Texas governor cites IRS scandal to veto nonprofit transparency bill

By Eric W. Dolan
Sunday, May 26, 2013 12:05 EDT
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Rick Perry speaks to CBS affiliate in Dallas. Photo: Screenshot.
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Texas Governor Rick Perry on Saturday vetoed Republican-sponsored legislation aimed at reducing the flood of so-called dark money in political campaigns.

“At a time when our federal government is assaulting the rights of Americans by using the tools of government to squelch dissent it is unconscionable to expose more Texans to the risk of such harassment, regardless of political, organizational or party affiliation,” the Republican governor said in a statement. “I therefore veto SB 346.”

Perry claimed the proposed law could be used by the government to “intimidate” political donors, an allusion to the recent scandal involving IRS scrutiny of tea party groups.

The bill, proposed by state Sen. Kel Seliger (R-Amarillo), would have prevented people from using social welfare nonprofit organizations — known formally as 501(c)4 organizations — to circumvent campaign finance laws. Following the Supreme Court’s Citizens United decision, social welfare organizations became a favorite way to influence federal elections. Unlike political action committees, social welfare organizations are not required to disclose their donors.

Nonprofit groups spent more than $308 million in the 2012 elections.

SB 346 would have required social welfare organizations to report contributions of $1,000 or more if their political expenditures exceeded $25,000.

“This is a sad day for integrity and transparency in Texas,” Seliger in a statement. “Governor Perry’s veto of SB 346 legalizes money laundering in Texas elections. The Governor’s veto is ironic since money laundering is illegal in other endeavors. As other states have stepped forward to ban election money laundering by dark money 501(c)4 non-profit corporations, it is embarrassing that the Lone Star state is now an official safe haven for political money launderers.”

Seliger noted the Supreme Court held disclosure of contributions was necessary for “citizens and shareholders to react to the speech of corporate entities in a proper way” in the Citizens United ruling.

Eric W. Dolan
Eric W. Dolan
Eric W. Dolan has served as an editor for Raw Story since August 2010, and is based out of Sacramento, California. He grew up in the suburbs of Chicago and received a Bachelor of Science from Bradley University. Eric is also the publisher and editor of PsyPost. You can follow him on Twitter @ewdolan.
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