Money speaks’: S.C. House Speaker Bobby Harrell’s PAC doled out big money in campaign donations, contracts
South Carolina’s House speaker is affiliated with a political action committee that has doled out hundreds of thousands of dollars in donations and private contracts to sitting state lawmakers.
By the numbers
Palmetto Leadership Council’s miscellaneous spending since 2008:
McBee payroll: $81,000
State Legislative Leaders Foundation: $50,000
The Palmetto Club of Columbia: $29,000
Republican Governors Association: $10,000
Morganelli’s Party Store, a Columbia beer, wine and liquor shop: $4,800
“Bud’s Field Vehicle Fund”: $500
Kia’s House of Unity, a Columbia wedding shop and banquet hall: $500
Grateful Goldens Rescue of the Low Country: $360
The Palmetto Leadership Council has given direct campaign contributions to more than 100 S.C. House candidates and more than two dozen S.C. Senate candidates since 2008. It also backed a number of Republican candidates for statewide office.
The group has taken in more than $1.3 million and has spent more than $1.2 million in that time.
Contributors to the PAC include organizations with business before the state.
Source: Data filed with the S.C. Ethics Commission
Bobby Harrell’s Palmetto Leadership Council has channeled about a half-million dollars in the last four years to the S.C. House Republican Caucus, to the state Republican Party and to more than 130 mostly incumbent Republican candidates for legislative office, according to publicly filed data analyzed by The Post and Courier.
The council is the only PAC of its kind — that is, one associated with a state official — known to be operating in the state, according to the S.C. Ethics Commission’s spokeswoman. The S.C. Senate last year passed a rule prohibiting so-called “leadership PACs” that are established or maintained by state senators.
But legislation that would outlaw leadership PACs associated with any state official has stalled, and the two lawmakers who blocked the bill from getting a hearing have received money from Harrell’s PAC.
Critics charge Harrell, a Charleston Republican, is using the committee to evade campaign finance laws that set limits on individual contributions to political candidates. Harrell, who has been a state lawmaker for more than two decades, also uses the group to “consolidate power beneath him,” said John Crangle, executive director of Common Cause South Carolina. The government watchdog group has rallied against leadership PACs, or non-candidate committees, since 2006.
“Controlling the Republican Party has become like herding cats,” Crangle said. “Harrell uses money like a saucer of milk to get them to do what he wants. He creates a control relationship over the recipients.”
Harrell defended the committee’s work, saying it “identifies legislators who are pro-business-minded and gets them elected to office.”
“Looking for candidates to help is a very good thing,” he said.
All PACs are unregulated, so the Palmetto Leadership Council is operating within the law, according to the Ethics Commission.
Harrell said criticism that he has used the PAC to influence House lawmakers “doesn’t hold water.”
“In order for that to be true, it would have to be supporting House members only,” he said.
Tom Davis is among the state senators who received campaign donations. The Beaufort Republican — who referred to PACs as “forums for the express purpose of influencing legislation” — voided the $1,000 check the Palmetto Leadership Council sent him in 2008.
“It’s better to have that degree of separation,” Davis said.
‘Living off politics’
Beyond its political donations, the Palmetto Leadership Council has funneled hundreds of thousands of dollars in contract work to sitting legislators and their families and to the speaker’s own spokesman, according to the data analyzed by the newspaper.
Daniel Island Rep. Jim Merrill, for example, took about $123,000 since 2008 for handling Harrell’s direct mail work.
Crangle called the contracts a “direct conflict of interest.”
“It’s the ‘living off politics’ phenomenon,” Crangle said. “They’re getting substantial sums of money based on their political connections. A number of people are living off this Palmetto Leadership Council.”
Harrell dismissed the conflict allegation, while his spokesman downplayed the speaker’s affiliation with the committee.
“It’s a completely independent organization,” said Harrell spokesman Greg Foster, who has taken a reported $23,000 from the committee in the last four years.
(Foster said he took a “leave of absence” from his $85,000-a-year state job while doing consulting work for the group.)
