Bingo is chief beneficiary of Michigan PAC
Monday, June 21, 2010
A little-noticed political action committee, tucked away on the shores of Lake St. Clair, Mich., and named for the lawmaker once known as the conscience of the U.S. Senate, has suddenly surged into the front ranks of national campaign fundraising after more than a decade in the minor leagues.
And the reason is: bingo.
Revenues of the Philip A. Hart Democratic Club this election cycle exceed $1.9 million, more than the combined political action committee receipts of House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Mitch McConnell (R-Ky.). It is one of the top gainers among political action committees anywhere in the nation, last year boosting its revenue eightfold, compared with 2007.
There is one small, perhaps significant, catch. The prodigious political fundraising machine turns out to have given away just $500 to a political candidate in the past 16 months, to Rep. Gary Peters, a first-term Michigan Democrat. That record demonstrates how loosely such federal PACs are regulated, because organizers are free to hold onto their funds or spend them on virtually anything unrelated to campaigns and elections, according to campaign finance experts.
For example, most of the Hart club's wealth appears to have been paid to two local bingo-supply companies and to self-described local housewives and homemakers, in expenditures ranging from $50 to $1000. Each is listed on monthly reports to the Federal Election Commission as a "Bingo Prize."
In short, the Hart club has raised an average of $3,700 a day to throw less than a thousandth of that amount into federal political campaigns. That represents perhaps a record for stinginess among the tax-exempt entities known as federal PACs.
"It certainly is a reminder that all contributors to PACs should keep in mind: Caveat emptor -- buyer beware. Once you turn over your money to a PAC, you lose all control of where it ends up," said Meredith McGehee, policy director of the Campaign Legal Center, a nonprofit group that advocates tighter campaign-finance regulation.
On the other hand, many contributors seem satisfied with the club's paltry contributions. "I am not going out of my way to play because it's for that [Democratic] cause," said Joanne Kortas, 57, a winner of $5,388. "I just like playing the game."
Her comments were echoed by half a dozen other regulars at the Hart Democratic Club who, according to the FEC, have taken home winnings ranging from $3,700 to $8,600 over the past four years. They all said politics was never discussed at the games and that no attempt was made to promote Democratic candidates or causes. As to where the profits go, "I have no idea," said Janice Perry, 61.
The Hart club's use of gambling under the structure of a PAC follows years of controversy in Michigan over the legality and propriety of political candidates tapping into cash-fueled games of chance.
Democrats have netted millions of dollars at bingo events in rented halls. Republicans have complained that bingo gaming operators do not keep proper track of contributors and that participants at times have been gulled into thinking their funds are going to charitable causes rather than partisan causes.
In the mid-1990's, when Republicans briefly controlled the state legislature, they banned the licensing of bingo games by any "candidate committee, political committee, [or] political party committee." Democrats responded by winning a state referendum reinstating their authority, which a panel of GOP-appointed judges ruled invalid. But Democrats found a legal wrinkle to allow renewed licensing by the Michigan State Lottery Bureau.