Political spending by Abrams' nonprofit could pose problems

WASHINGTON (AP) - In a matter of months, Stacey Abrams has gone from losing the Georgia governor's race to being a heavily recruited Democratic star, urged to run for Senate and mentioned as a possible presidential contender.

It's a dramatic rise often fueled by the promotional spending of Fair Fight Action, a nonprofit she founded to advance voting rights. The organization has paid for advertisements featuring Abrams and some of her travel and organized national watch parties when she delivered the Democratic rebuttal to President Donald Trump's State of the Union.

But spending by Fair Fight Action, which is staffed by former Abrams campaign aides, could prompt questions about whether the nonprofit is inappropriately supporting her political ambitions. Although there is no proof of any illegal activity, some of the organization's expenditures could pose a problem if Abrams follows through with her pledge to run for office again.

"There is nothing wrong with a nonprofit promoting its charismatic founder," said Adav Noti, a former Federal Election Commission attorney who now works for the nonpartisan Campaign Legal Center. But, he added, that "if we later learn that the spending was to lay the groundwork for a campaign, retrospectively that could be a violation."

Abrams has said that she will decide soon on her political future. Last week, she met with former Vice President Joe Biden, leading to speculation he might pick her as a running mate if he enters the 2020 White House race and wins the Democratic nomination. Her latest moves have also been closely watched by national Republicans, who think she would be a formidable challenger to Republican Sen. David Perdue of Georgia in 2020.

On Wednesday, a GOP-affiliated group called the Foundation for Accountability and Civic Trust, or FACT, filed a complaint with the Internal Revenue Service. The group points to roughly $100,000 worth of Facebook ads featuring Abrams, an advertisement for a "Stacey Abrams Fundraiser" that featured Fair Fight Action's logo, travel for Abrams' post-election "thank you" tour of Georgia and a professionally produced "highlight reel" of Abrams footage on the group's website.

The complaint argues Fair Fight Action is supporting Abrams' political ambitions, not advocating for voting rights. That's a violation of tax law that forbids political 501(c)(4) nonprofits from providing a "private benefit" to a particular person or group, according to a copy of the complaint provided to The Associated Press. The group typically files ethics complaints against Democrats but has also targeted some Republicans, including North Carolina Rep. Mark Meadows, a leader of the conservative House Freedom Caucus.

Fair Fight Action CEO Lauren Groh-Wargo, Abrams' former campaign manager, disputed the details of FACT's complaint. She said that while Abrams is the figurehead of the organization, Fair Fight Action's promotional activities have always focused on voting rights issues.

"It's no surprise that right-wing hit groups allied with Donald Trump are launching bogus attacks against Fair Fight," she said in an emailed statement. "They're afraid of Stacey Abrams and even more afraid that all eligible Georgians will exercise their right to vote."

It's not unusual for politicians to have a nonprofit or be supported by one staffed by their associates. The group Our Revolution backs Bernie Sanders' White House bid, but the Vermont senator does not have a direct role in the group, according to its most recent tax filing. Trump has a nonprofit staffed by allies that is facing a complaint pending before the FEC.

Biden, too, has several 501(c)(3) nonprofits, which are largely barred from engaging in political activity. They have employed longtime aides and are mostly geared toward academia and medical research. Much of his spending on political advertising runs through his political action committee, which is subject to federal donation limits.

For nonprofits like Fair Fight Action, which can raise unlimited sums and engage in political activity, steps are often taken to at least give the appearance of being kept at arm's length from the politician they support. But Abrams serves as the chairwoman of Fair Fight Action's board, giving her a direct hand in the group's management.

If she runs for federal office and it is determined that the group laid the groundwork for her campaign, donation limitations could retroactively apply to Fair Fight Action, legal experts say.

"If she were to maintain the same relationship with this nonprofit and become a candidate, then legal risks do arise," said Paul S. Ryan, an attorney for the liberal-leaning government watchdog group Common Cause.

Caitlin Highland, an Abrams spokeswoman, said Abrams will step down from Fair Fight Action if she runs for office again.

The mission of Fair Fight Action, founded in 2014 as the Voter Access Institute, was to provide "education to voters on how and where to vote." It paid Abrams an annual salary of about $80,000 and was barred under its own corporate bylaws from promoting political candidates, records show.

The group, which does not disclose its donors, raised about $2.5 million from 2014 to 2016, records show. It has not yet filed tax paperwork showing what it raised in 2018, when she was running for governor.

After Abrams lost the governor's race, the nonprofit was overhauled. She became the chairwoman, stepping down as CEO. Groh-Wargo began running the operation. Language forbidding the group from promoting a political candidate was stripped out of its charter, records show. The group also took over the Twitter account used by Abrams' gubernatorial campaign and renamed it Fair Fight Action.

The group's leaders say all its activities focus on highlighting the need to protect voting rights in Georgia. Furthermore, they say, staff members carefully separate voting rights work from more overtly political activities done by newly formed Fair Fight PAC, which does not have to report its fundraising and spending to the FEC until April 15.

Ultimately, it may be tough to tell if any of the spending crosses the line. Only limited information is included in publicly available tax filings. The IRS has also been hesitant to enforce the law, particularly after facing intense blowback for investigating tea party nonprofit groups earlier in the decade.

"There have been a lot of former candidates and officeholders over the years that have been closely associated with (nonprofit) organizations," said former FEC chairman Michael Toner, a Republican. "The devil is in the details in terms of whether the legal line has been crossed."