Campaign spending is flooding all levels of government in the post-Citizens-United era. What is worse than the millions flowing freely, however, is that much of this is so-called “dark money”—the sources of this spending are hidden. The public has no idea who is behind the deluge of ads that can swamp a campaign in the final weeks of an election.

The Center for Public Integrity’s latest report on independent money spent on state-level races shows that state disclosure laws are weak or nonexistent in more than half of all states. You can find out about your state by clicking here.  

Produced in collaboration with the National Institute on Money in State Politics,  we show clearly that in 30 states it is impossible to calculate how much money is being spent on campaigns by outside groups like “social welfare” nonprofits — information that is mostly available when it comes to federal contests.

And in 35 states, disclosure laws are less stringent than federal election laws, meaning shadowy nonprofit groups and big-spending super PACs are able to do business virtually undetected in many races.

This is important because a majority of states will elect their governors, legislatures and other major statewide officers in 2014. But the public will not know how much money will be spent to influence the outcome of most of those races. This 50-state analysis of state laws graded the states from A to F on disclosure requirements for super PACs, nonprofits and other outside spending groups. 

A fresh example from Montana shows how last-minute “dark money” can swing an election. We report that a candidate for the state Supreme Court was clobbered with misleading mailers and radio ads. The ads were paid for by a nonprofit group called the Montana Growth Network, a largely unknown organization. Under Montana’s laws, the group is not required to report its spending nor disclose the sources of its funds.

The U.S. Supreme Court’s Citizens United decision in 2010 added about $1 billion in spending to federal races in the 2012 election cycle and led to unlimited spending by individuals, corporations and unions.

But the decision also impacted the states. It is a near certainty that more money than ever before will be pouring into state races in 2014, but without better laws in many states, the sources of these funds will never be known.

One hundred years ago, in an article in Harper’s Weekly, U.S. Supreme Court Justice Louis Brandeis wrote that "sunlight is said to be the best of disinfectants." To paraphrase the justice, transparency and full accountability for campaign spending can be the best disinfectant for democracy, and an antidote to dark money.

Until next week,

Bill

Trevor Potter — a Republican lawyer and president of the Campaign Legal Center, which advocates for stronger campaign finance regulations — says that the Internal Revenue Service is right to be on the lookout for organizations with a “significant amount of political activity.”

“What they are trying to do is identify groups that intend to be politically active, which is the appropriate thing for them to do,” he told the Center for Public Integrity, adding an important caveat.

“It seems to me, personally, that using the name is a pretty weak indicia,” he continued.

There are about 90,000 organizations recognized by the IRS as "social welfare" nonprofits under Section 501(c)(4) of the U.S. tax code.

Most don't have politically charged names, but scores do.  

For instance, there are 20 social welfare nonprofits with the word "Democrat" in their name, according to a Center for Public Integrity review of IRS data. Meanwhile, 18 social welfare nonprofits include the word "Republican" in theirs.

Twenty-one organizations use the word "conservative," while 31 use the word "progressive."

Sixty-nine social welfare nonprofits include the word "campaign" in their names. Just three use the word "politics."

Words such as "America" and "veterans" are far more commonly used by 501(c)(4) organizations, as our word cloud illustrates.

According to a recently released inspector general report, the buzzwords “tea party,” “patriot” and “9/12” were used by IRS employees to flag potentially political cases.

Only two social welfare nonprofits with any of those buzzwords in their names reported any political spending to the Federal Election Commission, as the Center for Public Integrity today reported. One was Republican-aligned and one was Democratic-aligned.

Methodological note: This graphic was constructed based on a Center for Public Integrity analysis of organizations listed in the IRS business master file that were recognized in 2012, omitting some common, generic words such as "association," "club" and "inc."

One of the largest super PACs active in Virginia’s high-profile U.S. Senate race last year has ceased operations and transferred its leftover funds to a Georgia-based nonprofit — though what the group plans to do with the money is unclear.

Rise and Shine America, Inc., the Georgia nonprofit, is organized as a “social welfare” organization under section 501(c)(4) of the U.S. tax code. It received nearly $42,000 on April 30 from Independence Virginia PAC, according to records filed with the Federal Election Commission.

Ahead of the 2012 election, Independence Virginia PAC spent approximately $5 million attempting to boost Republican George Allen in his unsuccessful U.S. Senate bid against Democrat Tim Kaine.

Casino magnate Sheldon Adelson accounted for $4 million of the group’s $5.2 million in receipts. Adelson was the top donor to super PACs during the 2012 election cycle, when he, along with his relatives, contributed more than $93 million to GOP-aligned super PACs.

Independence Virginia PAC’s donation to Rise and Shine America was first reported by Roll Call’s Kent Cooper, who posited that the funds might be used in connection with the state's upcoming U.S. Senate election.

However, Doug Chalmers, the attorney for Rise and Shine America, Inc., told the Center for Public Integrity that the nonprofit “does not intend to be involved in the Georgia U.S. Senate race.”

“We're not sure how that story got started, but it's pure speculation and incorrect,” he wrote in an email to the Center for Public Integrity.

Chalmers declined to specify how the money would be put to use.

Incumbent Republican Sen. Saxby Chambliss announced that he will not seek re-election, sparking a flurry of interest from Georgia Republicans who are eyeing the seat including three sitting U.S. House members, Reps. Paul Broun, Phil Gingrey and Jack Kingston.

In filings with the Internal Revenue Service, Rise and Shine America describes its mission as “protecting conservative values” such as “limited government” and “fiscal responsibility.”

Harry “Chip” Lake III, a former aide to Rep. Lynn Westmoreland, R-Ga., serves as Rise and Shine America’s chief executive officer, chief financial officer and secretary, according to business records filed with the state of Georgia.

The super PAC’s five-figure donation nearly equals the nonprofit’s entire budget during its first year of existence.

Rise and Shine America, which was formed in July 2011, raised $50,000 during its first year, according to a new tax filing obtained by the Center for Public Integrity.

As of June 30, 2012, at the end of its first fiscal year, the nonprofit listed assets of $340 with liabilities of $2,000 — leaving it $1,660 in the red.

There is at least one definitive link between Rise and Shine America and Independence Virginia PAC: Republican political consultant Paul Bennecke.

Bennecke was the treasurer of the Virginia-based super PAC. He is also listed as a director of Rise and Shine America on its IRS annual report.

Bennecke, a former executive director of Georgia’s Republican Party and former political director of the Republican Governors Association, could not be reached for comment.

One of the largest super PACs active in Virginia’s high-profile U.S. Senate race last year has ceased operations and transferred its leftover funds to a Georgia-based nonprofit — though what the group plans to do with the money is unclear.

Rise and Shine America, Inc., the Georgia nonprofit, is organized as a “social welfare” organization under section 501(c)(4) of the U.S. tax code. It received nearly $42,000 on April 30 from Independence Virginia PAC, according to records filed with the Federal Election Commission.

Ahead of the 2012 election, Independence Virginia PAC spent approximately $5 million attempting to boost Republican George Allen in his unsuccessful U.S. Senate bid against Democrat Tim Kaine.

Casino magnate Sheldon Adelson accounted for $4 million of the group’s $5.2 million in receipts. Adelson was the top donor to super PACs during the 2012 election cycle, when he, along with his relatives, contributed more than $93 million to GOP-aligned super PACs.

Independence Virginia PAC’s donation to Rise and Shine America was first reported by Roll Call’s Kent Cooper, who posited that the funds might be used in connection with the state's upcoming U.S. Senate election.

However, Doug Chalmers, the attorney for Rise and Shine America, Inc., told the Center for Public Integrity that the nonprofit “does not intend to be involved in the Georgia U.S. Senate race.”

“We're not sure how that story got started, but it's pure speculation and incorrect,” he wrote in an email to the Center for Public Integrity.

Chalmers declined to specify how the money would be put to use.

Incumbent Republican Sen. Saxby Chambliss announced that he will not seek re-election, sparking a flurry of interest from Georgia Republicans who are eyeing the seat including three sitting U.S. House members, Reps. Paul Broun, Phil Gingrey and Jack Kingston.

In filings with the Internal Revenue Service, Rise and Shine America describes its mission as “protecting conservative values” such as “limited government” and “fiscal responsibility.”

Harry “Chip” Lake III, a former aide to Rep. Lynn Westmoreland, R-Ga., serves as Rise and Shine America’s chief executive officer, chief financial officer and secretary, according to business records filed with the state of Georgia.

The super PAC’s five-figure donation nearly equals the nonprofit’s entire budget during its first year of existence.

Rise and Shine America, which was formed in July 2011, raised $50,000 during its first year, according to a new tax filing obtained by the Center for Public Integrity.

As of June 30, 2012, at the end of its first fiscal year, the nonprofit listed assets of $340 with liabilities of $2,000 — leaving it $1,660 in the red.

There is at least one definitive link between Rise and Shine America and Independence Virginia PAC: Republican political consultant Paul Bennecke.

Bennecke was the treasurer of the Virginia-based super PAC. He is also listed as a director of Rise and Shine America on its IRS annual report.

Bennecke, a former executive director of Georgia’s Republican Party and former political director of the Republican Governors Association, could not be reached for comment.

I was not among those who believed the Supreme Court’s Citizens United decision would open the floodgates of corporate money to influence elections and public policy. While the decision enables corporations to call for the election or defeat of federal candidates, those expenditures have to be reported and few corporations will take the risk of losing customers by getting involved in politics so publicly.

The reality is, the floodgates have been open for years, and the attention focused on Citizens United has actually been helpful to corporations, because it has diverted the public’s attention away from the deceptive yet perfectly legal ways corporations are able to deploy enormous sums of money to advance their political agendas.

The mainstream media, meanwhile, seems to willfully ignore what corporations and other moneyed interests do to get what they want in Washington. That was certainly the case last week after National Journal reporter Chris Frates disclosed how America’s Health Insurance Plans, the insurance industry biggest PR and lobbying group, funneled hundreds of thousands of dollars to a longtime ally with a better reputation to pay for an industry-serving communications campaign. The only media outlets I could find that picked up the story were The Huffington Post, Bloomberg Businessweek and ABC News online.

As Frates’ investigation uncovered, AHIP in 2011 gave the National Federation of Independent Business $850,000 to finance an effort to persuade Congress to repeal a provision of Obamacare that will actually help many uninsured people afford coverage. NFIB is a nonprofit that calls itself the voice of small business but which I know from my days in the insurance industry has often been a voice for my former bosses.

Insurers are delighted that Obamacare will require most Americans to buy coverage from them beginning January 1. That was one of their health care reform goals, along with making sure reform did not include the creation of a public option to compete with private companies. And insurers love the fact that the federal government will be sending them billions of dollars every year to help subsidize the coverage of low-income Americans who would otherwise be unable to afford their premiums.

Knowing that insurers would be getting a windfall in new revenue from all of that, drafters of the Affordable Care Act included a provision that would impose a tax on some policies insurers sell to help finance the expanded coverage that insurers will benefit from. Sounds reasonable, right?

Well, not if you are the CEO of a health insurance company who cares more about meeting Wall Street’s profit expectation than the health care needs of Americans.

But even health insurance executives know they’re not viewed as positively as small business owners. If AHIP spent that $850,000 in a way that could easily be traced to the insurance industry, the campaign to get the tax repealed would be considered — rightly — as self-serving. So AHIP needed a trusted partner with a better reputation to try to get the job done, and the NFIB was more than willing to sign on and take the money.

Exactly how the NFIB spent insurers’ money will likely never be known, but there is a good chance most of it went to set up and finance the operations of an outfit called the Stop the HIT Coalition. (HIT stands for Health Insurance Tax.) That’s the group that is fronting for the industry to get the tax repealed.

The NFIB, one of the organzations that challenged the constitutionality of the Affordable Care Act, undoubtedly was willing to partner with AHIP because insurers say they will pass the tax along to their small business customers instead of absorbing it as a cost of doing business or as goodwill from getting the additional business guaranteed by Obamacare. Rather than push back against the insurers, the NFIB clearly saw this as a new reason to attack and weaken the law.

Frates discovered this back channeling of money by looking at tax returns filed by both AHIP and the NFIB. It turns out the $850,000 from AHIP was the second largest contribution the NFIB received in 2011. To put that into context, the NFIB offers small business memberships for $180, so AHIP’s money (which comes from premiums insurers charge their customers), was equivalent to 4,722 small business memberships.

Other than the reporters at the Center for Public Integrity, Frates — who last year broke the story that AHIP funneled more than $100 million to the U.S. Chamber of Commerce in 2009 and 2010 to pay for an anti-reform advertising campaign — is one of the few Washington reporters investigating how corporations and trade associations hide the money they spend to influence Congress. As a result of this lack of media interest, Americans remain in the dark about how big special interests are able to control what happens in the nation’s capital. And Citizens United has nothing to do with it.

During its past four fiscal years, the Internal Revenue Service has formally denied the applications of just 60 organizations seeking recognition under Section 501(c)(4) of the U.S. tax code as “social welfare” groups.

