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Finance report offers more details about funding behind pro-business group involved in 2017 Minneapolis election

Disclosures by the Minnesota Jobs Coalition revealed that its role in the 2017 Minneapolis city council election was substantial — and financed by some of the city’s most prominent business interests.

Because of the way state law governs campaign finance disclosure for city races, voters knew little of the sources of money that paid for a flood of direct mail supporting Minneapolis Works-endorsed candidates.
MinnPost file photo by James Nord

There was no money from the Koch brothers, no funding from Hubbard Broadcasting or Walmart.

But a long-anticipated (yet still-late) report by the pro-business political committee Minnesota Jobs Coalition revealed that its role in the 2017 Minneapolis City Council election was substantial, and that it was financed by prominent business interests, including the Pohlad brothers, Ryan Companies, Sherman Associates, Swervo Management, the downtown building owners and managers and the Minnesota Multi-Housing Association.

The report, due Jan. 31 but filed Monday with the state Minnesota Campaign Finance and Public Disclosure Board, shows that the Jobs Coalition collected money from the same types of donors that gave directly to Minneapolis Works, an independent expenditure committee that was heavily involved in the 2017 Minneapolis election. Developers and construction interests made up most of the money the Jobs Coalition raised between September and November of 2017.

Of the $274,000 raised and spent by Minneapolis Works to defend six City Council incumbents and support development-friendlier candidates in two other council races, $140,000 came from the Jobs Coalition. The effort was only marginally successful: Only two of the six Minneapolis-Works-backed incumbents retained their seats, with the group’s preferred candidates in the two other races also losing.

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Because of the way state law governs campaign finance disclosure for city races, voters knew little of the sources of money that paid for a flood of direct mail supporting Minneapolis Works-endorsed candidates — and attacking their opponents. Infrequent reporting deadlines, a bifurcated county and state reporting system, and low penalties for those who fail to timely file reports make it possible — easy, even — for political committees to raise and spend money without full disclosure before ballots are cast.

Minneapolis Works was registered with Hennepin County and filed two reports during the election — one prior to the city’s August primary and one before the November election. But because of the way the deadlines apply, donations to Minneapolis Works that came in after Oct. 24 did not get reported until an end-of-year report was filed on Jan. 31.

And though that report revealed the level to which the Minnesota Jobs Coalition was involved — three donations to Minneapolis Works totaling $140,000 — it didn’t show who had channeled their money through the Jobs Coalition rather than directly to Minneapolis Works. The effect of going through the Jobs Coalition was that donors could be involved in the election without having their names revealed until long after Election Day. 

That appeared to be a strategy by the founders of Minneapolis Works, who invited donors to use either route to help the campaign. Because the Jobs Coalition is registered with the state  — and because there wasn’t a state election in 2017 — the Jobs Coalition is only required to file a single end-of-year report. By the time that report was filed Monday, nearly two weeks beyond the state deadline, the election was three months over. (State fines are $25 per business day, not to exceed $1,000, for missing the reporting deadline, meaning the Jobs Coalition could face less than $200 in penalties.)

Money mostly from in-state business interests

While the two different sets of reporting rules allowed some donors to escape pre-election scrutiny, it also allows opponents to fill the information void with speculation. In the run-up to November, TakeAction Minnesota, a progressive activist group, alleged that national corporations and conservative interests were trying to “buy” the Minneapolis City Council.

While TakeAction had no data to back up the claim, they did know that the Minnesota Jobs Coalition had received such money in the past — and had used it to attack Democrats in legislative elections throughout the state. The Jobs Coalition, founded as a conservative pro-business PAC, was especially active in the 2016 legislative races, when one of its chief strategies was to try to tie DFL candidates from Greater Minnesota to urban lawmakers from Minneapolis.

The one significant national donation that flowed to the Jobs Coalition during the Minneapolis election was $25,000 that came from RAI Services Company of Winston-Salem, North Carolina. RAI is a subsidiary of tobacco company Reynolds America. The rest of the money came from in-state business interests. James, Robert and William Pohlad, whose family-owned businesses include United Properties, gave $3,000 each to the Jobs Coalition. Patrick G. Ryan, president and chief executive officer of Ryan Companies, and Collin Barr, regional president of Ryan Companies, gave $20,000 each.

Other development-related money came Kleinman Realty ($20,000), Lupe Development Partners ($15,000), the Excelsior Group ($15,000), Sherman Associates founder George Sherman ($15,000), TE Miller Management ($10,000), McGough Construction Co. ($10,000)  and Swervo Management Division ($10,000).

The Greater Minneapolis Building Owners and Managers Association gave $5,000 and the Multi-Housing political action committee gave $2,000.

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Two other committees active in the 2017 Minneapolis election also received Jobs Coalition money. Save Our No. 1 Parks and Hear Our Voices each recieved $15,000. The parks groups was created by several outgoing Minneapolis Park & Recreation Board  incumbents who were trying to elect replacements who would support their vision for the park system. That effort, like Minneapolis Works’, was mostly unsuccessful.

Hear Our Voice was initially active during the DFL caucus period and spent $25,000 to hire four Somali-American political consultants. That early effort was funded entirely by James and Mary Lawrence, prominent national Democratic donors. The money the Jobs Coalition sent to Hear Our Voice in October helped to hire two of the same consultants.

Limited election success

Minneapolis Works surfaced in late summer when leaders of the Minneapolis Chamber of Commerce, the Minneapolis Downtown Council and developer Steve Minn who co-owns Lupe Development Partners began holding meetings to promote the group. The intent, organizers said, was to try to maintain a more-business-friendly City Council.

Even that goal seemed aspirational, since organizers admitted that the council they wanted re-elected had not been especially open to business concerns over the last several years, when the city passed ordinances on paid sick leave and minimum wage. One emailed solicitation noted that business and development interests “haven’t and won’t always agree with city leadership.” But this “already progressive council is being challenged from the much further left by candidates with limited experience concerning the issues that are central to the success of a city that works.”

The money was spent mostly on direct mail that both promoted chosen candidates and attacked their rivals. Of those supported, only Council Member Kevin Reich and Council Member Lisa Goodman were re-elected. Its candidate in the open Ward 3 race and Council Member Alondra Cano’s re-election in Ward 9 both lost. However, the candidate most-attacked by the committee’s mailings — Socialist Alternative candidate Ginger Jentzen — lost in Ward 3.