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Mossack Fonseca's U.S. operations cut back after Nevada penalty

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Panamanian law firm Mossack Fonseca’s local affiliate in Nevada has resigned from more than 1,000 companies and paid a penalty to the state, while the law firm has also announced the closure of three of its international offices as the fallout from the Panama Papers investigation continues.

Nevada’s Secretary of State Barbara Cegavske announced in a statement on Monday that M.F. Corporate Services (Nevada), Mossack Fonseca’s local affiliate, had paid a $10,000 fine for failing to keep the required records and contact details for its clients. The penalty is the maximum allowed under the state’s laws.

Cegavske’s statement also revealed that the firm had abruptly resigned as registered agent from the 1,024 companies it administered in the state, a move that one expert told ICIJ partner McClatchy was “absolutely unusual.”

Mossack Fonseca’s operations in Wyoming, which were also operated out of the Nevada office, also faced a significant setback when its local Wyoming business partner cut all ties last week, leaving M.F. Corporate Services Wyoming with 60 days to find a new registered agent in the state, or face dissolution by the Wyoming Secretary of State’s office.

Beyond the U.S., the firm has announced the closure of three of its offices, and faces investigations in multiple jurisdictions.

On Wednesday, it was reported that Mossack Fonseca said it would close its offices in Gibraltar, Jersey and the Isle of Man, citing the international attention drawn by the Panama Papers as one of the reasons behind the decision.

In Panama, the firm has liquidated its financial services arm, named Mossack Fonseca Asset Management S.A., and applied for a cancellation of its license. The business division was used by Mossack Fonseca to help clients invest their money, and has been under investigation by Panama’s securities regulator over its fulfilment of due diligence requirements.

Mossack Fonseca has also faced enforcement action from the British Virgin Islands’ financial regulator and remains under investigation. The firm has been ordered by the authority to appoint a “qualified person to oversee its operations and to provide regular reports” according to ICIJ partner the Guardian.

The law firm and its clients have been under investigation in a number of countries after ICIJ, German newspaper Süddeutsche Zeitung and more than 100 media partners published the Panama Papers investigation, revealing the secrets of the shadowy world of offshore finance.

In the wake of the controversy, Panamanian authorities raided Mossack Fonseca’s headquarters and pledged to boost the transparency of its financial services industry and to cooperate with investigating authorities from around the world.

A sign for M.F. Corporate Services (Nevada) Limited is shown outside a buisness complex in Las Vegas.Hamish Boland-Rudderhttps://www.publicintegrity.org/authors/hamish-boland-rudderhttps://www.publicintegrity.org/2016/05/27/19740/mossack-fonsecas-us-operations-cut-back-after-nevada-penalty

A former senior U.S. general again calls for abolishing the nuclear forces he once commanded

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President Obama became the first sitting U.S. president to visit Hiroshima on Friday—in a symbolic effort to close some very old wounds from America’s first nuclear detonation. In a much-anticipated speech, Obama declared that “we have a shared responsibility to look directly in the eye of history," learn from it and “pursue a world without” nuclear weapons.

But for 76-year-old retired Air Force General George Lee Butler, a country boy from rural Mississippi who once had his finger on the trigger for thousands of nuclear warheads more powerful than the Hiroshima bomb, Obama and the rest of Washington are moving far too slowly towards a denuclearization; indeed, he believes the devastation that unfolded there is still a haunting vision of what could happen in the future.

Butler is a former bomber pilot who in 1994, after retiring from a position as commander of the U.S. Strategic Command, made the highly unusual and controversial decision to renounce his lifelong profession of preparing for cataclysmic conflict and publicly embrace the abolition of nuclear arms on the grounds that they are “immoral and therefore anathema to societies premised on the sanctity of life.”

Butler says that while he is cheered by Obama’s rhetorical embrace of denuclearization and by the agreement to cap nuclear arsenals that the president reached with the Russians in 2010, he is generally chagrined that the two largest nuclear powers, the United States and Russia, have missed opportunities to move towards much smaller nuclear arsenals and to limit the risks of a surprise or accidental nuclear attack.

In a new memoir, Butler writes that “any sense of urgency for further reductions has been lost” in part because the United States has mishandled its relations with Russia. Vladimir Putin, he writes, “is the thuggish and entirely predictable embodiment of a Russia wounded badly in pride and stature” due to some mistakes Washington has made. Russia is still far from “a great rather a feared nation, and like my own country, it is still held in thrall by nuclear weapons,” he says.

At Hiroshima, a relatively small and primitive explosive destroyed roughly 65,000 structures and killed 70,000 people instantly and 70,000 more over the next five years. Butler, as the 13th in a long line of gung-ho U.S. nuclear commanders— an heir in 1991 to the legacy of the likes of Curtis LeMay—came to realize this was minor damage compared to what could be wrought by the weapons he controlled. In the nuclear war contemplated in his years in Omaha, Nebraska at the Strategic Air Command, he writes, roughly 10,000 nuclear weapons would have been used by America and another 10,000 by Russia in the space of just a few hours.

“Wholesale nuclear war” – of the type that he and his colleagues expected, planned for, and practiced in simulations – “would have made life as we know it unsustainable,” Butler writes. “Billions of people, animals, every living thing would perish under the most agonizing conditions imaginable.”

And it could still happen today, he believes, because U.S. officials remain in the grip of the delusion that nuclear deterrence is an effective and safe policy. According to data recently declassified by the Pentagon, the United States still has 4,571 warheads in its stockpile, plus more awaiting dismantlement. The data show, according to Hans Kristensen, a nuclear policy expert at the Federation of American Scientists, a smaller reduction in the U.S. nuclear arsenal under Obama than during any other post-Cold War administration, and a steady decline during the Obama administration in the pace of warhead dismantlement.

In his new book Butler reveals—in passages written by him and by a former Pentagon colleague—that the world was in greater danger from nuclear devastation during the Cold War than most people knew. He writes that the nuclear targeting process for years was substantially divorced from what the nation’s top civilian leaders, including the president and secretary of Defense, said they desired. His story of the infighting waged between defense civilians in Washington and the military’s team of targeting officers in Omaha hasn’t previously been told in such detail.

Butler’s dramatically changed role in America’s nuclear drama was driven by what he describes as a growing alarm over deficiencies in nuclear war plans and the vested interests of Pentagon officials and the defense industry in maintaining such plans.  After participating in monthly drills at the Strategic Air Command headquarters with U.S. officials to prepare for a massive nuclear attack, he learned that then, as today, a president would have just ten minutes “to grasp the circumstances, listen to… the retaliatory options, and make a decision that could mean life or death for tens or hundreds of millions of people.” And in every case, the “presidential stand-in” on the phone would ask for Butler’s recommendation, putting the onus of that heavy decision on him.

Butler, who had begun investigating the nuclear targeting plan’s secrets several years earlier as a senior officer with the Joint Staff, eventually recoiled from his role as a chief implementer of the war plan. His public remarks after retiring in 1994 brought him a burst of celebrity and swept him into commissions and studies by independent experts aimed at pointing the way towards a closure of the nuclear weapons age.

Stepping into the anti-nuclear camp, he writes, “put my reputation in the balance [and] cost me innumerable friends.” At one point, a fellow retired senior officer startled him on the way to a National Press Club speech by asking if he was concerned “that you will give comfort to our enemies and insult the men and women you used to command.” His advocacy failed, in the end, to significantly alter the direction of nuclear policy under three succeeding presidents.

But now, Butler says firmly, “I have no regrets” about staking out that startling position.

Butler says he remains convinced that during the Cold War, “we fell victim to a cascading series of missteps, driven by the visceral fear” of a nuclear-armed archenemy, and reaped as a result “a bitter harvest of worst-case scenarios” that ceaselessly demanded “more weapons and delivery systems.” He still feels that “shearing away entire societies” — a unique prospect of nuclear war — has no military or political justification, as he told an arms control group in Boston in 1997. “There are no rogue nations, only rogue leaders,” and so any use of such devastating weapons would necessarily amount to unjustifiable overkill.

Butler as a result says he has many lingering frustrations about the military’s failure to hear his alarms about the dangers of keeping large nuclear stockpiles, and about what he regards as the continuing ability of today’s nuclear strategists and the large corporations that profit from such work to pull the government more deeply into archaic nuclear roles.

Although President Obama in 2009 embraced “the peace and security of a world without nuclear weapons” and during his visit to Hiroshima called for a "moral revolution" that would eliminate such arms, Butler says he is not a fan of the administration’s nuclear modernization plans.

Those plans include upgrades to a handful of existing nuclear warheads, a fleet of new nuclear submarines, a new intercontinental ballistic missile system, a new air-launched cruise missile, and a new strategic bomber force. The cost, according to the Pentagon, will be $350 billion to $450 billion over the next 10 years alone, and many independent experts say it will be much higher.

Targeting absurdities

When Butler commanded such weapons systems, he calculated they had cost the government more than $6 trillion. The submarines under his operational command alone cost $3 billion a copy, he writes, the 24 missiles on each boat cost $60 million apiece, and the annual operation of a boat cost $75 million.

His staff in Omaha numbered 6,000, including a thousand intelligence analysts, and he nearly always held a “clunky cell phone” that kept him tethered to the command’s command post 100 feet below ground. “I saw the arms race from the inside… I was responsible for nuclear war plans with some 12,000 targets, many planned to be struck with repeated nuclear blows, some to the point of complete absurdity,” he recalled.

More than some of his predecessors in that role, Butler insisted on getting detailed briefings on both nuclear weapons targets and the effects of their detonations. Typically around 30 times more powerful than the Hiroshima bomb, the weapons in his arsenal would ignite fires and char skin many miles away, generate gusts of winds more fierce than anything produced by nature, destroy electrical circuits and disrupt communications miles away, dig out craters approaching a mile in diameter, and release “a torrent of poisonous fallout” over a large territory downwind.

But parts of the plan were using these weapons “were inconsistent with presidential guidance,” says Butler’s former colleague, Franklin C. Miller, a senior Defense Department and White House policy official under five presidents and the author of a chapter in Butler’s memoir. The reason, Miller said, was that for decades, military authorities who controlled access to the target list and the procedures for creating it "thwarted every effort by [civilian defense officials]...to gain the insight” needed to ensure the plan reflected their wishes.

The targeting staff in Omaha, for example, had planned so many detonations in and around cities that the civilians’ desire to leave open the option of preserving them was not feasible, Miller wrote. He recalls that then-Secretary of Defense Richard Cheney was among those who were astonished at the number of weapons that had been directed at the general area around Moscow, a figure that targeters surrendered only after Miller demanded to know it.

The civilians’ desire to ensure that Soviet leaders could sense some restraint in a nuclear exchange — preserving the option of a negotiated settlement – was also foreclosed by the scale of the planned devastation. The overkill extended to sending nuclear-armed NATO warplanes to bomb targets “already destroyed by U.S. strategic missiles.” No consideration was given to the consequences of firestorms or radiation — only to blast effects. And no room was left in the plan for waiting for enemy warheads to detonate before US missiles were let fly. No senior targeting officer “could believe a president would not choose to direct a launch on warning/under attack,” Miller wrote.

Some of the details of Miller’s fight with the targeters were redacted in Butler’s manuscript by the Pentagon’s current Joint Staff under classification rules that govern what even retired generals can say. But Miller wrote that he came away from his close contact with the war plan convinced that the “target base and the weapons allocation process were incoherent and riddled with errors,” and that a lack of civilian oversight had improperly left the Air Force and the Navy to decide for themselves how many nuclear “delivery systems” — planes and missiles — they should buy. This problem was fixed at the time, Miller wrote.

In an interview this month, Miller confirmed that the NATO bomber overkill issue was also fixed. Officials say further that “launch under attack,” which lay at the heart of the U.S. war plan until the 1980’s, is still an option in the U.S. war plan but no longer the required response. And Miller said “while I investigated [nuclear weapons] effects other than blast, there was never enough reliable data to quantify or measure them; as a result, I did not attempt to change the ‘blast only’ rules.”

As to whether the problems of that era have cropped up again, Miller said although he remains in touch with defense officials, “I don’t comment on current [strike] plans.” He said he remains a supporter today of keeping a substantial stockpile of nuclear arms so that America can deter its enemies by scaring them so badly with the prospect of massive devastation that no nuclear war will ever start – following the classic theory of nuclear deterrence.

Butler, who considers Miller a close friend, to the contrary came away from his years of close contact with the war plan convinced that the theory of deterrence itself was unrealistic. “We maintained the wholly misguided belief that the vast nuclear weapons enterprise could be exquisitely managed,” Butler says. Instead, problems with the management and operation of nuclear systems were persistent and the mammoth bureaucracies involved in such work acquired “gargantuan appetites” for new and ever-more destructive weaponry, he said.

Butler’s open-mindedness made him an appealing figure in the late 1980s to then-Chairman of the Joint Chiefs of Staff Colin Powell, and to then-Air Force Secretary Merrill “Tony” McPeak. In their day, while serving under two Republican presidents, the three of them easily embraced the idea that the Cold War was over and communism no longer posed a political threat.

Butler was then head of strategic plans and policy on the Joint Staff, and he became the proverbial garden party skunk, openly supporting budget cuts that were anathema to some of the military services. When he was asked in 1989 to attend an interagency briefing by senior officials at the Department of Energy — which oversees the production of nuclear warheads — on their future plans to double the capacity of the complex at a cost of billions of dollars, he shocked the room.

All those attending, he writes, had “lauded the briefing with lip-smacking anticipation of what it would mean for his or her piece of the pie.” But when Butler said the military would instead be cutting nuclear weapons requirements by 50 percent, “dead silence ensued. No one moved” and the meeting was swiftly adjourned.

After taking the Strategic Air Command’s helm in 1991, Butler writes, he summoned to Omaha the leaders of firms that he said had "pocketed trillions of dollars in profits" by making Air Force and Navy strategic hardware — Boeing, Lockheed, Northrop, Rockwell, General Dynamics, McDonnell Douglas, Raytheon, and others — to tell them it was time to stop growing and start cutting the nuclear weapons business.

Most of those present greeted his words “with disbelief and denial,” he recalls. And when he conveyed the same message at a separate meeting that year to directors of the three U.S. nuclear weapons laboratories, “there followed an incredulous silence.”

With the approval of President George H. W. Bush and then-Secretary of Defense Cheney, Butler eventually organized the dissolution of the Air Command, took its airborne command post off alert, and placed its warheads under a new Strategic Command with both nuclear and non-nuclear warfighting responsibilities. Angry servicemen at the headquarters in Omaha responded by organizing a brisk trade in T-shirts that blared, “The Butler did it.”

Persistent appetites for more weaponry

In his memoir, Butler says that the inertia behind America’s nuclear weapons work — which has produced an arsenal smaller in quantity but greater in quality than during the Cold War – is attributable in part to some nefarious institutional forces. He disparages what he calls the “two-way flow" of senior military officers "moving out of uniform and into the corridors of key defense industries, and the reverse migration of top industry executives coming into high-level positions in the Department of Defense.”

It’s not illegal, and need not be unethical, he writes, but it is “fraught with opportunity for mutual nest-feathering, sweetheart deals, inflated [military] requirements, and massive contracts.”

He said nuclear weapons policymaking remains — as he told an audience at the Stimson Center in 1997 — under the control of “a relatively small cadre of theorists and strategist who speak with great assurance and authority” but remain stuck “in the apocalyptic vocabulary of nuclear deterrence…[and] worlds which spiral toward chaos.” Deterrence, he says, is a “crutch that led to the expenditure of trillions of dollars” while “we ignored, discounted, or dismissed its flaws.”

Rationality, Butler said, “has never been the hallmark of any nation pursuing a nuclear arsenal or thinking about its employment. Such arsenals take on a life and logic of their own, commanding huge budgets and compelling decisions that march at an ever increasing tempo to the beat of fear, technology, status and vested interests.” During his tenure at the Air Force, “vitally important decisions were routinely taken without adequate understanding, assertions too often prevailed over analysis… Technological opportunity and corporate profits drove force levels and capabilities, and political opportunism intruded on calculations of military necessity.”

Butler also says in his memoir that the Clinton and Bush administrations needlessly poisoned the atmosphere for more arms control by pressing for NATO’s wide expansion, “sending the wrong signal to Russia, a defeated foe whose sensibilities are rubbed raw.” They should instead have pushed “our European allies to take charge of their own security,” a view that’s been expressed by others during the election season this year.

Butler, like former Secretary of Defense William Perry and former Vice Chairman of the Joint Chiefs of Staff James E. Cartwright, in particular supports scrapping the Air Force’s force of land-based intercontinental ballistic missiles. He argues that the missiles are “an anachronism,” because they are vulnerable to preemptive attack, unlike those deployed on submarines. Cartwright, who served after Butler as head of the Strategic Command and also oversaw nuclear targeting, has also argued that ICBMs are no longer useful because their most likely contemporary targets — such as North Korea or China — could only be reached by provocatively flying them over Russian territory first.

At Hiroshima, Obama poignantly said "We stand here in the middle of this city and force ourselves to imagine the moment the bomb fell. We force ourselves to feel the dread of children confused by what they see. We listen to a silent cry....We have a shared responsibility to look directly into the eye of history and ask what we must do differently to curb such suffering again."

But Butler says he is sadly not optimistic that major new nuclear arms reductions will occur soon, though he feels the urgency is great. The U.S. Strategic Command’s nuclear deterrence mission, he laments, “is still premised on assumptions and policies distressingly reminiscent of the Cold War era, with arsenals of hundreds of warheads still poised for immediate launch from silos and submarines.”

Butler, who now lives in Laguna Beach, Calif., published the memoir, he says, partly to drive home the argument that it is “way past time to begin to change our thinking and the real world deployment of our [nuclear weapons] systems” -- or something like Hiroshima, causing another “silent cry” far worse in fact, could happen again.

This article was co-published with Politico Magazine.

George Lee Butler (center) at the signing ceremony for the Agreement on the Prevention of Dangerous Military Activities in Moscow, June of 1989. R. Jeffrey Smithhttps://www.publicintegrity.org/authors/r-jeffrey-smithhttps://www.publicintegrity.org/2016/05/27/19731/former-senior-us-general-again-calls-abolishing-nuclear-forces-he-once-commanded

'Dark money': a pro-veteran nonprofit's political weapon

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Vote Vets Action Fund, a liberal “dark money” nonprofit that’s raised millions to ostensibly advance pro-veteran causes, is prohibited from engaging in politics as its “primary purpose.”

