Tax-credit group on notice

Pro-school-choice group must list expenditures , donors by today; it doesn’t plan to do so

By AARON GOULD SHEININ

asheinin@thestate.com

South Carolinians for Responsible Government, a pro-tuition tax credit group, has until today to disclose where it gets and spends its money, an official with the State Ethics Commission said.

The group’s spokesman said they have no plans to do so.

What happens when the deadline comes and goes with no filing is unclear. The group could face an investigation and potential fines from the Ethics Commission, a lawsuit, or find that nothing happens.

Since first coming on the S.C. political scene in 2004, South Carolinians for Responsible Government has been outspoken and often controversial. The organization has refused attempts to reveal where it gets its money. Critics have claimed it is largely funded by out-of-state donors advancing a national school choice agenda.

The group’s leaders deny this, and say it has strong grass-roots support in South Carolina.

If the organization is forced to divulge its finances, or if it beats back this latest attempt to do so, the outcome could set a precedent for other groups.

The issue is coming to a head because the group recently ran radio advertisements urging voters to call Rep. Bill Cotty, R-Richland, and tell him to support the tuition tax credit plan the House was considering.

Cotty has opposed the bill, which would give parents tax credits to send their children to private schools. The House ultimately voted to kill the proposal for the second straight year.

Cathy L. Hazelwood, general counsel to the Ethics Commission, said state law requires any organization that spends money in an attempt to influence the outcome of an election with 45 days of the vote to disclose its fundraising and spending.

The group’s ad about Cotty meets that standard, she said.

Cotty faces Sheri Few of Kershaw County in the June 13 Republican primary. Few supports the tuition tax credit bill. Efforts to reach her Wednesday were unsuccessful.

Because the ad mentions Cotty, Hazelwood said, it is considered an attempt to influence the election, even though the ad never specifically tells voters to vote against Cotty or for Few. Legal experts say another section of the law might contradict itself, meaning the 45-day rule might not actually apply. That would create a loophole protecting such organizations.

Regardless, group spokesman Denver Merrill said they disagree with Hazelwood.

“We feel very confident that we’re within our rights to run those ads,” he said. “I don’t see how in the world somebody can construe that as being altering the outcome of an election.”

Merrill said as a 501(c)4 nonprofit, they are not allowed to participate in political campaigns. Their focus, Merrill said, is on advocating for the legislation or the larger issue of school choice.

What happens next is unclear. Hazelwood said the Ethics Commission will not unilaterally investigate whether the group has violated the law.

“Somebody needs to file a complaint,” Hazelwood said. “We’re not going to do it based (only) on all the telephone calls and e-mails we’ve gotten.”

As of Tuesday, Hazelwood said they had received more than a dozen calls or e-mails from individuals asking about the ads.

Cotty has asked for an informal opinion of commission staff, and a formal opinion from the full commission, as to whether the group is required to disclose how it raises and spends money.

He said he would also consider taking the organization to court to force the disclosure or to prevent the group from running more ads.

He said the ads “are clearly intended to influence the election against me. It’s like being attacked by carpetbaggers.”

Cotty and others claim the group is largely funded by out-of-state interests intent on using South Carolina as a model for school choice legislation.

Merrill dismissed such claims.

“It’s laughable. If (Cotty) wants to claim that our 2,000 grass-roots supporters are not South Carolinians, that’s his right. But I think they will take great offense at that.”

Merrill declined, however, to provide a list of supporters.

Reach Gould Sheinin at (803) 771-8658.