ALEC Facing 'Funding Crisis' Following Public Scrutiny

On Tuesday, the day before the American Legislative Exchange Council (ALEC) will convene with hundreds of state legislators and corporate representatives for a "states and nation policy summit" in Washington, The Guardian newspaper has published a series of ALEC documents that reveal the group is amidst a major funding shortfall and is scrambling to win back donors who have recently jumped ship.

Ex-Florida governor Jeb Bush speaks at Alec’s 40th annual meeting in August (M Spencer Green/AP)

At the heart of the crisis, The Guardian reports, is the criticism the big money group has faced over its policy on gun laws and its influence in Washington over gun control deregulation in the past two years, following the high-profile case of the killing of unarmed black teenager Trayvon Martin.

"ALEC was embroiled in the controversy surrounding Florida's 2005 'stand-your-ground' law under which George Zimmerman, the neighborhood watch volunteer who shot and killed the 17-year-old Martin, initially claimed self-defense," The Guardian reports. "The Florida law was picked up by ALEC, and, working in partnership with the National Rifle Association, used as a template for one of its 'model bills', which was then taken up by other states across the country."

In the controversy that followed, many of ALEC's top corporate donors pulled out membership and funding from the organization.

The Guardian reports:

The Guardian has learned that the American Legislative Exchange Council (ALEC), which shapes and promotes legislation at state level across the US, has identified more than 40 lapsed corporate members it wants to attract back into the fold under a scheme referred to in its documents as the "Prodigal Son Project".

The target firms include commercial giants such as Amazon, Coca-Cola, General Electric, Kraft, McDonald's and Walmart, all of which cut ties with the group following the furor over the killing of the unarmed black teenager Trayvon Martin in Florida in February 2012. […]

The Guardian has learned that by ALEC's own reckoning the network has lost almost 400 state legislators from its membership over the past two years, as well as more than 60 corporations that form the core of its funding. In the first six months of this year it suffered a hole in its budget of more than a third of its projected income.

According to the Guardian, the documents—which include papers prepared for ALEC's board of directors—also reveal that ALEC has established a "sister group" called the "Jeffersonian Project." The group is filed as 501(c)(4) social welfare organization, which will allow ALEC "to be far more overt in its lobbying activities than its current charitable status as a 501(c)(3)."

While ALEC denies that its current actions qualify as lobbying, critics charge that the group's work in crafting and pushing right-wing legislative agendas does qualify and is in violation of current tax laws.

As for both ALEC's funding shortfall and the restructuring of its lobbying activities, Lisa Graves, executive director of the Center for Media and Democracy, said the revelations show that the organization is vulnerable to public scrutiny.

"This is a reflection of the power of sunlight on their activities – for too many years they were operating largely in secret. Corporations are sensitive to these issues," she said.

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