But the group nevertheless spent more than half the money it raised in fiscal year 2014 on “direct or indirect political campaign activities,” according to new tax filings reviewed by the Center for Public Integrity.

Such activity is legal because Vote Vets Action Fund’s campaign spending made up less than half the group’s overall expenditures for fiscal year 2014.

It reported spending a total of about $7.6 million during the period that included the 2014 election, making the political spending only about 41 percent of total spending. The group spent more than it took in, leaving it with net assets of $1.5 million at the end of 2014.

“The law requires that a majority spent be used on issue advocacy, which VoteVets does by a healthy margin. We will always abide by the law,” said Eric Schmeltzer, a spokesman for Vote Vets Action Fund, in an email to the Center for Public Integrity.

Vote Vets Action Fund, which does not disclose its donors, is already establishing itself as a significant force during the 2016 election cycle.

The nonprofit has so far reported spending more than $623,000 to support U.S. Rep. Tammy Duckworth of Illinois, a Democrat running for U.S. Senate against incumbent Sen. Mark Kirk, R-Ill., according to reports filed with the FEC.

With control of the Senate at stake this cycle, the race is viewed as one of the most competitive for Democrats. So far, Vote Vets has spent more than any other outside group on the Illinois Senate race, according to data available via the Center for Responsive Politics, a nonpartisan nonprofit that tracks election spending.

Duckworth is an Iraq War veteran who piloted Black Hawk helicopters. She's also a former assistant secretary of veterans’ affairs.

The Vote Vets Action Fund ad in support of Duckworth opens with a shot of a helicopter. “You’ve got to be a special kind of person to fly of these,” the voiceover, by a veteran, says. “That’s Tammy Duckworth.”

Vote Vets Action Fund reported making nearly $2.4 million worth of independent expenditures supporting Democratic candidates during the 2014 election cycle, according to reports filed with the Federal Election Commission. Senate Majority Leader Mitch McConnell, R-Ky., and Sen. Tom Cotton, R-Ark., ranked among its targets.

Vote Vets Action Fund is organized as a nonprofit under Section 501(c)(4) of the tax code, which requires that it spend the majority of its resources on activities to improve social welfare. The group’s website describes its mission as using “public issue campaigns to give a voice to veterans.”

The IRS code also permits the group to keep its donors anonymous.

But an analysis by the Center for Public Integrity of tax filings available via CitizenAudit.org and other public records has identified some of Vote Vets Action Fund’s donors in recent years, notably labor unions.

In 2013, the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada reported giving Vote Vets Action Fund $500,000, according to the union’s own tax filing.

America Votes, another liberal “dark money” group with ties to Hillary Clinton’s presidential campaign, reported giving Vote Vets Action Fund $55,000 during the 2014 fiscal year, the Center for Public Integrity reported last week.

The American Federation of Government Employees reported giving Vote Vets Action Fund $96,000 in 2015, according to a filing with the U.S. Department of Labor.

In all, Vote Vets Action Fund in 2014 raised more than $5.5 million from 52 contributors, none of whom it identified voluntarily. Its two largest donors — who gave $805,000 and $735,000 respectively — provided more than one-fourth of the group’s income in fiscal 2014, tax filings indicate.

Last week, in response to questions regarding the America Votes contribution, Schmeltzer, the Vote Vets Action Fund spokesman, told the Center for Public Integrity that the nonprofit uses a majority of its funds for issue advocacy and does not voluntarily disclose donors “because the law does not require disclosure of people’s identities.”

“We maintain that privacy for individuals,” Schmeltzer said.

Liberal nonprofit group Vote Vets Action Fund targeted U.S. Sen. Tom Cotton, R-Ark., in television ads during his 2014 campaign.Carrie Levinehttps://www.publicintegrity.org/authors/carrie-levinehttps://www.publicintegrity.org/2016/06/01/19742/dark-money-pro-veteran-nonprofits-political-weapon

Billionaire environmentalist behind anti-Donald Trump immigration ads

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A billionaire environmentalist is spending big money in California to skewer presumptive Republican nominee Donald Trump— the latest volley in a barrage of anti-Trump advertising that has saturated TV airwaves.

The billionaire? Tom Steyer, who has so far contributed $24 million to his personal super PAC, NextGen Climate Action Committee. That ranks him among the top contributors to all super PACs so far this election.

NextGen Climate Action Committee says it acts “politically to prevent climate disaster and promote prosperity for every American.”

But the Spanish-language ad sponsored by NextGen Climate Action Committee depicts Trump calling Mexican immigrants “rapists” and announcing plans for a “deportation force” — a clear departure from the super PAC’s typical environment-focused messaging.

The ad then cuts to Steyer himself who, in Spanish, encourages Californians to vote.

During the 2014 midterm elections, no person funneled more traceable money into federal elections than Steyer. He spent more than $73 million that year backing Democratic candidates concerned about rising global temperatures — exceeding what individual conservative megadonors spent backing Republicans.

Yet, a majority of the candidates Steyer backed lost their races, and Democrats failed to retain control of the U.S. Senate.

Steyer appears ready to double down on politics in 2016, despite a low return on his previous investment: NextGen Climate Action will invest $25 million in get-out-the-vote efforts, and Steyer himself said he plans to spend more money on this election cycle than he did the last one.

The ad’s sponsor

Technically sponsoring the ad is NextGen California Action Committee, a super PAC operating under the “NextGen” umbrella.

NextGen Climate Action first formed in 2013 as two entities: a 501(c)(4) nonprofit and a super PAC, NextGen Climate Action Committee.

The super PAC made a splash in 2014 when it raised about $78 million amid hotly contested U.S. Senate races, according to data from the Center for Responsive Politics.

Some of the money — about $17.6 million directly attacked Republicans. That included spending $100,000 to build a “Noah’s Ark”— literally, a giant wooden boat on wheels — that traveled throughout Florida, taunting Republican Gov. Rick Scott.

It also spent some money directly supporting Democrats, such as Iowa politician Bruce Braley, who benefited from about $780,000 in NextGen Climate Action support but still lost to now-U.S. Sen. Joni Ernst.

NextGen Climate Action Committee also transferred tens of millions of dollars to other liberal super PACs and politically active nonprofits. They included state-based affiliates of NextGen Climate Action, as well as pro-Democrat groups such as the League of Conservation Voters and Fair Share Action.

NextGen Climate Action has offices in states such as New Hampshire, Iowa and California and has begun organizing on college campuses, too. Before elections this November, NextGen Climate Action plans to send organizers to hundreds of campuses in seven states.

Who’s behind it?

Steyer, mastermind behind the “NextGen” behemoth, once shared the same occupation as several Republican megadonors: hedge fund manager.

But in 2012, Steyer sold his stake in hedge fund Farallon Capital, and he became a full-time political and environmental activist. Since then, Steyer has heavily invested in supporting candidates, political parties and ballot initiatives.

Steyer is also rumored to be considering a 2018 run for governor in California to replace Gov. Jerry Brown, which wouldn’t be surprising considering all 2016 NextGen Climate Action Committee ads prominently feature Steyer as if he were himself a political candidate. Few other super PACs, be them liberal or conservative, feature their leaders or top donors in TV ads they produce.

Steyer’s super PAC funding exploded in 2014. While most of the $78 million he contributed — about $68.7 million — went to his own super PACs, Steyer also gave $5 million to Senate Majority PAC, a super PAC dedicated to electing Democrats to the U.S. Senate.

In 2016, Steyer has yet to help fund any of the main super PACs supporting Democratic frontrunner Hillary Clinton, such as Priorities USA Action, or run NextGen Climate Action Committee ads that overtly praise or promote Clinton.

Steyer did, however, donate to Clinton’s presidential campaign and conduct a $2,700-per-person fundraiser for her in May.

Money in

During the 2016 election cycle, NextGen Climate Action Committee has so far raised more than $24.6 million.

How much comes from Steyer’s own pocket? More than 97 percent.

After Steyer, no other individual donor has given more than a five-figure contribution.

Money out

So far, NextGen Climate Action Committee is advertising only in California, which conducts its presidential primary on Tuesday. To date, it has spent $1.6 million on negative ads against Trump and Sen. Ted Cruz of Texas. Cruz dropped out of the presidential race in early May.

The first TV ad released this election cycle by environmentally-focused NextGen Climate Action Committee, which hit in April, did feature Trump and Cruz respectively calling climate change a “hoax” and “not science.”

But the latest anti-Trump did not mention the environment once, instead knocking Trump’s statements about immigration.

Overall, ads sponsored by NextGen California Action Committee have aired 88 times through May 30, according to a Center for Public Integrity review of data compiled by ad monitoring firm Kantar Media/CMAG.

Federal Communications Commission records indicate that NextGen Climate Action ads will air until June 6 in California markets, mostly on Spanish-language TV stations.

Why it matters

Steyer’s spending to date outpaces that of Republican megadonors, such as hedge fund manager Paul Singer and casino mogul Sheldon Adelson.

Although massive political spending via super PACs is often associated with Republicans, Steyer proves that Democrats indulge in the post-Citizens United world of elections, too.

Still, Steyer contends that he’s different than conservative megadonors Charles and David Koch, and that he supports repealing the Supreme Court’s Citizens United v. Federal Election Commission decision.

For one, Steyer pours his money into super PACs, which may raise and spend unlimited amounts of cash to advocate for and against politicians — but must reveal their donors.

The Kochs primarily fund nonprofit organizations that may to some extent also promote or attack political candidates — but may keep their donors secret.

The Kochs, who themselves have shown little enthusiasm for Trump, are so far focusing their network’s resources on U.S. Senate races. Charles Koch, in particular, has been adamant that the brothers’ political spending springs from a desire to make the United States a wealthier nation with more economic opportunity for all.

“The Koch brothers say they’re acting out of conviction,” Steyer told PBS. “But whatever they’re doing also definitely benefits their bottom line. You can’t say that about us.”

Cady Zuvichhttps://www.publicintegrity.org/authors/cady-zuvichhttps://www.publicintegrity.org/2016/06/02/19745/billionaire-environmentalist-behind-anti-donald-trump-immigration-ads

Regulators to crack down on payday and auto-title lenders

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Arguing payday and auto-title loans trap borrowers in a “cycle of debt,” federal officials today proposed new restrictions to clamp down on the thriving lending industry.

The Consumer Financial Protection Bureau rules would for the first time require lenders to take steps to ensure consumers have the means to repay loans they take out. 

“Too many borrowers seeking a short-term cash fix are saddled with loans they cannot afford and sink into long-term debt,” CFPB Director Richard Cordray said in a statement. 

“It’s much like getting into a taxi just to ride across town and finding yourself stuck in a ruinously expensive cross-country journey,” he said.

According to the CPFB, typical payday loans of $350 charge a median annual interest rate of 391 percent. Though the loans are designed to be repaid quickly, four out of five are extended, which Cordray called a “debt trap.” One in five people defaults on payday loans, he said.

Payday and auto-title lenders are typically the lender of last resort. The industry argues it provides a vital financial service to people who can’t take out a bank loan or get credit when they need fast cash.

But consumer advocates and some state regulators have long argued that payday and auto-title lenders make little effort to verify a borrower’s ability to repay the loans, even when state laws require it. A 2015 Center for Public Integrity investigation found that some auto-title lenders approved loans with terms that took more than half the borrower’s monthly income, for instance.

Under the proposed CPFB rules, lenders must determine if a borrower can handle the payment when it’s due and still cover basic living expenses and major financial obligations. The rules also allow only two extensions of a loan.

Corday called the regulations “mainstream, common-sense lending standards” and said the new rules would “prevent lenders from succeeding by setting up borrowers to fail.”

According to the CFPB, the payday industry took in fees of $3.6 billion in 2015 operating nearly 16,000 stores nationwide. About half the states allow borrowers to pledge a car title as collateral for short-term loans, often at interest rates that can top 300 percent. Lenders can, and sometimes do, seize and sell off cars when borrowers fail to pay. The CPFP has reported that about one in five people lose their cars after defaulting.

The CFPB is seeking public comment on the proposal until Sept. 14.

The proposed rules represent a major federal push into overseeing the controversial industry, which has largely succeeded in fending off stricter lending laws in the states.

The Center for Public Integrity investigation found that title lenders have beaten back reform legislation behind millions of dollars in campaign contributions to state legislators and by aggressively challenging regulators who seek to rein them in.

Three major title lenders, their owners or key executives, pumped just over $9 million into state political campaigns over the past decade as they lobbied to kill bills that hindered their operations. Since 2011, about 150 bills to cap interest rates or crack down on lending abuses died in 20 state legislatures, the Center found.

In Virginia, where the three big lenders spread about $1.5 million in campaign cash in the last decade, five reform bills died in 2015 alone.

Virginia officials also have restricted public access to annual business reports title lenders file with the state. The reports include detailed sales figures, volume of loans, interest rates charged on loans and defaults, as well as how often the lenders get in trouble with regulators.

Three giant auto title lenders — TitleMax of Virginia Inc.; Anderson Financial Services LLC, doing business as Loan Max; and Fast Auto Loans Inc. have argued that disclosure would hurt their businesses.

The Virginia Corporation Commission, which oversees corporations in the state, has sided with the title lenders. In April, the Center filed a notice of intent to appeal the corporation commission’s decision to the Virginia Supreme Court.

Consumer Financial Protection Bureau Director Richard Cordray, center, listens to comments during a panel discussion in Richmond, Va. in March 2015.Fred Schultehttps://www.publicintegrity.org/authors/fred-schultehttps://www.publicintegrity.org/2016/06/02/19748/regulators-crack-down-payday-and-auto-title-lenders

Panama Papers fallout, free speech

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Fallout from the Panama Papers reverberates around the world from Brazilian politicians found to have used New Zealand trusts, to the U.S offices of the law firm at the center of the world’s largest leak being cut back

Stories are still emerging from the epic database managed and networked with 400 journalists by the International Consortium of Investigative Journalists (ICIJ). More can be expected as new major media organizations join the those who have been probing the 11.5m document trove for the past year.

The intelligence, technology and effort that went into the project from the small team of the ICIJ was clear in a sparkling presentation to a London conference by Mar Cabra, the Madrid-based ICIJ team member who heads the data journalism operation of the consortium. If you really want to know what it took — apart from trust and leaving your ego at the door — the explanation from Mar gives a sense of the skill that went into the operation. It’s highly recommended.

ICIJ Director Gerard Ryle spoke to an intimate gathering in Los Angeles last week put together by LA-based board members of the Center for Public Integrity at private home in Beverly Hills. Interviewed by former CNN White House correspondent Jessica Yellin, Ryle spoke eloquently of the challenge of tying together the network of 370 journalists who kept the secret but also the visceral excitement he felt when friends at Suddeutsche Zeitung told him of the approach from the leader identified only as John Doe who confirmed his long-held suspicions about Mossack Fonseca. Here’s an earlier interview Gerard did with Christiane Amanpour (incidentally a member of Public Integrity’s advisory board) on the leak.

Herograms

I am a little behind in recognizing strong reporting from staff at the Center for Public Integrity over the past couple of weeks.

Ashley Balcerzak, a fellow from American University,  gets a a shout-out for her hustle on the recent piece on our site and The Washington Post, after Maryland’s governor signed a bill into law limiting civil asset forfeiture. Her story on legislative battles over the ability of police to seize and keep people’s belongings around the country had been slated for early June. But when this important news peg developed in Maryland, Ashley quickly pivoted with her story and pushed it out to coincide with the news. That allowed The Post to give its readers a localized story with strong context from other states around the country, one of the key goals of our state politics project.

Federal politics maven and finder-of-amusing-detail Michael Beckel excavated official data to find the three dozen people who have contributed to both Donald Trump and Hillary Clintonreprinted by Daily Beast.

What we’re reading and thinking about

As a newcomer to the United States I find myself an advocate for the First Amendment and full of the passion of an immigrant or zealot about it. I don’t believe the work of the Center or the ICIJ could be conducted anywhere else because of the public interest shield for free speech provided by the First Amendment. So it’s interesting to read a new book by British historian Timothy Garton-Ash“Free Speech 10-principles for a connected world”.

Garton-Ash made his reputation with studies on the former East Germany and particularly of the Stasi secret police. His book tries to deal with something I have long felt, that the Internet is almost inherently a First Amendment space because of its creation by the United States and the dominance of U.S-domiciled platforms like Facebook and Google. I’m only a third of the way through the book  but it is an intriguing and challenging read about when the First Amendment comes up against European or other “local” laws and mores. He’s built an accompanying site at http://freespeechdebate.com/en/

Executive Editor Gordon Witkin notes a piece on the Poynter site about the future of The New York Times, again.

I welcome feedback on this note, thank you.

Peter Bale
CEO, The Center for Public Integrity

pbale@publicintegrity.org@peterbale

A sign for M.F. Corporate Services (Nevada) Limited is shown outside a buisness complex in Las Vegas.Peter Balehttps://www.publicintegrity.org/authors/peter-balehttps://www.publicintegrity.org/2016/06/02/19753/panama-papers-fallout-free-speech

Defiant Bernie Sanders pours remaining cash into last-ditch ad blitz

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Bernie Sanders left it all in California.

Even with rival Hillary Clinton on the precipice of securing the Democratic presidential nomination, Sanders burned through $2.2 million on advertising ahead of today’s California primary, according to data provided to the Center for Public Integrity by The Tracking Firm, a nonpartisan media tracking company.

Sanders’ spending eclipsed that of Clinton, who spent about $1.4 million on TV and radio advertising in California alone.

The competitive, delegate-rich California primary arrives hours after the Associated Pressdeclared Clinton the presumptive nominee, meaning that she has earned enough delegates to clinch the nomination.

This count includes superdelegates: free agents — often party leaders — who vote for their favored candidate at July’s Democratic convention in Philadelphia.

Sanders’ ad flurry included about 2,800 TV ads targeting California voters in the weeks leading up to the primary, according to an analysis of data provided by Kantar Media/CMAG, a firm that monitors advertising on broadcast television and national — but not local — cable.

Clinton’s campaign aired nearly 3,000 ads in California during the same time frame.