In the same period, the agency processed 8,214 applications and approved 6,837 of them — about 83 percent, according to a Center for Public Integrity analysis of IRS data.

Sometimes applications were neither approved nor denied, meaning groups could still be awaiting recognition of tax-exempt status or still be providing the IRS with additional information. They may also have withdrawn their applications.

The IRS's approval processes have come under fire following an inspector general report that found IRS employees used “inappropriate criteria” to discern which organizations’ applications warranted additional scrutiny.

The IRS’s 2012 fiscal year, which covered the period between Oct. 1, 2011, and Sept. 30, 2012, saw a surge of new applications under Section 501(c)(4). During that period, 2,774 groups sought recognition as “social welfare” nonprofits, as the Center for Public Integrity has previously reported.

That represented an increase of more than 56 percent from fiscal year 2011 — and an increase of nearly 86 percent from fiscal year 2008.

The IRS processed 23,722 applications for 501(c)(4) nonprofit status between fiscal years 2001 and 2012, records indicate.

The agency approved roughly 77 percent of those, while rejecting less than three-tenths of one percent: 66 denials versus 18,214 approvals, albeit in fiscal year 2008 the IRS did not report how many groups it denied “to avoid disclosure of specific taxpayer data.”

Before the House Ways and Means Committee on Friday, Steven Miller, who served as the agency’s commissioner until he resigned last week, testified that IRS did not have “sufficient personnel” to process all of the applications its tax-exempt unit has received.

Both the Senate Finance Committee and the House Oversight and Government Reform Committee are planning hearings on the topic this week.

BATON ROUGE, La. — Shirley Bowman noticed the smell after 8 a.m. on June 14, 2012, her 61st birthday. In Baton Rouge, where the petrochemical industry dominates the landscape, foul odors resembling burnt rubber or propane are perennial. But this odor, caustic and potent, seemed especially foul — “like some sort of chemical,” she recalls.

Bowman found her daughter crying over a migraine. Her neighbors experienced headaches, dizziness, nausea. One family reported a toddler son coughing up phlegm; another, an elderly father collapsing on the floor. She soon suspected the cause: A leak of “steam-cracked” naphtha, a liquid mixture of volatile petrochemicals, occurring at the ExxonMobil Baton Rouge petrochemical complex a half mile away.

Four hours earlier, Exxon operators detected an odor in the East area tank field, and discovered a “bleeder” valve on Tank 801 dripping naphtha into a sewer. The leaky valve dumped 411 barrels into the underground system, company records filed with the state show. The liquid traveled a mile before pouring into a separator pit, vaporizing along the way, and releasing tens of thousands of pounds of benzene and other toxic chemicals into the air.

What happened that day in Baton Rouge is one thread of a larger story about the often toxic, sometimes hidden releases emanating from oil refineries, chemical plants and other industrial facilities along the chemical corridor of Louisiana and Texas. Those unplanned emissions — known in regulatory parlance as “upsets” — are occurring more often than industry admits or government knows, according to more than 50 interviews with regulators, activists, plant representatives, workers and residents, and an analysis of tens of thousands of records by the Center for Public Integrity.

For many communities, these upsets have evolved into an invisible menace: They disrupt lives, yet offenders are rarely punished. In Texas, where activists have clamored for relief, state officials say enforcement efforts helped reduce incidents by 6 percent in the most recent year of reporting; Louisiana officials cite a 41 percent decrease since 2008.

Yet those numbers tell only part of the story. The mass of pollution emitted in Texas, the nation’s refinery hub, hit a five-year peak in 2011, the Center found — so even as the number of reported events dipped, the amount of pollution increased. And, experts say upset releases are consistently underreported. For communities straddling industry fence lines, worry and fear remain in the air.

This hidden pollution can produce harm. Over the last five years, records show, upset events have yielded almost four million pounds of toxic air pollutants in Texas alone — the 189 chemicals deemed so harmful to health Congress sought to bring emissions under control two decades ago. That’s two percent of all upset emissions.

“These are a major public health threat,” acknowledges Larry Soward, a former commissioner at the Texas Commission on Environmental Quality, who served on its board from 2003 to 2009.

“Upsets” occur when equipment breaks down or production units are shut off, restarted and repaired; or, as regulations state, when there’s an “unavoidable” accident.

Under law, plant managers must notify officials when accidental releases exceed certain hazardous air thresholds. In Baton Rouge, Exxon did this. Yet its numbers kept escalating.

At 5:10 a.m. that day, Exxon supervisors told the state the benzene leak would likely exceed the 10 pound reportable quantity. Within hours, they classified it “level 2,” barricading areas and monitoring the air. According to a call log, company officials found benzene levels “so high” bordering a rail yard, they advised the railroad “not to let anyone go through that area.” By 12:30 p.m., the company was testing 400 workers for exposure to the cancer-causing chemical.

The following day, Exxon reported that benzene emissions totaled 1,364 pounds during the leak’s first three hours. By June 20, it increased the number to 28,688 pounds. In its final report filed 60 days later, Exxon revealed the benzene total was actually 31,022 pounds — nearly four times what the refinery released in upset events in eight years, according to company reports compiled by the nonprofit Louisiana Bucket Brigade. State regulators later deemed the leak “preventable,” issuing an enforcement order contending that Exxon “failed to provide notification of a change in the nature and rate of the discharge.”

Exxon doesn’t dispute the leak was preventable. But the company, saying it accurately reported the release, is appealing the state’s order. While plant supervisors acknowledge the “large” leak, they say it didn’t threaten residents. Tests along the fence line showed “no community impact,” their records state; air sampling by regulators back up the company.

“It was a large number. We regret that number,” says Derek Reese, Exxon Baton Rouge’s environmental manager. “But we believe we did an appropriate response to mitigate the impact.”

That’s little consolation to residents, like Bowman. “Everything seems to stop at that magical gate,” she says, motioning to Exxon’s South Gate adjoining her neighborhood. “But if you live here, you know. Chemicals are let out on you.”

Upsets plague plant, community — time and again

Last spring’s valve leak has played out again and again at the sprawling, 2,400-acre ExxonMobil Baton Rouge complex, which encompasses an oil refinery and a chemical plant, and dwarfs the Standard Heights community. The leak marks the 1,068^th upset emissions event at the compound in the last eight years, according to a database of incident reports compiled by the Bucket Brigade. Of these events, 172 involved benzene, a carcinogen that can trigger headaches, dizziness and rapid heart rate.

Exxon’s chemical plant had 265 of all incidents. At the refinery, the data show 803 accidental releases over these years; at its height, the facility averaged two a week.

ExxonMobil Baton Rouge questions the Bucket Brigade’s analysis, calling it “likely another misrepresentation of data.” In an email, the company criticizes the environmental group’s methodology and findings, contending that incident numbers published by the group don’t match the reports catalogued by the state.

The Bucket Brigade stands by its analysis, and explains that Louisiana doesn’t have a standardized system for companies to report upset events. Instead, reports are filed on a rolling basis and then posted online.

The steady hazards extend far beyond Baton Rouge. In the Gulf states of Texas and Louisiana, the vast number of plastics, power and gas plants provide an on-the-ground case study of a national problem.

“Non-routine” upset emissions have become regular occurrences at oil refineries, chemical plants and manufacturing facilities.

Data collected by the Texas Commission on Environmental Quality, TCEQ, offer a rare window into this pollution peril; the state agency requires companies to report events online within 24 hours, as well as annual totals.

From 2007-11, just over 2,400 of the largest facilities across Texas spewed almost 180 million pounds of upset emissions, contamination on top of the 14.8 billion pounds of routine air emissions in that time. Nearly half the facilities experienced at least one event in that period, pumping out sulfur dioxide and other smog-inducing pollutants. The greatest concentration came in 2011: 58.1 million pounds.

The 20 biggest offenders — oil refineries and natural-gas plants in Kermit, Beaumont, Corpus Christi and beyond — account for more than half of all such emissions in Texas.

“It’s a lot of stuff,” says Neil Carman, a former state air pollution inspector who investigated upset events.

Carman now heads the air program for the Sierra Club’s Lone Star chapter, which has filed several citizen lawsuits targeting illegal emissions. Two facilities the Club sued rank among the state’s top emitters: ExxonMobil, whose petrochemical complex in Baytown has released 5.1 million pounds of upsets in the five years; and Shell Oil, whose Deer Park plant has emitted 2.5 million.

Studies have also explored this problem, documenting how the releases sometimes occur every day or two, and for largely avoidable reasons: Equipment breakdowns and poor maintenance, for instance. One researcher, Texas A&M University’s Melissa Jarrell, says they “are happening so frequently, it’s more likely companies know about the problems and know what to do to stop upsets.”

Industry portrays the discharges as an inevitable — and overwhelmingly harmless — byproduct of manufacturing. Regulators have encouraged this casual attitude, some say.

For decades, the U.S. Environmental Protection Agency and state regulatory agencies have effectively ignored the emissions. Officials don’t count upset events in facility permits and compliance records, notes Kelly Haragan of the environmental law clinic at the University of Texas-Austin, because they “aren’t supposed to happen.” In August 2004, Haragan penned a 215-page report showing how easily facilities can get away with releasing more pollution than allowed by the federal Clean Air Act — with little to no repercussions.

At times, she says, “It’s like having a whole other plant no one is even acknowledging.”

These incidents skirt normal pollution controls, venting through flares and leaks. Plants can have scores of events a year, giving off a constant cloud of invisible spoliation.

“A big dose of toxins are coming out of these facilities,” says Soward, the former TCEQ official, who now works for Air Alliance Houston, “and into fence line communities.”

The health effects are harder to measure; little research exists on the threat to residents. But recently, Dr. Mark D’Andrea, at the University of Texas Cancer Center, began tracking 4,000 residents exposed to the poster child of all upsets — the “40-day Release” at the BP refinery, in Texas City, which belched 514,795 pounds of benzene and 20 other pollutants throughout the spring of 2010. Earlier this year, D’Andrea unveiled preliminary data showing the residents have “significantly higher” white-blood cell and platelet counts than their Houston counterparts. The data suggests BP’s release may have increased their risk of developing such cancers as leukemia, the doctor says.

In a statement, BP says it does “not believe any negative health impacts resulted from” its 40-day release. “To our knowledge, the University Cancer Centers’ pilot study does not support a claim for any plaintiff alleging injury from that flaring and has no relevance to those claims,” the company wrote, referring to pending litigation filed by 47,830 residents and workers against BP alleging health ailments caused by the release. D’Andrea has not been hired as an expert witness for either side in the case, but has testified in pre-trial discovery.

‘An Invisible Poison’

In Baytown, Texas, about 250 miles from Baton Rouge, ExxonMobil operates the nation’s largest petrochemical complex, replete with an oil refinery and two chemical plants. The mass of stacks, tanks and pipes spans 3,400 acres on Houston’s ship channel, looming over blue-collar neighborhoods nestled in its shadow. In Harris County, a manufacturer’s Mecca, Exxon’s refinery tops all 155 upset emitters, spitting out 3.8 million pounds’ worth from 2007 to 2011. Its olefins plant ranks third in the county, with 1.1 million.

Here, residents describe fiery flares that have rattled windows, belched black smoke and cast a sooty substance on the ground. At times, they’ve unleashed a thunderous boom, “like an Air Force fighter jet,” says Shae Cotter, who lived across a highway from the complex. He remembers the sound jolting him from sleep at 3 a.m. Occasionally, he videotaped flares aglow like celestial globes, flames ballooning toward his home.

Residents say smells drive them inside. Stuart Halpryn, whose house sits a quarter mile from Exxon, says he tried to adapt to the odors, along with the runny noses and allergy-like symptoms. That changed in February 2009, he says, when his family became sick after a valve leak at the refinery. His four children suffered from such severe indigestion, he says, they missed school for a week. Later, he learned from reading Exxon’s report the leak had unleashed 17,432 pounds of six different toxic chemicals.

“Nobody really understands what’s being dumped on them,” says Halpryn, who moved his family to Kentucky in June. “It’s an invisible kind of poison that’s being rained down.”

The Exxon complex ranks among the state’s biggest emitters of upset emissions involving carcinogens and noxious gases. Top chemicals include hydrochloric acid, 1,3-butadiene and benzene, toxins that can trigger skin irritations, respiratory problems, neurological disorders and gastro-intestinal diseases.

Baytown residents Cotter and Halpryn, worried over Exxon’s emissions, are witnesses in a citizen lawsuit against the company in the U.S. District Court in Houston.

The Sierra Club, along with Environment Texas, filed suit in December 2010, charging that non-routine incidents at the Baytown complex since 2005 have heaved more than eight million pounds of “unauthorized emissions.” The complaint alleges “longstanding systemic problems,” and company records revealed in court show some facility units have encountered dozens of upset events: The refinery’s Fluid Catalytic Cracker Unit 3 raked up 34 incidents from 2005 to 2011; at the olefins plant, the Cold Ends Unit has had 32.

