BY JIM DOOLEY - Pacific Resource Partnership is a leading pro-rail spender in this year’s election cycle just as it was in 2008 and 2010, but where the group’s money comes from is shrouded in secrecy.
PRP, as it is known, is a non-profit “social organization” that combines the economic clout of the $39 million Hawaii Carpenters Union with hundreds of contractors and developers that have signed union agreements with construction trade union locals.
Together, PRP and the Carpenters have spent an estimated $1.5 million since 2008 promoting rail and attacking opponents of the planned $5.2 billion rapid transit project, according to financial reports filed with state and federal agencies.
In 2008, PRP spent more than $250,000 on pro-rail promotions and the Carpenters Union Local 745 separately spent $500,000 or $700,000 for the same purpose, according to reports filed with the state Campaign Spending Commission and with the Labor Management Services Administration of the U.S. Labor Department.
So far this year a new PRP political action committee (PAC) has already spent more than $500,000 on television ads attacking anti-rail mayoral candidate Ben Cayetano, according to Cayetano and television station public disclosures.
Details of PRP’s 2012 spending won’t be revealed until August 1, the Campaign Spending Commission’s deadline for submission of 2012 PAC financial reports.
A review of past PRP PAC reports indicates that while spending details will be disclosed, the precise source of the money will not.
In 2008, PRP formed a PAC called the Pacific Resource Partnership Smart Growth Hui, financed entirely with $262,849 from PRP, that promoted the rail project. Where PRP got the money that it gave to the PAC isn’t known.
Unlike many large tax-exempt non-profits, PRP is what the IRS classifies as a 501(c)(4) organization which isn’t required to publicly release its federal tax returns.
Non-profits chartered under that section of the federal tax code “must operate primarily to further the common good and general welfare of the people of the community (such as by bringing about civic betterment and social improvements),” according to the IRS.
Political activities and lobbying are permitted activities for such organizations as long as they are not the non-profit’s “primary activity.”
But their tax returns are confidential so details of their financial activities, including such items as sources of income and staff salaries, are not disclosed.
State Rep. Della Au Belatti, a former member of the state Campaign Spending Commission who
yesterday denounced the contents of PRP’s anti-Cayetano ads, called on the organization to “immediately disclose” its sources of money.
Such disclosure would allow voters to be “fully informed by who’s paying to play in this year’s election,” Belatti said.
“I challenge them to immediately disclose their donor lists—and not just contributions to their PAC but (also) their 501(c)(4) non-profit organization," said Belatti.
John D. White Jr., executive director of PRP, declined to respond to emailed questions about
PRP’s finances and Belatti’s demand by saying: “Given the Hawaii Reporter editor's obvious bias in favor of Ben Cayetano's candidacy for mayor, PRP doesn't feel it will get a fair shake in response to questions posed by Hawaii Reporter, and therefore will not respond to your specific questions.”
White is the former chief of staff for U.S. Rep. Mazie Hirono, who is now campaigning to replace retiring U.S. Sen. Daniel Akaka in Washington, D.C.
White also ran an unsuccessful political campaign of his own in 2010, seeking election to the Honolulu City Council.
In that well-financed Council race, White raised more than $250,000 in campaign money, including the maximum allowable $4,000 from PRP and $3,800 from the Carpenters Union, according to state records.
White lost the race by fewer than 50 votes to Ernie Martin, who is now chairman of the Council. White joined PRP in 2011.
White is chairman of PRP’s newest PAC and its bookkeeper is Paul Marx, a businessman who, with White, is a registered lobbyist representing the interests of PRP at the Legislature and elsewhere.
Marx is manager of Hawaii Benefit Administrators, Inc., which oversees pension and other benefit programs for the Carpenters and other clients, according to business records.
Marx’s Vineyard Boulevard office is also listed as the address for a variety of other non-profit construction industry groups, including the Construction Industry Improvement Program of Hawaii and the Roofing Industry Improvement Program Trust Fund, according to business records.
While PRP’s 2008 pro-rail PAC raised and spent more than $250,000, the Carpenters Union here separately raised and spent at least twice that much through its own 2008 PAC, the Pro-Rail Committee of the Hawaii Carpenters Union.
According to disclosures filed with the Campaign Spending Commission, that PAC received $504,000 from Carpenters Union Local 745, spending all but $17,000 of it. The unspent balance was returned to the union when the PAC was terminated in November 2008.
Financial forms filed by Local 745 with the U.S. Labor Management Services Administration, however, reported that the union spent far more money -- $739,526 -- on pro-rail activities in 2008. The union told the feds that virtually all of its pro rail spending was for television advertising and video production expenses.
Sean Kim, attorney for Local 745, did not respond to questions today about the discrepancy between what the union told the Campaign Spending Commission and what it reported to the federal government.
Neither White nor Kim responded to questions about how much financial support the union gives to PRP.
The union reported no monetary transfers or payments to PRP in its last four annual financial reports filed with the federal government.
Local 745 said in its latest federal report that it had 6,500 members and assets of $39 million at the end of 2011.
PRP and Local 745 joined economic forces here in 2010 to form yet another PAC, Smart Growth Hui. (The 2010 PAC was a different entity from the similarly-named PAC operated by PRP in 2008).
PRP and the Carpenters each contributed $59,330 to the 2010 PAC’s successful efforts to promote passage of a city charter amendment creating the Honolulu Transit Authority. The PAC was dissolved in 2010.