CONCORD, N.H. -- By some accounts, ads attacking Democrat Maggie Hassan last fall during her successful run for governor could be one of the costliest flops in New Hampshire’s political history.
The ads hit her for paying zero property taxes but left out that as part of her husband’s job as principal of Phillips Exeter Academy, the couple is required to live in a home owned by the school. When response ads pointed that out, a new round of attack ads used them to hit back that Hassan had admitted paying no property taxes.
But it wasn’t her opponent, Republican gubernatorial candidate Ovide Lamontagne, who was behind the ads. They were paid for by the Live Free PAC, an arm of the Republican Governors Association. Lamontagne had no control over the ads, which were among the results of an estimated $23 million that was spent on New Hampshire’s gubernatorial election last fall, all but $4 million by groups or people other than the candidates themselves.
Now, in an effort to identify who is contributing to -- and influencing -- campaigns, New Hampshire lawmakers have introduced legislation in both the House and Senate that would require more disclosure of a growing source of spending on state elections.
New Hampshire law allows groups known as super PACs and others to spend unlimited amounts on television ads and fliers without disclosing either the amounts or their donors, making it nearly impossible for voters to know who is backing or opposing a particular candidate or issue.
"That’s a loophole that needs to be fixed," said Oliva Zink of the Coalition for Open Democracy in New Hampshire.
The Live Free PAC filed a spending report -- though it was not required to do so -- but its counterpart, The New Hampshire Freedom Fund, an arm of the Democratic Governors Association, did not. Each spent nearly $8 million on the Hassan-Lamontagne race.
"I can’t tell you with exact clarity, but I think they canceled each other out, dollar for dollar," said Jim Merrill, who was a senior adviser to the Lamontagne campaign.
But rather than spend that kind of money to explain issues and candidate positions, voters got misleading ads instead.
Though attacks on opponents are as old as politics, a 2010 U.S. Supreme Court decision in the Citizens United case brought a new round of murk. The ruling allows corporations, unions and other groups to spend unlimited amounts on elections and led to the formation of political action committees with millions of dollars in resources that became known as super PACs. Billionaires, anonymous donors and shadowy outside groups funneled huge sums into last year’s elections.
Legislators are trying to shed light on the influence of outside money on elections in two ways.
Independent groups would be required to detail their spending to the state if they spend more than $5,000 on a race under the two bills. That goes further than current law, which requires groups to report their spending only if they expressly support or oppose a candidate, said state Sen. David Pierce, who is chairing the subcommittee working on the Senate bill. The bill is sponsored by Senate Majority Leader Jeb Bradley.
A House committee has decided to hold its bill until next year. And the Senate is voting Thursday whether to do the same with its bill.
But such disclosure requirements would only be baby steps because the proposals would exempt certain tax-exempt groups from reporting their donors, argues former Democratic Party Chairwoman Kathy Sullivan. They would only have to report their expenditures.
"No group in and of itself is a good group or a bad group. They all should be forced to disclose where the money is coming from," she said.
Groups fear that their donors will stop contributing if they don’t want the public to know who is attempting to influence voters, Sullivan said.
"At least you’ll know how much they’re spending and on what," Sullivan said of the disclosure the bills would require of the groups.
Among groups that would be exempt from reporting its donors is Americans for Prosperity, which was founded by the billionaire brothers Charles and David Koch and was behind public-union-busting efforts in Wisconsin and elsewhere. It’s not clear whether the group spent money on New Hampshire elections last fall, though Merrill believes they paid for some mailings to voters’ homes.
A representative from the group testified against the Senate bill, saying its donors deserve anonymity to protect the exercise of their constitutional right to free speech. The call for anonymous free speech is not a loophole or "some nefarious political tactic," Corey Lewandowski of Americans for Prosperity told the committee.
Though groups like Americans for Prosperity would be exempt from reporting their receipts, Zink believes such groups would find ways to hide their donors even if required to report them.
"What we need from true disclosure is a complex process where you’d be able to chase the money back to its source," she said.
Big-spending super PACs are here to stay in state races and campaigns simply need to plan their finances so they can respond to them -- regardless of whether New Hampshire begins to require more disclosure, said Merrill, a Republican political consultant with The Bernstein Shur Group.
"It’s always been a rough and tumble world," he said, "but (super PAC spending) introduces a new variable in a rough and tumble world."
Merrill notes that Hassan entered the general election with just $16,000 left of the more than $1 million she raised in her primary campaign. The Democratic Governors’ Association jumped in with ads to boost her campaign.
"It helped keep her ship balanced," said Merrill.