Stand for Children, charter candidates face massive fines
A pro-charter school organization and the four school board candidates it backed in August are subject to combined civil penalties totaling $685,000, potentially the harshest punishment for campaign disclosure violations in recent Nashville election history.
The Tennessee Registry of Election Finance on Tuesday sent a show cause letter to Stand for Children and candidates Miranda Christy, Thom Druffel, Jane Grimes Meneely and Jackson Miller.
The violations relate to the candidates coordinating with Stand for Children and its two political action committees to find campaign workers. The coordination, first reported by The Tennessean, stemmed from an email between Stand for Children's political director, Dan O'Donnell, and the executive director of the Martha O'Bryan Center, a nonprofit group that operates two charter schools.
“I am appalled at the money that was put into this race,” said school board member Jill Speering, who easily defeated Grimes Meneely despite being dramatically outraised. “It’s going to be interesting to see what the findings are and what kind of action is taken.”
According to the ethics bureau's board of directors, that coordination caused the four candidates to eclipse campaign contribution limits. Each campaign is subject to a fine equal to 115 percent of the difference between the contribution cap of $7,600 and the amount of the unreported political help provided by Stand for Children. That comes out to about $70,000 in potential fines per campaign, and Stand for Children's political action committee is subject to the same potential fine for each infraction.
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The campaigns also are subject to $10,000 fines for incorrectly reporting contributions in their disclosure reports. According to the letter, each candidate reported incorrect figures on the second quarter and the pre-primary disclosures, which means each is subject to up to $20,000 in total fines. In total, the two Stand for Children political groups and the four candidates could face up to $685,164.38 in fines. A hearing is set for Oct. 12.
"Please note that is a maximum," said Drew Rawlins, executive director for the Bureau of Ethics and Campaign Finance. "It could be anywhere from $0 to that amount."
The Tennessean did not hear back after seeking comment from three candidates on Wednesday.
Dan Haskell, attorney for Druffel, said his client has been cooperative during the state registry’s investigation.
“I always advise my clients to be cooperative,” he said. “If they find that some violations have occurred — and that’s a question — ultimately the registry will use its own judgment about the amounts of the fines given the probability that the candidates really didn’t have any idea they were committing a violation.”
Stand for Children's attorney Stephen Zralek said the organization "meticulously followed the law and we look forward to all the facts coming out."
A complaint against Stand for Children and the candidates was filed Aug. 4, a day before Nashville's school board elections, by consumer rights group Tennessee Citizen Action and a Metro parent. The initial complaint quoted stories in The Tennessean regarding the email exchange between O'Donnell and Martha O'Bryan Center Executive Director Marsha Edwards. O'Donnell emailed Edwards and other charter school backers in Nashville to find more campaign workers for the four candidates. It is illegal for nonprofit groups like the Martha O'Bryan Center to engage directly or indirectly in political campaigns, and the organization was the subject of a complaint from school board member Will Pinkston to the Internal Revenue Service.
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“The emails discussed above show that Stand Independent was making expenditures in cooperation with, or in concert with, or at the request or suggestion of a candidate, the candidate’s political campaign committees or their agents," the registry said in the letter to candidates Tuesday.
The registry also referenced a report by WSMV that showed O'Donnell and Druffel meeting in the days leading up to the election, which is illegal because there is a black-out period leading up to election day.
An investigation by the registry board was launched into allegations against Stand for Children and the candidates Sept. 14 after the board determined there was enough evidence to launch the probe. Stand for Children had a heavy influence in this year's Nashville school board race, and spent over $200,000 in July on the race.
Dave Boucher contributed to this story.
Reach Jason Gonzales at 615-259-8047 and on Twitter @ByJasonGonzales. Reach Nate Rau at 615-259-8094 and on Twitter @tnnaterau.