by Robert Schmad
The Eleventh Circuit Court of Appeals on Monday struck down an injunction blocking Georgia from enforcing a state campaign finance law against two nonprofits founded by former Democratic Georgia gubernatorial nominee Stacey Abrams.
A 2019 Georgia state ethics commission complaint accused the New Georgia Project and the New Georgia Project Action Fund of illegally canvassing for Democratic candidates, including Abrams, during the 2018 midterm elections and that it failed to disclose millions in electioneering expenses, Axios reported. A federal court in September 2022, however, blocked the state from enforcing the Georgia Government Transparency and Campaign Finance Act because the two nonprofits argued it was unconstitutional — a ruling the Eleventh Circuit vacated on Monday, opening the door for the state to continue with its case against them, according to court filings.
The Atlanta federal judge that initially ruled in favor of the New Georgia Project and the New Georgia Project Action Fund should have abstained from taking up the case brought by the nonprofits under existing Supreme Court precedent because the state’s investigation was “ongoing,” according to the Eleventh Circuit’s ruling. The nonprofits sued to stop the enforcement in August 2022, weeks after the state campaign finance commission held a preliminary hearing and found “reasonable grounds” that they had violated Georgia law by failing to disclose political expenditures, Law360 reported.
“The state had been investigating New Georgia for years and recommended enforcement weeks before New Georgia filed its federal suit,” the panel of Eleventh Circuit judges wrote.
After subpoenaing the nonprofits’ bank records in 2019, state investigators found that they had spent $36,000 on providing door knockers with lists of Democratic candidates to encourage people to support in the 2018 elections as well as $4.2 million in unreported political expenditures, a local NPR affiliate reported. Since the nonprofits were trying to influence voters, rather than simply registering people to vote, they should have filed campaign finance reports, according to the Georgia Government Transparency and Campaign Finance Commission.
The commission unanimously voted that the New Georgia Project had violated state campaign finance laws. New Georgia Project chair Francys Johnson at the time said he was “totally unsurprised” by the voter, arguing that the ruling was motivated by politics as four of the commissioners were Republicans, a local outlet reported.
New Georgia Project Action Fund is a 501(c)(4) organization, meaning it is allowed to engage in some kinds of political spending. The New Georgia Project, on the other hand, is a 501(c)(3) nonprofit and risks losing its tax-exempt status if it endorses political candidates or engages in partisan advocacy. New Georgia Project describes itself as “nonpartisan” on its website.
The New Georgia Project was founded by Abrams, who is no longer affiliated with it, and led by Democratic Georgia Sen. Raphael Warnock between 2017 and 2020, according to Politico.
New Georgia Project, New Georgia Project Action Fund and the Georgia attorney general’s office did not immediately respond to the Daily Caller News Foundation’s requests for comment.
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Robert Schmad is a reporter at Daily Caller News Foundation.
Photo “Stacey Abrams” by Stacey Abrams.