Such a concerted effort in California makes sense: delegates there make up about one-fifth of the total 2,383 needed to secure the nomination.

And Sanders’ ad spending is indicative of how he isn’t quite ready to quit the campaign.

“Our job from now until the convention is to convince those superdelegates that Bernie is by far the strongest candidate against Donald Trump,” Sanders spokesperson Michael Briggs said in a statement on Monday.

Sanders’ entered May with about $5.8 million cash on hand, meaning his California ad spending represented a significant portion of his campaign’s cash reserve.

But even with all eyes on California, ad spending wasn’t overwhelming, said Ken Goldstein, a University of San Francisco politics professor who studies political advertising.

“California, it is a TV state, and neither Sanders or Clinton were not up at levels you would see in a competitive, engaged race,” Goldstein said.

Despite all but winning the Democratic nomination, Clinton’s California primary performance still matters.

A poor showing would feed the perception among some Democrats that she’s less likely than Sanders to defeat Donald Trump, the presumptive Republican nominee.

Clinton’s spending on advertising in California more than tripled going into June — perhaps a reaction to Sanders inching closer to Clinton in the polls. From May 24 to May 30, she spent $254,298. Then from May 31 to June 6, her spending increased to $952,327, according to The Tracking Firm.

Meanwhile, Sanders’ continued viability as a candidate — already minimal — hinges on California.

If he loses in California to Clinton, his hope of convincing hundreds of pro-Clinton superdelegates to flip their allegiance slips from remote to implausible.

Still, advertising is not a silver bullet for either candidate in California, and hasn’t been throughout the presidential primary, Goldstein said.

“Advertising has an impact at the margin,” Goldstein said. “At the end of the day, it didn’t lose the race for Bernie Sanders and it didn’t win the race for Hillary Clinton.”

Beyond California, Sanders and Clinton aired less than 400 ads in New Mexico, according to Kantar Media/CMAG, while forgoing TV advertising entirely in the four other states — New Jersey, Montana, North Dakota and South Dakota — conducting primaries today.

While Sanders continues his moonshot endeavor to become the Democratic nominee, Clinton operatives are already operating as if the former senator and secretary of state is Trump’s general election opponent.

Pro-Clinton super PAC Priorities USA Action is blanketing Florida, Nevada, Ohio, Tennessee and Virginia with TV ads, Kantar Media/CMAG data indicates. All of these states are likely swing states that could determine the outcome of the 2016 presidential contest.

The latest Priorities USA Action TV ad attacks Trump for mocking a New York Times’ reporter with a physical disability. (Trump denies he did.) The scathing 60-second spot features Chris and Lauren Glaros, parents who talk about their young daughter who was born with spina bifida.

“When I saw Donald Trump mock somebody with a disability, it showed me his soul. It showed me his heart,” Chris Glaros said in the ad. “I didn’t like what I saw.”

The anti-Trump TV ads are just beginning. Priorities USA Action, fueled by an elite group of liberal megadonors and even some “dark money” nonprofits, had about $46.7 million on hand heading into June, according to federal disclosures.

That’s on top of more than $130 million in TV and digital ads reserved starting this week after today’s primaries.

Priorities USA Action is a super PAC, meaning it can raise and spend unlimited amounts of money. Until this point, such outside groups aligned with Democrats have largely stayed on the sidelines, with the Clinton and Sanders campaigns themselves sponsoring most primary season political ads.

But Priorities USA Action is changing this dynamic, and is joined by NextGen California Action Fund, a super PAC founded by billionaire environmentalist Tom Steyer.

So far, the environmentally-focused super PAC has spent roughly $1.4 million on advertising in California — mostly get-out-the-vote ads that also target Trump.

Michael Beckel and Chris Zubak-Skees contributed to this report

Democratic presidential candidate Bernie Sanders and his wife, Jane Sanders, arrive at a campaign rally on Monday, June 6, 2016, in San Francisco. Sanders remais definant, refusing to concede the Democratic nomination race to rival Hillary Clinton.Cady Zuvichhttps://www.publicintegrity.org/authors/cady-zuvichhttps://www.publicintegrity.org/2016/06/07/19755/defiant-bernie-sanders-pours-remaining-cash-last-ditch-ad-blitz

Center for Public Integrity alum wins Livingston Award

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Former Center for Public Integrity reporter Daniel Wagner won the prestigious Livingston Award for reporting on the predatory practices of Warren Buffett's mobile-home empire, it was announced Wednesday.

The $10,000 prizes for journalists under the age of 35 are the largest all-media, general-reporting prizes in the country, according to a press release announcing the awards.

Funded by the John S. and James L. Knight Foundation and the University of Michigan to support a new emphasis on digital media efforts, the program continues to see an increase in digital submissions, with 21 percent more than in 2015.

Livingston judges Dean Baquet of the New York Times, John Harris of POLITICO, Kara Swisher of Recode and Code Conference, and Ken Auletta of the New Yorker introduced the winners at a luncheon in New York City.

"The judges have a remarkable record in singling out for early recognition journalists who go on to leadership, including Thomas Friedman, Christiane Amanpour and David Remnick," said Charles Eisendrath, founding director of the program at the University of Michigan. "Adding a prize for mentors who provide indispensable guidance at critical moments in a developing career help complete an important circle of celebration."

Eisendrath is a former member of the Center for Public Integrity's board of directors.

Wagner, 34, shared the award with Mike Baker, 31, of the Seattle Times. Wagner is now with BuzzFeed News. The series revealed how Clayton Homes, a part of the Berkshire Hathaway conglomerate, and its lending subsidiaries, target minority homebuyers and lock them into ruinous high-interest loans.

"Our story showed that Clayton had not reinvented and perfected mobile-home lending, but instead had quietly bought up much of the rest of the industry, creating a near monopoly in many markets," Wagner said. "In addition, it showed how reverse redlining, a practice typically associated with lending to urban minorities, is a serious problem in rural areas."

Among the other winners:

Local Reporting
Lisa Gartner, 28, Michael LaForgia, 32, and Nathaniel Lash, 24, of the Tampa Bay Times, for "Failure Factories," an investigation into the high failure rates and violence in five Florida elementary schools.

International Reporting
Adrian Chen, 31, of the New York Times Magazine, for "The Agency," an investigation into an internet trolling organization located in St. Petersburg, Russia, responsible for spreading pro-Kremlin propaganda and manufacturing false stories about unrest and disaster in the U.S.

On-the-Job Mentoring
Charles Eisendrath received the Richard M. Clurman Award for his dedication to mentoring young journalists. A former Time correspondent based in Washington D.C., London, Paris and Buenos Aires, Eisendrath came to the University of Michigan a journalism fellow in 1974. He stayed to join the faculty and later head the master's program for journalism.

In 1980, Clurman asked Eisendrath to design and direct the Livingston Awards. In 1986, Eisendrath became the third director of the Michigan Journalism Fellowships and transformed a financially strapped sabbatical program into the prestigious, globetrotting Knight-Wallace Fellowships and built a $60 million endowment to maintain them in perpetuity. For nearly four decades, he positively influenced the careers and lives of hundreds of journalists. Eisendrath, who is retiring, will donate his prize money to the Livingston Awards endowment.

In addition to Auletta, Baquet, Harris and Swisher, the Livingston judging panel includes Christiane Amanpour, CNN's chief international correspondent and host of "Amanpour"; Ellen Goodman, author and co-founder of The Conversation Project; Clarence Page, syndicated columnist and editorial board member of the Chicago Tribune; and author Anna Quindlen.

Billionaire investor Warren Buffett holds an ice cream bar from Berkshire Hathaway subsidiary Dairy Queen as he talks to Kevin Clayton, CEO of Clayton Homes, also a Berkshire subsidiary, in Omaha, Nebraska before a shareholders meeting in May, 2014.The Center for Public Integrityhttps://www.publicintegrity.org/authors/center-public-integrityhttps://www.publicintegrity.org/2016/06/08/19761/center-public-integrity-alum-wins-livingston-award

Anti-Hillary Clinton super PAC backed by investment mogul, 'ethical vegan'

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Although Sen. Rand Paul ended his presidential bid four months ago, a pro-Paul super PAC sounds particularly presidential in a new TV ad — this time, in slamming likely Democratic nominee Hillary Clinton.

The ad, sponsored by America’s Liberty PAC, borrows from Donald Trump’s playbook in calling Clinton “crooked Hillary” and linking her to Kentucky Democrat Jim Gray, who is challenging Paul for his U.S. Senate seat. (Paul is seeking re-election.)

“Crooked Hillary isn’t alone,” the ad’s narrator says. “Jim Gray backs Hillary because they’re the same kind of liberal, big government, coal-hating politicians.”

The ad is airing throughout Kentucky. It is the first significant TV ad buy of the election that features a presidential candidate and is designed to influence a congressional race.

The ad’s sponsor

America’s Liberty PAC formed in 2012. The super PAC initially sponsored an ad campaign attacking Democrat Sen. Claire McCaskill of Missouri. Then, in 2014, it attempted to boost the ultimately doomed U.S. Senate bid of North Carolina Republican Greg Bannon.

In 2015, America’s Liberty PAC came out full force to support the presidential campaign of Paul, who consistently trailed in polls and primary elections. He dropped out of the race in February, only picking up a lone delegate during the primaries.

As a super PAC, America’s Liberty PAC can raise and spend money in unlimited amounts.

But unlike the moneyed super PACs supporting other Republican presidential candidates, America’s Liberty PAC collected a modest $4.6 million during Paul’s presidential run. For comparison: Super PAC behemoth  Right to Rise USA, the pro-Jeb Bush operation, boasted a $121 million fundraising haul before Bush himself flamed out.

Who’s behind it?

The mastermind behind America’s Liberty PAC is John Tate, a longtime adviser to Paul. Tate managed the 2012 presidential campaign of then Rep. Ron Paul, R-Texas, Rand Paul’s father.

A federal jury in May found Tate guilty of public corruption, including falsifying  campaign expenditure reports and making false statements. The case stems from 2012, when Tate and other members of Ron Paul’s campaign team allegedly paid an Iowa state legislator $73,000 to endorse Ron Paul for president, and then concealed the transactions from the Federal Election Commission.

Ron Paul campaign manager Dimitri Kesari and campaign chairman Jesse Benton were also convicted. Benton now helps lead Great America PAC, a super PAC supporting Trump.

Money in

During Paul’s presidential run, his anti-Wall Street rhetoric likely scared off some prominent conservative donors who could have helped America’s Liberty PAC raise more than the $4.6 million it did.

“We will not cut one penny from the safety net until we’ve cut every penny from corporate welfare,” Paul said in January 2015 in response to President Barack Obama’s State of the Union address.

Still, Paul’s super PAC benefitted from numerous big-time donors, including investors, CEOs and venture capitalists.

The top donor to America’s Liberty PAC was Jeff Yass, a managing director of global investment firm Susquehanna International Group. Yass contributed about $1.6 million to America’s Liberty PAC. He also split $1.5 million between two other pro-Paul super PACs: Concerned American Voters and Purple PAC.

In September, Yass also gave $100,000 to anti-tax Club for Growth’s super PAC, which has spent more than $9.7 million on ads attacking Trump, according to federal campaign finance filings.

John Mackey, co-founder of grocery store Whole Foods, is also a Paul supporter and donor. A self-described “ethical vegan,” Mackey donated $50,000 to America’s Liberty PAC and another $232,000 to Concerned American Voters.

“I reject the premise that liberal and libertarian values are necessarily in conflict,” Mackey told Mother Jones in 2013.

Money out

America’s Liberty PAC spent about $1.7 million directly advocating for a Paul presidency, according to federal campaign finance filings.

A portion of that was spent on TV advertising, with the group airing roughly 340 TV ads targeting voters in Iowa and New Hampshire, according to according to a Center for Public Integrity review of data from Kantar Media/CMAG. America’s Liberty PAC ad campaign in those two states began in August 2015 — six months before voters there took to the polls.

America’s Liberty PAC also paid Tate, president of the super PAC, more than $195,000.

The super PAC has about $400,000 remaining in its account as of March 31, according to federal disclosures. It is scheduled to next disclose its finances in mid-July.

Why it matters

America’s Liberty PAC will certainly not be the only presidential super PAC shifting its focus to down-ballot races.

Mainstream Republican support for Trump as the presumptive GOP nominee is tenuous, at best.

Take Republican House Speaker Paul Ryan, who offered Trump a lukewarm endorsement only to days later call Trump’s comments about a Mexican-American judge “the textbook definition of a racist comment.”

Some Republican operatives are instead scrambling to maintain control of both the U.S. Senate and U.S. House.

Consider: Groups tied to billionaires Charles and David Koch have begun reserving $30 million in advertising in key U.S. Senate races. The Kochs’ political network has effectively ignored Trump and has not yet played a meaningful role in the presidential race.

Our Principles PAC, a conservative super PAC dedicated to attacking Trump, has also indicated that it will support down-ballot candidates who its organizers believe are endangered by Trump’s presidential bid.

Screenshot from America's Libery PAC ad against U.S. Senate candidate Jim Gray, a Kentucky Democrat, and Democratic presidential candidate Hillary Clinton. Cady Zuvichhttps://www.publicintegrity.org/authors/cady-zuvichhttps://www.publicintegrity.org/2016/06/14/19766/anti-hillary-clinton-super-pac-backed-investment-mogul-ethical-vegan

Two Center projects win Kaleidoscope Awards for diversity coverage

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Two 2015 Center for Public Integrity investigations are co-winners of the Radio Television Digital News Association’s Kaleidoscope Award, which honors “journalistic excellence in covering issues of race, ethnicity, sexual orientation and gender identity.”

The RTDNA announced Tuesday that the award in the digital category would be shared by “Criminalizing Kids,” which revealed that Virginia schools referred students to law enforcement agencies at nearly three times the national rate, and “Environmental Justice, Denied,” which found that the Environmental Protection Agency’s Office of Civil Rights had never made a formal finding of a civil rights violation in its 22-year history.

“Criminalizing Kids” was produced by Center staffers Susan Ferriss, Chris Zubak-Skees, Ben Wieder and Jared Bennett in partnership with the investigative radio program Reveal, a project of the Center for Investigative Reporting and PRX, and The California Report from KQED. “Environmental Justice, Denied,” was produced in partnership with NBC BLK by Center staffers Kristen Lombardi, Talia Buford and Eleanor Bell Fox, and former staffers Ronnie Greene, Yue Qiu and Kristian Winfield.

“We hope the work done by our Kaleidoscope Award winners this year inspires journalists across the country,” RTDNA Executive Director Mike Cavender said in a statement. “All are outstanding examples of how newsrooms can provide breadth and depth to their coverage of diverse communities and issues.”

Lynchburg, Virginia resident Stacey Doss holds her toddler, B.J., while son Kayleb plays big brother. Doss, the daughter of a police officer, is outraged that a school resource officer arrested her son after he left a classroom without permission. The autistic 11-year-old, who is sensitive to touch, was charged with felony assault on a police officer because he struggled to get away.The Center for Public Integrityhttps://www.publicintegrity.org/authors/center-public-integrityhttps://www.publicintegrity.org/2016/06/14/19773/two-center-projects-win-kaleidoscope-awards-diversity-coverage

Center wins awards from Society of Professional Journalists’ D.C. chapter

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The Center for Public Integrity and the International Consortium of Investigative Journalists won seven journalism awards on Tuesday night from the Washington, D.C., chapter of the Society of Professional Journalists.

Reporting on the secretive world of Swiss banking, the criminalization of minor school crimes, the proliferation of “dark money” in U.S. elections, the fate of American workers exposed to toxic substances and the failure of the Environmental Protection Agency’s civil rights efforts was honored.

SPJ DC judges praised the “Environmental Justice, Denied” project in particular — which highlighted the EPA’s inaction — for being “thoroughly investigated and written in a compelling way that brings a human face to the issue,” as well as for bringing “attention to a serious problem in a government agency.”

“It’s great to have this recognition from the Washington press corps of the importance of investigative journalism and the work of the Center for Public Integrity and the ICIJ in U.S. and international reporting,” said Peter Bale, chief executive officer of the Center for Public Integrity.

The awards also came as the Society of Professional Journalists’ DC chapter honored Center for Public Integrity founder Chuck Lewis with its Distinguished Service Award.

In his acceptance speech, Lewis — now the founding executive editor of the Investigative Reporting Workshop at American University, where he is also a professor — praised the Center for Public Integrity for doing “a lot of the heavy lifting that others can’t do,” and he encouraged all journalists to keep investigating “the bastards.”

Lewis also praised the recent transnational collaboration of journalists in the Panama Papers investigation spearheaded by the ICIJ and Süddeutsche Zeitung. “Can you imagine that happening 10, 20, 30 years ago?” Lewis said.

The specific Center for Public Integrity and ICIJ projects that won Dateline Awards from the Washington, D.C., chapter of the Society of Professional Journalists on Tuesday night included the following:

  • Criminalizing Kids” won in the online non-breaking news category, as well as winning the Correspondent Award for distinguished coverage of the Washington area published outside of the Washington, D.C., area
     
  • Unequal Risk” — the series on toxic substances — won in the category for an online series, as well as the category for YouTube content
     
  • Environmental Justice, Denied” won in the category for online investigative journalism
     
  • Swiss Leaks” won in the online business reporting category
     
  • A package from the team focused on state and federal politics entitled “Dark Money in America” won in the online beat reporting category

Five other projects from the Center for Public Integrity and the ICIJ were honored as finalists.

Center for Public Integrity reporter Michael Mishak was also named a finalist in the non-breaking news category for magazines for a story he wrote last year at the National Journal about labor unions’ relationship with Democratic presidential candidate Hillary Clinton.

The Washington, D.C., chapter of the Society of Professional Journalists honored print, TV, radio and online journalism at its annual Dateline Awards banquet at the National Press Club on Tuesday night.

The group’s top prize — the Robert D.G. Lewis Watchdog Award — was awarded to John Solomon and Kelly Riddell of the Washington Times for their investigation entitled “The Clintons’ Swedish Jackpot,” which examined how former President Bill Clinton’s charitable fundraising and speechmaking intertwined with Hillary Clinton’s official government work overseas.