In a statement, ExxonMobil Baytown says it has worked with regulators to “greatly” reduce emissions. “We are proud of the overall reductions we have made,” the company wrote. Since 2000, Exxon notes, it has decreased total emissions at the Baytown complex by more than 50 percent. The company declined to provide similar statistics for the facility’s upset emissions. “ExxonMobil is committed to continuously improving the environmental performance of our Baytown Complex,” the company said.

In court records, Exxon doesn’t deny the 9,374 violations alleged by plaintiffs for “unlawful upset emissions”; they’re based on its reports cataloged with the state.

In August, the company filed a motion to dismiss the suit, contending, among other issues, that environmental groups aim to “second-guess” enforcement practices by the TCEQ. On April 3, a federal magistrate denied most of Exxon’s motion, paving the way for a possible trial.

For residents, the court proceedings might not come soon enough. Since December, the Baytown facility has set off a wave of upset emissions. One, triggered by a tripped compressor in the refinery’s Booster Station Four, pumped out 114,000 pounds of sulfur dioxide in 18 hours. It was the 20^th upset recorded there by company reports.

“Exxon is emitting all of these day after day,” says Marilyn Kingman, a long-time resident. “Anybody who lives in the Baytown area is suffering.”

Infrequent monitoring, incomplete data

The threat to fence line communities may be even greater than industry self-reports — and official data — suggest. One reason is that companies rely on infrequent air monitoring to estimate chemical emissions, including upsets. When monitors do measure toxic air pollution, they can miss the short spikes characterizing upset events. “Part of the problem with upsets,” says Jarrell, of Texas A&M University, “is you’re not getting a lot of true data.”

Companies can misstate the magnitude of events through faulty calculations, environmental advocates argue. Formulas used to estimate what’s spewed from tanks and flares are so antiquated — 19 and 20 years old, respectively — they “do an extremely poor job of predicting emissions,” says Eric Schaeffer, director of the Environmental Integrity Project. Attorneys from his nonprofit are suing the EPA to force it to update these “emissions factors.” Recent studies have shown discrepancies between what’s reported and what’s emitted.

Take the 40-day release at BP’s Texas City refinery. Plant supervisors assumed one flare had destroyed nearly 98 percent of the emissions, a regulatory requirement. Three years earlier, however, regulators concluded that, in some cases, actual emissions were six times greater than what the company reported. BP maintained it has “multiple bases for concluding that the flared hydrogen stream was well combusted.”

Others aren’t so sure.

“It’s a typical example of what goes on in these situations,” says Jim Tarr, a former Texas air regulator who serves as a consulting expert in pending lawsuits against BP over its 40-day release. “Not all companies do it this way,” he says, referring to the flaring forecast, “but a lot do.”

If the calculations seem questionable, critics say, so do all those upsets that don’t count. Company reports don’t account for unpermitted releases falling beneath the thresholds for reporting requirements — up to 5,000 pounds for some pollutants. Plant supervisors must keep records detailing the events and include their emissions in annual totals, but not in incident reports. Considered “below reportable quantity,” they essentially never happened.

“That’s the bigger story on upsets,” asserts Jay DeLouche, a Lake Charles lawyer who has sued facilities over the emissions. Some managers “just determine [an upset] is below reportable quantity … and say, ‘Nothing happened, it’s a non-event.’ ”

“Non-events” can translate into big numbers. Company records revealed in court in the ExxonMobil Baytown case show thousands more “non-reportable” emissions events than the “reportable” ones filed online with TCEQ. Filling 235 pages’ worth of documentation, the 2,158 non-events outnumber the 333 reportable events by more than six to one. In Baton Rouge, Exxon’s refinery has boasted a similarly high ratio of non-events; according to the latest data compiled by the Louisiana Bucket Brigade, the company has designated 70 percent of refinery incidents “below reportable quantity” in 2011, up from roughly 10 percent in 2005.

“We believe the refineries under-report,” says the Bucket Brigade’s Anne Rolfes.

Exxon says it “is very diligent in its reporting of incidents, no matter how small.” Plant supervisors must notify authorities of events within an hour of discovery, even if the amount is unknown, the company notes; often, they must report back to regulators that “the quantity is less than initially thought.”

Over the last five years, the company says it has reduced incidents exceeding the reportable quantity at the Baton Rouge refinery by 86 percent, and at the chemical plant by 47 percent. “We take every environmental incident seriously,” Exxon wrote. “We have a passion to reduce incidents and releases.”

Some residents and workers wonder whether ExxonMobil disclosed the massive amount of benzene released last June because regulators had swooped in to investigate. “If they could have hid it, they would have hid it,” contends Bob Landry, of the United Steel Workers Local 13-12.

The Louisiana Department of Environmental Quality is exploring that question.

In their 206-page report in 2012, LDEQ inspectors determined that Exxon supervisors failed to notify the agency once they knew a “substantial amount” of benzene was emitted. An Exxon Baton Rouge environmental manager informed inspectors the company had become aware of the leak’s extent at 12:30 p.m. that first day — just seven hours after notifying the state — when its engineers calculated the vapor loss. Exxon disclosed the calculations six days later.

The agency “believes Exxon knew more about the leak than it shared with us,” says Cheryl Nolan, LDEQ’s enforcement chief. She declined to elaborate, citing the company’s appeal.

Exxon supervisors insist they intended to notify regulators of the growing leak. “As the data came in we shared those concentrations with” the LDEQ, says environmental manager Reese, noting that his calculations kept changing as workers collected the naphtha and tested the air. “We want to be open and honest.”

The Trouble in Shreveport

Upstate in Shreveport, residents have for years complained of the Calumet Specialty Products oil refinery’s upsets, which have shattered windows and shaken foundations. Regulators wouldn’t necessarily know about the drama from company reports. The refinery has filed just 83 incident reports with the LDEQ from 2005 to mid-2011, among the lowest numbers in the state, the Bucket Brigade’s data shows.

Tired of the pervasive “rotten-egg” stench, residents have kept event logs and taken samples with specially equipped buckets, exposing unsafe levels of hydrogen sulfide. The gas causes headaches, eye irritations and sore throats. “It’s a battle every day,” confides Velma White, of the Residents for Air Neutralization, “and I’m tired.”

In August 2011, after a push by RAN and the Bucket Brigade, EPA inspected the refinery, uncovering a series of plant failures. The agency also found a litany of reporting problems. Calumet managers notified the EPA of six incidents in five years, yet their internal files documented nearly 600 — 100 times as many — a 2011 EPA document shows. Inspectors audited 161 records, finding most lacked the basic required information. Some offered no details.

Calumet’s plant manager, Tom Germany, didn’t respond to emails and calls seeking comment, and neither did other facility representatives. According to the EPA’s inspection report, Germany told regulators that “he knows what good looks like and recognizes that Calumet is not there yet.”

In the ensuing 18 months, Calumet managers have filed 19 reports of “unauthorized discharges” with the state, nearly one a month. “You’d have thought they’d be more cautious” since the EPA visit, says RAN’s White. “But they’re still piling it on us.”

Sometimes, the government stick is more tepid than expected. More than a year and a half after the EPA’s damning report in Shreveport, regulators have yet to issue violations. Advocate White says she met with EPA officials and Calumet supervisors as part of negotiations in a civil enforcement action — relaying community demands for anti-pollution projects including a medical mobile unit. While EPA officials told her to expect a “large” fine, she says past settlements with Calumet, including a $1 million fine levied by state regulators in 2010, have meant little in real terms.

“It didn’t solve the problem,” White says. “You send DEQ and EPA to Calumet, and they come out with roses.”

Some former regulators view such fines as “ineffective.” As TCEQ commissioner, Soward tried to change the way the agency determines financial penalties, to no avail. Today, he says, upset events aren’t treated “any differently than a common violation,” rendering fines so paltry companies have no incentive to stop.

Citizen suits, whistleblowers expose truths

The citizen suits in Texas may reveal deeper truths than regulators have found. In 2008, environmental groups sued Shell over recurring emissions at its Deer Park facility, which ranked among the state’s top 20 upset emitters at the time. By 2010, Shell had settled the case, agreeing to pay a $5.8 million penalty for its violations, a record in any Texas citizen suit, and to annually reduce the plant’s upsets in volume and number. Since then, Shell has cut upset emissions by 35 percent, court records show.

“That proves it right there,” says Karla Lande, who lives across a river from Shell Deer Park, and attributes her lost sense of smell partly to its upsets. When companies are forced to ease upsets, she adds, “They’re able to do it.”

In Baton Rouge, it took an ExxonMobil worker to shine a light.

The first day of the valve leak, Bucket Brigade advocate Anna Hrybyk remembers giving two EPA officials a “toxic tour” of Standard Heights and noticing a “rancid smell.” She got a headache; the officials, she recalls, “were like, ‘Quick, get in the car, roll up the windows.’ ” On June 15, Hrybyk asked regulators about the incident, and received an email assuring her the initial “estimated quantity was 10 lbs.”

The next day, a whistleblower worker tipped off Hrybyk to a different scenario. More than 48 hours into the incident, company records show, refinery employees were still collecting naphtha from the sewer, trying to suppress benzene vapors. Hrybyk dialed the state’s hotline, setting off a series of regulatory activities that would end in the LDEQ’s enforcement order. The July 2012 notice of violation says Exxon, among other things, was “emitting pollutants not authorized by a permit.” The action, pending the company’s legal challenge, could result in penalties.

Critics believe regulators never would have brought down the hammer without outside pressure. Nolan, the LDEQ enforcement chief, acknowledges that agency officials “didn’t act until we got a complaint,” but stresses that the enforcement order proves “we do act when a company has unauthorized releases.”

For residents, it all seems like more of the same. In the aftermath of the leak, Bowman displayed posters in her yard declaring, “ENOUGH IS ENOUGH,” helped form the Standard Heights Community Association, and traveled to the nation’s capital to lobby.

As the months have passed, feelings of helplessness have surfaced. She has noticed other pungent odors pervading her neighborhood. The Bucket Brigade’s latest data show 13 incidents at Exxon’s Baton Rouge complex since last June’s release, emitting more than 62,000 pounds of hydrochloric acid in one upset last November alone.

“I live up in fear here,” Bowman says. “I’m just sitting here, waiting to get poisoned.”

David Donald contributed to this report.

Nothing in the law allows for the invisible danger from “upset” emissions to persist, but legislation and reality often collide.

On the contrary, the federal Clean Air Act was meant to reduce harmful emissions by requiring continuous pollution limits for industrial facilities. But since its passage in 1970, state and federal regulators have created loopholes involving accidental releases — loopholes that have for years been challenged, re-written and bogged down in bureaucracy.

Nearly from the start, regulators began waiving pollution standards when equipment unexpectedly malfunctioned and had to be shut down, started up and maintained.

By 2004, 29 states had devised what University of Texas-Austin researcher Kelly Haragan calls “a flat-out exemption” for such emissions. The Environmental Protection Agency offered similar immunity for those involving hazardous air pollutants.

“There is a big caveat here,” acknowledges Adam Kushner, who headed the EPA’s air enforcement unit until last year. “They didn’t necessarily count against your compliance picture.”

This murkiness began fading after environmental groups sued the EPA in 2003, alleging its exemption violated clean-air laws. By December 2008, a federal court agreed, vacating the language. The agency has lagged at fully closing its loophole; earlier this year, it unveiled a proposed rule that would require facilities in any state to follow pollution limits during periods of start-up, shut down and maintenance.

At the state level, regulators have begun replacing blanket exemptions with rules that, critics say, aren’t much firmer. In Louisiana and Texas, plant managers can claim unauthorized releases are “upsets” as a defense to enforcement.

“When regulators get one of those reports, they don’t even think about it any further,” says Adam Babich, of the environmental-law clinic at Tulane University, who has sued a half dozen plants. “It’s like, ‘Look, here’s another incident report. Let’s file it away.’ ”

Frequently, state regulators — the primary enforcers of the Clean Air Act — fail to investigate the thousands of reports of emissions events they receive, let alone issue enforcement orders. When regulators do act, punishment can amount to a slap on the wrist. Less than one percent of the 7,533 upset reports filed by Texas companies in 2004 had ended in penalties or corrective plans, a 2005 study by the nonprofit Public Citizen found.

Little has changed, enforcement data collected by the Texas Commission on Environmental Quality suggests: Throughout fiscal year 2011, agency officials investigated 36 percent of emissions events. About 3 percent of the reports led to enforcement notices yielding fines or corrective action.

Regulators bristle at the notion they’re ignoring this fence line pollution. To some extent, they say, they must expect that industrial facilities — many complicated amalgamations of countless pieces of equipment — will have unexpected releases. Simply put, says Tim Knight, an environmental-compliance administrator at the Louisiana Department of Environmental Quality, “Industry will have problems.”

Earlier this year, the LDEQ launched a voluntary workgroup with ExxonMobil Baton Rouge and 39 other petrochemical facilities to identify common causes of upsets. The TCEQ has paid particular attention to emissions events over the past decade, requiring that companies report online and revamping permitting policies.

Larry Soward, a former TCEQ commissioner, believes such scrutiny has had an effect; indeed, upset events in Texas declined from 4,766 reported incidents in fiscal year 2010 to 4,469 a year later.

