Where does the marijuana money go?
03 Oct, 2013
Donations are often sidetracked to unintended recipients; when in doubt, ask before giving
by Rick Thompson for The Compassion Chronicles/ Oct 3, 2013
FLINT- Before you donate to a cannabis-related charity or pay to attend an event, ask where the proceeds are going. You might actually be funding legislators that oppose your viewpoint.
At issue are PACs, those Political Action Committees that nearly every legislator has- or has access to. Designed to allow fundraising and dispersal of the funds to multiple recipients, some PACs are allowed to donate to any registered charity they desire and can even transfer money from one PAC to another.
Not all charity events are created equal, and not all fundraising entities are PACs. Read the fine print before purchasing tickets at the next legislative fundraiser or spaghetti dinner.
ORGANIZATIONS AND NON-PROFITS
Every advocacy group takes in donations, and from those donations they pay for overhead expenses like printing, salaries and headquarters. Donations come in the form of membership fees and direct contributions.
National groups like ASA and NORML, who maintain state branches in Michigan, take a portion of membership fees paid and leave the rest to their local chapters. As a return on their portion of the dues, national offices provide their local chapters with support, public relations and resources. In-state groups like the Macomb-Oakland Compassion Club keep all membership fees and use them to fund local activism. In both cases, membership fees create a direct contribution at the grass-roots level of marijuana law reform.
Direct contributions to marijuana-related charities are either to a general fund or to a specific fund for a special purpose. At the recent fundraiser held in Ann Arbor by the National Patients Rights Association, the purpose of the event was listed on the promotional flyer: “Support the lobby effort to protect Medical Marijuana Dispensaries in Michigan”. NPRA is open about their employ of at least two lobbying and liaison people in Lansing, and that their purpose is the passage of House Bill 4271, The Provisioning Centers Act. Although the money donated will be received in a general fund, NPRA’s use of the capital will be in a manner expected by all the attendees and donors.
Other funds are obvious in their intent through their titles. ‘The Green Family Legal Defense Fund’ immediately conveys who is involved and where the money is going. Dinners where the donations are earmarked for a specific ill person or a family who has suffered a catastrophic event are, in most cases, directly contributing all proceeds to the people named.
General fund contributions are made to groups who then allocate the funds to pay for everyday expenses like telephones, business cards and rent. Any funds remaining after overhead expenses are paid for can then be distributed to other charities and projects. If a donor believes in the organization to whom he or she is writing a check, this should be a non-issue. The MOCC Harvestfest received monies through ticket sales, campsite rentals and vendor fees; all of these general revenue sources will help the advocacy group maintain their community presence throughout the next 12 months.
Corporate donors, who often give donations in exchange for advertising opportunities, are frequent victims of unintended general fund contributions. Case in point: the t-shirts designed for this year’s Mackinac Bridge Walk. Ads were offered at $250 each, and there are eight of them appearing on the shirt; the revenue generated from the ads seems to have exceeded the costs of shirts and printing.
PAC contributions are similar to general fund donations described above but are frequently distributed to other legislators or political groups, at the discretion of the PAC owner. PACs often generate huge amounts of money, and are therefore in a position to leverage influence.
A recent article on the Michigan Campaign Finance Network revealed over $9.5 million has been raised by the top 150 Michigan PACs during the first half of 2013. Leading the pack of PACs were, per the article:
The House Republican Campaign Committee led all PACs with $850,880 in contributions. It was followed by the Senate Republican Campaign Committee, $632,975; the House Democratic Fund, $546,253; the Michigan Health & Hospital Association’s Health PAC, $348,093; and Blue Cross / Blue Shield of Michigan PAC, $316,666.
In the SuperPAC category, Business Leaders for Michigan PAC II is the leader with $239,000. Second among SuperPACs so far this cycle is the Michigan Chamber PAC III with $113, 731.
Unlike ordinary PACs, SuperPACs are allowed to raise funds from corporate donors, but they are not allowed to make contributions to candidates’ campaign committees.
Every legislator has a campaign committee- ‘The Committee to Re-Elect John Dingell’, for example. Individual citizens and most of the committees are limited to contributions not to exceed $500 to a House candidate and $1,000 to a Senate candidate’s campaign committee. SuperPACs are not allowed to contribute to these campaign committees, either, so specialized PACs called leadership PACs were created to work around these restrictions and funnel money to candidates.
Contributions to independent committees, including leadership PACs, are not limited. Those leadership PACs can give ten times the normal amount to a candidate, making a maximum donation of $5,000 to a House candidate or $10,000 to a Senate candidate.
Leadership PACs are common. The MIRS media group recently wrote, “The majority of Michigan’s 147 lawmakers currently have at least one leadership PAC on file with the Secretary of State’s office.” Rep. Jeff Irwin’s PAC is called the ‘Jeff Irwin Leadership Fund’; Rep. Callton’s PAC is the ‘Callton Action Fund’; House Speaker Chase Bolger’s PAC is called the ‘Restore Michigan Fund’.
“For instance, during one campaign finance period last year, the Restore Michigan Fund took in large $10,000 donations from the Business Leaders for Michigan, the Comcast PAC, the DTE Energy PAC and JP Morgan Chase’s PAC. During the same period, the Restore Michigan Fund made maximum $5,000 donations to 20 different House candidates,” MIRS explained.
HOW TO TELL THE DIFFERENCE
When donating to a campaign committee- “The Committee to Elect George Cushingberry”, for example- the funds are designated to a known and straightforward purpose. When donations are made to a leadership PAC, the funds are likely to be donated again to support the political allies of the candidate whose PAC benefited from the fundraiser. Regardless of the reason cited at the time of the fundraiser, leadership PAC funds are given out at the discretion of the PAC owner.
All fundraisers are required to stipulate to where the funds will be applied. Donating to a leadership PAC is not a bad thing- if you trust the PAC owner is going to re-gift your money to people whose work you support.
Take the Callton Action Fund, for instance. Callton, a Republican, has famously created a sizable PAC from contributions gained from the medical marijuana law reform community. Campaign law, and his own statements, indicate Callton can contribute to the campaign fund of powerful House and Senate leaders, including those who are opposed to marijuana law reform.
Senators Rick Jones, Roger Kahn and Randy Richardville together sponsored a bill called the Pharmaceutical Grade Marijuana Act in 2012. That bill was not seen by the medical marijuana community as a positive step toward protecting patients and caregivers. The Callton Action Fund is very likely to have already contributed to the campaign funds of each of these three powerful Republicans last year, and in 2013, too.
It would be perfectly legal to take the donations made in the spirit of positive change for marijuana patients and funnel those monies to the people that stand against patient protections and caregiver’s rights. Legal, but not moral.
Many fundraisers masquerade as other events. A recent meeting in Lansing was billed as “A (sic) Industry Shareholders Meeting Hosted By The Honorable Michael Callton”. It came with a $55 ticket price; the flyer does not indicate if the fund are to be directed at a leadership PAC, at a campaign committee or into someone’s pocket. Calling the event a Shareholder’s Meeting did not diminish the fundraising element; failing to reveal the fund’s destination should give potential donors cause to reconsider their support.
Before contributing to a leadership PAC, be familiar enough with the legislator in question to guarantee that any candidate or project they choose to fund would be a cause you would approve of. Your donation dollars are likely to be re-gifted and end up in someone else’s bank account.