STATE OF MINNESOTA MINNESOTA CAMPAIGN FINANCE AND PUBLIC DISCLOSURE BOARD COMPLAINT FOR VIOLATION OF THE CAMPAIGN FINANCE

AND PUBLIC DISCLOSURE ACT INTRODUCTION Prior to the 2012 general election, the Republican Party of Minnesota made numerous independent expenditures attacking Minnesota DFL candidates as part of the Republican Partys failed effort to retain control of the Minnesota Senate. No fewer than 22 different pieces of literature, and likely many more, were mailed to thousands of homes across the State. However, the Republican Party failed to disclose a single independent expenditure against any DFL Senate candidate on its 2012 Year End Report, or any other report hiding thousands of dollars of electioneering activities from the public. This failure to disclose even a single independent expenditure attacking a DFL Senate candidate cannot be explained by mere inadvertence and is a blatant disregard of the Campaign Finance and Public Disclosure Act. In addition, the Republican Party appears to have understated its independent expenditures affecting the Minnesota House races and supporting some of its own Senate candidates by an additional $144,100. For each independent expenditure included in its YearEnd Report, the Republican Party disclosed the amount paid for Printing and Photocopying Political Mail but did not disclose the amount paid for the postage to deliver the political mail to voters homes. Instead, the Republican Party of Minnesota reported $144,100 of postage expenses between August 24, 2012 and October 31, 2012 as general expenditures. The

misleading and inaccurate reporting of postage expenses dramatically understates the Republican Partys spending to influence the outcome of the 2012 election through independent expenditures.

BACKGROUND AND VIOLATIONS A. Failure to Report Independent Expenditures. The Republican Party sent at least 22 different mailings to voters either attacking DFL candidates for the Minnesota Senate or supporting Republican candidates.1 Each and every mailing included the disclaimer that This is an independent expenditure not approved by any candidate or candidates committee. Paid for by the Republican Party of Minnesota. 525 Park St, Suite 250, St. Paul MN 55103. However, the Republican Partys 2012 Year-End Report failed to disclose a single independent expenditure against a DFL candidate and identified only six independent expenditures supporting Republican candidates.2 Several of the unreported independent expenditures attacking DFL Senator Kent Eken were the subject of an Order by the Office of Administrative Hearings concluding that the Republican Party violated Minnesota Fair Campaign Practices Act by preparing and disseminating false campaign material with reckless disregard as to whether the information in the campaign material was false.3 The Order finds that the Republican Party of Minnesota retained Jeff Bakken, a long-time Republican consultant and vendor, to design and prepare the campaign material; that each version of the campaign material included a disclaimer that said it was paid for by the Republican Party of Minnesota; and that the campaign materials were sent to the same list of 15,000 households in Senate District 4 that the Republican Party had identified as swing voters.
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Although the Republican Party acknowledged that it was

responsible for the campaign material and was assessed a $600 penalty for violating the
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See Exhibits 1 and 2. The 2012 Year End Report disclosed independent expenditures supporting Keith Downey, John Howe, Cory Jensen, Benjamin Kruse, Gregg Kulberg, and Bruce Lundeen. See Republican Party of Minn. Report of Receipts and Expenditures (January 31, 2013), Sch. B3. However, it does not include any independent expenditures supporting Mike Dudley or Bill Weber. See Exhibit 2. 3 See Exhibit 3 (Martin v. Republican Part of Minnesota, OAH 7-0320-30106, (Dec. 7, 2012)). 4 Exhibit 3, 4, 6, and 17. 2

Minnesota Fair Campaign Practices Act, it failed to disclose a single independent expenditure against Kent Eken in its campaign finance reports and the only reported payments to P2B Strategies, the company for whom Jeff Bakken works,5 related to two independent expenditures supporting Republican candidates Keith Downey and John Howe.6 The Republican Partys failure to disclose at least 22 independent expenditures concealed hundreds of thousands of dollars of electioneering activities from public view. This is a serious violation of the provisions of Minnesota Statutes, Chapter 10A regarding the reporting of independent expenditures. B. Failure to Properly Disclose Postage Expenses Related to Independent Expenditures In addition, even when the Republican Party of Minnesota reported its independent expenditure activity, it concealed more than a hundred thousand dollars of expenses related to those independent expenditures. When reporting its independent expenditures affecting

Minnesota House races and supporting six Republican candidates for the Senate, the Republican Party reported only expenses for Printing and Photocopying Political Mail.7 The Republican Party did not report any of the expenses involved in distributing the mailings to Minnesota voters even though the expenses are an integral part of the independent expenditures. Instead, it appears that the costs of distributing the mailings may have been reported as general expenditures. The Republican Partys 2012 Year-End Report includes $157,172.56 of general expenditures for postage with the United States Postal Service.8 Of these postage-related expenditures, $144,100 do not correlate with other mailings reported as general expenditures and, instead, appear to relate to the independent expenditures. There is no question these postage
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Exhibit 4. Republican Party of Minn. Report of Receipts and Expenditures (January 31, 2013), Sch. B3. 7 Republican Party of Minn. Report of Receipts and Expenditures (January 31, 2013), Sch. B3. 8 Republican Party of Minn. Report of Receipts and Expenditures (January 31, 2013), Sch. B1, p. 33-34. 3

expenses, if they relate to the independent expenditures, should have been reported as independent expenditures. Reporting them separately is no different than reporting the costs of producing a television advertisement but not the costs of broadcasting the advertisement. By falsely classifying its postage expenses as general expenditures, the Republican Party concealed $144,100 of its independent electioneering activities in violation of Minnesota Statutes, Chapter 10A. CONCLUSION The Republican Party of Minnesota, either by improperly reporting independent expenditures or failing to report the expenditures altogether, concealed hundreds of thousands of dollars of electioneering activities in connection with the 2012 elections. This is a serious violation of the Minnesota Campaign Finance and Public Disclosure Act and a breach of the public trust. The Campaign Finance and Public Disclosure Board should thoroughly investigate the reporting of independent expenditure activities by the Republican Party of Minnesota and assess appropriate penalties for all violations of law.

Respectfully submitted,

Dated: January 27, 2014

By:

____________________________ Ken Martin, Chair Minnesota DFL Party 255 East Plato Boulevard St. Paul, MN 55107 Phone: 651-293-1200 E-mail: chair@dfl.org