EPA officials, too, portray emissions as a “high priority.” Officials at the agency’s regional office encompassing Texas and Louisiana launched a program in 2011 inviting the area’s top 17 emitters to the table.

Program directors asked companies to analyze their own records of upsets. Under current voluntary-compliance guidelines, companies wouldn’t begin to “benchmark” the emissions and thus document reductions until 2014. So far, no company has agreed to participate.

“We have found that using multiple approaches to try and solve this problem has worked best,” says Sam Coleman, EPA’s deputy regional administrator, noting that a similar initiative in 1999 “consistently” reduced upsets for several years. “The voluntary approach is simply one tool in the toolbox.”

Advocates remind federal regulators problems continue.

Eric Schaeffer, director of the Environmental Integrity Project and a former EPA enforcement chief, has sent letter after letter to Texas and EPA officials, flagging “egregious upset releases” and urging them to pursue the worst offenders. On April 23, he asked the EPA’s inspector general to examine how regulators responded to repeated upsets by the biggest Texas emitters. In Louisiana, Bucket Brigade advocates have turned toward a little-known EPA program that inspects facilities for the risk of “unanticipated” releases.

After a flurry of lobbying activity by the group highlighting a benzene leak at ExxonMobil Baton Rouge, EPA inspectors showed up at the company’s refinery for four days last July. Inspectors outlined a host of concerns, including pervasive “piping, valve, and vessel corrosion,” a November report shows. Exxon supervisors also failed to “correct deficiencies” in processing equipment; to assure that equipment was installed correctly; and to inspect underground piping.

Exxon says it has reviewed the EPA report and is sharing information that “we believe may clarify many of the areas of concern.” The company stresses the report doesn’t constitute a notice of violation.

EPA officials declined to elaborate. Coleman says, “It’s not appropriate for me to say whether there will be violations or what the outcome will be.”

WASHINGTON -- The U.S. House of Representatives on Monday overwhelmingly approved legislation to ensure the United States complies with two broadly supported international nuclear security accords, but a key Senate opponent on Tuesday affirmed his lingering opposition.

The 390-3 vote marked the chamber's second endorsement of measures needed to comply with the treaties and two separate maritime security agreements. The two nuclear pacts, which address nuclear terrorism law and domestic nuclear material security, are themselves relatively noncontroversial; the Senate issued resolutions of advice and consent for them in 2008. House lawmakers, though, took nearly four years to break a stalemate over measures included in the legislation that could extend wiretapping authorities and apply the death penalty in nuclear terrorism cases.

The House first passed the legislation last summer without those elements, but, Senate Judiciary Committee Ranking Member Charles Grassley (R-Iowa) said he wanted them included, and an anonymous hold prevented a Senate vote. Grassley would be willing to consider it on the Senate floor this year with a separate vote on the death penalty provision, Grassley spokeswoman Beth Levine said. Senate Democrats last year prevented passage of a draft containing revisions sought by Grassley.

As with four prior drafts, the newest bill would complete U.S. ratification of the International Convention for the Suppression of Acts of Nuclear Terrorism. The pact, which entered into force in 2007 and now has 86 states parties, requires member nations to criminalize possession and use of nuclear and radiological weapons by individuals. It establishes guidelines for cooperating in the extradition and prosecution of individuals linked to a nuclear plot or threat.

The bill would also bring the United States into line with a 2005 amendment to the Convention on the Physical Protection of Nuclear Material. The amendment updates the 1980s-era pact, which governs international shipments of civilian nuclear material, by including standards for securing nonmilitary atomic substances held, used or transferred within a single nation’s borders.

Sixty-seven governments had fully adopted the amendment as of last month. To take effect, the measure must receive backing from two-thirds of the full treaty's signatories. The original convention now has 148 members, placing the amendment's implementation threshold at 99 states.

"Many other countries have indicated that they are waiting for the United States to complete ratification before moving ahead with their own ratification processes, since it was the United States that pushed for the amendment in the first place,” Kingston Reif, nuclear nonproliferation director at the Center for Arms Control and Nonproliferation, said in comments released by the Fissile Materials Working Group. Responding to one of Grassley's key objections to the House-approved language, Reif and another expert argued last week that existing law already allows for the execution of convicted nuclear terrorists.

"In the wake of the Boston attacks, it seems clear that an attack involving radiological or nuclear material would allow prosecutors plenty of latitude to seek the death penalty,” Reif and Miles Pomper, a senior research associate at the James Martin Center for Nonproliferation Studies, wrote in a World Politics Review column last Friday.

Story by Diane Barnes​, courtesy of Global Security Newswire.

ICIJ’s investigative series on offshore secrecy – which draws from a cache of 2.5 million secret records – has ignited reactions around the globe.

Since the initial release of stories by the ICIJ and its media partners across the world, public officials have issued statements, governments have launched investigations, and politicians and journalists have been debating the implications of the records and the reporting.

Among the latest reactions and responses:

• European Council President Herman Van Rompuy says there has been a "real breakthrough" in the EU's efforts to combat offshore tax evasion.At the council's May 22 meeting, Reuters reports, Rompuy said the current aggressiveness of the EU's push is "unprecedented. We couldn't speak in those terms on those issues, let's say, a month or two months ago. . . . There is a strong political will by the leaders, not only the Europeans but also on a global level, to go forward in attacking tax fraud and tax evasion."
   
• The Luxembourg finance ministry announced they would automatically exchange information with United States tax authorities about the bank accounts held by U.S. citizens and residents. The tiny nation, one of the biggest financial centers in Europe, announced in April they would "follow a global movement" and end decades of banking secrecy in regards to EU citizens. The move came on the eve of European leaders meeting to discuss sharing more data on citizens who park wealth across borders, in an effort to limit tax evasion.
   
• The Council of the European Union issued a statement May 14 calling for efforts at the national, EU and international levels “to combat tax fraud and tax evasion” and “aggressive tax planning.” The statement noted that the council’s presidency plans to ask ICIJ to supply EU member states “with the names and details regarding all EU citizens on the ‘offshore leaks’ list.” ICIJ has said that it will not turn over the data to government agencies, but that it is exploring the possibility of publicly releasing some entity ownership data.
   
• After meeting with President Barack Obama at the White House, British Prime Minister David Cameron made a strong call to tackle what he called “the scourge of tax evasion,”one of the key topics in next month’s G8 meeting in Ireland. “We need to know who really owns a company, who profits from it, whether taxes are paid.  And we need a new mechanism to track where multinationals make their money and where they pay their taxes so we can stop those that are manipulating the system unfairly,” Cameron said.
   
• British, U.S. and Australian tax authorities announced that they are pursuing tax evasion investigations based on a cache of offshore documents that link to the Cook Islands, Singapore and the Cayman Islands, among other jurisdictions. The secret records are believed to include those obtained by ICIJ  and that are the basis of the Offshore Leaks investigation. British tax authorities said the files “reveal extensive use of complex offshore structures to conceal assets by wealthy individuals and companies.” The three agencies plan to share the information with their counterparts from other countries in what could be the beginnings of one of the largest tax investigations in history.
   
• Canada's revenue minister Gail Shea announced a $30 million commitment to fight tax evasion and target the practice of hiding money in offshore accounts, and the formation of an international tax expert "SWAT team". Asked if her department now has the list of 450 Canadian names contained within the documents obtained by ICIJ, Shea said: "We currently don’t have the list and I can assure you that we’re looking at all of our options. We’re working with our international partners to get that list."
   
• The UK Treasury announced that following the lead of the Cayman Islands, all British overseas territories – including Bermuda, the British Virgin Islands, Anguilla, Montserrat and the Turks and Caicos Islands – have agreed to share information about individuals holding bank accounts in their jurisdictions with the UK, France, Germany, Italy and Spain. 
   
• The South China Morning Post reported that the new information exchanges will have real implications for Hong Kong and China companies, which do significant business through the Cayman islands, the British Virgin Islands and other offshore locales.
• European finance ministers may reach an agreement to eradicate tax havens on May 13, after a meeting in Helsinki between finance ministers from Finland, Luxembourg, Greece, Slovakia, and Lithuania as well as the European Commissioner on Taxation  to discuss measures against tax evasion.
   
• The European Commissioner on Taxation Algirdas Šemeta  and Irish Finance Minister Michael Noonan sent a letter to all EU Finance Ministers, setting out 7 key areas for immediate action in improving the fight against tax fraud, evasion and avoidance. Member States were asked to agree on these actions at the ECOFIN in May. The letter credits the offshore leaks investigation with "sharpening the focus" on tax fraud, and says it will ask ICIJ to supply names and details of European citizens from its data.
   
• Finance ministers and central bankers at the G20 meeting in Washington said in a communiqué that automatic exchange of tax-relevant bank information should be adopted as the global standard to overcome international tax evasion. Skeptical European leaders reportedly "became more enthusiastic" after the public outcry over ICIJ's offshore leaks revelations.
   
• Bayartsogt Sangajav, deputy speaker of the Mongolian Parliament, has beendismissed from his post following ICIJ's revelations about his undeclared offshore company and bank account. In a parliamentary session he was asked to explain his actions. Several MPs called for further disciplinary action, including expelling him from Parliament entirely.
   
• Santosh Kumar Agarwal (Kedia), a member of the board of directors for the Antwerp World Diamond Centre, has resigned from the organization after his offshore dealings were revealed. “In the interest of the integrity of the Antwerp World Diamond Centre as [an] organization and the industry as a whole, Kedia has taken the initiative to withdraw from the AWDC's board of directors, awaiting the outcome of a potential investigation,” said a statement released by the company.”
   

• French president Francois Hollande has published the personal financial details of  government ministers on the official government website, following the Jerome Cahuzac and Jean-Jacques Augier offshore assets scandals. The list of assets includes details of bank accounts, life insurance, property and other expensive items such as cars, art works and antiques. Various properties in Paris and the south of France have already been itemized by ministers, as well as designer lounge chair (Industrial Renewal Minister Arnaud Montebourg) and a David Beckham t-shirt (Culture Minister Aurelie Filippetti).
   

• European Council president Herman Van Rompuy announced that tax evasion will be discussed at the next European Council in May, saying "we must seize the increased political momentum to address this crucial problem."
   
• BVI government officials have announced they are opening a new business headquarters in Hong Kong, with Orlando Smith, BVI Premier and Finance Minister, confirmed to officiate the opening. Executive director of BVI International Finance Centre, Elise Donovan, said the data obtained by the ICIJ was "a small fraction" of the total number of BVI firms. She later added, "We want to reassure clients in Hong Kong and the region that this is an isolated incident. We remain committed to clients' privacy and confidentiality."
   
• The Swiss and U.S. governments are investigating a possible solution to the dispute over wealthy Americans using Swiss banks to hide their money. These talks come at time when Switzerland’s banking sector is under increased pressure to surrender personal information about suspected tax evaders. Swiss Finance Minister Eveline Widmer-Schlumpf said all countries should be treated equally in the drive for bank transparency. "We consider it very important that rules must apply to all and are engaging ourselves for a level playing field in multilateral forums," Widmer-Schlumpf said.  
   
• German Chancellor Angela Merkel urged UK's PM David Cameron to crack down on tax havens during talks in Berlin, following a public outcry in Germany over the "offshore leaks." Sources "close to Cameron" claim he was actually the first to raise the issue, spelling out how his government was cracking down on tax avoidance in places such as Jersey and Guernsey.
   
• Russian Deputy Prime Minister Igor Shuvalov.Russian Deputy Prime Minister Igor Shuvalov is moving his offshore assets back to Russia after ICIJ's revelations that Shuvalov's wife Olga Shuvalova was either a shareholder or owner of several secretive offshore entities. The Shuvalovs had a declared income of $12.7 million in 2011, most of which was earned by Olga.
   
• Spanish political party Unión Progreso y Democracia submitted written questions to the Spanish Congress today in the wake of French president François Hollande's announcement that French banks had to declare their tax haven subsidiaries. The questions read: Is the government going to present in the European institutions any initiative to eradicate the tax havens within the Member States? and Is the government going to force banks to disclose the subsidiaries they have in tax havens and what are their activities?
   
• Francois Hollande: called for tax havens to be "eradicated."French president François Hollande called for "eradication" of the world's tax havens and toldFrench banks they must declare all of their subsidiaries. He also announced the creation of a special prosecutor to pursue cases of corruption and tax fraud. French government ministers have been ordered to declare their assets publicly within days.
   
• Luxembourg's Prime Minister Jean-Claude Juncker announced his country plans to lift bank secrecy rules for European Union citizens who have savings based in the country, ending decades of bank secrecy in Luxembourg. "We are following a global movement," Juncker told parliament in a state-of-the-nation address. The new transparency regime would begin in January 2015. Austria is now the only EU country not sharing data about bank depositors. In a recent interview, Austrian Vice Chancellor and Finance Minister Spindelegger Fekter said: “How much money someone has in the bank is a matter between the bank and the customer and is no one else’s business."
   