During the event, CBS News Senior White House correspondent Bill Plante, longtime New Yorker magazine Washington reporter Elizabeth Drew and Washington Post columnist Jonetta Rose Barras were also inducted in the SPJ DC’s Hall of Fame, which recognizes individuals for producing strong Washington journalism for at least 25 years.

The Center for Public Integrityhttps://www.publicintegrity.org/authors/center-public-integrityhttps://www.publicintegrity.org/2016/06/15/19776/center-wins-awards-society-professional-journalists-dc-chapter

Network neutrality decision likely won't go to Supreme Court

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It is unlikely that Tuesday’s ruling upholding network neutrality regulations will see a Supreme Court review, leaving advocates of an open internet with a historic victory say legal experts on both sides of the debate.

A three-judge panel for the U.S. Court of Appeals for the District of Columbia ruled 2-1 to let stand the Federal Communications Commission’s Open Internet Order, or net neutrality rules, which prohibit providers from slowing or blocking competitors’ content or charging higher prices to companies such as Netflix Inc. or AT&T Inc. to deliver their content to customers faster.

The judges also decided that the rules also apply to wireless service.

The court held that the FCC has the authority to “compel internet openness — commonly known as net neutrality.”

FCC Chairman Tom Wheeler said, “Today’s ruling affirms the Commissions ability to enforce the strongest possible internet protections.”

The Democrat-led FCC approved the rules in February 2015 in a 3-2 party-line vote, classifying internet providers as a utility, like phone companies, which are subject to tighter regulations. Previously providers were classified as information services, which are subject to less stringent rules.

At the time, Wheeler said the rules were needed because “broadband providers have both the economic incentive and the technological capability to abuse their gatekeeper position.”

The U.S. Telecommunications Association, an industry trade group that advocates on behalf of broadband providers such as AT&T Inc. and Verizon Communications Inc., filed suit, arguing the FCC’s rules violate federal law.

Republicans and Internet providers argued the rules amounted to a government overreach and would prompt providers to cut back on investing in networks. Such improvements would lead to improved speeds and expanded services into rural and low-income areas, they say. Broadband providers invested $78 billion in their networks in 2014, according to the U.S. Telecommunications Association.

AT&T vowed Tuesday to appeal the decision to the Supreme Court.

“We have always expected this issue to be decided by the Supreme Court, and we look forward to participating in that appeal,” David McAtee, AT&T Senior Executive Vice President and General Counsel, said in a statement.

Other groups and companies said they would pursue an appeal or were evaluating their legal options.

But broadband advocates and legal scholars on both sides of the debate said it is unlikely the Supreme Court would hear the case, leaving the rules to stand and giving the Obama administration and net neutrality supporters a huge victory.

Reed Hundt, FCC chairman during the Clinton administration, said the dissenting opinion — written by Judge Stephen Williams, who was appointed to the court by President Ronald Reagan in 1986 — supports the argument that the FCC has the authority to reclassify internet service as a utility, making it unlikely that the Supreme Court will take up the issue.

“I agree with the majority that the Commission’s reclassification of broadband internet as a telecommunications service may not run afoul of any statutory dictate in the Telecommunications Act,” wrote Williams, who concurred in part and dissented in part. He argued, however, the FCC failed to properly justify why it was reclassifying internet services, saying “its explanation of the policy is watery thin and self-contradictory.”

Hundt said the FCC decision settled the matters of law and is among the top victories in the FCC’s history.

The two judges voting to uphold the rules were appointed by Democratic presidents: Judge David Tatel was appointed by President Bill Clinton, and Judge Sri Srinivasan was appointed by President Barack Obama. In December, the day before the appeals court heard oral arguments, the Center for Public Integrity reported that the FCC had an advantage in the case because of the Tatel’s and Srinivasan’s earlier decisions.

Further diminishing the possibility of an appeal is the tendency that the Supreme Court doesn’t accept cases unless lower courts have ruled differently on the issue, which has not happened.

 “SCOTUS does not take up a case unless there is a split in lower courts,” said Matt Wood, policy director at Free Press, an advocacy group that supported the net neutrality rules.

John Bergmayer, senior staff attorney at Public Knowledge, which also supported the FCC’s net neutrality rules, agreed. There is “no legal question for the court to take up,” he said.

Even Christopher Yoo, a telecommunications law scholar at the University Of Pennsylvania School Of Law who submitted an amicus brief in support of the internet providers’ argument to strike down the rules, agreed that an appeal would likely be unsuccessful.  

“There would need to be a broader issue for the court to take up,” Yoo said in an interview. He added that there are no conflicting laws in the case and that the high profile of the case alone isn’t enough for the court to take it up.

Other scholars agree that the Supreme Court hearing of the case is a long shot.

Having lost a major battle in the courts, providers are now looking to Congress.

The National Cable & Telecommunications Association, which represents providers such as Comcast Corp. and Time Warner Cable Corp., called for “meaningful legislation that can end ongoing uncertainty, promote network investment and protect consumers.”

Providers have a sympathetic ear in Sen. John Thune, a Republican from South Dakota who heads the Commerce, Science, and Transportation Committee, which oversees the FCC. He said in a statement that the court’s decision “is a clear signal that my colleagues and I need to re-establish Congress’ appropriate role in setting communications policy on a bipartisan basis.”

A sign outside the Comcast Center is seen in Philadelphia. A federal appeals court has upheld the government's "net neutrality" rules that require internet providers to treat all web traffic equally. Providers like Comcast, Verizon and AT&T say the rules threaten innovation and undermine investment in broadband infrastructure.Oghene Oyiborhorohttps://www.publicintegrity.org/authors/oghene-oyiborhorohttps://www.publicintegrity.org/2016/06/15/19781/network-neutrality-decision-likely-wont-go-supreme-court

South Carolina Legislature passes ethics reform

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COLUMBIA — After a slow, four-year march toward ethics reform, the South Carolina General Assembly late Wednesday adopted two bills requiring lawmakers to disclose sources of independent income and also creating an independent investigation commission to oversee lawmaker conduct.

They now go to Gov. Nikki Haley for her signature.

Lawmakers in a compromise committee reached an agreement that will require elected officials who file a statement of economic interest — from the governor down to locally appointed boards — to include sources of private taxable income.

Members of the House and Senate voted unanimously for approval.

“This is just one of the elements of ethics reform that we’ve looked at,” said Sen. Larry Martin, R-Pickens, who has led the charge for reform in the Senate all year. “It’s not a big element, but it’s an important element. It’s a start.”

Last fall, the “Capitol Gains” series published by The Post and Courierand The Center for Public Integrity spelled out problems with income disclosure requirements and an ethics system in which lawmakers police themselves. The series found that some lawmakers used their campaign war chests like personal ATM machines, profited off business deals with government and failed to disclose key sources of income while policing their own behavior through internal ethics committees.

South Carolina had earned a D- in the Center for Public Integrity’s State Integrity Investigation in November, ranking 36th worst in the nation in part for its minimal disclosure laws and the not enough independence in its ethics enforcement agencies.

Some lawmakers said the bill that passed was not truly reform because it does not require elected officials to disclose how much money they make. Others were upset the Legislature did not work to regulate campaign spending by outside groups, so-called “dark money.”

“We’ve debated ethics for how many years now?” said Sen. Brad Hutto, D-Orangeburg, as he held up a sheet of paper signifying the measure. “It’s not even a whole page. That’s what we’ve got. What I don’t want anybody to leave here thinking is we’ve done ethics reform.

“This is a step in the right direction. But if there was a baby step, this is the babiest of baby steps,” Hutto said.

Elected officials will be required to list the source and type of all private income on their statements of economic interest filed with the election commission, including the income of their spouse and anyone they claim as a dependent.

Lawmakers also unanimously passed a bill creating an eight-member ethics commission to investigate when elected officials are accused of wrongdoing.

Currently, lawmakers lack such independent oversight. The state Ethics Commission has the power to enforce laws for everyone but them. House and Senate lawmakers each have their own separate ethics committees to take complaints and police themselves.

The independent commission called for in the bill would add more oversight. If the commission finds probable cause, it would make a recommendation to the House or Senate ethics committee. If the committee agrees there is probable cause, the investigation will become public. If the legislative committee disagrees with the commission’s findings, it can send it back to the independent panel for a second look before the investigation becomes public.

Public disclosure had been a sticking point for the two bodies, but lawmakers were able to reach a compromise late Wednesday.

“I’m pleased,” said the bill’s author Rep. Tommy Pope, R-York. “If you had asked me 10 times during this day, I would not have told you that it were possible.”

Haley praised the lawmakers on social media shortly after the votes, thanking them for their work on ethics reform and “bringing this home.”

This story was co-published with The Post and Courier.

South Carolina lawmakers don't earn large salaries for holding office, but some bring in cash connected to government for everything from public relations campaigns to engineering work, health care contracts and legal services through their side businesses or those of their immediate family members. Here, the South Carolina House of Representatives is empty after the end of the term on Aug. 1, 2014. Maya T. Prabhuhttps://www.publicintegrity.org/authors/maya-t-prabhuhttps://www.publicintegrity.org/2016/06/16/19782/south-carolina-legislature-passes-ethics-reform

Donald Trump's big money bait-and-switch

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When it comes to raising money, Donald Trump is morphing into the very kind of bootlicking presidential candidate he’s insisted — over and again — that he wasn’t, isn’t and wouldn’t become.

On one hand, it’s hard to blame Trump.

The real estate mogul, after all, is sprinting headlong into the buzz saw that is Hillary Clinton’s big-money machine— a machine composed not only of her own moneyed campaign, but allied political committees, super PACs and nonprofit groups that are together raising hundreds of millions of dollars, sometimes from billionaires (such as George Soros) who are even more billionaire-y than The Donald.

Consider that last week alone, Team Clinton aired about 3,400 ad spots — mostly eviscerating Trump — on broadcast and national cable television, according to a Center for Public Integrity analysis of data from media tracking firm Kantar Media/CMAG. The Trump campaign aired no such TV ads at all, while a supportive super PAC managed fewer than 100.

On the other hand, Trump’s turn toward fueling his White House ambitions with cash from special interests and political megadonors undermines what’s been one of his most effective marketing messages: that he’s beholden to no one and can’t be bought because he’s a rich man who’s self-funding his campaign.

Now Trump is no longer spurning super PACs and eschewing tony private fundraisers tailor made for 1 percenters. Rather he’s tolerating, if not embracing, the post-Citizens United era of cash-flush politics that, until recently, Trump considered anathema to his largely anti-establishment presidential bid.

That may surprise some likely voters, who in a recent Center for Public Integrity/Ipsos poll ranked Trump well ahead of Democratic rival Hillary Clinton — an avowed campaign finance reformer —  on the question of which candidate, if elected president, would do the most to make elections less reliant on big money.

Trump’s campaign refused to answer questions about how Trump’s attitude toward political money has shifted. But an analysis of Trump’s statements on the matter demonstrates how it most certainly has.

Trump on self-funding his presidential campaign:

“Part of the beauty of me is that I’m very rich. So, if I need $600 million, I can put up $600 million myself. It’s a huge advantage.” — interview with ABC News in March 2011 ahead of aborted 2012 presidential run

“I don’t need anybody’s money. It’s nice. I don’t need anybody’s money. I’m using my own money … I’m not using donors. I don’t care. I’m really rich.” — announcement speech on June 16, 2015

“You know the nice part about me? I don’t need anybody’s money.” — from an interview in August 2015 in Iowa

"I'm self-funding my own campaign. It's my money." — during a speech in Iowa on Feb. 1, 2016

“I don't believe I have been given any credit by the voters for self-funding my campaign, the only one. I will keep doing, but not worth it!” — from a tweet Feb. 2, 2016

The reality:

Trump is not exclusively self-funding his campaign.

Make no mistake: He has personally invested an eight-figure sum into his push to Make America Great Again — more than $43 million and counting, according to Trump’s most recent round of federal campaign finance disclosures.

But almost immediately after announcing his presidential bid, Trump began passively accepting contributions from his growing legion of supporters. The dollars began adding up, and as May arrived, federal records indicate Trump’s supporters had together given his campaign about $14 million.

Trump at the time stood poised to vanquish Ted Cruz and John Kasich, the last of his Republican primary opponents. His securing the GOP presidential nomination appeared imminent. Perhaps coincidentally, perhaps not, Trump’s self-funding talk changed.

“I mean, do I want to sell a couple of buildings and self-fund? I don’t know that I want to do that necessarily, but I really won’t be asking for money for myself, I’ll be asking money for the party,” Trump said during an interview on MSNBC’s “Morning Joe” on May 4.

The same day, in an interview with the Wall Street Journal, Trump said that he’d personally “be putting up money, but won’t be completely self-funding” as the campaign moved forward.

Trump’s prediction that he’d dump $600 million of his own money into his campaign therefore seems remote.

Trump in early May hired private investor Steven Mnuchin as his national finance director. On May 25, Trump’s campaign formally tethered itself to the GOP establishment. It teamed with the Republican National Committee and 11 state-level Republican Party committees to form Trump Victory, a joint fundraising committee that may collect large contributions from wealthy donors and spread the money among its member committees.

The same day, Trump conducted his first major fundraiser of his presidential campaign — an ultra-exclusive affair at the southern California home of borderline billionaire real estate investor Tom Barrack. The event reportedly raised $6 million.

And last week, Trump huddled in New York City with “some of the Republican Party’s biggest fundraisers and wealthiest donors,” the Washington Post’s Matea Gold reported. Among those offering Trump financial support he said he didn’t need: billionaire roofing executive Diane Hendricks, New York Jets owner Woody Johnson and investor Ray Washburne.

He followed it up with a tony fundraising affair in Boston, with lunch and a photo with Trump selling for $10,000, according to the Boston Herald’s Jennifer Miller. Trump today is in the midst of a fundraising swing through Texas.

But Trump has even bigger political paydays in mind.

Trump on billionaire industrialists Charles and David Koch:

“I really like the Koch Brothers (members of my P.B. Club), but I don't want their money or anything else from them. Cannot influence Trump!” — from a tweet July 29, 2015

“I wish good luck to all of the Republican candidates that traveled to California to beg for money etc. from the Koch Brothers. Puppets?” — from a tweet on Aug. 2, 2015

“Little Marco Rubio, the lightweight no show Senator from Florida, is set to be the "puppet" of the special interest Koch brothers. WATCH!” — from a tweet on Feb. 28, 2016

The reality:

Today, Trump thinks so little of the Koch brothers’ money that the Trump campaign recently requested a meeting with Charles Koch’s political lieutenants.

That’s according to Charles Koch himself, a Trumpskeptic who on June 8 toldUSA Today’s Fredreka Schouten: “We are happy to talk to anybody and hope they understand where we’re coming from, and they will have more constructive positions than they’ve had.”

When Schouten asked Koch whether Trump was fit to be president — Koch has flirted with openly opposing Trump and even supporting Democrat Hillary Clinton— he replied: “I don’t know the answer to that.”

The Kochs’ massive political fundraising network, which says it plans to spend $750 million on politics this election cycle, could very well avoid the presidential race altogether. The Kochs have already declined to contribute money to the Republican National Convention next month in Cleveland.

For now, the Koch network is focusing its efforts on helping like-minded Republican candidates win U.S. Senate races.

Trump on casino magnate and GOP megadonor Sheldon Adelson:

“Sheldon Adelson is looking to give big dollars to Rubio because he feels he can mold him into his perfect little puppet. I agree!” — from a tweet on Oct. 13, 2015

The reality:

Trump is now billionaire besties with Adelson.

Adelson never did intervene in the Republican presidential primary — in contrast with his tack in 2012, when he backed Newt Gingrich, and then Mitt Romney, with tens of millions of dollars.

Rubio’s Adelson windfall never materialized, and the junior U.S. senator from Florida quit the race after Trump thumped him in his home state’s primary.

Trump’s pursuit of Adelson’s money began just weeks after accusing Adelson of being Rubio’s puppeteer.

Adelson confirmed he met with Trump in December, telling Reuters’ Farah Master he found the fellow billionaire “charming.”

By February, Adelson signaled to colleagues that he was open to supporting Trump, even if he wasn’t yet ready to endorse him.

And in early May, as the White House hopes of Cruz and Kasich finally flamed out, Trump and Adelson met again.

On May 13, the New York Timesreported that Adelson said he’s willing to contribute more than $100 million to boost Trump’s candidacy.

“An incredible honor to receive the endorsement of a person I have such tremendous respect for. Thank you, Sheldon!” Trump tweeted that day.

Trump on super PACs:

“This whole Super PAC scam is very unfair to a person like me who has disavowed all PAC's & is self-funding.” —from a tweet on Oct. 26, 2015

“All Presidential candidates should immediately disavow their Super PAC’s. They're not only breaking the spirit of the law but the law itself” — from a tweet on Oct. 26, 2015

“I see Marco Rubio just landed another billionaire to give big money to his Superpac, which are total scams. Marco must address him as ‘SIR’!” — from a tweet Oct. 30, 2015

“They’re in total cahoots with their [super] PACs, which they’re not allowed to be. They’re all in total cahoots. They put their friends in there. One good thing about me: I’m not.” — to the Washington Post in October 2015, regarding other presidential candidates

“PACs are a horrible thing.” — interview with CNN on Jan. 17, 2016

These Super PACs are a disaster by the way, folks, very corrupt. It’s going to lead to a lot of disasters … There is total control of the candidates. I know it better than anybody that probably ever lived … I know the system far better than anybody else, and I know the system is broken. I’m the only one up here that’s going to be able to fix that system because that system is wrong.” — at a Republican presidential debate on March 10, 2016

The reality:

Trump has effectively embraced these “total scams,” squelching his criticism of them.

Most notable is super PAC Rebuilding America Now, which formed June 2.

It’s led by Tom Barrack, chairman of movie studio Miramax and the same man who feted Trump at a multi-million-dollar fundraiser May 25. Barrack this month told CNN’s Erin Burnett that he’s already secured $32 million in financial commitments for his super PAC. If true, the figure would rival what Trump himself has so far given to his presidential campaign.

To date, Rebuilding America Now has sponsored more than $1 million worth of anti-Clinton ads, according to federaldisclosures. By law, it isn’t required to release the names of its donors, or the amounts they’ve given, until mid-July.

Like all other super PACs, Rebuilding America Now may raise and spend unlimited amounts of money to advocate for and against candidates — a power obtained by such political committees thanks to the Supreme Court’s Citizens United v. Federal Election Commission decision and a lower court ruling in SpeechNow.org v. Federal Election Commission.

