A nonprofit organized by former U.S. Rep. Bob Beauprez should have registered as a political committee — and now must disclose the donors who funded attacks on Republican candidates in 2016 primary elections, a Colorado appeals court has ruled.
In an unpublished decision handed down on May 30, a three-judge Colorado Court of Appeals panel also upheld the $17,735 penalty imposed in 2017 on Beauprez’s nonprofit, Colorado Pioneer Action, by an administrative law judge.
That judge found the group qualified as a political committee under state campaign finance law even though it didn't coordinate its spending with the candidates it supported.
“The wheels of justice grind slowly, but they do grind — and have ground CPA’s groundless appeal to dust,” said Matt Arnold, whose Campaign Integrity Watchdog group filed the complaint against Beauprez's nonprofit in 2016 and has continued arguing the case through the appeals process.
Beauprez told Colorado Politics he is reviewing the decision with attorneys and left open the possibility the group could appeal the ruling.
"In 2015, Colorado Pioneer Action set out to make the point that conservative principles are the heart and soul of the Western spirit, and not the domain of brash, divisive politicians," Beauprez said in a statement.
"We believed, and still believe, that our actions complied with both the letter and spirit of the law. But as we all know, Colorado’s campaign finance laws can sometimes be convoluted and at times even conflicting."
The Beauprez group was organized as a tax-exempt 501(c)(4) “social welfare” nonprofit, which isn't required to reveal its funding sources, so long as its "major purpose" isn't to support or oppose candidates.
But the appeals court agreed with the lower court judge that supporting some candidates and opposing others had indeed been the group's major purpose, making it subject to the same registration and disclosure requirements faced by other state political committees.
According to court documents, Colorado Pioneer Action spent roughly $420,000 of the $660,000 it raised during the 2016 election cycle for and against candidates, including spending heavily in a handful of GOP legislative primaries.
The group spent about $120,000 on TV ads supporting Republican Heidi Ganahl's winning campaign for University of Colorado at-large regent. But it also aimed a barrage of attack mailers and digital ads at Republican legislative candidates who Beauprez characterized as "better known for grandstanding than for effecting conservative change."
Colorado Pioneer Action's targets included then-state Rep. Gordon Klingenschmitt, a Colorado Springs Republican, who was defeated in a primary for El Paso County's state Senate District 12 seat by fellow Republican Bob Gardner.
"They broke the law, and they did it with brazen attitude, and they want the courts to look the other way," Klingenschmitt told Colorado Politics after the appeals court ruling was handed down. "No. We want transparency in our politics."
Klingenschmitt hailed the decision and said he's looking forward to finding out who paid for fliers that flooded Republican voters' mailboxes ahead of the primary — and, he maintains, swayed the race.
"This is vindication of how their team cheated and helped win two of the elections they got involved in," he said. "When they and other groups spend $250,000 in my race running false, nasty anonymous postcards, it literally cost me the election. Otherwise, I would be a state senator today. I blame Bob Beauprez for helping Bob Gardner win his race."
He added: "I think they should give up and disclose their identities. Maybe they'll take my advice."
As the 2016 primary approached, Klingenshmitt and Douglas County Republican Jess Loban, another GOP legislative candidate hit with negative mailers funded by the Beauprez group, filed criminal complaints alleging the ads included inaccurate statements.
Then-state Rep. Janak Joshi, a Colorado Springs Republican, was also targeted by the group with attack ads and lost his re-election bid to Republican Larry Liston.
In the wake of the appeals court ruling, Arnold called on Beauprez to "quickly and fully comply with the orders," which include registering as a political committee with the Colorado Secretary of State's office, filing required financial disclosures and paying the penalty, which ranks among the stiffest ever imposed for a state campaign finance violation.
"CPA has defied the law long enough; time to man up and pay the piper," Arnold said.
The appeals court set aside a ruling by the administrative law judge requiring Arnold to pay $1,018 of the Beauprez nonprofit's attorney fees because Arnold leaked court documents to a reporter, saying the judge didn't have the authority to levy what amounted to a contempt fine.
Beauprez said he relied on "experienced election legal counsel" and noted that then-Secretary of State Wayne Williams filed court documents supporting his committee's position.
"Nonetheless, the Court of Appeals disagreed in this instance as courts continue to define the scope and meaning of the campaign finance provisions. While disappointing, we are evaluating what action to take in response to the Court’s decision," Beauprez said.
A spokeswoman for Secretary of State Jena Griswold, the Democrat who replaced Williams after defeating him in the November election, told Colorado Politics that her office hasn't decided whether to continue supporting the Beauprez group's position.
"We're reviewing the decision and monitoring further developments," said Serena Woods, the Secretary of State's communications director, in a text message.
Colorado Pioneer Action has until mid-July to appeal the ruling to the Colorado Supreme Court.
Correction: This article was updated at 1:30 p.m. June 10 to correct Loban's first name.