• Algirdas Semeta, European Union Tax Commissioner stated in a recent interview that it istime to move “quicker and harder” against tax evasion. He said the “growing willingness to act” increases the likelihood of a more coordinated EU stance against tax havens.
   

• Europe’s five biggest economic powers — Britain, France, Germany, Italy and Spain —announced they would begin regularly exchanging banking and tax information as a way of identifying tax dodgers and other financial wrongdoers. 
   

• Meanwhile, the British Virgin Islands (BVI) authorities are not fans of the ICIJ investigation. The BVI premier and Finance Minister Orlando Smith told the South China Morning Post that "BVI authorities are actively investigating how this private information has been illicitly obtained and used to attack the BVI financial services industry, which operates compliantly within international guidelines and the law."
   
• Athens’ district attorney Panayota Fakou has started a preliminary probe to find out if Greeks who own offshore companies unearthed by the ICIJ investigation have evaded taxes or laundered money. According to the Greek newspaper Ta Nea, prosecutors will send information requests to British Virgin Islands’ financial authorities asking them to turn over records of 107 entities connected to Greek citizens.
   
• An investigation by Finnish State Televisionand ICIJ exposing the offshore connections of state-owned postal company Itella has been received with surprise by the Finnish Finance Minister, Jutta Urpilainen. The minister said that “state owned companies should be an example for other companies. That is why it is especially unacceptable that Itella owns a company in a tax haven.” Urpilainen said the Finnish government should adopt clear rules on the use of offshore jurisdictions by state-owned corporations and called tax havens “one of the biggest threats to the Finnish welfare state.”
   
• Canada's national revenue minister Gail Shea says the government may pursue the Canadian Broadcasting Corporation in court to force it to share the offshore leaks records.
   
• Quebec Premier Pauline Marois has declared that neither she, nor any other elected officials in her government have dealings in the offshore world. Marois also supported the handover of internal documents to Canadian authorities, stating the Quebec government would not hesitate to use "all legal means" to ensure this.
   
• French budget minister Bernard Cazeneuve joins the clamor from governments around the globe in urging ICIJ and its media partners to release the offshore tax haven files to them, to "aid justice and help them do their job." Le Monde's response: "It is up to the justice system to establish responsibilities at a time when the law might have been broken ... It is up to the press to enlighten the reader..."
   
• Austrian Chancellor Werner Faymann says he is ready to make concessions on banking secrecy, to bring the nation in step with Switzerland and Luxembourg. "Austria should participate in talks on banking secrecy,” Austrian Chancellor Werner Faymann declared to Die Presse.
   
• The European Commissioner for Taxation, Algirdas Šemeta, called for an automatic exchange of information between countries and a "tough common stance." "Recent developments,fuelled by the outcome of the Offshore Leaks, confirms the urgency for more and better action against tax evasion .... Now it is time to put words into action." He said he was "very pleased" to see many of the Member States reviewing where they stand on the issues and "intensifying their political will to act."
   
• The Swiss government has distinguised itself from other world governments by publicly stating it does not want access to the offshore leaks records. Finance minister Eveline Widmer-Schlumpf said Switzerland has worked hard in recent years to curb fraud and tax evasion and that much of the activity pointed to in the leaked documents can be perfectly legal. She says the Swiss government does not want access to the data as "it was acquired illegally and Bern wants no part of that".
   
• The Philippine Presidential Commission on Good Government probe into the disclosure that Maria Imelda Marcos Manotoc, the eldest daughter of the late dictator Ferdinand Marcos, was a beneficiary of a secret offshore trust in the British Virgin Islands, will release its report within two weeks.  “We are duty bound to investigate and, depending upon informed preliminary findings, decide whether to pursue the matter,” said Andres Bautista, the chairman of the Presidential Commission on Good Government, tasked with recovering the Marcos family’s alleged ill-gotten wealth.
   
• The president of the Association of German Banks denied that his group’s members had helped customers engage in tax evasion. “First in line are the individuals and the organizations that invest their money in tax oases,” Andreas Schmitz said."
   
• The Berne internal revenue service authorities announced they will re-open the Gunter Sachs case after ICIJ's revelations about the former Mr. Brigitte Bardot's intricate offshore scheme.
   
• In Canada, a Liberal senator urged his caucus colleague, Senator Pana Merchant, to answer questions in the wake of CBC News and ICIJ reports that she has been listed as beneficiary of an offshore trust created by her husband, a well-known class-action attorney. "We're all innocent until proven guilty in this country, but I want to hear her explanation," Senator Percy Downe told CBC News in an interview.
   
• In the Philippines, two lawmakers dismissed a report by an ICIJ media partner, the Philippine Center for Investigative Journalism (PCIJ), that they had offshore holdings. Senator Manuel Villar said his offshore entity was a “1-dollar shell company” that he wasn’t required to report, because he hadn’t made any real investment in it. Villar said that he hadn’t conducted business with the British Virgin Islands company “because I decided to concentrate in the Philippines.” Congressman Joseph Victor ‘JV’ G. Ejercito suggested the story about him was politically motivated. “To the best of my knowledge, I have truthfully and accurately declared all my assets, liabilities, and net worth” on required disclosures forms for public officials, he said in a statement.
   
• Germany's Economics Minister Philipp Rösler urged the media to pass the data on to the government, stressing that tax evasion was a "criminal act."
   
• Luxembourg's Finance Minister Luc Frieden says he is open to greater transparency of its banks in order to cooperate further with foreign tax authorities. 
   
• The Indian Finance Minister P. Chidambaram said an inquiry had been initiated by the authorities against individuals whose names figured in the global media report. “Yes. We have taken note of the names and inquiries have been put in motion in respect of the names that have been exposed,” he told a press conference.
   
• The Mongolian Deputy Speaker, Bayartsogt Sangajav, admitted to an "ethics failure" over his undeclared million-dollar Swiss bank account. He told a press conference: “It is true that there is 1,658 Euros or 2.9 million MNT in a Swiss bank account. I opened the account to trade in international stocks with three other acquaintances in 2008. My failure of responsibility is that I did not include the company in my declaration of income. I have admitted my ethic failure and I am ready to take responsibility." 
   
• Philippine government officials said they will investigate evidence that Maria Imelda Marcos Manotoc, a provincial governor and daughter of the late dictator Ferdinand Marcos, was the beneficiary of a secret BVI offshore trust.  
   
• George Mavraganis, the Deputy Finance Minister of Greece announced that the Greek government is moving to address offshore-driven tax dodging. Greek members of parliament asked Mavraganis what he planned to do about the 103 offshore companies that ICIJ found hadn’t been registered with Greece’s tax authorities. 
   
• George Sourlas from Greece’s Ministry of Justice said the revenue loss caused by offshore was huge. “By the actions of offshore companies in Greece, the revenue loss to the Greek government is in the order of 40% or more of the debt of our country,” Sourlas said. “The offshore companies cast a shadow at this time of great crisis, when some get rich and many get poor.”
   
• In France, President Francois Hollande denied knowledge of the offshore accounts held by his 2012 campaign manager, Jean-Jacques Augier, asserting that it’s up to the tax administration to monitor Augier’s private activities. Reports about Augier’s offshore dealings by Le Monde, the BBC and other ICIJ partners came in the wake of news about tax fraud charges against Hollande’s ex-budget Minister, Jerome Cahuzac.
   
• The office of Azerbaijani President Ilham Aliyev asserted there was nothing unusual about the information in the leak – which showed that his two daughters were shareholders of three offshore companies. The statement said the President’s daughters “are grown up and have the right to do business.”  A spokesperson for Azersun – a holding company controlled by Hasan Gozal, a corporate mogul who was listed as the director of the daughters’ companies – said the report was biased and based on inaccurate information. “I regret that authority of Press Council doesn't go beyond Azerbaijan and there is no such institution worldwide to fight racketeer journalists,” the spokesman said.
   
• Ex-Colombian President Álvaro Uribe Vélez publicly defended his sons’ involvement in offshore business. Uribe stated that his sons Tomás and Jerónimo are entrepreneurs and “have participated in business dealings since they were children” and “they are not tax evaders.”
   
• In the UK, David Cameron is facing renewed pressure to take action over Britain’s entanglements within the offshore world. Lord Oakeshott, a senior Liberal Democrat said that the secrecy haven of the British Virgin Islands “stains the face of Britain.” Oakeshott and others are questioning whether Cameron will raise the issue in June of at the G8 summit of wealth nations. "How can David Cameron keep a straight face calling for the G8 to make big business pay tax when we let the BVI use British law and British protection to suck in billions in dirty money?" Oakeshott asked.
   
• German Finance Minister Wolfgang Schäuble stated on public radio that he was “pleased”with the ICIJ reports. He went on to say, “I think that such things as have been made known will increase the pressure internationally, and we will be able to increase the cooperation with those who have been more reticent”, a sentiment reflected in Germany’s previous lobbying to stamp out tax avoidance.
   
• Canadian Federal Revenue Minister Gail Shea called the released of offshore banking information as “good news” for Canadians and bad news for tax evaders. Ms. Shea urged ICIJ or anyone else with information on tax cheats to come forward.
   
• Pascal Saint-Amans, director of the Organization of Economic Cooperation and Development, said: "Secrecy is no longer acceptable. We need to get rid of it. If the rules make it possible, then we'll change the rules.”

Supporters of Republican Sen. Rand Paul, R-Ky., have launched “Rand PAC 2016.” But because the super PAC uses the potential presidential candidate’s first name, this action may violate federal law.

Three Hillary Clinton-themed super PACs established earlier this year could also find themselves in the same situation. Since, however, the former secretary of state is not officially a candidate for president or any other federal office, they are on safe ground — for now anyway.

Paul, on the other hand, has raised more than $600,000 for his 2016 re-election to the U.S. Senate, including $457,000 during the first quarter of 2013, according to Federal Election Commission filings.

Federal law, in most cases, only permits political committees authorized by a candidate to use that candidate’s name — which super PACs, by definition, are not.

The regulations, though, are unclear about whether the use of a partial name would trigger a change.

This would be “a good area for the FEC to clarify its own rules,” Paul S. Ryan, an attorney at the nonpartisan Campaign Legal Center, told the Center for Public Integrity.

An FEC spokesman directed questions to the agency’s chairman and vice chairman, who could not immediately be reached for comment.

The FEC typically sends a letter to a super PAC if it uses a candidate’s name. For example, during the 2012 GOP presidential primaries, the super PAC “Americans for Rick Perry” ran afoul of the rule and changed its name to “Restoring Prosperity Fund.”

Brandon Edwards — the 27-year-old, self-described libertarian from California who is the chairman of the newly created Rand PAC 2016 — said that if his group were asked to change its name by the FEC, “that would be no problem.”

Edwards said his group does not want to be seen as “leaching off" Paul's name.

“That’s definitely not the goal of this,” he added. “The goal is to become active with the community, find other like-minded people and help spread the message of liberty.”

Another pro-Paul group may face a similar predicament. It christened itself the "Stand with Rand PAC" when it registered in March as a hybrid super PAC.

A hybrid super PAC can operate one bank account fueled by limited contributions to dole out money to candidates — plus a second account funded by unlimited donations that are used to produce political advertisements.

Bill Willenbrock, Stand with Rand PAC's treasurer, said his group had not been asked to change its name by the FEC, adding that he was "not aware that Ayn Rand was running for office," making reference to the deceased author, a libertarian icon.

The super PAC’s website features a photo of the Kentucky senator above the assertion that it exists to “support candidates like Rand Paul who stand up for the Constitution and, more specifically, the Bill of Rights.”

In a previous interview with the Center for Public Integrity, Willenbrock said his group planned to support Paul as well as "other candidates who stand for liberty," such as Sens. Ted Cruz, R-Texas, and Mike Lee, R-Utah.

In January, several notable Clinton supporters formed a super PAC called “Ready for Hillary PAC,” as the Center for Public Integrity previously reported.

The super PAC has not yet been required to report any fundraising to the FEC, but Democratic heavyweights such as strategist James Carville and former Michigan Gov. Jennifer Granholm have already madepitches for the group.

“We are aware of this federal regulation,” said Jim Lamb, Ready for Hillary's general counsel. "If Hillary decides to run and becomes a candidate, we will continue to be in compliance with this regulation."

Clinton supporters have also created an Iowa-based group called "Hillary Clinton Super PAC" and a California-based super PAC called "Hillary FTW," an acronym standing for "for the win."

Further confusing the issue, political committees designed to specifically oppose a candidate are granted an exemption from the rules governing names.

Case in point: the “Stop Hillary PAC” registered with the FEC last week as a hybrid super PAC. Similarly, the “Retire Pryor” super PAC has spent about $10,000 opposing the re-election of incumbent Sen. Mark Pryor, D-Ark, who will face voters in 2014.

The only other exception to the naming restriction is for groups that seek to “draft” a candidate to run for office. These groups must also “clearly indicate” that they are “a draft committee,” according to federal law.

Like super PACs, draft committees need not abide by the strict contribution limits faced by candidate’s own committees.

