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A dark-money super PAC that has spent millions buying TV ads for mayoral candidate Jeff Brown was ordered today to halt all expenditures after the city’s Board of Ethics alleged it illegally coordinated its fundraising with Brown’s campaign.
There is “extensive evidence” that the PAC coordinated with Brown “to circumvent the city’s annual contribution limits,” ethics board executive director J. Shane Creamer said.
Furthermore, the campaign ignored previous warnings, per the board, which wrote in the court filing, “Despite being put on notice… respondents continue to make coordinated expenditures.”
Judge Joshua Roberts of the Court of Common Pleas handed down the order during a short hearing in City Hall this afternoon.
The suspension of PAC spending may have little direct impact on Brown’s messaging to voters, as the organization is not currently buying ads, according to Matthew White, an attorney with Ballard Spahr who represents the PAC.
Following the hearing, Creamer described Brown’s alleged involvement in the For a Better Philadelphia PAC as one element of a strategy of funneling funding from the candidate’s grocery store empire and other big-pocketed donors into the campaign, while getting around contribution limits and hiding contributors’ identities.
The Board of Ethics uncovered the coordination through subpoenaes of bank records and emails from the PAC and an associated nonprofit, the For a Better Philadelphia 501(c)4, Creamer said. He declined to say whether the board subpoenaed Brown’s campaign.
“It was a very well-planned, well-executed scheme to circumvent the [contribution] limits,” Creamer said. “But they got caught.”
In an email, Brown campaign spokesperson Kyle Anderson described the case as “a disagreement on campaign finance between the lawyers.”
“We have complied with the law and neither we, nor the voters, will be distracted by this nonsense,” he said. “The bottom line is that Jeff is fighting for change and a new direction for Philadelphia, and that message is resonating.”
Over $3 million raised
The other big-spending mayoral candidate, Allan Domb, who has frequently targeted Brown, was quick to seize on the Board of Ethics complaint as further evidence of his rival’s flaws.
“Jeff Brown is running one of the most unethical campaigns in Philadelphia history, and it’s no wonder that he’s tanking in the polls,” Domb spokesperson Jared Leopold said. “The findings of the Ethics Board today are deeply troubling. It’s time for Jeff Brown to come clean to Philadelphians about who donated to his dark money organization and what promises he made behind closed doors to secret donors.”
Attorney White argued in court that Creamer had not provided evidence to justify an order permanently halting For a Better Philadelphia’s activities, but he agreed to the judge’s temporary order. He declined to speak with the press after the hearing.
The full case will be heard on April 24.
In the 25-page emergency petition, the ethics board detailed its proof — including emails and invitations to fundraisers — that Brown helped raise millions of dollars on behalf of the PAC, which in turn made millions in expenditures in support of his candidacy.
That’s a violation of campaign finance law, which limits contributions from political committees.
The PAC and nonprofit have racked up $160k in $2,000 fines, Cramer told the judge. “We can’t keep up with their violations. They’re happening on a daily basis,” he said.
Under the Supreme Court’s Citizens United ruling, groups seeking to influence elections can spend unlimited amounts and can keep their donors secret, but only if they don’t directly contribute to candidates or coordinate their activities with candidates.
Philly’s limit is $12,600 per year, though it doubled in this race to $25,200 after the “millionaire’s amendment” was triggered in December.
The For a Better Philadelphia PAC has reportedly raised more than $3 million, with most of the money coming from the associated nonprofit. Any amount over $25,200 represents excess contributions that violated city limits, the board says in the court petition.
The full Board of Ethics filing is below.
‘Let me know if you have edits’
The Board alleges that Brown helped fundraise and direct spending for For a Better Philadelphia within the 12 months prior to this May’s Democratic primary for mayor.
For example, the board says Brown helped organize and was the keynote speaker at a fundraising dinner the nonprofit held in August 2022. The organization’s fundraising consultant, Olivia Scanlon, emailed Brown a draft invitation and a chart describing his planned interactions with potential donors, according to the court petition.
In an email to Brown, Scanlon describes how she adjusted the expected amount one donor was expected to contribute to the PAC, per the legal filing. “Let me know if you have any edits and we should probably call [Individual Donor #1] tomorrow to discuss,” according to the board’s complaint.
Brown later responded directly to the Scanlon, writing, “Olivia, See if that works with [Individual Donor #1],” per the court petition. Scanlon now works directly for the campaign as its deputy campaign manager.
Another example regards an unspecified “Philadelphia professional sports team” that contributed $250,000 to the PAC-connected nonprofit last September. A few months later, a rep from the sports team emailed the campaign directly to “schedule a briefing” with Brown, per the court documents. A redacted copy of the email was included with the petition.
David Maser, the chair of the PAC, also emailed direct policy suggestions to Brown’s campaign manager, per the ethics board filing.
Because of coordination like this, the PAC’s work constitutes contributions to Brown’s campaign and is subject to city contribution limits, which it has substantially exceeded, the board says.
Among other revelations in the court petition, the board says Brown’s Super Stores, where Brown was until recently chairman and CEO, contributed $1.25 million to the For a Better Philadelphia nonprofit.
State law prohibits corporations from contributing directly to or spending on behalf of political candidates and their campaign organizations, but they may contribute to PACs.
Creamer argued in court that the judge should order the PAC to stop spending money because the Board of Ethics has limited powers to sanction the PAC by imposing fines. The PAC could simply solicit more donations from Brown’s Super Stores or other secret donors to cover the relatively small fines, he said.
“If we were limited to those monetary penalties, it becomes a cost of doing business for groups that have millions of dollars to spend not only on TV ads, but also on fines,” he said after the hearing. “And then we become a mosquito bite for violators of our law.”
He said the board could also seek “disgorgement” or refunds of illegal contributions by the Brown campaign. The campaign currently has about $408,000 cash on hand, according to its most recent filing with the city, which is far less than the amount of allegedly illegal spending by the PAC and nonprofit.
Creamer declined to comment on whether the board would pursue that step.