Great America PAC is another pro-Trump super PAC, run by Ed Rollins, who ran former Arkansas Gov. Mike Huckabee’s 2008 presidential campaign and served as finance chairman for the 2012 presidential bid of former Republican House Speaker Newt Gingrich.

Formed in February as “TrumPAC” — it changed its name under FEC pressure— the group has recently sponsored hundreds of thousands of dollars worth of pro-Trump TV and digital advertisements as well as promotional phone calls.

If you’re in the market for a cut-rate engagement ring, take note: Great America PAC’s top patron is William Doddridge, CEO of the Jewelry Exchange. The California-based Goldenwest Diamond Corporation, parent company of the Jewelry Exchange, loaned Great America PAC $250,000 on March 17, federal records show.

Yet another potentially active pro-Trump super PAC is the Committee for American Sovereignty, formed April 8 and led by Doug Watts, former communications director for retired neurosurgeon Ben Carson’s presidential campaign. Watts says the group plans to raise $20 million by July; the group must file its first financial disclosure by Monday night.

And the biggest Trump-backing super PAC of all could be one that doesn’t yet exist: Adelson is now considering funding a pro-Trump super PAC.

Earlier in the presidential race, Trump’s campaign sent cease-and-desist messages to some such groups that traded on his name.

It also wroteletterstotheFEC, systematically disavowing supposedly pro-Trump super PACs, many of which have raised little or no money and largely appear to exist only on paper.

But the Trump campaign hasn’t written such messages — not that they were binding in the first place, as super PACs don’t need the candidates they support to authorize them — since early May.

Trump on lobbyists:

“I’m not using the lobbyists.”— announcement speech June 16, 2015

“I am not controlled by my donors, special interests or lobbyists. I am only working for the people of the U.S.!” — Facebook post on Sept. 5, 2015

“They say I’m too truthful. And, no, I don’t lie. I don’t lie. I’m self-funding my campaign. I tell the truth … It’s my money. It’s not money from an electric company. It’s not money from a lumber company. It’s not money from Johnson & Johnson and pharmaceutical companies.” — interview Feb. 19, 2016, with Fox News’ Greta Van Susteren

The reality:

As with megadonors, Trump is now cozying up to professional government influencers.

Trump’s campaign itself is run in part by Paul Manafort — one of the subjects of a 1992 Center for Public Integrity report, “The Torturers’ Lobby,” which detailed how American lobbyists aided foreign governments that violated their citizens human rights. Manafort has since worked for a variety of other foreign interests as an influence broker and political consultant.

Earlier this month, the Trump campaign asked top defense industry lobbyists to travel to New York City and brief Trump personally, which they did.

And lobbyists themselves are beginning to band together to raise cash for Trump — something to which Trump has not objected.

The ultimate question is this: Will Trump’s financial flip-flopping alienate the anti-establishment voters who help him clinch the Republican presidential nomination?

Trump has less than five months to convince them that they haven’t been misled — if they care in the first place.

Republican presidential candidate Donald Trump shrugs during the first Republican presidential debate at the Quicken Loans Arena, Aug. 6, 2015, in Cleveland.Dave Levinthalhttps://www.publicintegrity.org/authors/dave-levinthalhttps://www.publicintegrity.org/2016/06/17/19762/donald-trumps-big-money-bait-and-switch

Hot mess: states struggle to deal with radioactive fracking waste

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This story was produced in collaboration with the Ohio Valley ReSource, a public media partnership covering Kentucky, Ohio and West Virginia.

The Marcellus Shale has transformed the Appalachian Basin into an energy juggernaut. Even amid a recent drilling slowdown, regional daily production averages enough natural gas to power more than 200,000 U.S. homes for a year.  

But the rise of hydraulic fracturing over the past decade has created another boom: tons of radioactive materials experts call an “orphan” waste stream. No federal agency fully regulates oil and gas drilling byproducts — which include brine, sludge, rock and soiled equipment — leaving tracking and handling to states that may be reluctant to alienate energy interests.

“Nobody can say how much of any type of waste is being produced, what it is, and where it’s ending up,” said Nadia Steinzor of the environmental group Earthworks, who co-wrote a report on shale waste. (Earthworks has received funding from The Heinz Endowments, as has the Center for Public Integrity).

The group is among several suing the U.S. Environmental Protection Agency to regulate drilling waste under a federal system that tracks hazardous materials from creation to final disposal, or “cradle to grave.” The EPA declined to comment on the lawsuit but is scheduled to file a response in court by early July.

Geologists have long known soil and rock contain naturally occurring radioactive materials that can become concentrated through activities like fracking, in which sand and chemicals are pumped thousands of feet underground to release oil and gas from tight rock. But concerns about fracking largely have focused on injection wells and seismic activity, with less attention paid to “hot” waste that arrives at landfills and sets off radiation alarms.

An analysis by the Center for Public Integrity shows that states are struggling to keep pace with this waste stream, relying largely on industry to self-report and self-regulate. States have also been slow to assess and curb risks from exposure to the waste, which can remain radioactive for millennia. Excessive radiation exposure can increase cancer risks; radon gas, for example, has been tied to lung cancer.

The four states in the Marcellus are taking different approaches to the problem; none has it under control. Pennsylvania has increasingly restricted disposal of drilling waste, while West Virginia allows some landfills to take unlimited amounts. Ohio has yet to formalize waste rules, despite starting the process in 2013. New York, which banned fracking, accepts drilling waste with little oversight.

Inconsistencies have raised concerns among regulators and activists that waste is being “shopped around” by companies seeking the path of least resistance, or unsafely reused. In March, Kentucky’s attorney general opened an investigation into two landfills he alleged illegally accepted radioactive drilling waste from West Virginia. A separate investigation is ongoing at the Kentucky Cabinet for Health and Family Services, where officials exchanged emails about whether landfill workers and schoolchildren might have been exposed to dangerous levels of radiation.  

Bill Kennedy, a radiation expert at the consulting firm Dade Moeller, called radioactive drilling waste “virtually unregulated” and said consistent standards are needed to “protect workers, protect the general public, protect the environment.”

Kennedy co-chairs a committee working with regulators and industry to develop guidelines and recommendations for states. “You can’t rely on industry to go it alone and self-regulate,” he said.

While radiation emitted from fracking waste may pale in comparison to that from nuclear power plant waste, Steinzor said regulators don’t know the cumulative impacts of landfilling the loads over time. “There’s been such a push to expand the industry and to drill as much as possible,” she said. “No one has had the desire or political will to slow the industry down long enough to figure out what the risks truly are.”

Race to the bottom

Trucks rolling into West Virginia landfills grind to a near halt as they pass fixed poles — monitors — that detect radiation above a set threshold. If the monitors go off, drivers reverse and pass through them again. After a second alarm, landfill staff members check drivers and trucks with hand-held detectors.

An emergency state law required landfills to install the monitors in 2015 and submit reports detailing any alarms to West Virginia’s Department of Environmental Protection and Department of Health and Human Resources within 24 hours.

More than 70 alarms have been reported since, but what happened to the waste after they were set off is unclear. The reports routinely lack basic information, such as whether the waste was accepted or rejected, where it came from and how much of it there was.

One report, for example, shows the landfill in Wetzel County, West Virginia, took in 14 tons of industrial bag filters from an unknown source in April 2015. The filters weren’t labeled as drilling waste but contained radium 226, an isotope associated with fracking.

Landfills must reject waste that exceeds state radium limits, yet the amount of radium in the filters was left blank on that form and every other alarm report generated in 2015. Radium 226 remains radioactive for thousands of years, breaking down into gases such as radon.

After the Center contacted the West Virginia Department of Environmental Protection about inconsistent or missing information in the reports, officials reviewed the records and acknowledged “discrepancies.” They said they plan to work with state health officials to overhaul the reporting process, including revising the single-page form so it captures more useful information. Such efforts seem warranted: The health department, as a matter of practice, said it has been throwing away the reports it receives. A spokesman declined to comment further.

Scott Mandirola, waste director at the Department of Environmental Protection, said West Virginia regulators are doing their best to keep up with the fracking industry by collaborating with their counterparts in Ohio and Pennsylvania. “Everybody's dealing with it differently,” he said, pointing out widely held concerns that one state will become the preferred dumping ground. “It was obvious there was waste being shopped around.”

Bill Hughes, who sits on the Wetzel County Solid Waste Authority, doubts the state will enact or enforce rules that burden industry. “West Virginia is not going to do anything that Pennsylvania and Ohio are not required to do,” he said.

Last year, the Department of Environmental Protection conducted its first environmental analysis of potential impacts from landfilling drill cuttings. The report, which was mandated by the state Legislature, looked at the threat of groundwater pollution from the leaching of radioactive materials through soil and found “little concern.”

Hughes said it was the first time state legislators had openly acknowledged that drilling waste was more than just dirt and rock and could pose a radiation hazard. The report noted that before the waste was hauled to landfills, oil and gas companies simply buried it in pits on well-pad sites.

Twisting in the wind

On windy days, grit gathers on Toni Bazala’s home in South Huntingdon Township, 40 miles south of Pittsburgh, staining her white shutters black. A chain-link fence separates her property from the Yukon landfill 200 feet away.

“We look like we’re in a desert,” said Bazala, 74. The black dust from the landfill, she said, is like “an acid that goes down your throat.”

Max Environmental Technologies, Inc., which runs Yukon and another nearby site, has footed the bills for annual cleanings of her house’s exterior and paid for a new air conditioner, she said.

The company recently surprised Bazala and her husband with a legal waiver restricting them from speaking publicly about the cleanings in court, or to state and federal regulators. “What it amounted to was, ‘If you don’t sign this paper, you don’t get your house pressure-washed.’”

The retired couple refused to sign and has no plans to leave. “I wouldn’t even dream of selling my house,” Bazala said. “We don’t have much, but what we have is ours.”

Former township supervisor Mel Cornell said relocation isn’t an option many can afford. He spent years inspecting Yukon, often raising concerns about radiation measured on site, but quit and retired early to Florida last year. “They can’t clean people’s bodies when they breathe that in,” Cornell said of the dust. On at least one occasion, he said, he vomited while inspecting the landfill because the stench was so overpowering.

The township has repeatedly sued Max Environmental for producing a strong odor Cornell called “burnt cement,” which began in 2013 when Yukon started accepting drilling waste. The company has tried masking the odor with a bubblegum-scented deodorizer and paid a $10,000 fine to the township in monthly $25 installments.

Township residents say penalties have failed to spur lasting improvements or quash Yukon’s expansion plans. Yukon has been inspected more than 200 times for solid waste issues since March 2013, racking up more than $200,000 in fines. The company admitted to odor and other violations in an August consent decree with the Pennsylvania Department of Environmental Protection.

Max Environmental’s Carl Spadaro, who previously worked for the department, declined to be interviewed but wrote in an email to the Center that the company has “shown time and time again that we strive to operate in compliance.” Homes have been pressure-cleaned “for many years to remove pollen, mildew and staining,” he wrote. When asked about the waiver Bazala refused to sign, Spadaro added, “We suggested to a neighbor that to continue this service, an acknowledgement of the reason for the service would be appropriate."

Pennsylvania regulators have increasingly restricted disposal of radioactive waste, instituting monthly intake limits on landfills. But the rules keep changing. Sludge, which is left over from drilling waste processed by treatment plants, is considered highly concentrated and radioactive. But the state has gone back and forth on exactly how much of it landfills can take from one year to the next.

In a panel discussion last year, Spadaro called Pennsylvania’s protocols “rather stringent,” saying they force landfills like Yukon to scale back the waste it takes. Landfills in the state maxed out monthly radioactive waste caps at least 87 times last year, often forcing haulers to try elsewhere.

But some haulers can be persistent. In January, a driver was caught trying to dispose of the same load from a northeastern Pennsylvania well pad three times at the same landfill in one day.

Gregg Macey, a professor at Brooklyn Law School, reviewed hundreds of Department of Environmental Protection emails and other documents obtained in an open-records request by Earthjustice, an environmental law group. His report highlighted the agency’s growing confusion over increasing numbers of radiation alarms at landfills and mislabeled waste.

Emails from 2010 to 2013 show regulators reviewed records and found waste taken by landfills that should have gone to out-of-state facilities equipped to handle low-level radioactive debris.  Officials also expressed concern that landfill operators didn’t fully grasp how to handle the new waste stream.

“We need a statewide guidance on the handling, sampling and protocol and we need it yesterday not a year from now,” a state employee wrote in the fall of 2012, signing his email, “frustrated in the field.” In 2013, an employee commenting on a backlog of waste awaiting state review, wrote, “We need to find a solution for this and it sure isn’t allowing the boxes to pile up.”

None of these concerns was mentioned in a highly anticipated report by the Department of Environmental Protection last year that found “little potential for harm to workers or the public from radiation exposure due to oil and gas development.” The study was quickly championed by energy interests.

Some, however, have questioned the study’s methodology and the impartiality of its author, Perma-Fix Environmental Services, a nuclear waste contractor. The state works closely with Perma-Fix to assess landfill radiation risks 1,000 years in the future.

“We have evolved since 2013,” said state waste and radiation director Ken Reisinger, insisting there is “plenty of space” in Pennsylvania for drilling waste. “We have continued to refine our science and we continued to question ourselves on the protocols.”

Steinzor, with Earthworks, said that without a federal tracking system, states have no reliable way of ensuring waste isn’t being illegally dumped. Pennsylvania regulators were able to pinpoint final burial locations for a third of nearly 300 loads rejected in 2015, but two-thirds remain unaccounted for.

Critic under fire

Bill Hughes has sat on the Wetzel County Solid Waste Authority in West Virginia for 15 years — five as chairman — but he has a feeling this year will be his last.

A staunch fracking critic, Hughes has spoken out against the dumping of radioactive drilling waste alongside household trash in municipal landfills.

Located at the base of West Virginia’s Northern Panhandle, Wetzel County has become a prime destination for out-of-state drilling waste. Hughes, 71, concedes that he’s “made a lot of noise” about the dumping of such waste in the county’s 238-acre landfill; since 2012 it’s outpaced the intake of all other garbage combined.

In February Hughes, a retired electrician who belongs to the Heinz-funded FracTracker Alliance, was sued by the landfill’s operator, Lackawanna Transport Company. Lackawanna is seeking damages that “could be in excess of $1 million,” claiming  Hughes illegally invoked his chairmanship of the waste authority to temporarily block the company from building a separate, lined surface pit for drilling waste in 2013.

Nearly 100 public commenters raised concerns about the pit — known as a cell — which would allow Wetzel to accept an unlimited amount of drilling waste. West Virginia does not count such waste as part of Wetzel’s monthly cap of 9,999 tons, which is meant to conserve space and limit the life of the landfill. Wetzel has already taken 650,000 tons of drilling waste since 2013.

Further south, in Harrison County, Meadowfill Landfill sought approval for a similar cell in 2013 and won easy approval. That landfill has gone on to become the state’s top disposer of drilling waste, taking in nearly 900,000 tons since 2013, including loads deemed too radioactive for Pennsylvania.

News of the million-dollar lawsuit against Hughes rattled the Wetzel authority’s volunteer members, who had bickered with him about mounting legal costs associated with fighting the proposed cell. In March, they told the authority’s lawyers to withdraw official opposition to it, and a state commission approved it a short time later.

Authority members are unpaid, but the authority itself and its popular county recycling program are funded largely by landfill fees, creating potential conflicts of interest, Hughes said. His term on the authority expires in July.

‘Wild West’ in Ohio

Rachelle Quigg and her son had a rude awakening one summer night in 2014 when a neighbor’s property in Hammondsville, Ohio, was invaded by large yellow tanks and humming trucks.

“It was like the most bizarre thing ever,” Quigg said, describing trucks noisily pulling in and out at all hours of the night.  She said the Ohio Department of Natural Resources sent an inspector in February 2015 only after she and others complained to a television news crew. “It seemed like they had too much to deal with; they couldn't bother.”

A month later, officials ordered the company responsible, Anchor Drilling Fluids USA Inc., to shut down and clean up the property, which it did in July 2015. The company was not penalized outside of being ordered to close the site.

In lieu of issuing permits, the state has allowed more than 40 facilities to handle and treat drilling waste under a temporary authorization process since 2014. Some applications were approved the same day they were submitted — unlike permits, which require public comment and various stages of review.

Department of Natural Resources spokesman Eric Heis said companies consult with state engineers prior to filing applications, which shortens review times. Temporary authorizations are granted without public comment.

Under Gov. John Kasich, the department has drawn criticism for being deferential to industry. A 2012 memo detailed joint plans by the department and Kasich’s office to rally support for fracking by undercutting “environmental-activist opponents, who are skilled propagandists.” The memo singled out opponents, including the Sierra Club and Democratic legislators, and potential allies such as Halliburton and other energy and business interests. The plans were never carried out.

Melanie Houston of the Ohio Environmental Council said rulemaking efforts have moved at a snail’s pace, creating a “Wild West” milieu.  Proposed guidelines would require landfill operators to install radiation monitors and report alarms to health officials and the Ohio Environmental Protection Agency, which shares authority with the Department of Natural Resources.

The Ohio EPA began the rulemaking process in 2013, but has yet to approve any rules. Statewide, six landfills reported accepting 583,000 tons of drilling waste in 2013. In 2014, eight landfills reported taking in nearly double that amount.

Emails obtained by the Center through an open-records request show state officials struggled to coordinate response to an alarm last July triggered by drilling “filter socks” in East Sparta that were emitting roughly 200 times the state’s radiation limit. The socks, which separate liquid and solid drilling waste, were picked up unknowingly by a residential garbage truck. The waste was shipped to a Utah nuclear waste site in October, since it was too radioactive for a much closer facility in Michigan.

Dumping in New York

Like Ohio, New York is mulling new rules. In February, Gov. Andrew Cuomo announced proposed regulations requiring landfills to install radiation monitors and lower the radioactivity of disposed waste. The state’s Department of Environmental Conservationis accepting public comments through the summer.

The proposals come a year after an Environmental Advocates of New York report claimed thousands of tons of fracking waste were being landfilled upstate. “There were a lot of residents pretty outraged,” said report author Elizabeth Moran.