Two senators serving on a subcommittee that Tuesday grilled Apple Inc. executives over the company's offshore tax practices are themselves owners of Apple stock, either directly or through a spouse, according to interviews and a review of federal disclosure documents by the Center for Public Integrity.

Sen. Heidi Heitkamp, D-N.D., owns the most Apple stock among the 14 members of the Senate Homeland Security and Governmental Affairs Committee's Permanent Subcommittee on Investigations, with her holdings worth at least $250,001 and up to $500,000, according to personal financial disclosure documents for calendar year 2012. She also earned up to $5,000 in Apple stock dividends last year, records show. 

Heitkamp was one of six committee members to not attend Tuesday's hours-long hearing, during which Apple Chief Executive Officer Tim Cook defended his company against accusations of tax dodging. Attendee or not, the senator's stock holdings do not pose a conflict with her committee service, a spokeswoman said.

“Senator Heitkamp was selected to serve on the Homeland Security and Governmental Affairs Committee because of her unique position being from a border state and her past experience as a state attorney general working along aside law enforcement," spokeswoman Whitney Phillips said. "Her position on this committee is in no way impacted by her personal financial holdings.” 

Sen. Tom Carper, D-Del., chairman of the Homeland Security and Governmental Affairs Committee and an ex officio member on its Permanent Subcommittee on Investigations who attended the hearing and asked questions, reported that his wife, Martha Ann, owned up to $100,000 worth of Apple stock during 2012. The stock also generated up to $2,500 in dividends last year, federal records show. 

Officeholders generally disclose their assets and earnings in broad ranges.

Carper's committee office confirmed the senator's wife currently owns Apple equities, but spokeswoman Jennie Westbrook declined to answer specific questions about the stock holding. 

Sen. Tom Coburn, R-Okla., another ex officio subcommittee member, also reported trading in Apple stock options during 2012, earning up to $50,000 from the transactions, according to his newly released personal financial disclosure document.

The same document also states that Coburn's Apple holdings at the end of 2012 were worth $1,000 or less — an indication he may no longer have Apple holdings. Representatives for Coburn, who also did not attend Tuesday's hearing, could not be reached for comment.

In addition to Carper, Sens. Carl Levin, D-Mich; John McCain, R-Ariz.; Claire McCaskill, D-Mo.; Ron Johnson, R-Wis.; Rob Portman, R-Ohio; and Kelly Ayotte, R-N.H. attended Tuesday's hearing. These senators reported no Apple stock holdings in 2012 outside of what might exist in broad-based mutual funds that many of them reported.

Another committee member in attendance, Sen. Rand Paul, R-Ky., was granted a 90-day filing extension for his 2012 disclosure paperwork after asking for more time. It is therefore unknown whether Paul, who defended Apple during the hearing, owned Apple stock during 2012. During 2011, he did not, federal records show.

In 2011, Apple stock, which today closed at $441.35 per share, ranked among the most popular holdings by all members of Congress — just below the stock shares of other massive companies such as General Electric, ExxonMobil, Pfizer and Bank of America, according to the Center for Responsive Politics.

They are two cutting-edge electric car makers, headquartered in California and backed by powerhouses of politics and money. In 2009, each secured half-billion dollar loan commitments from President Obama’s Department of Energy to help transform their clean-energy cars from drawing boards to showrooms.

But this week, the fortunes of Tesla Motors and Fisker Automotive took sharply divergent turns.

On Wednesday, the Energy Department announced that Tesla repaid the balance of its $465 million government loan nine years early. Fisker, meantime, has ceased making cars as it weighs potential bankruptcy, confronts a $171 million loan balance with DOE and, last month, faced questions from the House Committee on Oversight & Government Reform.

In October 2011, The Center for Public Integrity and ABC News explored the Energy Department’s risky $1 billion bet on two companies lauded for their innovative design, but facing warnings from experts over the marketability of cars that, in some models, carry price tags hovering around six figures.

In announcing Tesla’s loan repayment this week, the department said the risks were worth taking, coming at a time the industry itself suffered a deep downturn. “The lack of financing for the automotive industry was critical and potentially lethal,” Energy Secretary Ernest Moniz said in a statement. “Providing these loans was a calculated risk — but it was the right decision for the country.”

Yet for Fisker, whose loan was heralded by Vice President Joe Biden, the risks remain ripe. The company’s vision of developing a muscular Karma and more practical sedan faltered amid a series of setbacks from slow- moving government approvals to recalls and financial downturns involving suppliers.

DOE initially agreed to loan Fisker $529 million to help the company develop two lines of plug-in hybrids. Of that, $359 million would help the company re-open a shuttered former GM plant in Delaware, where Fisker would develop “Project NINA” — a mass-market hybrid sedan to be called the Atlantic. “The company estimates it will build 75,000-100,000 of these highly efficient vehicles every year by 2014,” DOE announced in 2009.

The remaining money would help Fisker complete its luxury Karma.

"We understood a new chapter had to be written, a new chapter in which we strengthen American manufacturing by investing in innovation,” Biden said in 2009, citing Fisker’s loan.

Yet reality collided with those projections, and Fisker Automotive has not come close to meeting its goals.

The company began drawing down on the DOE loan in 2010, and by the middle of 2011, had collected $192 million in government money, records show. But then, as Fisker encountered production hiccups, the Energy Department cut off the money spigot. DOE has recouped $21 million of the $192 million it loaned Fisker, leaving the company $171 million in debt to the government as it weighs a potential bankruptcy.

Testifying before the Oversight and Reform Committee late last month, co-founder Henrik Fisker said the company had sold 2,000 Karmas worldwide. He cited a series of setbacks that, like a domino, helped topple production of the company’s fleet.

In 2011, Fisker said, regulatory approvals for the Karma in the United States “took longer than anticipated.” Then, after the company began delivering the car to customers, two parts provided by outside suppliers had to be recalled. “The recalls generated bad publicity, diverted management attention, impacted sales, and further delayed our production schedules,” Fisker said.

Then came a bigger blow: In October 2012, Fisker’s lithium ion battery manufacturer filed for bankruptcy protection. Fisker’s exclusive supplier — another recipient of DOE funding— stopped manufacturing batteries.

“Fisker Automotive had to cease production of the Karma,” Fisker said. “We explored options for other battery suppliers, but due to large investment costs and long development cycles, we could not secure arrangements that would allow us to resume production immediately.

“This was a crippling factor in restarting production of the Karma.”

With Hurricane Sandy came more bad news. More than 330 Karmas, awaiting shipment at Port Newark in New Jersey, were “damaged beyond repair during this unforeseen natural disaster. This constituted a major share of the company's inventory and resulted in a drastic loss in revenue,” Fisker said.

Fisker’s other car, the Atlantic, has yet to go into production.

Henrik Fisker stepped down as CEO in 2012, and resigned from the board in March. Yet he told the committee the company’s technology earned honors, and said Fisker Automotive “still has the potential to build on these achievements” if it can secure financing.

“From the outset, Fisker Automotive aimed to be a new American car company, setting pioneering standards for low-emission technology and cutting-edge design,” he said. “I sincerely hope that the company can find a way to move forward and repay its Department of Energy loans.”

Tesla, the other California electric car company backed by DOE money, repaid its loan this week.

Both companies received backing from heavyweights in business and politics. Fisker’s prime supporters included the California venture capital firm Kleiner Perkins Caufield & Byers, whose partners include former Vice President Al Gore. Tesla’s prime backers include venture capitalist and Obama fundraiser Steve Westly, and Google co-founders Larry Page and Sergey Brin.

While Fisker searches for a potential buyer to help salvage the company, Tesla has, of late, pointed to headlines: Its Model S was recently named Motor Trend Car of the Year. On its website, Tesla prices the sedan from $62,400-$87,400, depending on the model — after a $7,500 federal tax credit. Its six-figure Roadster sports car, it said, is sold out in North America.

Tesla’s $465 million loan, the DOE said, enabled the company to open a shuttered plant in Fremont, California, “and to produce battery packs, electric motors, and other powertrain components.”

In a brief interview Thursday, Diarmuid O’Connell, Tesla’s vice president of business development, said the company raised money to pay off the DOE loan this week.

Asked why the two electric car companies have forged disparate paths, he provided a concise answer.

“Fisker and Tesla have always been on different trajectories, our business models have always been different,” O’Connell said. “What we are focusing now on is building market.”

For the Energy Department, the next focus could be Fisker — and bankruptcy court, should the company take that route. On Thursday, energy officials did not respond to questions about what steps the department would take if Fisker files for bankruptcy, or how much the government anticipates recovering.

The American Future Fund, a Republican-aligned “social welfare” nonprofit, is circulating a petition to “fire Lois Lerner,” the Internal Revenue Service official at the center of the ongoing political storm about the agency’s targeting of conservative groups seeking tax-exempt status.

“Did you see IRS official Lois Lerner’s stunning and insulting actions before a Congressional committee yesterday where she made a personal statement of innocence, then plead the Fifth and left?” American Future Fund founder Nick Ryan wrote in an email to supporters Friday obtained by the Center for Public Integrity.

“Does it leave you seeing red that Ms. Lerner refused to fully and honestly answer questions before the Committee about who knew what and when?” Ryan continued. “Then let’s do something about it.”

The American Future Fund itself has frequently been singled out by campaign finance reform groups, who have accused the nonprofit of masquerading under Section 501(c)(4) of the U.S. tax code when it ought to be registered as a political committee — and subject to donor disclosure rules.

During the 2012 election season, the American Future Fund spent more than $29 million on political advertisements, as the Center for Public Integrity previously reported.

As a 501(c)(4) nonprofit, it is allowed to make election-related expenditures, so long as politics are not its “primary” purpose.

Little is known about the donors to the American Future Fund. Between 2009 and 2011, 51 percent of the money the group raised came from another nonprofit — the Arizona-based Center to Protect Patient Rights, which has no website and lists its address in government filings as a post office box in Phoenix.

The American Future Fund was awarded tax-exempt status under Section 501(c)(4) in October 2008, IRS records show.

Lerner, the director of the IRS exempt division, was put on administrative leave from the IRS on Thursday.

During his time at an upcoming “Louisiana Bayou Weekend” super PAC fundraiser, Sen. David Vitter, R-La., will be able to ask attendees how they like the Cajun cooking. And he’s free to inquire whether they bagged a gator during the weekend’s planned alligator hunt.

But he won’t be able to ask them to contribute more than $5,000 to its sponsor, the Fund for Louisiana’s Future, a super PAC created to support Vitter.

That’s because federal law prohibits federal candidates from officeholders from soliciting contributions in excess of $5,000 per year for super PACs, even though the groups may accept contributions of unlimited size.

It also doesn't matter "whether the funds are used for state or federal election work,” attorney Paul S. Ryan of the Campaign Legal Center told the Center for Public Integrity.

“The donor can always give as much as they choose to,” added Joe Birkenstock, an attorney at Caplin & Drysdale in Washington, D.C. “It’s a limit on what can be asked.”

Vitter, who is mulling a run for governor, will appear at the September fundraiser as a “special guest,” according to an invitation obtained by Politico.

The Fund for Louisiana’s Future is also registered with the state of Louisiana, which caps contributions to all political action committees at $100,000 per election cycle.

Since the advent of super PACs during the 2010 election cycle, federal politicians on both sides of the aisle have solicited funds for the unlimited-spending groups, including Senate Majority Leader Harry Reid, D-Nev., and GOP presidential nominee Mitt Romney.

Neither Fund for Louisiana’s Future treasurer, Charlies Spies, nor a spokesman for Vitter immediately responded to requests for comment.

An ailing, 69-year-old Yuri Andropov was running the Soviet Union from his Moscow hospital bed in 1983 as the United States and its NATO allies conducted a massive series of war games that seemed to confirm some of his darkest fears.

Two years earlier Andropov had ordered KGB officers around the globe to gather evidence for what he was nearly certain was coming: A surprise nuclear strike by the U.S. that would decapitate the Soviet leadership. While many of the officers didn’t believe that the U.S. had such plans, they dutifully supplied the Kremlin with whatever suspicious evidence they could find, feeding official paranoia.

The Western maneuvers that autumn, called Autumn Forge, were depicted by the Pentagon as simply a large military exercise. But its scope was hardly routine, as Americans learned in detail this week, for the first time, from declassified documents published by the National Security Archives, a Washington-based nonprofit research organization.

To the Russians, it could easily have looked like a genuine preparation for a nuclear strike, the documents revealed: A total of 40,000 U.S. and NATO troops were moved across Western Europe, while 16,044 more U.S. troops were airlifted overseas in 170 missions conducted in radio silence.

More ominously, in an unpublicized exercise called Able Archer 83, U.S. and NATO officers practiced the procedures they would have followed in authorizing and conducting real nuclear strikes, shifting their headquarters as the game escalated toward chemical and nuclear warfare. In communications, they several times referred to non-nuclear B-52 sorties as nuclear “strikes” — slips of the tongue that could have been intercepted by Soviet eavesdroppers.

While historians have previously noted the high risk of an accidental nuclear war during this period, the new documents make even clearer how the world’s rival superpowers found themselves blindly edging toward the brink of nuclear war through suspicion, belligerent posturing and miscalculation.

