The money trail

The Montana Statesman calls itself "Montana's largest and most trusted news source." It is edited and published by Donald Ferguson, an "award-winning newspaper veteran," boasts the Statesman's website. Its home page features 11 stories -- six of them unflattering portraits of Steve Bullock, Montana's attorney general and the Democratic candidate for governor. The headlines topping the page: "Bullock admits FAILURE: 1 in 4 sex offenders go unregistered," and "Bullock failed to track child predators, little progress seen after audit." 

One hundred and twenty thousand copies of the Statesman arrived at Montanans' doorsteps recently. But despite appearances, the newspaper isn't a newspaper at all. Rather, it's a cleverly disguised political mailer, little different than the loudly designed, plus-size postcards that may be piling up in your recycling bin, accusing candidates for public office of hating puppies and cancer patients.

The Statesman is put out by American Tradition Partnership (ATP), a "social welfare" 501(c)(4) organization that describes itself as "dedicated to fighting environmental extremism and promoting responsible development and management of land, water, and natural resources in the Rocky Mountain West and across the United States." Donald Ferguson, in addition to his "journalistic" duties, is also the group's executive director.

Formerly known as the Western Tradition Partnership (WTP), the group is the subject of a new Frontline documentary that shines an unusual amount of sunlight on these secretive groups, which are spending unprecedented amounts of money to influence elections at the federal, state and local levels. 

501(c)(4)s are similar to super PACs in that they can spend unlimited amounts of money on political advertising, so long as they don't coordinate their efforts with candidates' campaigns. Suspicion is rampant that these outside groups do work closely with campaigns, but the Federal Election Commission has rarely been able to prove it. Unlike super PACs, 501(c)(4)s aren't required to disclose where their money is coming from, which has made it very hard for journalists or voters to discern much about the motives behind their message. 

But thanks to a lucky break and a conscientious whistleblower, the curtain has been at least partially lifted on WTP, and by extension, its new iteration, ATP. 

Karolin Loendorf, an active member of the Republican Party in Montana, was hired in 2010 to do some contract work for WTP, not knowing much about what the group was about. She noticed immediately that the group was very secretive, which bothered her, she told Frontline. But what really drove her away, she said, was the realization that the group had a "hit list" that included some of her favorite state legislators. "I found out what WTP was really all about," she said. "If you don't vote the way that they wanted you to vote in the legislature or the county or the city, they would be there to replace you." 

Loendorf ended up leaking WTP's fundraising pitch to Montana's Political Practices Commission. The pitch assured potential donors their names would never be known, and further comforted them: "No politician, no bureaucrat and no radical environmentalist will ever know you helped make this program possible. You can just sit back on election night and see what a difference you've made." The commission saw this as a clear indication that the WTP was a political organization, and told the group it must begin to disclose its donors and expenditures. The group sued, but the Montana Supreme Court ruled against them, upholding the state's law banning corporate spending on elections, despite the federal Supreme Court's earlier ruling in Citizens United which said corporations can spend whatever they please on elections as a matter of free speech. The Montana decision went to the High Court, and this summer, it reversed the decision without taking up the case, thereby affirming that Citizens United did in fact apply to Montana and overturning the state's ban on corporate spending. In doing so, the court basically said it still believed in the basic premise of its Citizens United decision: that unlimited, independent spending on elections does not "give rise to corruption or the appearance of corruption." 

A couple of boxes of WTP documents discovered -- bizarrely enough -- in a meth house in Denver after the Montana court's decision in the case appear to show coordination between the group and political campaigns, and have ATP tussling anew with the state. 

"There a little bit of irony, right, in these documents being about WTP and WTP being the group at the center of this case, the Supreme Court case," says the Frontline documentary's host, Kai Ryssdal, to Trevor Potter, former head of the Federal Election Commission. Potter responds: "Right, because what the majority of the justices said is, 'We don't have any evidence that there's anything corrupting about independent spending. We have no reason to change our mind based on the Montana case.' Well, here you're looking at something that may, in fact, not be independent at all."

WTP was focused on influencing the outcomes of state and local elections, and this, the documentary concludes, may be where these outside groups can most throw their weight around. As Montana State University professor David Parker tells Frontline: "Voters have far less information at these local elections. There's a lot less money that's being spent on these elections already, so if you have a big gorilla come into town and drop a lot of cash -- let's say $100,000, $200,000 in that race -- I think the effect there could be much more tremendous than at the federal level." 

If he's right, we'd all be wise to start paying a lot more attention to how money is flowing into these lower level races. Outside groups of many stripes are already working to sway these elections in many Western states. In New Mexico, for example, Republican Gov. Susana Martinez is closely associated with two super PACs that are targeting unfriendly state legislators. Together, they've spent around $1.25 million this election cycle. I called New Mexico pollster Brian Sanderoff recently to ask if this was unusual -- if governors often used such tactics. "She’s been more aggressive than most governors, in terms of getting involved in races where people are likely to support her agenda," he said. "It’s upset a lot of Democrats. So the stakes are high. Because if she doesn’t get (the targeted Democratic legislators) out, they’re not going to be happy." 

Cally Carswell is HCN's assistant editor.