When the state’s fracking ban took effect in 2014, Cuomo cited health officials who called potential risks,  such as water contamination from radioactive waste, “too great” to bear.

But data show seven New York landfills have accepted at least 460,000 tons of solid fracking waste since 2010, according to Moran. The numbers, based on self-reported estimates from oil and gas companies operating in Pennsylvania, are incomplete.

They don’t reflect, for example, Pennsylvania fracking waste that was processed by a New Jersey landfill and later sent to Staten Island in New York City. Records obtained by Delaware Riverkeeper in 2014 showed the treated drilling waste was used in 2011 to cover the Brookfield Avenue Landfill, an illegal dumping ground that was shuttered in the 1980s and is undergoing a $240 million cleanup.

Lacking confidence in the state, several New York counties have banned fracking waste disposal, while a bill outlawing the dumping, use or sale of all fracking byproducts is being considered by the New York City Council.

Moran suspects many New Yorkers don’t know that radioactive waste is being scattered in the state.

“We banned fracking,” she said, “so people don’t think we’re part of this dirty process.”

Byproducts of hydraulic fracturing, or fracking, create radioactive waste like the truckload shown here in West Virginia.Jie Jenny Zouhttps://www.publicintegrity.org/authors/jie-jenny-zouhttps://www.publicintegrity.org/2016/06/20/19784/hot-mess-states-struggle-deal-radioactive-fracking-waste

Hillary Clinton crushing Donald Trump in White House cash dash

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Democrat Hillary Clinton’s presidential campaign is making Republican Donald Trump— a man who can’t stop bragging about his billions — look like a political pauper.

Clinton’s campaign, along with a network of supportive super PACs, has charged out to a significant fundraising lead as Election 2016 shifts into general election mode.

But while Trump’s understaffed and decidedly unorthodox campaign lacks raw cash, it continues to enjoy blanket mediacoverage that Clinton’s machine is attempting to battle with nonstop advertising.

Here’s a Center for Public Integrity rundown of the more telling — and curious — statistics to emerge from this latest round of campaign finance filings covering activity during May:

$173,597,679: The amount by which Clinton’s campaign has outraised that of Trump during the 2016 election. Entering June, Clinton’s fundraising machine had pulled in more than three-and-a-half times as much money as Trump’s. She had raised about $238 million for her campaign (not counting supportive super PACs), while Trump had collected about $65 million— largely from his own money. Most recent polls give Clinton a modest lead in the presidential race, although Trump has praised his campaign’s thriftiness. "I spend much less money than her and the results so far [are] the same. I should be credited for that," Trump told FOX News host Bill O'Reilly Monday night.

$46,098,694: The amount Trump has contributed to his own campaign, mostly in the form of loans his campaign says Trump won’t collect on. Sure, $46 million-plus is serious scratch for most Americans. But in Trump terms, it’s a pittance — not even 8 percent of the way toward the $600 million that Trump once said he could personally pump into a presidential campaign.

$13,747,372: The amount Right to Rise USA refunded to its donors in May. The super PAC, which backed former Florida Gov. Jeb Bush’s presidential bid, had raised more than $121 million and spent nearly all of its haul before Bush withdrew from the race in February. The super PAC, which can raise and spent unlimited amounts of money, said it would refund a minimum of 10 percent to donors who gave $1,000 or more to back Bush’s fight for the Republican nomination. At the end of May, Right to Rise USA had a little more than $3 million left in the bank.

$9,235,391: The amount Democratic presidential candidate Bernie Sanders had in the bank entering June, after raising more than $229 million and spending about $220 million since he launched his 2016 bid last year. Sanders appears to have burned through much of his remaining cash competing in the final Democratic presidential primaries. In June, his campaign sponsored about 2,000 TV ads, as he beat out Clinton in Montana and North Dakota but lost delegate-rich contests in other states such as California and New Jersey.

$8,966,466: The amount refunded by pro-Ted Cruz super PAC Keep the Promise II to GOP megadonor and energy investor Toby Neugebauer. Neugebauer last year contributed $10 million to Keep the Promise II, which added financial heft to Cruz’s emerging candidacy. But later, the group drew ire from Cruz supporters for not spending significantly during the primary election cycle. Neugebauer, who has since endorsed Trump, told the Center for Public Integrity in May that he had “not yet focused” on the future of Keep the Promise II. Keep the Promise II has since terminated.

$6,966,000: The total amount owed to BB&T bank by the Republican National Committee, according to its most recent campaign finance filing, which showed it borrowed approximately $2 million of that amount in May. That’s less debt than the $9.9 million the RNC reported carrying in June 2012, but the party also reported a lot less cash on hand — $19.9 million, compared to $60.8 million at the same point four years ago. One possible comfort: The Democratic National Committee owes even more, reporting more than $7.9 million in debt at the end of May to Amalgamated Bank Of New York and a variety of other creditors.

$3 million: The amount conservative billionaire Charles Koch donated to the Freedom Partners Action Fund in May. The super PAC has so far this election cycle only invested in Republicans competing for U.S. Senate seats. The Koch brothers have yet to endorse Trump or contribute to his presidential bid. Since January 2015, Freedom Partners Action Fund has raised nearly $21 million. The Kochs’ extensive political network intends to spend about $250 million influencing elections in 2016.

$1,888,032: The amount Marco Rubio’s presidential campaign owed creditors at the end of May. Rubio’s latest single debt — more than $721,000 — is owed to political data consulting firm FLS Connect for telemarketing services. Rubio, who is mulling whether to seek re-election to his U.S. Senate seat, isn’t alone among GOP presidential also-rans in his indebtedness. Wisconsin Gov. Scott Walker’s campaign, for example, still owes 25 creditors a collective $807,675 — about nine months after Walker quit the race. And the presidential campaign of Sen. Rand Paul, R-Ky., owes almost 50 vendors nearly $311,000. But some former candidates are squarely in the black. Cruz retained more than $6.8 million through May. Meanwhile, Ben Carson reported a net $1.57 million left in his campaign account, and Ohio Gov. John Kasich ended last month with more than $552,000 in the bank.

$851,245: The average amount that Clinton raised per day during May, as her campaign committee pulled in more than $26 million. To date, her campaign has now raised more than $238 million, with about $1 of every $5 coming from small-dollar donors who gave $200 or less. Trump has collected a similar portion of funds from such small-dollar donors.

$300,000: The amount that Republican Carly Fiorina’s failed presidential campaign has transferred to a hybrid super PAC that Fiorina helped launch about a month after she dropped out of the 2016 White House race. Of that sum, $250,000 came in May. Fiorina’s new group, known as Carly for America, has also received nearly twice that amount from the pro-Fiorina super PAC, which was legally prohibited from coordinating its spending with her presidential campaign. Super PAC CARLY for America — short for Conservative, Authentic, Responsive Leadership for You and America — donated $575,000 to Carly for America on May 26, according to a new campaign finance filing.

$100,000: What the Entertainment Software Association, a trade group that spends millions of dollars each year lobbying the federal government, gave in May to Senate Majority PAC, a super PAC closely aligned with the Democratic Party. The contribution — part of Senate Majority PAC’s $4.7 million haul last month — is the latest example of Democrat-backing super PACs accepting money from corporations, nonprofits and other entities that aren’t by law required to publicly disclose their root funders. Many Democrats (including the Democratic Senatorial Campaign Committee and Senate Majority PACitself) have decried what they like to dub “dark money.” Meanwhile, most congressional Democrats havesupported legislation such as the DISCLOSE Act, which aims to outlaw secret political cash.

$36,906: Value of the greenbacks in the Green Party of the United States’s account heading into June. While Jill Stein, the presumptive Green Party presidential nominee, has high hopes for her insurgent bid, her national party’s resources are but a tiny fraction of what the DNC and RNC boast. For perspective: the Green Party couldn’t pay cash for even one 2017 Ford Fusion Hybrid Platinum Sedan — manufacturer’s suggested retail price of $37,020. Stein’s campaign itself is doing a bit better, posting a cash-on-hand total of about $196,000 through May.

$25,000: The amount billionaire media mogul Stan Hubbard of Minnesota donated in May to Great America PAC, a pro-Trump super PAC. Great America PAC has raised more than $2.5 million since its formation in February, but high-profile donors not named Hubbard have been largely absent. To date, most of Great America PAC’s nominally pro-Trump TV ads have prominently urged viewers to call 1-800 numbers, leading some critics to raise concerns about the group. However, a new spot, unveiled Friday, features a former Navy SEAL endorsing Trump as a strong leader at a time in which the tragedy in Orlando stands as "a stark reminder that the enemy and the battlefield is moving here to our shores."

$6,043: The amount the Trump campaign spent in May on office supplies from online retailer Amazon. That’d be entirely unremarkable if the Trump campaign hadn’t, in revoking the Washington Post’s campaign credentials, released this statement on June 13: “The Washington Post is being used by the owners of Amazon as their political lobbyist so that they don't have to pay taxes and don't get sued for monopolistic tendencies that have led to the destruction of department stores and the retail industry.” The Washington Post is owned by billionaire Jeff Bezos, who is also Amazon’s founder and chief executive.

$3,938: What upstart vintner Eric Trump Wine Manufacturing LLC of Charlottesville, Va. — Eric Trump being Donald Trump’s adult son — earned in May from his father’s presidential campaign.

98.8: Percentage of the $12.1 million pro-Clinton super PAC Priorities USA Action raised in May from just 14 individuals or entities. Top donors last month included media mogul Fred Eychaner ($3 million), financier Donald Sussman ($2 million) and private investor Bernard Schwartz ($1 million). Political organizations controlled by three labor unions — the American Federation of Teachers, Laborers International Union of North America and International Union of Operating Engineers — each also gave $1 million to the super PAC, which has sponsored a torrent of anti-Trump advertising in recent weeks.

73.7: Percentage of the roughly $190,000 spent by Libertarian presidential candidate Gary Johnson in May that went to the consulting firm of his campaign manager, Ron Nielson. In late May, Johnson officially became the Libertarian Party’s nominee. But ahead of the party’s convention, his spending habits drew criticism in some quarters. (His 2012 presidential campaign is also still about $1.9 million in the red.) Johnson’s 2016 campaign entered June with about $176,000 in the bank and no debt.

$0: The overall fundraising haul for ill-fated Never Hillary PAC, one in a gaggle of avowed anti-Clinton organizations that have registered with federal regulators but have largely accomplished little. “Never Hillary has been open for a month and has received zero donations and has zero debts or outstanding payments,” PAC treasurer Sean Duenser wrote Friday in a decidedly sad trombone-y letter to the Federal Election Commission. “I wish to terminate this PAC.”

Chris Zubak-Skees contributed to this report.

Democratic presidential candidate Hillary Clinton gestures as she greets supporters at a presidential primary election night rally, Tuesday, June 7, 2016, in New York.Michael Beckelhttps://www.publicintegrity.org/authors/michael-beckelDave Levinthalhttps://www.publicintegrity.org/authors/dave-levinthalCarrie Levinehttps://www.publicintegrity.org/authors/carrie-levineCady Zuvichhttps://www.publicintegrity.org/authors/cady-zuvichhttps://www.publicintegrity.org/2016/06/21/19795/hillary-clinton-crushing-donald-trump-white-house-cash-dash

The next ‘Citizens United’ is coming

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Most Americans last heard from conservative lawyer James Bopp six years ago when he crafted a case, Citizens United v. Federal Election Commission, that won the Supreme Court’s favor and helped uncork a torrent of cash — some of it secret — that continues pouring into elections.

But Bopp is back. The Terre Haute, Indiana-based attorney, who was literally laughed at by a judge when he made his first arguments in Citizens United, is now the lead lawyer in the most prominent of a series of lawsuits attempting to further destroy political contribution limits. The case, brought by the Republican Party of Louisiana, addresses restrictions on how state and local political parties use “soft money” contributions to influence federal elections.

Bopp’s clients argue that if independent outside groups such as super PACs are permitted to raise and spend unlimited amounts of such money, there’s no reason why state political parties, acting independently of federal candidates, should be treated differently. Political parties are “disadvantaged” compared to super PACs, Bopp said in an interview with the Center for Public Integrity. “They want to compete, and they want to do this activity without the severe restrictions that they suffer under.”

Bopp says he won’t rest until there are as few election rules as possible since he believes that too many rules lead to more opportunities to game the political system. “When you say, ‘Congress shall make no law,’ I know that’s kind of a shocking statement, but it’s a pretty definitive statement,” he said, referring to the First Amendment and its application to political speech. “There shouldn’t be any laws as opposed to thousands of pages of laws and regulations that you have now in the federal system.”

The stakes are high. If the Republican Party of Louisiana wins the case, “in effect, the ‘soft money’ world of the late ‘90s and 2002 would be reestablished,” purging some of the last remnants of McCain-Feingold and other restraints on donations, said Richard Briffault, a professor at Columbia Law School and expert on election law.

Tara Malloy, deputy executive director of the Campaign Legal Center, which favors campaign contribution limits, compares the deregulatory approach of those like Bopp who are fighting against limits to peeling an onion.

“First it was the aggregate limits, which was sort of like the outermost protection. Now they’re going for the party limits, which again seems one degree removed from a direct contribution for the candidate,” she said. “I assume if they were successful here, they would go for the rest.”

Multiple campaign finance lawyers point to the Louisiana case as one of the most likely of a small number of campaign finance cases now wending their way through the legal system to reach the U.S. Supreme Court, and several others may land there as well.

These still-obscure challenges to remaining campaign finance laws have the potential to again reshape the way money influences politics. They could further erode contribution limits or chip away at state laws aimed at restricting money’s influence on state-level elections.

To be sure, there are many variables that will shape the outcomes. And lawyers on all sides of these cases agree U.S. Supreme Court rulings are notoriously tricky to forecast, especially with the court down to eight members following the death of Justice Antonin Scalia earlier this year.

Nevertheless, those in favor of more deregulation of campaign finance, like Bopp, are looking to extend the reasoning laid out in decisions such as Citizens United and 2014’s McCutcheon v. FEC, which overturned aggregate campaign finance limits.

The practical effect of the U.S. Supreme Court siding with the Louisiana state Republican Party would be reopening the door to what was known in the 1990s as “soft money,” allowing what in many states would be practically unlimited contributions to state parties.

The case would “substantially” reduce the difference between the amounts of money independent groups such as super PACs could accept and the amounts state parties could accept, Bopp said.

Two other cases could also be big, if they don’t first fizzle out: a federal district court ruling striking down Montana’s contribution limits, also a Bopp case, and a messy, politicized case out of Wisconsin that raises questions about coordination between candidates and independent groups, among other legal issues.

There’s also a case seeking to overturn a Delaware law that requires groups spending more than $500 per election cycle on ads referring to specific candidates to disclose their donors.

Parties in both the Wisconsin and Delaware cases have filed certiorari petitions asking the Supreme Court to take the cases. The Supreme Court has not yet ruled.

‘A time bomb’

The most prominent cases involve objections to contribution limits, and they seem to follow a trail laid down by Chief Justice John Roberts in the 2014 McCutcheon case when he appeared to invite, or at least open the door to, additional challenges to contribution limits. Bopp and his ideological allies are taking Roberts’ hint, argues Rick Hasen, a law and political science professor at the University of California, Irvine, who has written about both Roberts’ wording and the Louisiana Republican Party  case.

McCutcheon was, in some ways, a narrow case concerning only the so-called aggregate contribution limits, the total amount contributors can give to all federal candidates in a single election cycle.

The law previously capped the total amount an individual could donate to federal candidates at $48,600 per election cycle plus $74,600 to parties and political action committees. A contributor who wanted to give the maximum contribution — then $2,600 — to a large number of federal candidates, such that his total giving would exceed the cap, filed suit.

The U.S. Supreme Court, in a 5-4 decision, struck down the aggregate limit, although it left limits on contributions to individual candidates and to parties in place.

But in McCutcheon, Roberts reinforced a limited definition of political corruption, defining it very much like bribery. To prove corruption, one must essential prove a quid pro quo — that money led to some specific act of corruption. The tight definition of corruption is important, because preventing corruption — or the appearance of corruption — is the only legitimate reason the court has said justifies contribution limits.

If the justification underpinning campaign contribution limits rests on broader definitions of corruption — for instance, limiting the access to politicians that can accrue to big contributors — Roberts seemingly opened the door to striking down the limits as unjustified restrictions.

“It’s been kind of a time bomb,” Hasen says of the language in the McCutcheon opinion.

Bopp hopes to see the bomb detonate, describing more campaign finance deregulation as “definitely desirable.”

Soft money 2.0?

All this goes back to the big debate over “soft money” that has raged for decades. “Soft money” was the term given to unlimited contributions made by corporations, individuals and labor unions to national political parties. The funds were often used to pay for “issue” ads — commercials that avoided directly calling for the election or defeat of a particular candidate but otherwise looked and sounded very much like campaign ads.

The Bipartisan Campaign Reform Act of 2002, often referred to as McCain-Feingold, after its chief Senate sponsors banned soft money in federal elections, eliminating unrestricted contributions to national political parties and restricting state parties to funding what the law termed “federal election activities” with federal funds, or funds raised subject to specific sets of restrictions and requirements.

The latter restrictions on state and local parties are the ones the Louisiana Republican Party’s lawsuit seeks to knock down.

“Some would argue that in the end, the money is going to get there one way or the other and the fact that the money is in parties is no worse and potentially better,” said Columbia Law School’s Briffault. “On the other hand, it’s one more reaffirmation of the idea that nominal independence means freedom from restriction.”

Thanks to judicial review provisions in the law that set the contribution limits, Bopp was able to request a hearing before a three-judge panel in federal district court. The panel’s decision can be appealed directly to the U.S. Supreme Court.

Some campaign finance experts suggest Scalia’s death worsened odds that the Republican Party of Louisiana will win its case after the three-judge panel rules and the inevitable appeal is filed. The high court may be more likely to simply uphold the lower court, for example. Or, there may be a greater likelihood of a tied verdict given the even number of justices.

Bopp who has long been active in the Republican Party, strongly contests the likelihood of a stalemate on the U.S. Supreme Court, arguing precedent is on his side.

“Unless you’re prepared to say … ‘parties can’t do independent spending,’ then the logic is irresistible,” he said, adding that “political parties are highly regulated, more regulated than many of the other political actors in the process and frankly that, in my view, has the world upside down.”

