Bulk of money raised by opposition Nashville transit group kept secret

The donors behind more than three-fourths of the campaign dollars raised by the leading opposition group fighting Nashville's transit referendum are secret.

The political action committee NoTax4Tracks, in its first financial disclosure submitted Tuesday, reported raising $948,953 over the past three months. But $750,000 of that amount came from a single organization — Nashville Smart Inc.

Nashville Smart Inc. in December registered as a 501(c)(4) nonprofit, which under federal law does not have to disclose its donors. The organization is led by Lonnie Spivak, a former Republican congressional candidate in 2010 and Metro Council candidate in 2015.

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Attorney Charles Robert Bone, a referendum proponent, raised the issue of campaign finance transparency during a debate on the transit plan co-hosted by The Tennessean and WSMV-TV on Tuesday night.

"Just one quick question, who is Nashville Smart Inc.?" Bone said to jeff obafemi carr, an organizer for NoTax4Tracks, later asking, "Can you tell us who supports that organization?"

Transit group demands donors be revealed

Wednesday was the first day of early voting on the referendum on raising four taxes, including the sales tax, to pay for a $5.4 billion transit plan that includes light rail. The election is May 1.

Leaders of the Nashville for Transit coalition, which is pushing for its approval, gathered on Broadway outside Beaman Automotive to demand that NoTax4Tracks reveal the donors funding the 501(c)(4). The car dealership is owned by Lee Beaman, a deep-pocketed anti-transit advocate who was the original treasurer of NoTax4Tracks.

"This is almost $1 million of completely hidden and dark money," said Patrick Green, president of Amalgamated Transit Union 1235 and a member of Transit for Nashville. "We don't know who contributed the money. We don't know if it's from outside special interests. It's being purposely hidden from us.

"We deserve better. Nashville deserves better."

Transit supporters pointed to a Jan. 27 public forum hosted by the Beacon Center of Tennessee, where they alleged Beaman told the crowd that donors could "hide their money" by contributing to Nashville Smart Inc. instead of directly to NoTax4Tracks.

But Beaman, reached by phone, disputed that characterization of his remarks.

"I did not say they could hide their donations," Beaman said. "I said that PAC donors are public records and a (c)(4), as the law is, says they're not. That's all I said.

"I just said what the law is on it. I didn't encourage them to donate one way or another."

Jeff Eller, a spokesman for NoTax4Tracks, said his organization has no control over an independent 501(c)(4).

"By law, I cannot coordinate. I cannot talk to them," Eller said. "Any (c)(4) can give us money. It's up to the (c)(4) to make the determination. This is a case where I am damned if I do and damned if I don't.

"If I do anything to try to find out who gave them money, I break the law. If I don't, I'm accused of not being transparent. I'm not going to break the law."

Transit proponents, without evidence, have regularly accused the opposition of being financed by the likes of the conservative billionaire Koch brothers, whose group Americans for Prosperity has led its own campaign activity separate from NoTax4Tracks. Americans for Prosperity has primarily worked on grass-roots outreach on the transit issue.

Asked whether Nashville Smart Inc. has received some Koch brothers money, Eller could not say.

"I don't know," he said. "I can't know."

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Spivak declined to disclose the donors when asked by The Tennessean, nor would he say how many donors have contributed to the group.

"We were created for the betterment of Nashville," he said, pointing to its stated mission to "advocate for a vision of better choices, planning and positive economic development for Nashville when it comes to transit."

Tuesday was the deadline for first-quarter financial disclosures.

Opposition getting outraised, outspent

Despite the significant backing from Nashville Smart Inc., NoTax4Tracks has been vastly outraised by the Nashville for Transit PAC, a pro-referendum PAC that is funding the Nashville for Transit campaign.

The pro-transit PAC — which has received help from some of Nashville's biggest companies, such as HCA, Ingram Industries and Bridgestone Americas — reported raising an additional $1.2 million over the past three months, bringing its overall fundraising haul to more than $2.5 million since the campaign began in August.

NoTax4Tracks reported spending $799,371 over the past three months, compared with $740,066 by Nashville for Transit. But the pro-transit group had already spent $442,141 on campaign activity during the previous reporting period.

Almost all of Nashville for Transit's money, $735,125, over the past three months went to television advertising purchases made through the public relations firm McNeely, Pigott and Fox. The pro side has held a commanding advantage on television over opponents.

"We are such the underdog," Eller said. "We are getting pummeled and outspent."

Nashville for Transit also has received help from a 501(c)(4), Creating a More Mobile Community, but that group has disclosed its donors, which includes Vanderbilt University and Vanderbilt University Medical Center. The group's chairman is Nashville attorney Tom Trent.

Some of Nashville for Transit's largest contributions from the past three months were $150,000 from the National Association of Realtors, $100,000 from Community Health Systems, an additional $100,000 from Bridgestone Americas, $55,000 from CDM Smith, $50,000 from LifePoint Health Support Center and $50,000 from AECOM Technology Corp., among others.

Nashville for Transit, which is an ally of the Nashville Area Chamber of Commerce, formed last summer, meaning it has submitted one more financial report than NoTax4Tracks, which organized later.

The second largest donor to NoTax4Tracks behind Nashville Smart Inc. is Joe Scarlett, the retired president and chairman of Tractor Supply and vice chairman of the free-market think tank Beacon Center of Tennessee. Scarlett has contributed $100,000.

Other top donors include Jimmy Webb of Freeman Webb Co., who has contributed $20,000; attorney Dale Allen, who has given $10,000; and Gen Cap America President and CEO Barney Byrd, who has chipped in $10,000.

Other NoTax4Tracks donors include Vanderbilt University professor Malcom Getz; George Gruhn of Gruhn Guitars; the group's treasurer, Waymon Tipton of Avondale Partners; and Beaman.

Notable names who did not contribute to NoTax4Tracks individually include some of the anti-transit referendum's highest-profile backers, including investor Mark Bloom and downtown honky-tonk bar owners Steve Smith and Brenda and Ruble Sanderson.

Meanwhile, Beaman, who was a major force in the 2014 effort to stop the Amp bus rapid transit proposal, is listed as contributing only $1,000 on Jan. 16.

Nashville for Transit has $411,173 on hand to spend before the May 1 election, nearly three times more than NoTax4Track's $149,581 cash on hand.

Reach Joey Garrison at jgarrison@tennessean.com or 615-259-8236 and on Twitter @joegarrison.