The complaint, filed with the Federal Election Commission by the nonpartisan Campaign Legal Center, comes after The Associated Press reported earlier this month that Ernst's work with the political nonprofit Iowa Values to raise money and build an electoral “firewall" potentially violated campaign finance and tax law.
Political nonprofits are often referred to as “dark money" groups because they can raise unlimited sums and do not have to disclose their donors. But such tax-exempt groups are forbidden from making political activity their primary purpose.
The complaint requests that the FEC launch an investigation. It also argues that internal Iowa Values documents revealed by the AP show the group's major purpose is political activity. That likely violates the conditions of its tax-exempt status while breaking campaign finance laws that obligate the group to register as a political committee with the FEC and disclose its anonymous donors, the watchdog said.
“There is little evidence of Iowa Values engaging in any activities in 2019 other than those aimed at influencing Ernst’s reelection," the Campaign Legal Center wrote in the complaint.
The complaint is the third to be filed against Iowa Values following the AP's story. A group called the Campaign for Accountability, which has ties to the Democratic Party, filed a complaint last week along similar lines. Another called American Democracy Legal Fund, which is run by a longtime Democratic operative, previously requested an investigation, as well.
In a statement, Iowa Values executive director Derek Flowers said the group complies with “all applicable laws" and the complaints have “no basis in fact or law."
“In order to achieve its goals, Iowa Values will spend some of its money to help reelect Joni Ernst," Flowers said. “The three complaints have been filed without any knowledge of the full range of activities that Iowa Values is undertaking to promote its mission."
After a recent resignation, however, the FEC currently lacks enough commissioners to legally meet to conduct business, approve investigations or take enforcement action. It's unclear when the Senate may take action to appoint more board members.
Political nonprofits must take steps to operate independently from the candidates they support. Iowa Values was co-founded in 2017 by Ernst’s longtime consultant, Jon Kohan. It shares a fundraiser, Claire Holloway Avella, with the Ernst campaign. And a condo owned by a former aide — who was recently hired to lead the group — was used as Iowa Values’ address at a time when he worked for her.
The documents reviewed by the AP, including emails and a strategy memo, not only make clear that the group’s aim is securing an Ernst win in 2020, but they also show Ernst and her campaign worked in close concert.
Legal experts have said the fundraising practices of Holloway Avella are a potential campaign finance violation.
In July, Holloway Avella requested “an investment of $50,000” from a donor after Ernst made an introduction. And she made clear in the email how much a contribution of that size could help.
“As a follow up to our introduction by Senator Ernst, I am reaching out to you on behalf of Iowa Values,” she wrote.
“As you may have seen, an outside group on the left ... recently launched a six-figure ad buy in media markets across the state attacking Senator Ernst on her vote to repeal Obamacare,” she continued. “The purpose of our group, Iowa Values, is to push back against these type of negative attacks.”
Holloway Avella closed the email with a “reminder" that donations are not “publicly disclosed."