Another campaign contribution case of Bopp’s, a long-running challenge to Montana’s limits on contributions to state candidates by a group of political parties and individuals, has also received a rush of attention. 

Bopp says that case, as well as other challenges to contribution limits he is working on, have to do with applying the corruption definition in McCutcheon to campaign contribution limits.

A federal district court struckdown Montana’s limits as too low to allow candidates to conduct effective political campaigns. An appeals court overturned the decision and sent the case back, ordering the court to reassess it.

The district court again struck down the contribution limits, more broadly finding the limits weren’t justified because the state failed to present compelling evidence of quid pro quo corruption, required to justify the limits. The case is again under appeal, and experts say it could eventually reach the U.S. Supreme Court.

What started off as a case about whether contribution limits were too low “suddenly became about the constitutionality of contribution limits altogether, or what kind of incredibly strong legislative record you would need in order to have any kind of contribution limits,” said the Campaign Legal Center’s Malloy, whose organization has taken part in the case as a “friend of the court.”

Trump, Clinton could play roles

When asked by the Center for Public Integrity, campaign finance lawyers were more tentative when naming other cases that could bring sweeping change, and forecasting which cases have the potential to reach the U.S. Supreme Court and upend existing law is a dicey game.

The U.S. Supreme Court has yet to rule on two certiorari petitions asking it to hear a pair of closely watched cases.

One, Delaware Strong Families v. Denn, involves a Delaware law that requires groups to reveal their donors’ identities if they spend $500 or more in a single election cycle on advertising that refers to specific candidates. The disclosure requirements apply even if the ads don’t explicitly urge people to vote for or against a specific candidate.

Delaware Strong Families, a nonprofit organized under Section 501(c)(3) of the tax code as a charity, describes its mission as “to rebuild a culture of marriage, family, and freedom and raise up the next generation of leaders.” Charities cannot engage in activity aimed at influencing elections. The group publishes what it describes as a nonpartisan voter guide, and argues that the law is an unfair burden and could chill free speech.

In support of the law, the state argued it has a compelling interest in ensuring there is an informed electorate. Since Delaware is small, the state also contends it’s reasonable for a low-dollar threshold to trigger disclosure requirements.

The state won in the Third Circuit last year. The Center for Competitive Politics, which is representing Delaware Strong Families, has appealed to the U.S. Supreme Court, which has yet to say whether it will agree to hear the case.

“The Delaware law is pretty radical, and I think if the court accepted it, I think we’d win. I think we’d see a lot of support across the ideological spectrum for limiting the reach or striking down the Delaware law,” predicted David Keating, the president of the Center for Competitive Politics, which favors less regulation of campaign finance. “Good grief, they’re regulating nonpartisan voter guides.”

But Malloy, whose organization is representing Delaware in defense of the law, said overturning the law “would act sort of as a check against state innovation in the disclosure area, where states are sort of leading the charge because Congress has been ... in a quagmire.”

Another potential game changer is the so-called “John Doe” case out of Wisconsin, over which the U.S. Supreme Court also has yet to act.

The politically charged case is an appeal of the Wisconsin Supreme Court’s ruling ending an investigation into whether Republican Gov. Scott Walker coordinated with independent outside groups working to support him during his recall election in 2011 and 2012.

Prosecutors are appealing the Wisconsin Supreme Court’s decision, arguing it essentially guts limits on Wisconsin candidates coordinating with outside groups and goes beyond what the U.S. Supreme Court has so far permitted. Prosecutors also argue that three of the judges should have recused themselves because some of the independent groups involved in the investigation had supported their candidacies.

If the U.S. Supreme Court accepts the case, it could be a vehicle for justices to clarify the murky legal area of coordination between candidates and independent groups. It may also address whether the judges should have recused themselves.

“Obviously, if the court granted [certiorari] on that, that would immediately become a blockbuster,” said Daniel Weiner, a senior counsel at the Brennan Center for Justice, which advocates for campaign finance reform, though he and other lawyers hastened to say they believe the U.S. Supreme Court is unlikely to grant review.

“If the court were to adopt the interpretation of the Wisconsin Supreme Court, that would be the end of coordination law,” leaving only easily evaded restrictions on coordinating on communications that expressly urge voting for or against a candidate and nothing else, Weiner said.

Bopp, unsurprisingly, disagrees. He calls the Wisconsin Supreme Court’s decision well-founded.

“You’ve got to limit the idea of contribution to a candidate by coordinated spending to something that actually relates to an election, and issue advocacy isn’t it,” he said.

Everything comes down to which cases the U.S. Supreme Court chooses to accept, and how broadly they choose to rule — choices surrounded by uncertainty. It may seem obvious, but a lot also depends on when a new justice is appointed to fill the seat left vacant by Scalia’s death — and the president, be it Barack Obama, Donald Trump or Hillary Clinton, whose nominee is confirmed.

Bopp crafts his cases — such as the Louisiana case — to go the distance, with an eye to, in his words, having “a very plausible way to win the case which fits under existing law.”

Don’t underestimate him. Citizens United was given such low odds of success, a district court judge laughed openly in court when Bopp made his argument that an anti-Hillary Clinton video was really just like a 60 Minutes segment and should be treated as such.

But he got the last laugh — and may again.

This story was co-published with POLITICO Magazine.

Jim Bopp, a conservative attorney, speaks in favor of a measure amending the state's constitution to ban gay marriage during a hearing of the House Judiciary Committee at the Statehouse in Indianapolis, January 2014.Carrie Levinehttps://www.publicintegrity.org/authors/carrie-levinehttps://www.publicintegrity.org/2016/06/22/19802/next-citizens-united-coming

Majority of U.S. Supreme Court justices are millionaires

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At least six— and perhaps as many as all eight — U.S. Supreme Court justices are worth at least $1 million, according to a Center for Public Integrity analysis of new financial disclosures.

Topping the list is Stephen Breyer, who is worth at least $6.1 million— and possibly as much as $16 million going into 2016. Breyer's top holdings include stock in publishing company Pearson PLC, as well as property in New Hampshire and the Caribbean island of Nevis.

Chief Justice John Roberts boasts the second-highest net worth: at least $4.2 million.

Justices Ruth Bader Ginsburg, Samuel Alito, Sonia Sotomayor and Elena Kagan are also worth more than a million bucks.

The same is true of their would-be colleague Merrick Garland, who President Barack Obama has nominated to fill the vacancy following the February death of Justice Antonin Scalia. (Scalia's estate is not required to file a financial disclosure on his behalf.)

If confirmed to the Supreme Court, Garland — currently the chief judge of the United States Court of Appeals for the District of Columbia Circuit — would, in fact, become the court's wealthiest member.

Documents released today indicate Garland is worth at least $7.6 million— and possibly as much as $25 million. Among his top assets? A rental property in New York City and several mutual funds.

Justices Anthony Kennedy and Clarence Thomas are the court's paupers — relatively speaking. Both men's minimum estimated net worth was around $600,000— although each could be worth as much as $1.2 million.

Assets on the forms, which are filed annually, are reported in broad ranges. This makes it impossible to say precisely how much each justice is worth. Judges are also exempt from disclosing the value of their homes, making an accurate calculation even more difficult.

But suffice it to say, none of the Supreme Court justices are facing economic hardship.

The new documents show that the justices of the Supreme Court were a well-traveled bunch during 2015. All eight members of the Supreme Court took at least one trip sponsored by another organization, often law schools or foundations.

Breyer was the most jet-setting justice in 2015, taking 19 trips sponsored by other organizations. Among them: A pair of weeklong jaunts to Paris — one for a book event and speaking engagements, the other for a conference — and three separate trips to London.

Sotomayor's 16 trips placed second among justices, although none were international. Ginsburg, for her part, took eight trips, including one to Seoul, South Korea, for a "legal exchange program" that the Supreme Court of Korea funded. Alito, Kagan and Kennedy also traveled eight times, followed by Thomas with four trips and Roberts with one — to Tokyo.

While a majority of Supreme Court justices did not actively buy or sell individual company's stocks last year — mutual funds are popular among them — Alito, Breyer and Roberts held equities.

Alito reported stock in aerospace and defense giant Boeing Co., Molson Coors Brewing and oil companies ConocoPhillips Co. and Exxon Mobil Corp., among others. Roberts' stock holdings included Time Warner Inc., satellite radio company SiriusXM and tech titans Microsoft Corp. and Hewlett-Packard Co.

Kennedy, long a moderate voice on the high court, is particularly conservative with his investments. For example, he keeps between $500,000 and $1 million in an account at PNC Bank, according to his disclosure.

In addition to their salaries and financial holdings, most of the Supreme Court justices also collected tens of thousands of dollars each from side jobs — such as teaching gigs, speaking fees and book deals.

Breyer scored about $117,000 from royalties from his recent book, "The Court and the World."

Alito earned $21,000 teaching at the University of Kentucky and Duke University. And Roberts earned about $13,600 from the University of Tokyo in Japan, for teaching a course in July on historical perspectives of the U.S. Supreme Court.

Meanwhile, Thomas collected more than $27,000 from teaching gigs at three law schools — Creighton University, George Washington University and Brigham Young University. Thomas' wife, Virginia, also reported earning an unspecified salaries from The Daily Caller, a conservative news website, and Liberty Consulting Inc., her own political consulting firm.

Thomas also received a gift worth $6,500 — a bronze bust of abolitionist Frederick Douglass.

More notable is the person making the gift: Dallas real estate mogul and Republican megadonor Harlan Crow, who has long been friendly with Thomas.

This story was co-published with NBC News.

Chief Justice John Roberts and U.S. Supreme Court Justices Elena Kagan, Anthony Kennedy, Ruth Bader Ginsburg, Stephen Breyer and Sonia Sotomayor while attending President Barack Obama's State of the Union address in January 2016.Michael Beckelhttps://www.publicintegrity.org/authors/michael-beckelDave Levinthalhttps://www.publicintegrity.org/authors/dave-levinthalhttps://www.publicintegrity.org/2016/06/22/19804/majority-us-supreme-court-justices-are-millionaires

'It just ruined everything — the whole life'

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AVELLA, Pa. — Sixty years after his service in the Army, Jesse Eakin still completes his outfits with a pin that bears a lesson from the Korean War: Never Impossible.

That maxim has been tested by a low-grade but persistent threat far different than the kind Eakin encountered in Korea: well water that’s too dangerous to drink. It gives off a strange odor and bears a yellow tint. It carries sand that clogs faucets in the home Eakin shares with his wife, Shirley, here in southwestern Pennsylvania.

The Eakins told the state environmental agency about their bad water nearly seven years ago and hoped for a quick resolution. Like thousands of others who live in the natural gas-rich Marcellus Shale, however, they learned their hopes were misplaced.

Today, the state is still testing their water. The results of those tests will dictate whether a gas exploration and production company is held responsible for providing them with a clean supply. Meanwhile, the Eakins drink donated bottled water and in late 2014 began paying for deliveries of city water to avoid showering in contaminants such as lead and manganese.

Since 2007, at least 2,800 water-related complaints have been investigated by the Pennsylvania Department of Environmental Protection’s Oil and Gas Program. Officials found ties to the drilling industry in 279. Another 500 or so cases, including the Eakins’, are open. While regulators try to catch up to natural gas exploration, some residents of the state have gone months, even years, without access to clean water at their homes.

Responding to a public-records request by the Center for Public Integrity, the Department of Environmental Protection, or DEP, provided data on 1,840 complaints lodged since 2010. More than half took longer than the agency’s target of 45 days to resolve. Almost one in 10 took more than a year.

The state’s often-plodding response has left hundreds of rural Pennsylvanians scrambling to pay for water deliveries, seek remedies in court, take out second mortgages or even abandon their homes.

Complaints filed with the DEP reveal people’s fear and frustration. In 2011, a Butler County resident reported that her previously crystal-clear water had turned “brown and rusty looking” with a “terrible odor.”

In 2013, someone a few miles away complained of drinking water that “feels slimy and causes [his/her] skin to break out.” Last October a Westmoreland County father of five wanted to know whether his water was safe to drink — it had begun staining the bathtub and “didn’t smell like normal water should smell like.” He’s still waiting for the results of the DEP investigation.

If the past is any guide, the family may drink the malodorous water for months before finding out whether it is contaminated and whether the gas-drilling technique known as hydraulic fracturing, or fracking, that swept the Marcellus a decade ago had anything to do with it.

Even if the DEP determines that there is a connection, relief may prove unsatisfying or slow to come. In each of the dozen households interviewed for this story that received “positive determination” letters from the state, people were still dealing with the burdens of water contamination. Some who have the energy and resources are seeking compensation in court, while others accept endless supplies of bottled water or filtration systems without knowing when or if their well water or property values will return to what they once were.

After Texas, Pennsylvania produces the most natural gas in the United States. It also has the second-highest number of private water wells, behind Michigan, with about 3.5 million users. Meanwhile, it’s one of only two states without regulations for private-well construction.

Fracking took hold here years before its potential health impacts were considered. The extent of these impacts remains unknown. The Pennsylvania Department of Health only began pulling residents’ health complaints into a registry this year. The DEP didn’t establish protocols for gas-related water investigations until 2015; it is still building a computerized system for tracking the results of such investigations.

“What I tell people is, don't think that there's somebody up there [in Harrisburg] watching out for you, because they’re not,” said David Brown, an environmental health scientist at the nonprofit Southwest Pennsylvania Environmental Health Project. “That's a pretty sobering message, and it's not one I would think I would give in many states but Pennsylvania.” (The project has received funding from The Heinz Endowments, as has the Center for Public Integrity.)

In 2011, the state began requiring gas companies to report certain complaints from residents, who often call the local driller instead of the DEP. Between the complaints that never reach the agency and its inconsistency in recording the ones that do, however, the DEP is unable to provide a complete tally.

Residents have the option of closing DEP complaints and settling them privately with gas companies. But the agency doesn’t systematically track those settlements, which are often accompanied by non-disclosure agreements. The public is left in the dark.

In 2014, Pennsylvania’s auditor general, Eugene A. DePasquale, found that the DEP’s handling of water complaints from 2009 through 2012 was “a serious impediment to complainants’ quality of life” and called its documentation “egregiously poor.” The agency disagreed with all of his findings.

In a recent interview with the Center for Public Integrity, DePasquale said the DEP is headed in the right direction but has far to go.

Low-income Pennsylvanians with water problems are being left to fend for themselves “way too many times,” he said. “That's beyond not having good technology to track complaints. It’s ignoring your duty as public officials.”

The Center for Public Integrity has sought interviews with DEP officials since January; none was granted. In a written statement, Scott Perry, deputy secretary over the agency’s Office of Oil and Gas Management, wrote, “Protecting Pennsylvania’s water is a key part of the DEP mission, and the Department takes these complaints very seriously. DEP staff conduct a full investigation, including lab analysis of water samples, for each complaint received. Unfortunately, there is no ‘one size fits all’ solution to impacted water supplies.”

The DEP is close to finalizing rules on gas drilling “that strengthen the protections for water supplies,” Perry wrote. The rules would ban disposal pits, which can contaminate groundwater, and impose more stringent requirements for water-supply replacement.

At a panel discussion last year, Perry acknowledged the department’s regulation of oil and gas has been a work in progress.

“The Pennsylvania DEP is really an international leader in managing the potential environmental impacts of oil and gas development,” he said. “We certainly did not start that way. We have nonetheless risen to these challenges and modernized our regulations across the board.” The agency has toughened standards for gas drilling, increased its number of inspectors and boosted permitting fees, Perry said.

But the DEP is struggling with a shrinking budget, outdated technology, and a divided General Assembly. Last month, the department’s secretary, John Quigley, resigned following the release of an email he’d sent to several environmental groups, accusing them of weak support for oil and gas regulations that had been rejected by lawmakers the day before.

“Where … were you people yesterday?” Quigley wrote. “The House and Senate hold Russian show trials on vital environmental issues and there’s no pushback at all from the environmental community?”

The natural gas industry wields considerable influence in Pennsylvania. From 2014 through 2015, it contributed $2.7 million to political campaigns in the state and spent about $17.5 million lobbying, according to a new report released by Common Cause Pennsylvania and Conservation Voters of PA. Top spenders included the Marcellus Shale Coalition, an industry group, which gave $7.4 million to lobbyists, and Range Resources, a gas exploration and production company, which gave $1.7 million.

In a news release, Josh McNeil of the voters group blamed “corrosive ties” between fossil-fuel interests and legislators for the “recent disruption of longstanding efforts to create cleaner air and water for the people of Pennsylvania . . .”

Fracking takes off, water complaints grow

Around 2005, energy companies began drilling natural gas wells into America’s vast shale deposits. New technology — fracking — had made dislodging gas from ancient, underground rock formations feasible on a large scale. The process involves pumping millions of gallons of water, sand and chemicals deep into the earth at high pressure to break apart the rock and release the gas.

While operators extracted enough gas to make the United States one of the world’s leading energy producers, they were still perfecting certain parts of the process — how to construct a well so gas wouldn’t escape underground, for instance, or how to safely dispose of chemical-infused wastewater.

Research into fracking’s health and environmental effects was slow in coming; relatively few papers were published before 2013. By that time, Pennsylvania had issued permits for nearly 11,000 wells in the Marcellus Shale and had investigated at least 1,600 water-supply complaints, concludin­g that almost none had ties to fracking.

After their water went bad in 2009, the Eakins noticed rashes and mole-like, flesh-colored growths on their skin that seemed to pop up after showers. Their legs felt heavy. They stopped planting their annual garden in 2012 because the fruits and vegetables died right after they were watered. “It just ruined everything — the whole life,” said Shirley, 80.

When the Eakins complained about their water to Atlas Energy, the company that had begun fracking in the park uphill from their home, they knew little of the Marcellus — which encompasses 95,000 square miles in New York, Pennsylvania, West Virginia, Ohio and Maryland — or the estimated 85 trillion cubic feet of natural gas trapped within it. As it turned out, the three-bedroom house they built in 1978 in a remote part of Washington County, 30 miles southwest of Pittsburgh, rested atop what would become one of the most heavily drilled parts of the county.

