Mystery group fuels attack ads
The activities of an Arizona organization with deep ties to the billionaire Koch brothers have built a network of conservative advocacy groups.
Tribune Washington bureau
WASHINGTON — The financial firepower that fueled the rise of a network of conservative advocacy groups now pummeling Democrats with television ads can be traced, in part, to P.O. Box 72465 in Boulder Hills, Ariz., on the northern edge of Phoenix.
That's the address for the Center to Protect Patient Rights, an organization with ties to Charles and David Koch, the billionaire brothers who bankroll a number of conservative organizations.
The center sent more than $55 million to 26 GOP-allied groups during the 2010 midterm elections, tax filings show, funding opaque outfits such as American Future Fund, 60 Plus and Americans for Job Security that were behind a coordinated campaign against Democratic congressional candidates.
The money from the center provided a sizable share of the war chest for those attacks, which included mailers in California, robo-calls in Florida and TV ads that inundated a pocket of northeastern Iowa. The organizations it financed poured at least $46 million into election-related communications in the 2010 cycle, among other expenditures.
In that campaign, outside groups — the vast majority backing Republicans — reported spending a record $304 million, according to the nonpartisan Center for Responsive Politics. Democrat-allied groups still are trying to match their success.
With such spending to reach unprecedented levels in the 2012 election, the activities of the Center to Protect Patient Rights — whose existence was first reported this month by the Center for Responsive Politics — provide a glimpse into the network of deep-pocketed conservative advocacy groups that have already begun an air war against President Obama.
Because these nonprofits are under no obligation to reveal their donors, sources of their funding have remained a mystery.
The Koch brothers, with a combined net worth estimated by Forbes at $50 billion, are believed to be among the most generous backers of the efforts on the right. They have supported Americans for Prosperity, which, together with its sister foundation, plans to spend $151 million in the 2012 election.
The Kochs have several ties to the center. It is run by Sean Noble, a Phoenix-based GOP consultant who is a key operative in the Kochs' political activities, as first noted by the investigative blog Republic Report. One of the center's original directors, Heather Higgins, is chairwoman of the Independent Women's Forum, which has received funding from a Koch-controlled foundation.
And Cheryl Hillen, a Connecticut-based consultant who raised $2.6 million for the center, was director of fundraising for the Koch-backed Citizens for a Sound Economy.
Koch spokeswoman Melissa Cohlmia directed questions to the center, declining to say whether the brothers were involved.
The center largely was used as a vehicle to pass millions to other groups, which also zealously guard the anonymity of donors. Some campaign-finance experts suggested the center could have been set up to pool money from various sources.
"Rather than have to make the decision yourself, you would entrust them to spread it around," said Ellen Aprill, a tax-law professor at Loyola Law School in Los Angeles.
In March, Noble filed paperwork expanding the center's advocacy beyond patient rights to include "limited government and free enterprise."
Noble did not respond to repeated phone calls and emails. Courtney Koshar, a Phoenix anesthesiologist and the group's only other director, did not respond to requests for comment. And a Phoenix doctor who once sat on its board said he couldn't remember who asked him to join.
"I honestly played very little role," said Dr. Eric Novack, who headed an organization called the US Health Freedom Coalition that received nearly its entire budget — $1.7 million — from the center to help pass a state ballot measure that aimed to block Obama's health-care overhaul.
"This is a classic example of how our campaign-finance system has entirely fallen apart," said Craig Holman, lobbyist for Public Citizen, which advocates stricter campaign-finance rules. "We really don't know where this money originated from."
The Center to Protect Patient Rights was created in April 2009, just as the debate over the health-care bill was heating up. The group's mission was to "protect the rights of patients to choose and use medical-care providers," according to its corporate paperwork, filed in Maryland.
While never surfacing publicly, the center sent more than $10 million in its first year to groups such as Americans for Prosperity, which took a lead in protesting the measure.
"I think they saw what we were doing and liked it," said Tim Phillips, president of Americans for Prosperity, which received $4.1 million. He said he did not know the source of the center's funding and declined to say if it still supports his group.
The center's influence extended beyond the health-care debate, tax filings show. Money also went to anti-abortion groups such as the Susan B. Anthony List and to Americans for Tax Reform, led by anti-tax crusader Grover Norquist. In Florida, the center backed Protect Your Vote, a Republican effort to defeat two redistricting measures.
The largest share of the center's money went to American Future Fund, a Des Moines, Iowa-based group started by onetime GOP congressional aide Nick Ryan. The fund, which ran campaigns against two dozen Democrats in the 2010 election cycle, spent $23 million during that period, tax filings show, with nearly $13 million coming from the center.
Its biggest target was an up-and-coming Iowa Democrat, Rep. Bruce Braley. In August 2010, American Future Fund launched an ad falsely claiming Braley supported building a mosque at the former World Trade Center site in New York — the beginning of a $2 million fusillade that included radio ads, robo-calls and nine mailers.
"It was almost a feeling of helplessness because there was no way to identify who the source of the funds was," Braley said.
After winning his 2008 race by 29 percentage points, Braley squeaked to a 2-percentage-point victory.
Knowing now who helped finance the attacks is small consolation, he said. "It does nothing to shed light on who is contributing the hundreds of millions now that is being wound up to be used in races like mine again," he said.
Ryan did not respond to requests for comment.
The center appears closely linked with DCI Group, a Washington, D.C.-based consulting firm that specializes in under-the-radar corporate campaigns.
At least five groups that received large grants from the center paid more than $9 million in services to DCI Group or Direct Response, a mail and phone-bank company.
The two companies share a suite in a Phoenix office building, but a spokesman said they no longer were legally affiliated.
For example, the center gave more than $2 million to the similarly named Coalition to Protect Patients' Rights, a Virginia-based nonprofit formed in spring 2009, five weeks after the center. The two organizations share the same Phoenix accountant and records custodian — both former DCI employees, according to their online résumés.
The coalition staged rallies in 2009 to lobby against the so-called public option, a government medical insurance proposal eventually dropped by the Obama administration. The center provided 80 percent of the coalition's budget; nearly all went to DCI and Direct Response for consulting and voter contact.
DCI Group spokesman Craig Stevens said the firm did not set up the center or know where the coalition got its money.
New Orleans surgeon Donald Palmisano, former president of the American Medical Association and the public face of the coalition, also said he did not know the source of funding.
"I'm just the spokesperson," he said.
Tribune special correspondent Matthew Trotter contributed
to this report.