Harrell, whose portrait is posted twice on the Palmetto Leadership Council’s home page along with his message to donors, said he has “worked with the group very closely — helped them raise money, helped them campaign to get pro-business people elected.”
But he said the Palmetto Leadership Council is not a leadership PAC because someone else officially is in charge. That person is executive director India Hazzard Pickelsimer, who also is the chief fundraiser for Harrell’s re-election campaign.
Foster directed all questions involving the committee’s spending to Pickelsimer. A reporter has attempted to reach her since Monday.
On Wednesday, Pickelsimer requested an emailed list of questions and said she was too busy for a phone conversation. She did not respond to the questions.
Among the Palmetto Leadership Council’s biggest expenses is paying Geechie Communications on Daniel Island for “professional services.” Geechie is a public relations firm operated by Republican S.C. Rep. Jim Merrill.
Between 2008 and 2010, the committee paid Geechie nearly $123,000.
Merrill, referring to the Palmetto Leadership Council as “the speaker’s PAC,” said he mostly handled direct mail on Harrell’s behalf. He said he processed mailings about fundraising and endorsements, among other things.
“I don’t write them,” Merrill said. “He (Harrell) basically says, ‘Hey we have X letter we’d like to send out. Can you help us get it out?’ ”
Asked what, if any, conflict he sees with taking paid political work from Harrell, Merrill said:
“Zippo. … Just because I happen to know Bobby, why would I not take his work? If I can get the work, hell, I’m gonna do it.”
The PAC also gave Merrill two direct $1,000 campaign contributions.
Other legislators also benefited. The Majeal group in 2008 was paid $5,500 for “research.” Majeal, which has no website, is a Florence business registered to the home address of Republican S.C. Rep. Kris Crawford, according to a filing with the S.C. Secretary of State.
Crawford, who was arrested on multiple tax evasion charges in 2010 that resulted in a mistrial, also received a $1,000 direct campaign contribution from the PAC. He did not return messages last week.
Richard Quinn & Associates, a Columbia consulting group operated by the family of S.C. Rep. Rick Quinn, has received about $27,000 from the committee for “research” and “professional services” since 2009.
Quinn, too, got a $1,000 direct contribution from the PAC.
“I don’t see a problem with it,” the Lexington Republican said. “It’s certainly very legal, and I see no problem ethically.”
Late campaign help
In May 2010, the committee reportedly gave $50,000 to the “Foundation for Governmental Excellence” in Washington, D.C. The foundation has no website. One of its reported addresses is a post office, although no PO box is listed.
Among the only references online to the foundation is one on a left-leaning blog supporting former S.C. Rep. Vida Miller, a seven-term Democrat from Pawleys Island. Miller lost re-election to then-22-year-old Republican Kevin Ryan in 2010.
The Foundation for Governmental Excellence widely distributed a brochure the month before the election. It put Miller’s photo between those of national Democratic figures including Hillary Clinton, Nancy Pelosi, Barack Obama and Harry Reid.
“The Democrat party is on a mission,” the postcard stated. “They will not stop until our nation and state are socialists. … Whether it is Obama and Pelosi’s stimulus or corporate bailouts or Vida Miller’s spending of the stimulus … these Democrats have forgotten it’s your money.”
Reached last week, Miller called the foundation “a front.” She then recalled the group’s impact on her campaign during the closely contested election.
“Those negative mail pieces certainly had an effect,” she said. “People believe that crap.”
The foundation had targeted six Democratic S.C. House candidates — all women — across the state in that election cycle, said Tyler Jones, a spokesman for the S.C. House Democratic Caucus. All of them lost, he said.
The foundation used the same mail piece to attack the other candidates, Miller said.
“They just swapped the photo,” she said. “It was a concerted effort to get all of us out of office.”
An extra boost
In the last four years, the Palmetto Leadership Council has given direct campaign contributions to more than 100 mostly incumbent S.C. House candidates and more than two dozen S.C. Senate candidates. Among them was then-S.C. Rep. Nikki Haley.
The PAC also backed a number of Republican candidates for statewide office, including Curtis Loftis’ campaign for treasurer.
