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GOP Senators Press Harder for Independent Counsel (Washington Post, Oct. 23)

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RNC Steered Donations Toward Outside Groups

By Ruth Marcus
Washington Post Staff Writer
Thursday, October 23, 1997; Page A01

In the closing weeks of the 1996 campaign, the Republican National Committee steered more than $1 million in contributions from its major donors to sympathetic outside groups, collecting the checks at the RNC and then passing them on to the other organizations, documents obtained by Senate investigators show.

The documents, obtained last week from the campaign of former senator Robert J. Dole (R-Kan.) by the Senate Governmental Affairs Committee, demonstrate that then-RNC chairman Haley Barbour and deputy finance director Jo-Anne Coe tapped big GOP donors to make large contributions to the outside groups. Unlike political parties, such groups don't have to disclose where their money comes from or how they spend it.

The groups included the National Right to Life Committee, an antiabortion group that was heavily involved in voter education projects in the 1996 campaign, and Americans for Tax Reform, which made 4 million phone calls and sent 19 million pieces of mail urging voters to dismiss Democratic warnings about Medicare cuts.

The documents show that Coe passed on checks for $100,000 each to the Right to Life Committee and Americans for Tax Reform from Carl Lindner of the American Financial Group, a major donor to both parties.

The biggest beneficiary of the GOP program was the American Defense Institute, which runs a voter turnout program for military personnel, who tend to vote heavily in favor of Republican candidates.

The military-oriented group received around $1 million, including $500,000 that Barbour solicited from Philip Morris, the documents show. American Defense Institute president Eugene B. "Red" McDaniel said that was close to the full cost of the voter turnout effort.

Republicans erupted with criticism earlier this year after reports that Democratic National Committee officials and Harold Ickes, then White House deputy chief of staff, directed givers to groups they thought would help boost Democratic turnout in 1996.

Democratic and Republican election law experts said yesterday that party officials are allowed to solicit and even serve as conduits for contributions to outside groups as long as the groups don't coordinate their activities with the political parties.

But the GOP-generated donations to the outside groups allowed the party's backers to give additional sums that would help the party without having them publicly reported. Having the donors give directly to the groups also kept the full amount of the GOP's help to the outside organizations from being disclosed. Internal RNC documents show that officials there were highly sensitive to donors' concerns about keeping the full extent of their contributions from public view.

The checks, which were made out to the groups rather than to the RNC, were in addition to the large sums the RNC separately gave directly to the groups at the end of the 1996 campaign, including $650,000 to the National Right to Life Committee and $4.6 million to Americans for Tax Reform, run by GOP activist Grover Norquist.

RNC spokesman Clifford May said of the program: "This party has an interest in these organizations being successful. We help them. There's no reason not to. These are independent organizations, and we had no input into how this money was spent."

Asked why Coe had checks from donors sent to her to pass on to the groups rather than having the donors contribute directly to the organizations, he said, "She was raising it so I guess the protocol was to give it to her to get to them. The RNC wants these groups to know we support them. That doesn't mean we have sway over them. They're independent groups, and what they're doing is going to be philosophically similar to what we're doing."

In the case of the American Defense Institute, the contributors were able to deduct their gifts as charitable donations on their tax returns. Normal political contributions aren't tax-deductible.

The contributions from the RNC donors also allowed the group, which bills itself as strictly nonpartisan, to avoid taking money directly from the RNC.

In September 1996, the RNC gave the American Defense Institute $600,000 from its own funds, but the group returned the party's donation, McDaniel said yesterday, because "we didn't want to be controversial and we had funding from other sources."

Federal Election Commission reports show that the RNC money was returned on Oct. 29, several days after a bundle of six donor checks, totaling $530,000, was sent from the RNC to the group.

The checks came from some of the party's biggest donors, including $150,000 from John Moran, Dole's finance chairman in the 1996 campaign, and $100,000 each from longtime GOP donor Max M. Fisher, Enterprise Rent-a-Car founder Jack C. Taylor and a foundation started by billionaire investor Kirk Kerkorian. The other donations were $50,000 from a foundation controlled by former defense secretary Donald Rumsfeld and $30,000 from Houston oil executive Patrick R. Rutherford.

"Please send an acknowledgment to each individual as well as a receipt for their use in claiming deductions on their tax returns," said a letter to the group from Coe accompanying the checks.

In addition, an internal memorandum dated Oct. 17, 1996, refers to "the $500,000 Haley obtained from Philip Morris" for the institute. McDaniel said yesterday that the group received that amount from the tobacco company and that Barbour "could have" helped solicit it.

Barbour was traveling yesterday and unable to return telephone calls, said his aide, Ed Gillespie. Philip Morris did not respond to a request for comment on its involvement.

McDaniel said his group was "truly apolitical" and had asked for money from both parties. Asked why the RNC provided him with so much financial support, McDaniel said, "Maybe they think it helps them."

© Copyright 1997 The Washington Post Company

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