Republican Cook County Commissioner Sean Morrison faced a tough reelection battle last November to hang on to his suburban district as he squared off against Democrat Dan Calandriello, an attorney and former Orland Park trustee.
But in the waning months of the campaign, Morrison gained a major financial advantage after a nonprofit pumped $300,000 into his campaign, the most Morrison received from any single donor.
Calandriello said in an interview that his campaign had been going well but ”toward the end it was financially lopsided — I mean we were getting outspent 10 to 1.” In the end, Morrison eked out a victory with fewer than 3,000 votes.
The $300,000 in donations came from a recently created nonprofit, called the Coalition to Cut Taxes.
It’s unclear what the Coalition to Cut Taxes does. The paper trail that typically accompanies the creation of a nonprofit is scant when it comes to the group. Its website is rudimentary. The woman listed as the group’s board secretary says she actually hasn’t been involved in the group and wouldn’t provide basic financial information.
What is clear is that the organization received major funding from the similarly named ballot initiative committee, the Coalition To Stop The Proposed Tax Hike Amendment — propped up by hedge fund billionaire Ken Griffin with more than $53 million, as well as contributions from other wealthy conservatives. Crain’s Chicago Business first reported on that connection in September.
A ballot initiative committee can contribute money to support or defeat a ballot measure but not to a specific candidate.
The committee led a campaign that blasted out TV ads urging voters to reject a graduated state income tax in Illinois — which they ultimately did. After it won, the committee began emptying its coffers.
On June 2, 2021 — two months after the nonprofit was incorporated — the Coalition to Cut Taxes received $450,540 from the Coalition To Stop The Proposed Tax Hike Amendment, according to records from the Illinois State Board of Elections.
As a nonprofit, the Coalition to Cut Taxes can make contributions to specific candidates. It has made only two, both of them to Morrison, state records show.
The Coalition to Cut Taxes was registered as a nonprofit corporation with the Illinois Secretary of State in April 2021, but a spokesperson there says it has no additional records for the group.
There aren’t any records of the organization having tax exempt status in the Internal Revenue Services database which was last updated on Nov. 14. Spokespeople with the Illinois Department of Revenue and the Attorney General’s office also said they had no records of the group.
Morrison, chairman of the Cook County Republican Party, didn’t respond to multiple requests for comments after initially saying he would release a statement.
Jennifer Schuster, who is listed as the board secretary for the nonprofit in state records, said despite her title with the organization she hasn’t really been involved with the group, so her knowledge was limited but contended the appropriate paperwork was filed with the IRS.
“I know the IRS has a backlog of like 21 million tax correspondences, so it’s not surprising you can’t find it,” Schuster said. “It’s a brand new not-for-profit created in 2021 so it’s going to take some time.”
The IRS backlog has been widely reported including the fact that it’s delayed on releasing nearly half a million nonprofit tax records, according to ProPublica. But the IRS contends eligible tax deductible organizations are up-to-date on its organization search, which the Coalition to Cut Taxes doesn’t appear in.
Schuster declined to provide any of the organization’s filings.
Schuster, who was also the treasurer for the Coalition To Stop The Proposed Tax Hike Amendment, said there is no relationship between it and the Coalition to Cut Taxes other than that money was left over and was contributed to the newly formed nonprofit.
She referred further questions to attorney John Fogarty, a member of the Republican National Lawyers Association. He did not return numerous emails and phone calls requesting information.
Zia Ahmed, spokesperson for Griffin, said earlier contributions were done in compliance with the law.
“Ken has not made any political contributions in Illinois since he left the state in June and does not dictate how recipients direct their funds,” Ahmed said in a statement.
The Coalition to Cut Taxes’ website is barebones with a landing page that provides little information other than to sign up for a newsletter. It features a blue banner with the coalition’s logo and at the bottom of the web page it says “Paid for by Coalition to Cut Taxes.”
In general, organizations intending to operate under a 501(c)(4) must notify the IRS within 60 days of its formation.
According to the IRS, a 501(c)(4) is a social welfare nonprofit that is allowed to advocate and spend money on political campaigns but its primary objective should be to improve the community. It doesn’t need to disclose who has contributed to its organization but must file annual tax returns that are available to the public.
A 501(c)(4)’s primary responsibility can’t be used to funnel money into politics.
Money right on time
The spending in the 17th District race intensified in the final two months, Calandriello said, as Morrison was “in the mailbox twice a week” and airing TV campaign ads.
Calandriello attributes his loss to the influx of cash Morrison’s campaign received from the Coalition to Cut Taxes.
The group donated $200,000 to Morrison’s campaign on Sept. 9 and $100,000 on Nov. 7, just one day before the election.
Matt Dietrich, spokesman for the Illinois State Board of Elections, said these large donations were possible after the campaign contribution limits were taken off when Morrison filed a notice of self funding. This was done on Aug. 30 when Morrison loaned his campaign $100,001.
“We had a huge reception but at the end of the day we were outspent,” Calandriello said. “There is nothing we could’ve done differently.”
A complaint has been filed against the Coalition to Cut Taxes by Orland Park resident Michael Henry with the Illinois State Board of Elections, which held a hearing on the matter earlier this month. These preliminary hearings typically aren’t public
Dietrich said the hearing involving Morrison’s committee and Coalition to Cut Taxes resulted in a recommendation that has been forwarded to the board for consideration at its meeting on Feb. 22.
“I think my experience in this race shows the problems with campaign finance laws,” said Calandriello, who is not involved in the complaint. “I mean I have to disclose a $150 donation came from my mom but this kind of large donation where we don’t know who is behind it can kind of just funnel in so long as the spending cap is blown off.”