In a coincidence that could have proved catastrophic, the script for the maneuvers dovetailed snugly and perilously with the Soviets’ fears that they were under threat, coupled with nagging doubts about their ability to protect themselves from U.S. military might.

The problem with this brinksmanship was that it increased the risk of a nuclear exchange due to miscalculation, according to Nate Jones, a Cold War historian with the National Security Archives who edited and published the collection of more than 50 documents, totaling more than 1,000 pages, in three installments beginning May 16 and ending Thursday.

Ranging from presidential note cards to previously secret CIA reports, the documents describing Able Archer 83 offer fresh insight into a much studied but incompletely understood episode in the U.S.-Soviet rivalry. “This episode should be studied more because it shows that U.S. leaders might not have learned as much from the Cuban missile crisis [about avoiding accidental conflict] as they should have,” Jones said.

In the current edition of the Journal of Strategic Studies, Israeli historian Dmitry Adamsky calls the 1983 war games “the moment of maximum danger of the late Cold War.” Able Archer, he wrote “almost became a prelude to a preventative nuclear strike.”

The March 1984 edition of Air Man Magazine, a rare detailed public account, called Autumn Forge “the biggest North Atlantic Treaty Alliance show of force of the year — a test of military readiness in the context of NATO’s deterrent mission.” But the article emphasized the air lift, never mentioning rehearsal for nuclear war.

Even the troops on maneuver tried not to draw too much attention to themselves. At Dusseldorf Airport, the 45th Tactical Air Wing commander had his planes park away from the passenger terminal to keep a low profile. Most travelers, he was sure, were not even aware of troop activity at the airport.

But the Pentagon knew that the Soviets were monitoring his troops’ every move. “The series of exercises are watched very carefully by the Eastern Bloc nations, just as we try to watch their exercises as closely as we can, to learn tactics and procedures,” Air Force Maj. Gen. William E. Overacker told Air Man.

The impetus for the exercise came from the White House, “where they wanted to stare down the Soviet bear,” said Jones.

Tensions had heated up that September, after the Soviet shoot-down of Korean Air Lines Flight 007, which had strayed into Soviet air space. The administration responded with stepped-up surveillance, and provocative naval maneuvers, and pressed for the deployment of new Pershing II missiles in Europe capable of reaching Moscow in less than ten minutes.

Considered in a vacuum, Able Archer 83, in which officer’s at NATO’s Belgium headquarters practiced their response to a hypothetical chemical and nuclear conflict with a thinly-disguised Soviet Union, might not have seemed particularly threatening.

But for two years prior to Able Archer 83, KGB agents had been scouring the world for evidence of what the Soviet leadership in general — and Andropov in particular — believed were U.S. preparations for all-out nuclear war against the U.S.S.R.

The massive intelligence-gathering effort, called “Operation RYAN,” pressured the KGB to find proof that the U.S. was planning a “decapitating” strike against Moscow with its nuclear forces. (The Russian acronym derives from Raketno-Yadernoye Napadeniye, or nuclear missile strike.)

According to an unclassified summary of the Western nuclear exercise scenario, prepared for the National Security Archives by a NATO historian, the war game began with briefings on an imaginary East-West conflict in the Middle East, including “Orange” — that is, Soviet — arms deliveries to Syria, coupled with unrest in Eastern Europe.

Rising tensions and a change in the Soviet leadership triggered an invasion by the Red Army of Yugoslavia, Finland, Norway and Greece, according to the exercise scenario. After the “Orange” Soviets finally attacked “Blue” — U.S. and NATO forces — with chemical weapons, NATO decided to respond with two series of nuclear strikes.

The Soviets -- in a characteristic mirror-image -- feared a U.S.-initiated attack, and certainly made no secret about it at the time. One key document, released by the Reagan Presidential Library files, describes how Andropov repeatedly warned that the U.S. was approaching the “red line” leading to nuclear war when he met with veteran U.S. diplomat Averell Harriman in June 1983.

But President Reagan was unsure if the Soviets were really convinced that the U.S. was preparing a sneak attack on them, or were merely “huffing and puffing,” as Reagan asked his ambassador to the U.S.S.R. in 1984.

There was skepticism in Washington about Andropov’s sincerity. Three days after the end of Able Archer 83, the CIA issued a Top Secret Joint Net Assessment of U.S. and Soviet strategic forces that assured senior administration officials that the balance of forces “is probably adequate to deter a direct nuclear attack on the United States.” It did not acknowledge the possibility of nuclear war through miscalculation.

Another Top Secret CIA analysis, written six months after Able Archer 83, shows how profoundly the spy agency may have misread the Kremlin’s thinking. “We believe strongly that Soviet actions are not inspired by, and Soviet leaders do not perceive, a genuine danger of imminent conflict or confrontation with the United States,” its authors wrote.

It acknowledged, however, that since the Able Archer exercise, the Soviet military had stepped up its activity and deployed new weapons and forces.

Even if his intelligence advisers were sanguine, Reagan himself was worried after the exercise that the Soviets genuinely feared the U.S. was preparing to commit nuclear aggression, writing at one point in his diaries that “I feel the Soviets are so defense minded, so paranoid about being attacked that without being in any way soft on them we ought to tell them that no one here has any intention of doing anything like that. What the h—l have they got that anyone would want.”

Moscow’s reaction to the November 1983 war games is not well documented, partly because obtaining material from Russian government archives has become increasingly difficult since the 1990s. “I wouldn’t say it has stopped, but it’s proceeding at a glacial pace,” Jones says.

But Russia isn’t the only country hanging onto some of the secrets surrounding the 1983 war scare.

The papers of former Washington Post reporter Don Oberdorfer include a summary of what Jones says may be the most comprehensive account of the Able Archer 83 ever written, a classified 110-page report completed in 1990 by the President’s Intelligence Advisory Board.

The report has never been released, but Oberdorfer’s notes, based on an interview with a confidential source, say it concluded that the 1983 “war scare was an expression of genuine belief on the part of Soviet leaders that US was planning a nuclear first strike, causing Sov(iet) military to prepare for this eventuality, for example by readying forces for a Sov(iet) preemptive strike.”

The note concludes in telegraphic style: “If so, war scare a cause for concern.”

Jones says the 1990 report to President George W. Bush may be the most comprehensive account ever written on what happened during those five days in November of 1983, but he’s been fighting to get it declassified without success since 2004. “Until the President’s Intelligence Advisory Board report is declassified, we won’t know how close the U.S. came” to nuclear war, Jones said.

There is an age-old tradition in this country: if you don't like a law and can't get rid of it, look for a loophole.

That's what some companies that don't want to comply with an important Obamacare requirement have done, and it appears they've hit pay dirt.

The provision of the law mandating that all new insurance policies must cover certain "essential" benefits will take effect January 1, 2014. From that date forward, all polices offered on the online insurance marketplaces in every state must cover ten categories of benefits that range from prescription drugs and lab services to hospitalization and maternity and newborn care.

 The sponsors of the law hoped the provision was among those that would all but eliminate the need for Americans to file for bankruptcy because of medical debt.

The United States is alone among developed countries in having medical debt as the leading cause of bankruptcies, even among people who have health insurance. That's because a lot of the policies being sold today have such limited benefits, high deductibles and annual and lifetime coverage limits that many people realize after a serious illness or injury that their policies provide little help in paying medical bills.

"No longer will American families be a car accident or heart attack away from bankruptcy," said Senate Majority Leader Harry Reid in response to the Supreme Court's decision last June upholding the constitutionality of the law.

But as reported by the Wall Street Journal last week, corporate loophole hunters have invalidated Reid's statement, which honestly was an overstatement even then. While Obamacare will make affordable coverage available to millions of Americans for the first time, several million others-primarily low and middle-income workers-will still be left out.

According to the Journal, regulations written by the Obama administration pertaining to employers are being interpreted by health insurance benefits consultants as applying only to small businesses that buy coverage for their employees in the state online marketplaces. Those marketplaces, also called exchanges, were created for employers with up to 100 workers and individuals who cannot get coverage through the workplace.

So the good news is that anyone buying coverage through a state exchange will have the assurance of knowing that their policies will cover essential benefits and have lower deductibles than many policies being sold today.

The bad news for millions of others, however, especially those who work in low paying jobs at places like chain restaurants, retailers and nursing homes, is that many of the consumer protections that apply to policies bought through the exchanges will not apply to them. The adequacy of their coverage will depend on how much money their employers are willing to devote to health insurance.

We'll probably never know, but I suspect the language in the law pertaining to employer-sponsored coverage was written in a purposefully ambiguous way by lobbyists for insurance companies that have found selling inadequate coverage quite profitable. Some of the biggest insurers, including Aetna, Cigna and UnitedHealthgroup, bought companies several years ago that specialize in so-called limited-benefit plans. You can be certain they would try to protect their investments, especially considering that limited-benefit plans typically have high profit margins. That's because the insurance companies that sell them never have to pay out much in claims.

And that's why so many Americans filing for bankruptcy because of medical debt actualy have insurance. According to a 2009 study by Harvard researchers, 78 percent of people who listed medical debt as the leading reason for their bankruptcy filings had insurance.

Those researchers found that medically related bankruptcies have been rising steadily-from 8 percent of bankruptcies in 1981 to 62 percent in 2007. Also growing steadily during that timeframe was the number of underinsured Americans.

The Commonwealth Fund recently estimated that approximately 30 million Americans are enrolled in policies that do not offer adequate protection.  The organization's Biennial Health Insurance Survey of 2012, released last month, found that 46 percent of adults between the ages of 19 and 64-an estimated 84 million people-did not have insurance for the full year or were underinsured and consequently unprotected from high out-of-pocket costs. Two of five adults reported that they had problems paying their medical bills or were paying off medical debt.

In response to a question last month about the implementation of the reform law, President Obama said, " ... in a country as wealthy as ours, nobody should go bankrupt if they get sick." Regrettably, because of loopholes in Obamacare that undoubtedly will be exploited by employers more concerned about the bottom line than the health of their employees, that will continue to be little more than an aspiration for years to come. 

Aging Americans worried about their droopy upper eyelids often rely on the plastic surgeon’s scalpel to turn back the hands of time. Increasingly, Medicare is footing the bill.

Yes, Medicare. The public health insurance program for people over 65 typically does not cover cosmetic surgery, but for cases in which a patient’s sagging eyelids significantly hinder their vision, it does pay to have them lifted. In recent years, though, a rapid rise in the number of so-called functional eyelid lifts, or blepharoplasty, has led some to question whether Medicare is letting procedures that are really cosmetic slip through the cracks — at a cost of millions of dollars.  

As the Obama administration and Congress wrestle over how to restrain Medicare’s growing pricetag, critics say program administrators should be more closely inspecting rapidly proliferating procedures like blepharoplasty to make sure taxpayers are not getting ripped off.

From 2001 to 2011, eyelid lifts charged to Medicare more than tripled to 136,000 annually, according to a review of physician billing data by the Center for Public Integrity. In 2001, physicians billed taxpayers a total of $20 million for the procedure. By 2011, the price tag had quadrupled to $80 million. The number of physicians billing the surgery more than doubled.

“With this kind of management malpractice, it’s little wonder that the [Medicare] program is in such dire shape,” said Sen. Tom Coburn, R-Okla., who is also a physician. “The federal government is essentially asking people to game the system. Every dollar we spend on cosmetic surgery that isn’t necessary is a dollar that can’t be used to shore up the program for people who need it the most.”

Plastic surgeons say there are a number of legitimate reasons for the spike, including a tendency among the elderly to seek fixes for real medical issues they might have quietly suffered through even a decade ago. But surgeons also acknowledge an increased awareness of the surgery fueled by reality television, word-of-mouth referrals, and advertising — often including dramatic before-and-after photographs — that promises a more youthful appearance. And doctors concede they face increased pressure from patients to perform eyelid lifts, even when they do not meet Medicare’s requirement that peripheral vision actually be impaired.  

Thomas Scully, former Medicare administrator under George W. Bush, has a blunter assessment; he doubts the jump is caused by anything other than seniors seeking younger-looking eyes. “How many seniors among your friends or family have needed eyelid surgery?” he said. “I bet a hell-of-a-lot of them at 65 say, ‘You know what, I bet I can get Medicare to pay for this.’ And I can imagine the plastic surgeons love it. If you can go to patients and say that Medicare will pay, they will do it in much larger numbers.”

Florida surgeon bills Medicare for more than 2,200 eye surgeries a year

Surgeons who bill Medicare for large numbers of eyelid surgeries dot a map of the United States. Yet 11 of the 20 highest billers in 2008 were in Florida, which is both an elderly mecca and the country’s foremost magnet for questionable Medicare billing.

Among the top surgeons, the data show a South Florida doctor billed Medicare more than $800,000 in 2008 for about 2,200 eyelid lifts. That’s an average of six a day, including weekends. This same doctor was also a top biller in 2006 and 2007.

