The Koch brothers-backed group that helped launch the push for voter ID laws and “stand your ground” statutes has a new project: defending the anonymous “dark money” in politics.

The American Legislative Exchange Council, composed of conservative state lawmakers and corporations, devoted part of its annual conference last week to turning around negative perceptions about anonymous contributions. In an audio tape obtained by POLITICO, panelists at the San Diego event lament a movement gaining traction in state and local governments to require more disclosure of donations to politically active nonprofits, which are expected to spend hundreds of millions in the 2016 election.


According to the audio, speakers stressed that groups pushing for disclosure were strategic in labeling anonymous spending “dark money,” “conjuring images of shady operatives in smoke-filled rooms” in the minds of voters to boost their cause.

“Seems to me that by using the term ‘dark money’ in this discussion we are buying into their arguments,” said one state senator at the session. “If the media were to call it something better such as ‘anonymous free speech money’ or something else. Somebody needs to come up with a better label than ‘dark money.’”

Other speakers also acknowledged that disclosure advocates have waged a more successful public relations campaign in influencing voters’ opinion on the issue, and that it’s time for their side to step it up as more statehouses propose disclosure laws.

At least 125 campaign finance reform bills — many of them dealing specifically with disclosure — had been introduced in 33 statehouses in the first half of the year, according to the National Institute on Money in State Politics. And a recent New York Times/CBS poll found that three-quarters of self-identified Republicans support requiring more disclosure by outside spending organizations.

But participants at the ALEC conference, including many state legislators, talked about the need to counter arguments about transparency in political fundraising by referencing the “chilling effect” disclosure can have on giving. Some conservatives maintain that disclosing the identity of donors to nonprofits can lead to unnecessary harassment and would discourage the public from exercising their First Amendment right to free speech.

ALEC, a well-funded nonprofit, attracted to its conference two presidential hopefuls: Gov. Scott Walker and former Gov. Mike Huckabee. Sen. Ted Cruz, who presided over a Senate Judiciary committee hearing on the Internal Revenue Service and politically active nonprofits on Wednesday, addressed the conference by video.

By the group’s own estimate, about one in four state lawmakers nationwide is a member of ALEC, which prepares drafts of pro-business, anti-regulation bills and tries to get them introduced in state legislatures. The group also claims that 1,000 bills are introduced in the states each year based on its model legislation, and, of those, an average of 20 percent become law.

Jon Riches of the Goldwater Institute said in an interview after the event that ALEC’s discussion was partly a response to growing conservative concerns. “[Disclosure] is going to be a very important legislative issue in sessions to come, and it’s important that lawmakers know the impact that mandatory government disclosure can have on speech.”

During the event, Riches told participants, “Mandatory government disclosure prevents public discourse from focusing on the message and instead focuses on the messenger.”

“Two, mandatory government disclosure allows for retaliation against speakers by those who disagree, particularly when those speakers are speaking truth to power. And three, mandatory government disclosure [creates] regulations so that nobody, particularly average citizens, knows what’s permissible and what’s prohibited, and as a result choose not to speak.”

Riches even compared anonymous spending by nonprofits to newspapers who use unnamed sources in their reporting or publish editorials endorsing candidates.

“Newspapers engage in political dialogue all the time. They endorse candidates. What’s the difference there?” he said.

Attendees received detailed literature titled, “The Victims of ‘Dark Money’ Disclosure” from the Goldwater Institute, which calls disclosure requirements “an excuse to silence disfavored speech,” and “Three Primary Threats to 501(c)(3) Donor Privacy” from the Center for Competitive Politics that includes the groups’ main talking points on the issue.

David Keating of the Center for Competitive Politics took a more doom and gloom approach in his remarks. “The right of every American and the causes they believe in is under attack,” he told attendees.

Keating added that nonprofits are being unfairly targeted because they represent only 5 percent of total political spending. When asked by POLITICO to explain the 5 percent number, Keating said he was including only money spent by nonprofits directly advocating specific candidates and not issue ads that might criticize or praise candidates on a particular issue but don’t explicitly ask viewers to vote for or against them.

“Where do you begin to count issue advocacy? I know organizations try to do it, but they don’t disclose their methodology and no one can replicate it,” Keating said. “I think those numbers are junk. You might as well include the value of New York Times editorials in those numbers.”

Responding to the panelists’ comments, Common Cause, which has been pushing for more disclosure of politically active nonprofits, called their argument a red herring.

“No one is calling for complete disclosure,” said Stephen Spaulding, the group’s policy counsel. “If you’re a nonprofit and going to step into the political arena … then voters deserve to know who is funding those ads.”