On Monday afternoon, Guilford County school board members filed a second complaint against a local conservative group for engaging in what they say is illegal campaign-finance activity.
Board Chair Deena Hayes and Vice Chair Winston McGregor have filed a complaint with the State Board of Elections asking the entity to investigate Take Back Our Schools.
The move comes just a few weeks after the two school board members sent letters to the Guilford County Board of Elections, the NC Secretary of State’s office, the state attorney general’s office and the NC Board of Elections, asking each to investigate the activities of Take Back Our Schools.
This time, the duo have filled out a specific form, a campaign finance complaint, on the grounds that Take Back Our Schools is engaging in campaign finance activity that runs athwart of the law.
As previously reported by Triad City Beat, Take Back Our Schools was filed at the state level as a 501c(3) organization. However, the organization continues to state on their website and in statements that they are a 501c(4) organization. Eugene Parker, who filed to incorporate the group, has repeatedly said that he mistakenly classified Take Back Our Schools as a 501c(3) on the form. The main difference is that 501c(3)s are not allowed to engage in political activity at all, whereas 501c(4) can, in some instances.
However, the new complaint states that even if the organization were correctly filed as a 501c(4), that it would still be in violation of campaign finance law.
“TBOS failed to register as a political committee (NCGS 163-278.7) and therefore its receipts and expenditures remain unreported,” the complaint reads.
John Wallace, an attorney representing Hayes and McGregor, said that the violations refer to the way that Take Back Our Schools has been coordinating with candidates.
“Even a 501c(4) is prohibited from coordinating with candidates,” Wallace said. “And that’s what’s happened here. They’ve been collecting contributions and then expending those contributions in coordination with candidates. That leads to a corporate contribution as a matter of law. And they have been spending and putting on some of the material they have published that adds ‘paid for in part by the candidates,’ have also been ‘paid for in part by TBOS.’ Well TBOS as a corporate entity cannot pay for any portion of the candidates’ expenses. That is an in-kind corporate contribution.”
Take Back Our Schools is endorsing all of the Republican candidates for Guilford County School Board this election cycle: Crissy Pratt (District 2), Linda Welborn (District 4), Tim Andrew (District 6) and Demetria Carter (At-large).
If an organization wants to raise funds, coordinate with candidates and then use the funds to pay for candidates’ activity, they must form a political action committee, otherwise known as a PAC. That’s because if organizations want to raise and disburse funds, they are required by law to report those to the State Board of Elections and it would be public record.
According to state law, “each candidate who has received funds or made payments or given consent for anyone else to receive funds or transfer anything of value for the purpose of bringing about that individual’s nomination or election for office, political committee, and referendum committee shall appoint a treasurer and, under verification, report the name and address of the treasurer to the Board.” The law goes on to state how the treasurer should keep those records and file the information with the state board.
And that’s the argument the new complaint is making.
“Unless TBOS is determined to be a political committee (unregistered), then such expenditures as have been made for the purpose of defraying candidate expenses (Exhibit 2) would constitute illegal corporate contributions,” the complaint reads.
The public deserves to know where the money is coming from and how the candidates for Take Back Our Schools are being funded, McGregor says.
“Are they operating within all of the appropriate and legal guidelines?,” McGregor asked in a text. “Are they spending more money than they are allowed on direct political activity? Are they making direct contributions to campaigns beyond what is allowable? Are they directing other inappropriate or illegal contributions? Do we know where all their money comes from?”
As reported by TCB before, Take Back Our Schools is a conservative group that has made a name for itself in the last few years by rallying around issues like masking in schools, critical race theory and books they believe are inappropriate for children. Despite the fact that they tout themselves as a “tiny nonprofit,” this past summer, they hosted a fundraiser at Starmount Country Club with Lt. Gov. Mark Robinson as a guest. On their website, they list multiple donors who have given anywhere from $250-1,000 specifically for the school board candidates.
Wallace told TCB that if a 501c(4) spends more than $100 it is required to report the receipt of contributions for the purpose of those expenditures and to report the actual expenditures to the board of elections.
“This organization has not done that,” he said.
Now that the complaint has been filed, Wallace said it’s up to the State Board of Elections to investigate Take Back Our Schools and take action against them. That may include requiring the organization to disclose its finances and financial contributions or create a political action committee. The complaint wouldn’t affect the election results, even if candidates endorsed by Take Back Our Schools were to win.
The timeline for the investigation is unknown, Wallace said. The facts of any ongoing investigation would also be confidential according to state law.Eugene Parker with Take Back Our Schools responded to questions by TCB about the new complaint in an email on Monday evening. He said that he doesn’t “understand all the legal mumble jumble about [their] alleged violation of campaign laws,” and that they are operating legally.
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