The Center is barred from naming the Florida surgeon. A 1979 federal court injunction blocks the Department of Health and Human Services from publically releasing doctor’s names in conjunction with specific Medicare billing information. The Center sued HHS to obtain the Medicare data but as a condition for obtaining it, signed an agreement not to publish the names of individual doctors, unless they agreed to discuss their billing histories. After repeated calls for comment, and a fax including the billing referenced by the Center, the Florida physician’s office assistant said he would not talk “due to prior engagements.”

Dr. Michael Migliori, president of the American Society of Ophthalmic Plastic and Reconstructive Surgery, said the Florida surgeon’s billing level might be feasible, if he was a busy eyelid specialist who performed few or no other procedures. But since the doctor also advertises breast augmentations, tummy tucks, liposuction, and a variety of other general cosmetic procedures, Migliori said his billing “does seem like an awful lot.”

Ryan Stumphauzer, a former federal prosecutor in the Southern District of Florida and founding member of the Medicare Fraud Strike Force, put it more bluntly: “There is no way that is anything other than crap.”

A spokesman for the Centers for Medicare and Medicaid Services, after being shown the Center’s data analysis, declined to comment on whether agency officials had noticed the dramatic uptick in blepharoplasty or taken any measures to ensure the billed procedures are legitimate.

Strict Medicare guidelines difficult to enforce

Quick, easy, and relatively painless, eyelid surgery is one of the most popular cosmetic procedures, with patients paying out-of-pocket for more than 200,000 a year, according to the American Society of Plastic Surgeons. The process for purely cosmetic surgeries and Medicare-funded blepharoplasty is the same. Doctors numb the eyelids with a local anesthetic before removing fat and excess skin, often with a laser. The entire process usually takes less than 30 minutes, and is performed most often in doctors’ offices or outpatient surgical centers, some of which are connected to “medical spas” or “beauty clinics.”

Medicare reimbursement ranges from $574 to $640 per eye, depending on the setting, but the rules for Medicare coverage are firm. Purely cosmetic surgeries do not qualify. Before filing a Medicare claim, doctors are required to test a patient’s vision and document that drooping skin significantly compromises a patient’s eyesight. The exam usually involves lifting a patient’s eyelids with tape and comparing their vision results to tests performed without tape.

Unlike private insurance plans, though, Medicare does not require pre-authorization of eyelid surgeries. Robert Berenson, a health policy expert at the Urban Institute and former commissioner of the Medicare Payment Advisory Commission, has pushed for selective pre-authorization for some Medicare services. But Berenson questioned whether reviewing physician records in advance would help much in the case of blepharoplasty, if surgeons have learned how to document the need for the procedure in order to work the system. “I am sure there are some patients who are hampered by eyelids drooping. And I’m sure that many of them are not and it’s a cosmetic reason,” Berenson said. But the doctors, he added, “have probably gotten very skilled at knowing how to document that something is not cosmetic.”

Dr. Bruce Quinn, who served as Medicare medical director of California’s Medicare Part B program from 2004 to 2008, said monitoring blepharoplasty claims is notoriously difficult. When a claim is reviewed, Quinn said, staff receives a medical record from a doctor that says a patient’s eyelids interfered with their vision, along with a photo of someone with droopy eyelids. There really isn’t anything to review, Quinn said. “It’s really hard to go much further on that.”

It’s also difficult and expensive to take blepharoplasty cases to court if a provider is suspected of fraudulent billing, Quinn said. To make a case, the prosecution requires patient testimony and boxes of records, a bar that is hard to meet. Quinn said although the explosion of blepharoplasty caught his attention in California, it was “pretty slippery to get a handle on.”

In most cases, Medicare trusts that doctors follow the rules and pays the claims it receives. The program later reviews a small percentage of claims and sometimes attempts to recoup money. Experts say the process, derisively known as pay and chase, has allowed fraud to thrive.

Medicare does have the authority to review claims before payment, and does so in certain cases. In 2012, Palmetto GBA, a government contractor that processes and pays Medicare claims, instituted a pre-payment probe of functional eyelid surgery claims in California, Nevada, Hawaii and the Pacific Islands. In California, where the probe is complete, Palmetto denied nearly 62 percent of claims it reviewed. The majority of those errors involved insufficient information showing the eyelid surgeries were “reasonable and necessary,” a Palmetto spokesman said.

Top docs says treatments necessary

Unlike the top biller in South Florida, some eyelid surgeons were willing to discuss their Medicare billing. “I’m disappointed that I am not number one. I wish I was on top,” joked John LiVecchi, a Florida plastic surgeon who was among the top ten billers listed in 2008 Medicare data. LiVecchi, an eyelid specialist, said his practice at St. Luke’s Cataract and Laser Institute is one of the largest in the country, which accounts for his numbers. St. Luke’s operates five offices in the Tampa Bay area.

LiVecchi, who has had an eyelid lift himself, disputes that patients are flocking to the procedure primarily with vanity in mind. Patients with droopy eyelids often don’t realize how much the droopy skin is narrowing their field of vision, he said. LiVecchi said he jokes with his patients that he doesn’t want them driving in his neighborhood until after the surgery. “It’s safer for society,” he said.

As for the cosmetic boost, LiVecchi compared eyelid surgery to removing a cancerous lump from a patient’s face. In both cases the doctor’s primary objective is keep a patient healthy, he said. A more youthful appearance is only a pleasant side-effect, which he sees no problem with. “Doesn’t everybody want to look good?” he asked.

LiVecchi said he believes most Americans should have the surgery by the time they are in their late 70s, yet only a small percentage are currently getting the fix. Droopy eyelids, like cataracts, are a fact of life, he said. “It’s something you can’t prevent. It’s part of the aging process.”

Yet 2008 claims records shows that more than 25 percent of eyelid surgeries billed for traditional Medicare beneficiaries were for patients 65 to 69-years-old.

The benefits of functional eyelid surgery for some patients are documented. A 2011 study published in the journal Ophthalmology, for example, found that the surgery provided “significant improvement in vision, peripheral vision, and quality of life activities.”

The surgery does not always go well, and some patients are left worse off. Gail Wilensky, a former Medicare administrator whose husband is a plastic surgeon, said her mother needed the surgery, yet she feels it was poorly performed and left her with tearing for the rest of her life.

Plastic surgeons interviewed said vision problems are not always the draw. Migliori, the president of the American Society of Ophthalmic Plastic and Reconstructive Surgery, said he sees three or four people a day who need the surgery at his practice at Rhode Island Hospital. But he conceded he faces a lot of pressure from patients who do not qualify. “They come in begging for you to do this surgery,” Migliori said. “You get a lot of pressure to bend the rules.”

Migliori said fudging the paperwork wouldn’t be hard. “You could tell the patient to squint,” he said, regarding the requirement that the condition be documented by a photograph, and then fake the vision test. But he thinks the majority of his colleagues are honest.

“To me it seems like a lot of work for something that doesn’t pay that great,” he said.

Surgeons make Medicare eyelid lifts big business

Medicare pays a third, or less, of what many surgeons charge patients out of pocket for cosmetic eye surgery. In the medical world, it is far from a big ticket item. But for practices with a large number of Medicare patients, the dollars quickly add up.

Sean Blaydon, an ophthalmic plastic surgeon at the Center for Aesthetic and Reconstructive Eyelid and Orbital Surgery in Austin, Texas, said his practice is a top biller of Medicare eyelid lifts because with five eyelid specialists, it is likely the largest center in the country. “Our bread and butter is eyelids,” Blaydon said.

Blaydon said the doctors at the Austin clinic drive, and sometimes fly, across central Texas to examine prospective patients referred to them. Candidates travel for the procedure to the doctor’s Austin outpatient surgical center, which is in the same building as the center’s Italian-themed spa that advertises “the Bellisimo Experience,” and offers Botox, skin peels and a variety of cosmetic skin rejuvenation treatments.

Blaydon said the clinic’s high numbers make it vulnerable to Medicare appeals. The center keeps all patient records on site and hands them over to Medicare when they ask for them, he said.

Although Medicare contractors have strict rules for eyelid surgery, Blaydon said it’s hard to judge the reasons why patients are flocking to the surgery like never before. Some of it has to do with vision, he said. And some of it has to do with vanity.

“There is no questioning that when they come here they also want to look better,” Blaydon said.

A new super PAC called "Grow NC Strong" has formed to promote North Carolina House Speaker Thom Tillis, a Republican who is considering a U.S. Senate bid in what could rank among the nation's more competitive races in 2014.

Grow NC Strong registered with the Federal Election Commission on Thursday, new documents show.

The paperwork identifies Michael Luethy as the group's executive director and Cindy Marrelli Watko as its treasurer.

Luethy is a political consultant who previously worked for the National Republican Congressional Committee and North Carolina Republican Party, according to his official online biography.

Marrelli Watko is a former business executive who worked for companies including Triology, Electrolux, Accenture and IBM. She is also a real estate broker, a board member of the Christian nonprofit Project Mercy, which combats poverty in Ethiopia, and an activist with the Republican Party focused on "expanding the role of women in government and leadership," according to her LinkedIn profile.

Tillis, a former IBM executive, was first elected to the North Carolina legislature in 2006.

His top campaign contributors over the years include the North Carolina Association of Realtors, Duke Energy, Bank of America and AT&T, according to the nonpartisan National Institute on Money in State Politics.

Incumbent Democrat Kay Hagan is seeking re-election in 2014, and several Republicans other than Tillis, including Reps. Virginia Foxx and Renee Ellmers and North Carolina Senate President Pro Tem Phil Berger, are reportedly considering getting into the race.

Hagan's campaign had more than $2.7 million in the bank at the end of March, according to federal records.

When Texas’s biennial legislative session began earlier this year, many advocates for tougher ethics laws sounded an upbeat tone. Since a large crop of new lawmakers was coming aboard, some said at the time, 2013 was the year for bold reform.

But on Sunday, the legislature ended those hopes. An ethics bill was indeed passed, but it failed to include most provisions that watchdogs had pushed for. During a conference committee between the Senate and the House, lawmakers stripped several amendments that would have required online financial disclosure, exposed “dark money” in state campaigns and required lawmakers to disclose financial interests in businesses that receive state contracts.

“We’re extremely disappointed,” said Craig McDonald, director of Texans for Public Justice, a good-government group in Austin. “There were a lot of good things in there that reformers have been asking for for years, and all those were stripped in the dark of night.”

All was not lost for the reformers, though. The legislation, officially a reauthorization of the state Ethics Commission, did include several changes to the Lone Star state’s ethics laws. The measure will ban outgoing lawmakers who register as lobbyists from giving their unspent campaign funds to sitting lawmakers for two years, and directs the Ethics Commission to divide its cases into three categories, ranging from clerical errors to serious violations. The change will allow the commission to better manage its case load and devote more resources to serious ethics complaints, said Tom Smith, Texas director for Public Citizen, a Washington-based advocacy group.

The legislation also calls for a change in the Railroad Commission, which regulates the oil and gas industry: commissioners will now have to resign before running for another office. For decades, commissioners have pulled in huge contributions from energy companies while spending much of their time campaigning for another position, using the Railroad Commission simply as a lucrative launching pad, Smith said.

“Not only are the good government advocates like us sick of it,” he said, “but many in the industry supported it because they were tired of being shaken down.”

In a written statement, state Sen. Joan Huffman, a Republican who sponsored the bill, said it “includes substantial improvements in transparency.”

While that may be the case, state Sen. Wendy Davis, a Democrat, noted that most of the changes in the bill apply to other branches of government. “When it came time for making these decisions for shedding light on own our activities,” she said, “as usual in the Texas legislature, there was a tremendous amount of resistance.”

One of the more contentious provisions in the bill would have required nonprofits that spend on political campaigns, known as 501(c)(4) groups for a section of the federal tax code, to disclose the names of some of their donors. The legislature had passed a stand-alone version of the measure, but added an amendment to the reauthorization bill in case of a veto of the stand-alone bill by Gov. Rick Perry, who opposed the effort. But lawmakers removed the amendment Friday night, and the following day, Perry vetoed the stand-alone bill.

“It’s a tragedy,” Smith said.

Another controversial part of the legislation would have removed the ability of the Travis County District Attorney’s office, which is generally controlled by a Democrat, to investigate public corruption cases, leaving the jurisdiction to the Attorney General, who is usually a Republican. GOP legislators have pushed the move for years, McDonald said, to no avail. Instead, the legislature approved a study to look into the matter.

The provision governing post-legislative lobbying fell short of what some lawmakers had pushed for: a two-year ban on all lobbying activity after leaving office. Texas is one of 15 states that allow out-going lawmakers to register as lobbyists as soon as they leave office. This year, eight former House members registered as lobbyists, according to the Texas Tribune.

That failure was just one of many disappointments for good-government groups and their allies in the legislature. With the session now over, they’ll have to wait two years to try again, unless Perry adds ethics reforms to a list of issues covered by a 30-day special session that began Monday.

The bill now awaits action from the governor. Spokeswoman Lucy Nashed said in an email that “as with all legislation, the governor is reviewing the bill in its final form,” and has not decided what to do, but McDonald said he expects Perry to sign the bill.