Their water was never tested for fracking-related contaminants until sand began to clog their faucets. The DEP is still testing to determine whether their water may have been affected by gas drilling. In a letter to the Eakins last fall, the agency said contaminant levels kept fluctuating, making it difficult to reach a conclusion.

An Atlas spokesman said the company uses the best practices in the industry, but would not comment on any alleged environmental or property damage because of pending litigation by people other than the Eakins.

Among the dozen or so houses in the Eakins’ neighborhood, known as Rea, water quality differs from address to address. Residents of at least nine homes have stopped drinking water from their wells. One, Jeannie Moten, is certain fracking tainted her well water and led to her father’s premature death from heart failure. The well no longer functions; it collapsed one too many times after the gas drilling began, and her disability income won’t cover the cost of a new one.

One time, Moten said, she was standing in line at a restaurant behind an industry worker who was talking about Rea’s environmental problems. She heard him say that with only 15 homes, the community wasn’t worth worrying about. “We've been feeling like nobody since 2009,” she said.

There’s no shortage of cases like Moten’s and the Eakins’ across the state. People notice their water quality suddenly change and see a correlation with oil or gas drilling in their area. News outlets do stories on brown, bubbly water, but the DEP rarely finds proof of a connection. The buzz dies down; clean water doesn’t come.

Ben Groover sold his motorcycle and pickup truck to raise the $15,000 he needed to connect his home in Fayette County, 60 miles southeast of the Eakins, to a municipal water line in 2010.

Groover’s water well was 2,400 feet from a gas well drilled by Atlas Energy. Company records show the well was fracked on February 3, 2010. The same day, Groover filed a complaint with the DEP, saying his sink and toilets were filled with “brown muck.”

Groover, who had signed an agreement with Atlas allowing it to pipe gas across his land, had his water tested before the drilling started. Tests afterward showed that levels of a few contaminants commonly associated with fracking — suspended solids, iron and manganese — had gone up.

At the time, Pennsylvania law said gas companies were only presumed responsible for water pollution within 1,000 feet of a well. Groover was out of luck, even though scientists from Penn State University sampled his water in 2011 and concluded that it showed “potential impact from disturbance related to drilling or some other nearby activity.”

The following year, the law was updated: Gas wells drilled within 2,500 feet of a water supply that went bad would now be presumed responsible for the damage. Groover’s well likely would have fallen into this category, meaning Atlas would have been required to fix the problem. Groover said he filed multiple complaints with the DEP in an attempt to hold Atlas responsible, but his calls and emails to the agency had no effect. “I have less respect for the DEP than I do the gas industry,” he said.

He never got clean water from either the company or the state. He and several neighbors have filed a lawsuit against Atlas and other gas companies operating in the area.

In its answer to the complaint, Atlas said it was not liable for the alleged injuries and damages. Any problems that occurred “were the result of unavoidable circumstances beyond the control of Atlas, which could not have been reasonably foreseen or prevented by any person or entity…,” the company said.

A spokesman for the Marcellus Shale Coalition declined to be interviewed for this article. In a recent blog post, however, the group said that “natural gas development in Pennsylvania is governed by modern, tight regulations that in addition to the industry’s commitment to best practices strengthen our environment and protect local communities.”

In another post, the coalition noted that a state-imposed fee on natural gas has generated more than $1 billion since 2011. “These critical revenues are sent directly to local governments, which allows those closest to the development to invest in infrastructure improvements and community programs,” the group’s Dave Spigelmyer is quoted as saying.

The number of oil and gas industry jobs in Pennsylvania increased by more than 15,000 during the boom years — from 2007 through 2012 — though a recent drop in gas prices has moved companies to downsize. The number of active rigs in the state has dropped by more than half in the past year, though increasingly efficient gas-extraction techniques have sent production to new highs.

Evolving science

Scientists are still unraveling how, and under what circumstances, fracking can affect water. In Pennsylvania, methane or other impurities are sometimes present before drilling occurs, making things difficult for investigators. A 2012 Penn State study found, for example, that 40 percent of wells tested before fracking contained at least one contaminant above safe limits.

Rob Jackson, a professor of environmental earth systems science at Stanford University, has been investigating possible ties between fracking and poor water quality since 2009, when he and his colleagues realized that no peer-reviewed papers on the topic had been published.

When Jackson’s team released the results of studies showing evidence of such links in Pennsylvania and Texas, it quickly felt backlash from industry. When the team found no correlation in Arkansas, environmentalists were dismissive.

“It really depends on what we say, and always someone is unhappy with our conclusions,” Jackson said.

His work suggests that fracking impacts only a fraction of water supplies. In those cases, there is “very strong evidence” of a connection, Jackson said. Yet people whose water has been blighted “can’t get anyone to listen.”

A 2016 analysis of 58 water-quality studies by PSE Healthy Energy, an environmental research and policy group that has received funding from The Heinz Endowments, found that 69 percent showed an association between fracking-related activities and water contamination. Most air-quality studies reviewed indicated elevated risks from gas drilling as well.

The study’s lead author, Jake Hays, wanted to assess the state of the science, knowing much of it remains unsettled. “Unfortunately,” he said, “that’s in many ways paralyzed actual action on the issues.”

It also makes things hard for doctors who treat people living near drilling operations.

Dr. Poune Saberi, an assistant professor at the University of Pennsylvania’s Perelman School of Medicine who also serves on PSE Healthy Energy’s advisory council, trains doctors to ask such patients about fracking-related exposures.

“The true prevalence of health symptoms is way underestimated,” Saberi said, because many of those conversations aren’t happening. Patients often hesitate to talk about their experiences. “It's like, ‘Oh, they're going to think I'm crazy.’”

Some residents of the Woodlands area of Connoquenessing Township, north of Pittsburgh, can relate. The township runs a weekly water drive funded by donations because about 45 households have found their water unsuitable to drink since 2011. There are 65 gas wells within two and a half miles of the neighborhood.

Resident Kim McEvoy allowed her home to go into foreclosure and moved away from the Woodlands because of her black, foamy water. Every day for more than six months, she and her then-fiancé would fill 30 one-gallon jugs at work or friends’ houses so they could cook and shower.

“Every morning you woke up, you thought about, ‘Where I am going to get water today?’” McEvoy said. She underwent therapy to deal with her anxiety and depression.

At least eight families in the Woodlands are suing the gas driller, Rex Energy, and its contractors. Rex Energy, which initially provided some families with water after they complained, did not respond to interview requests from the Center for Public Integrity. In 2012, a spokesman told the Pittsburgh Post-Gazette that “a battery of tests” performed by experts had concluded that natural gas development had not affected water quality.

The DEP investigated 12 complaints from the Woodlands made within a year and found no ties to fracking in any of the cases.

Limited EPA powers

The U.S. Environmental Protection Agency says it has limited ability to help private well owners when their water degrades. The EPA doesn’t regulate such wells. It is barred from enforcing federal drinking water standards when fracking is involved — unless the contaminant is diesel, as per a provision in the 2005 Energy Policy Act.

The exemption codified a 2004 finding by the EPA that national regulation was not necessary. At the time, Vice President Dick Cheney, former CEO of Halliburton, an oilfield services company that pioneered the use of fracking, was in charge of energy policy for the White House, prompting critics to dub the provision the “Halliburton Loophole.”

One tool the agency does have when local officials have not acted is Section 1431 — “emergency powers” — of the Safe Drinking Water Act. It’s the legal authority the EPA used — albeit belatedly — after the lead crisis in Flint, Michigan, came to light in 2015. All told, the EPA has issued 228 orders under Section 1431 since 1991, forcing polluters to address “situations where there may be an imminent and substantial endangerment.”

In 2010, the EPA used this authority against a gas company for the first and only time. Range Resources, a major presence in the Marcellus, was accused of fouling two water wells near Fort Worth, Texas, with benzene, methane, propane and toluene. Range said the contaminants were naturally occurring and sued the EPA.

The EPA ultimately dropped the four orders it had issued against the company, saying it wanted to avoid a costly legal battle, and that the affected families had been switched to an alternate water supply. Range Resources agreed to monitor wells in the area and participate in a national EPA study of fracking’s effects on water. As it turned out, the company didn’t have a role in the study.

In 2012, the EPA also tested water wells in the heavily drilled northeastern Pennsylvania town of Dimock after receiving complaints about brown, sometimes flammable, water. It said the water was safe to drink, though in 2016 the federal Agency for Toxic Substances and Disease Registry, part of the Centers for Disease Control and Prevention, reported that chemical levels in at least 27 wells during a six-month period in 2012 were “high enough to affect health.”

The DEP ordered Cabot Oil & Gas, which operated in the area, to compensate people whose water had degraded. Dozens of residents later sued the company, and most of the lawsuits were settled. Two families whose cases went to trial were awarded $4.24 million by a jury this year. Cabot is appealing, saying methane found in their water was naturally occurring.

Southwestern Pennsylvania was one of five case studies included in the EPA study, released in draft form in 2015. Jesse and Shirley Eakin’s well in Cross Creek Township was one of 16 sampled in the area. After analyzing the water in 2011 and 2013 and considering an array of reasons for its poor quality, the EPA didn’t reach a conclusion about the cause of the contamination. Among the possibilities: natural sources, gas drilling and coal-mine drainage

In the Eakins’ case, the situation was clouded by the lack of pre-drill water testing. But Jesse Eakin said, “You can't have a pre-drill test when you don't know nobody's coming.” Before significant drilling began in the area in 2008 he had tested only for bacteria, not pollutants commonly associated with fracking.

In addition to the one filed by the Eakins, the DEP received at least six water-related complaints from Cross Creek Township in 2009. One resident reported water that looked like tea. Three others said their water flow had slowed to a trickle or stopped.

Nineteen more complaints came in over the next few years. Some cases were settled privately with Range Resources; others were closed after state inspectors decided the water wells were too far away from drilling to have been impacted.

The DEP tracks all complaints in a system developed in the early 1990s, though it’s working on an update. Most information about cases is still kept in paper form at the agency’s regional offices. In January, two Center for Public Integrity reporters visited the DEP office in Meadville, in the northwestern part of the state, to review complaints, consent orders, gas company correspondence and other documents. The reporters were given incomplete case files, heavily redacted determination letters and materials that were unresponsive to open-records requests.

The antiquated system has been the subject of several battles between the DEP, journalists and environmentalists. It took the Scranton Times Tribune a year to get access, through a lawsuit, to letters the department had sent between 2008 and 2012 to residents telling them whether their water had been impaired by oil and gas activities. The DEP had argued that it couldn’t provide the documents to the newspaper because it didn’t know where they were kept.

Later, the DEP told the investigative news outlet Public Herald that complaints were considered confidential because the department feared they would cause alarm. It took the outlet two years to obtain complaint documents for 17 of 40 counties in the Marcellus Shale.

In an analysis of more than 200 complaints, Public Herald identified the many ways cases were being closed prematurely or minimized. In some, the DEP claimed pre-drill tests proved that complainants’ water had been bad all along. (In fact, these tests had been done after drilling started.) In others, it diverted complaints from the Office of Oil and Gas Management to divisions within the agency such as the Environmental Cleanup Program. This kept the DEP from classifying the cases as energy-related.

Pressure from environmentalists and Auditor General DePasquale prompted the DEP to begin publishing positive determination letters — informing recipients that their water had been affected by “oil and gas activity” — online. To date, 279 such letters have been posted.

Companies deemed responsible for damaging a water supply are legally required to replace or restore it. This is easier said than done. A new well might tap into the same unclean groundwater source as the old one. Filtration systems don’t always remove every contaminant. Connecting homes to city water lines can cost tens of thousands of dollars.

Ed and Karen Atwood, who live in Warren County, in northwestern Pennsylvania, received a positive determination letter from the state more than three years ago.

In November 2012, sand started coming out of the Atwoods’ showerhead. DEP tests found high levels of iron, manganese and chlorides, all of which can be associated with oil and gas activity. In May 2013, the department ordered an oil well operator, Waste Treatment Corporation, to provide the Atwoods with a replacement water supply.

For two years afterward, the Atwoods received bottled water. They washed their clothes at laundromats and continued to bathe in their well water.

By 2014, their home was still crowded with big blue bottles, and they were eager to be connected to the nearest city water line, 830 feet away. Waste Treatment agreed to pay, on the condition that the Atwoods release the company from any past or future liability. They demurred. They sold their truck for $3,500 and convinced their bank to give them a $14,000 home-equity loan, even though their poor water quality had lowered their property value.

“Mother just took all her life savings,” Ed said of his wife. The couple still owes $1,105 on the loan and pays a monthly water bill of about $80. “We went bare-assed because of the oil people to pay for this city water,” Ed said.

Waste Treatment representative Kelly Roddy said the company does its best to limit environmental impacts. She blamed the Atwoods’ ordeal on the DEP’s “notoriously slow” process for resolving water complaints and the couple’s decision to seek legal counsel. Last year, the DEP told the Atwoods their water had returned to pre-drill quality and Waste Treatment was no longer responsible for replacing it. But they still don’t feel comfortable drinking it, and won’t recover what they’ve spent.

Down in Washington County, the Eakins stopped using their well water for showers in late 2014, a year before they learned from the Agency for Toxic Substances and Disease Registry that it contained aluminum, iron, manganese, sodium, lead and di-ethylhexyl phthalate — a man-made chemical commonly added to plastics — at levels of potential concern. The agency said residents faced a “slight increased risk of developing cancer” if they consumed the water for a lifetime.

Earlier that year, Shirley had had surgery to remove a large tumor — “the size of a lime” — from her heart. The growths on her skin had gone away while she was at the hospital.

Sitting in her living room in Rea, she cried remembering how she felt when the doctors told her she could go home. “Am I going to be going home and bathing in that water again?” she asked them. “I said, ‘I don't want to go home.’”

Jie Jenny Zou contributed to this story.

The soles of Jesse Eakin’s shoes disintegrate after a few months of walking on his lawn. He’s been told the culprit may be toluene, a volatile organic compound released into the air during natural gas production. The chemical settles onto his grass. Maryam Jameelhttps://www.publicintegrity.org/authors/maryam-jameelhttps://www.publicintegrity.org/2016/06/23/19809/it-just-ruined-everything-whole-life

Car dealer-congressman subject of ethics probe

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The House Ethics Committee has revealed it is investigating the conduct of U.S. Rep. Roger Williams, R-Texas, a Weatherford car dealer who authored an amendment that would have exempted his industry from a safety requirement and benefited his own business.

Williams’ apparent conflict of interest was first reported by the Center for Public Integrity in November and led to a formal complaint being filed by the Campaign Legal Center, a Washington, D.C. legal watchdog.

In a brief press release, the House Ethics Committee announced Monday that it had “decided to extend the matter regarding” Williams, which was “transmitted to the committee by the Office of Congressional Ethics on May 13, 2016.”

The Office of Congressional Ethics is a nonpartisan organization that vets complaints against members. The press release revealed for the first time publicly that the claims of misconduct leveled against Williams were under review by the House Ethics Committee.

The committee will announce its “course of action” on or before Aug. 11.

The amendment was proposed as part of a broader transportation bill. Offered just before midnight on Nov. 11, 2015, it would have allowed automobile dealers to rent or loan out vehicles even if they were subject to safety recalls. Rental car companies, meanwhile, wouldn’t get the same treatment. The measure passed the House of Representatives but after the Center wrote about it, the Williams proposal died in the conference process between the House and the Senate.

In the complaint, the Campaign Legal Center asked for a review and also recommended changes to clarify House rules concerning recusal and conflicts of interest by members.

The House Code of Conduct generally prohibits a member from taking an official action that may benefit his or her financial interest. Officially, a member cannot receive compensation where “the receipt of which would occur by virtue of influence improperly exerted from the position of such individual in Congress.”

The House Ethics Manual states that “whenever a Member is considering taking any such action on a matter that may affect his or her personal financial interests,” he or she should contact the House Ethics Committee for guidance.

It’s not clear whether Williams sought such guidance. Vince Zito, Williams’ spokesman, did not return a call seeking comment nor did he respond to an email asking whether Williams sought such a review.

The rental car provision in the legislation, which was also in the Senate version, was spurred by the deaths of Raechel and Jacqueline Houck, ages 24 and 20. The two sisters were killed in 2004 while driving a rented, recalled vehicle that caught fire and crashed head-on into a semi, according to consumer groups that have backed the rental car proposal.

Williams’ amendment would have made the act apply only to companies whose “primary” business is renting cars, which would effectively exclude dealerships. No such provision existed in the Senate bill.

Williams is chairman of Chrysler Dodge Jeep RAM SRT in Weatherford. In his remarks on the House floor, Williams said the bill was bad for small businesses.

“Vehicles would be grounded for weeks or months for such minor compliance matters as an airbag warning sticker that might peel off the sun visor or an incorrect phone number printed in the owner’s manual,” he said.

Democratic Rep. Lois Capps of California didn’t agree with that reasoning, however.

“This is ridiculous. NHTSA (National Highway and Traffic Safety Administration) does not issue frivolous recalls,” she said. “All safety recalls pose serious safety risks and should be fixed as soon as possible.”

Though Williams’ amendment did not make it into law, a House-Senate conference committee decided that rather than exempting auto dealers from the requirement, it would exempt rental fleets with 35 or fewer cars. That provision was included in the larger transportation bill and signed into law in December.

Williams has not responded directly to requests for comment from the Center, but issued a statement to the McClatchy news service Monday via Zito.

Williams, he said, offered the amendment “precisely because of his extensive knowledge and experience in the automotive industry and because he chose to apply some common sense to legislation that was specifically intended to regulate rental car companies.”

He continued: “Long-standing House precedents have not found that members are required to abstain themselves from legislation that affects a large class of individuals and businesses.”

A spokesman for the House Ethics Committee declined comment. Punishment for violating House rules can include a formal reprimand, censure or even expulsion. Each action would require a vote of the full House.

Rosemary Shahan, president of Consumers for Auto Reliability and Safety, a group that advocates for vehicle safety, was highly critical of Williams’ conduct. Shahan said she hopes the news of the committee’s review “sends a message that lawmakers should be representing the public and not their own personal interests."

Roger Williams, R-Texas, arriving on Capitol Hill in Washington in November 2012.John Dunbarhttps://www.publicintegrity.org/authors/john-dunbarhttps://www.publicintegrity.org/2016/06/28/19849/car-dealer-congressman-subject-ethics-probe
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