Tobacco-tax group says foes broke campaign laws

Petition

Initiative 185 signature gatherers gather, from the Healthy Montana website.

A coalition promoting an initiative to expand Medicaid coverage in Montana — and a big increase in tobacco taxes to help pay for it — has a filed a complaint charging its opponents with illegal campaign activities.

The complaint was filed Monday with the state Commissioner of Political Practices by Tara Veazey, initiative campaign manager for Healthy Montana, a coalition of health-care organizations and other groups that is pushing Initiative 185, which would raise the state tax on cigarettes by $2 a pack.

In its complaint, the coalition says illegal activities by opponents “constitute serious impediments to Montana’s campaign finance laws and the historical values they represent.”

Those activities include the failure to report expenditures made in the campaign against I-185, and the use of automated telephone solicitations, commonly known as “robocalls,” which are illegal in Montana unless a live operator first obtains permission to deliver the recorded message.

The charges are aimed at Montanans Against Tax Hikes, a group based in Helena, Decision Point Consulting, based in Ohio, “and any other now unknown entity or committee” that has financially supported the illegal activities.

Commissioner of Political Practices Jeff Mangan said the complaint was filed Monday, but still has to be examined to determine whether it meets all the requirements to be accepted by his office. He said that decision should be made by Wednesday.

Veazey said in an interview Monday that the complaint won’t have any bearing on I-185, which will appear on the ballot in November if supporters manage to collect verified signatures from at least 25,468 registered voters statewide by June 22.

She said the complaint was filed to force dark-money groups to be publicly revealed, and to let Montanans know who is spending money to influence elections.

“We just want to make sure that’s being disclosed, as early and as often as possible,” she said.

Besides raising state taxes on cigarettes by $2 a pack, I-185 would increase taxes on smokeless tobacco by 33 percent and create new taxes on vaping and electronic-cigarette products.

It also would extend Montana’s expanded Medicaid program, which provides government-funded health care to more than 94,000 low-income Montanans, past 2019.

The complaint says MATH — Montanans Against Tax Hikes — is the only group that filed papers as a committee opposed to I-185. (Not to be confused with Montanans Against Higher Taxes, which formed to fight Legislative Referendum 128, the 6-mill levy for the Montana University System.)

The complaint says Chuck Denowh, the treasurer for MATH, also filed a letter with the Montana attorney general in April, “opposing the proposed ballot statements for I-185 on behalf of Altria Client Services LLC and Rai Services Company, whose parent companies dominate the tobacco market, controlling roughly 86% of the market share in 2016.”

Denowh, the former director of the Montana Republican Party and president of the Montana Group, a political consulting firm based in Helena, did not return calls seeking comment, but he told Yellowstone Public Radio he was still reviewing the complaint and had no comment.

According to the complaint, “several individuals” reported receiving robocalls on or around May 1, offering them $100 to take part in a focus group. Veazey says in the complaint that when she called the number provided, her call was answered by a voicemail service for Decision Point Consulting.

“Clearly,” the complaint says, “the hiring of an out of state company to produce a robocall is an expenditure,” as is creating and conducting a focus group meeting. But Decision Point Consulting has not filed a C-2, a spending disclosure statement with the state.

On May 15, the complaint continues, “a voter received a call from a polling firm that was testing the I-185 ballot language and opposition messaging.” Healthy Montana was told that the poll was about 25 minutes long, and given the type and length of the poll, the complaint says, “this poll likely cost between $35,000 and $50,000.”

“If MATH paid for this poll to be conducted, it should have been reported in the C-6 disclosure report that was due on May 21. … MATH filed a form C-6 on June 1, but this report failed to include any of the above-described expenditures,” the complaint said.

That C-6 report, in fact, lists only two things: donations totaling $325 and debts of $1,700.

An examination of all ballot and incidental committee filings, the complaint says, “finds no reporting of any contributions, but for the above expenditures … to be made, there had to have been contributions to MATH or some other entity. If those contributions were made to MATH, MATH failed to report any type of contribution for the robocalls or focus group activity performed by Decision Point Consulting.”

The complaint then goes into the subject of illegal robocalls, saying that if MATH was responsible for such calls, “it also engaged in illegal criminal activity.”

“The failure of opponents to I-185 to file any of the required financial reports or disclose any information about their income sources or expenditures represents a clear disregard for Montana’s reporting requirements and warrants full and immediate investigation,” the complaint says.

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