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Friday, Jul 23, 2010 4:01 PM UTC

“Grassroots” Rove-linked group funded almost entirely by billionaires

Four of them, including three from Dallas, have put up 97 percent of the money for his new political operation

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Topics: Karl Rove, War Room, 2012 Elections, Republican Party,

White House Deputy Chief of Staff Karl Rove laughs during a ceremony honoring the 2006 recipients of the Presidential Medal of Freedom in the East Room of the White House in Washington, December 15, 2006. REUTERS/Larry Downing (UNITED STATES)(Credit: © Larry Downing / Reuters)

[UPDATED]Virtually all of the $4.7 million raised by Karl Rove’s new conservative outfit was contributed by just four billionaires, three of whom are based in Dallas, Texas, and two of whom made their fortune in the oil and gas industry.

The IRS filing of American Crossroads, an outside 527 group that was conceived by Rove and ex-RNC chair Ed Gillespie, gives a good taste of who is funding the GOP effort to make big gains in the House and Senate come the fall. The group has already burned through $600,000 on ads attacking Senate Majority Leader Harry Reid, who is facing a reelection contest against Republican Sharron Angle (see one of the spots below). Chaired by another ex-RNC chair, Mike Duncan, American Crossroads has pledged to raise $50 million to beat Democrats in the midterms and has been seen by some as a competitor to the Republican National Committee itself.

And despite the group’s description of itself as “grassroots,” Salon’s review of its IRS filings show that four billionaires have contributed 97 percent of the $4.7 million it has raised to date. There are no limits on how much corporations, unions, and individuals can donate to 527 groups. Here’s a guide to American Crossroads’ four donors:

  • Trevor Rees-Jones, president of Dallas-based Chief Oil and Gas, gave a $1 million donation to American Crossroads just as the group was starting in April. That’s small money for Rees-Jones, who, Forbes estimated in 2009, amassed a $1.5 billion fortune investing in gas prospects around America. He has also been a big donor to John McCain and the Texas Republican Party, Politico reported.
  •  Bradley Wayne Hughes, chairman of Public Storage Inc, is American Crossroads’ biggest donor, contributing $1.55 million to date. Hughes founded Public Storage in 1972 and the company has grown into a self-storage behemouth with over 2,000 locations. Worth $3.9 billion, he lives in Lexington, KY, where he actively raises thoroughbred horses at Spendthrift Farm. (Hughes’ son, B. Wayne Hughes Jr., is on the board of former Senator Norm Coleman’s new conservative group, the American Action Network.)
  •  A company called Southwest Louisiana Land LLC donated $1 million to American Crossroads in June. It turns out Southwest, which doesn’t have much of a public footprint, is owned by Dallas billionaire investor Harold Simmons — no stranger to conservative causes. Since the 1980s, he has ponied up for everthing from Oliver North’s defense fund, to Newt Gingrich’s PAC, to the Swift Boat Veterans for Truth in 2004, to the American Issues Project, a group that ran ads attempting to tie Obama to Bill Ayers in 2008 (Simmons was the sole funder of the Ayers effort, giving nearly $3 million.) Simmons is worth $4.5 billion.
  •  TRT Holdings, owned by Dallas’ Robert Rowling, gave American Crossroads $1 million. Rowling, whose firm owns Omni Hotels and Gold’s Gym, got started at his father’s successful company, Tana Oil & Gas. He’s now worth $4.4 billion. In 2004 Rowling gave $1 million to Progress for America, an outside group backing President Bush’s reelection.

It’s also important to note that American Crossroads has set up a partner organization called  American Crossroads GPS that, because it has a different tax status, does not have to reveal any donor information and is also more limited in spending its money on campaigns (Politico has more on this). American Crossroads GPS took in over $5 million in June, and we’ll likely nver know who is putting up the money.

Here’s one of American Crossroads’ ads against Reid:

 

UPDATE: Jonathan Collegio, spokesman for American Crossroads, sent over this statement arguing that the group has the same fundraising model as liberal groups, but the “major difference is that, unlike unions, we can’t tax our members to fund political activities.”

Like many groups on the liberal side of the political spectrum, we receive support from large, small and online donors – and while we are barely four months old, our membership is expanding rapidly, with more than one thousand people engaged with our social media efforts. The major difference is that, unlike unions, we can’t tax our members to fund political activities.

Justin Elliott

Justin Elliott is a reporter for ProPublica. You can follow him on Twitter @ElliottJustin More Justin Elliott.

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