federal law limits the permissibility of coordination between independent expenditures
(CAP) and individual candidates, in this case Mr. Shaffer. This too deserves review and, perhaps, the
assistance of the Federal Election Commission will be necessary in this endeavor.

We fully understand that these inquiries will be difficult due to CAP’s unwillingness to disclose
its donors. However, it is our hope that a full audit will ensure that no corporate money is being
utilized for campaign purposes.

CAP’s PAC has not reported any information since 2017 and although it is likely that there will
be some future disclosure, it will provide only a small window of information that is needed to
determine whether Mr. Shaffer is circumventing mandatory disclosure laws. In-kind services must be
reported and none have been itemized, to date, by Mr. Shaffer. Your department has the power and
obligation to ascertain whether CAP is complying with related tax exempt obligations, since no more
than 50 percent of CAP’s annual revenues may be utilized for political activities.

Very truly yours,

Matthew H. Haverstick

{01406446;v2 }

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