Elections Board Hears Morgan Case
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In a sweltering hearing room, members of the State Board of Elections Tuesday began hearings expected to last several days on a complaint by former House Speak-er Richard Morgan.
Sometimes waving funeral home fans against the heat, board members listened to arguments for and against Morgan's contention that Raleigh businessman Art Pope broke the law by funneling hundreds of thousands of dollars from his corporations to a campaign that Morgan says cost him and several other GOP legislators their party's nomination.
Morgan's petition contends that Pope family money sent thousands of fliers criticizing him and other coalition members and so illegally helped their opponents.
None of those mailers (copies of which were attached to the petition) say -- in so many words -- that Morgan or the others should be defeated. They used other language that Morgan's attorneys contend amounts to the same thing within the meaning of the law.
Pope's lawyers challenge that, saying these are issue-oriented mailers about how those legislators voted. They say the campaign represents perfectly legal, good old American politics.
If the law says only that certain words -- described as "magic words" in Tuesday's hearing -- cannot be used, it has a fatal weakness, Morgan's attorneys argued. A law like that, they said, is easily evaded with clever phrases and careful wording to avoid saying "elect this one" or "defeat that one" -- just what Pope's mailers did, they argued.
Pope's group -- Republican Legislative Majority (RLM) -- used the same mailer in all five targeted races, with only the name and record of candidates changed from mailer to mailer. Morgan's petition accuses RLM of using minor changes in appearance, typefaces, and so forth to skirt a law limiting the number mailed to fewer than 5,000.
Pope says they are all different. Morgan says they are essentially the same.
The dispute goes back to at least three years ago, when the N.C. House split 60-60 along party lines. Morgan and five other Republicans formed a tie-breaking bipartisan coalition with Democrats in a deal that made Morgan and Democrat Jim Black co-speakers.
They described it as a historic, bipartisan attempt to see that state business got done. Others saw it as a traitorous alliance with the opposition party and vowed to defeat them. Pope, a former member of the House who has long feuded with Morgan, bankrolled that effort with money from two Pope family corporations, Variety Stores Inc. and Variety Wholesale Inc.
More than a half-million dollars in the last two elections went to nonprofit groups that are not covered by campaign financing laws prohibiting corporate contributions. Pope money paid for mailings, radio and TV ads -- all aimed at defeating coalition Republicans, Morgan alleges.
It is against the law in North Carolina for corporations to contribute to election campaigns. Personal contributions are limited to $4,000 per person. But this money went to a so-called 527 group. Such groups are barred by law from supporting or opposing candidates. They are supposed to confine their purposes to issues only, but Morgan says these ads crossed the line, especially one that urged primary voters to "Call him out."
An advertising man, Harvey Harlowe Hukari, called as an expert witness on political direct mail, described the effect of this kind of electioneering on a favored candidate as "like a farmer coming out one morning to find his fields plowed, his seed planted, his farm irrigated and fertilized -- the only thing he has to do is fire up his John Deere and gather his crops."
The clear purpose was "to create a negative climate of opinion about certain incumbent legislators in order to have these people voted out of office" Hukari said.
RLM sent out 302,228 of the fliers at a cost of $180,389.86, according to figures supplied to the board. The entirety of the money came from two companies belonging to Pope, said Andy Penry, one of Morgan's attorneys.
After one witness confirmed that RLM had secured tax-free status as a 527 "advocacy" organization, Penry started to read to the board from the Internal Revenue Code -- a section dealing with the terms of that status.
"You are not about to take us to the Internal Revenue Code, are you?" Chairman Larry Leake, a Democrat from Asheville, asked.
"No, no, no," Penry said. "It's much too hot to wallow in the Internal Revenue Code."
The petition calls for the board to investigate RLM and the campaign committees of a number of Republican primary candidates, including Joe Boylan, who defeated Morgan in this year's primary in Moore County.
'This Is for the Future'
"RLM is currently engaging in electioneering advocacy," the petition states. "RLM constitutes, and is, a political committee RLM and Variety (Pope's company) by making in-kind contributions is violating (the law) which prohibits corporate contributions to political committees."
The hearings were expected to continue at least through today.
In an interview after Tuesday's session, Morgan said his fight was not just about him or what happened in the May primary.
"Nowhere in America do I believe that this kind of activity ought to go on," Morgan said. "This is for the future. ... The fact of the matter is that I am relatively insignificant in this case. The case is not about my election. It's got more to do with what the law of the land is in North Carolina, and if we are going to allow corporate contributions."
The board, ruling on questions raised in his petition, will make the law clear.
"This petition that we filed gives an opportunity for those ground rules to be laid down," Morgan said. "A decision by this board will impact candidates for every office that will follow me. The election was over on May 2 of this year -- and for me, very quickly, intellectually, after that. Emotionally, it may take a little while longer. But this action was brought well before the election occurred in 2006. I had made inquiries of the State Board of Elections and inquired, 'What else do I need to do?' What it comes down to is the issue of what's going to be the law in North Carolina."
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