Critics, including S.C. Sens. Vincent Sheheen and Jake Knotts, took aim last week at the giving habits of leadership PACs. The pair co-sponsored the bill to outlaw leadership PACs in South Carolina.
“If you’re in the General Assembly, you shouldn’t be doling out money to other lawmakers,” said Sheheen, a Kershaw Democrat. “They create an unhealthy influence. … Washington is completely out of control, and I don’t want it to be the same way here.”
Legislators on key committees “can raise huge sums of money,” Sheheen said.
“Then you start financially supporting people who are supportive of what you want,” he said. “It helps people already in power consolidate their power.”
Knotts, a Lexington Republican, acknowledged he received money from the Palmetto Leadership Council but eventually asked the group to stop contributing to him.
“Something has to look right to be right,” Knotts said.
Harrell said he opposes the senators’ bill because it would limit freedom of speech.
“People have a right to be heard, and I don’t think we should be infringing on that right,” he said.
Beyond the limits
State legislators can accept individual maximum contributions of $1,000 per election cycle, according to the Ethics Commission. Contributors, however, generally give money both to individuals and to PACs aligned with their interests. The PACs then redistribute money to candidates.
“It doubles the amount that people are getting through special interests,” Sheheen said.
The Palmetto Leadership Council has taken in more than $1.3 million since 2008, the data show. Among the biggest contributors are organizations with possible business before the state, such as Michelin, Bridgestone, Medicaid provider Select Health of South Carolina, Blue Cross Blue Shield and the American Resort Development Association.
But even some lobbyists have complained about what they describe as a “shakedown operation,” said Crangle of Common Cause. They complain of being “sick and tired of constant demands for money from state leadership PACs and caucuses,” Crangle said.
Sen. Davis, who voided the Palmetto Leadership Council’s check, summed it up this way:
“With leadership PACs, influence works in both directions.”
Candidates’ campaigns also benefited in less direct ways.
Since 2008, the Palmetto Leadership Council has given nearly a quarter-million dollars to the S.C. House Republican Caucus, which then gives contributions of up to $5,000 to individual House candidates. The committee gave an additional $45,000 to the S.C. Republican Party, which also redistributes money to candidates.
Some state lawmakers indirectly received campaign boosts from out-of-state communications firms paid by the PAC.
Conquest Communications Group of Virginia, for example, took more than $35,000 from the committee since 2010.
Conquest — whose clients are listed on its website — has worked on campaigns for Harrell, Merrill, S.C. House Majority Leader Kenny Bingham, R-Lexington, and S.C. Rep. Bill Sandifer, R-Oconee. Also listed are Lee Bright, R-Spartanburg, and Kevin Bryant, R-Anderson, the two senators who blocked the bill to outlaw leadership PACs.
Bryant said PACs should be able to “contribute where they want.”
“It’s political free speech,” he said.
Asked whether they unduly influence recipients, Bryant said: “I understand there’s a possibility and agree that it’s a legitimate argument. As long as we’re disclosing the money, it’s no problem.”
Knotts, who co-sponsored the legislation, also is listed as a Conquest client.
PACs have not been subject to oversight since 2010 when a U.S. district judge in Florence ruled that the state’s definition of a “committee” was too vague, said Cathy Hazelwood, general counsel for the Ethics Commission. The term still legally is undefined, leaving the commission with no regulatory authority, Hazelwood said.
(The plaintiff in the suit, S.C. Citizens for Life, this year received a $250 charitable contribution from the Palmetto Leadership Council.)
Hazelwood said she had no way of keeping track of leadership PACs, even before the deregulation because their names rarely indicate affiliation.
The Ethics Commission also would not address any questions of conflict involving the contracts to sitting legislators paid by the committee because it has “no jurisdiction over the House or Senate,” Hazelwood said.
Complaints would be handled by the House Ethics Committee, whose chairman, J. Roland Smith, R-Aiken, has taken campaign donations from the Palmetto Leadership Council.
Reach Renee Dudley at 937-5550 or on Twitter @renee_dudley.