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No New Taxes, Big Tobacco and Campaign Contributions: PART TWO The Ties that bind

By Bill Britt
Alabama Political Reporter

Montgomery – In 2010, Altria, the parent company of Phillip Morris, gave almost $500,000 in campaign contributions that were then funneled into the coffers of GOP leadership and on to republican candidates. 

There as been a fierce opposition by the GOP to raise taxes of tobacco products, while cutting funding to programs that encourage people to quit smoking.

In fiscal year 2012, tobacco-generated revenue for Alabama was $237 million according to tobaccofreekids.org, an organization that is  “a leading force in the fight to reduce tobacco use and its deadly toll in the United States and around the world.”

According to the Center for Disease Control (CDC) Alabama should have spend $56.7 million in fiscal year 2012 on tobacco prevention. 

This was part of the Master Settlement Agreement reached with the tobacco companies in 1998. 

Figures for 2012 were not available but in 2011, the state allocated $861,292 for the tobacco prevention program, a nearly 60 percent cut in funding from FY2010 and FY2009.

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In addition, Alabama is receiving $2.7 million in federal funds dedicated to tobacco prevention and control:

  • $1.3 million from the U.S. Centers for Disease Control and Prevention in a 12-month grant for the period beginning April 2011 (from annual appropriations).
  • $105,155 from the Prevention and Public Health Fund in the new healthcare reform law.
  • $1.2 million from the Food and Drug Administration for enforcement of the Family Smoking Prevention and Tobacco Control Act, including the provision regarding tobacco sales to minors.

With all the money available the state has continued to cut funding for tobacco control and prevention programs.

What began under Democrats has now taken a downward spiral of funding for such prevention outreach under the GOP supermajority.  

Over the years, Alabama Democrats and Republicans have taken campaign contributions for Big Tobacco but once again the GOP seems more than reluctant to advertise there reliance on tobacco money all the while cutting programs that would perhaps help to decrease tobacco use among teens and young adults. 

In his tome, “Storming the Statehouse,” Alabama House Speaker Mike Hubbard gave detailed accounts of his successful campaign fundraising organization, yet nowhere in the over 800 pages does Mr. Hubbard mention a word about Phillip Morris or its parent company Altria. 

As part of the takeover effort led by then ALGOP Chairman Mike Hubbard, money from Big Tobacco funded many of the campaigns of those who stormed the Statehouse. 

In October 2010, Altria Client Services contributed $420,000 to the Republican State Leadership Committee (RSLC) in Washington, DC.

While there is a twisted road that the money takes in entering Alabama, we are confident in our research which follows the same pattern used to launder gambling money that was then used to gain control of Alabama’s state government. 

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During September and October 2010, the RSLC contributes a total $373,000 to the 136 Year PAC

This was a PAC established by the ALGOP but was administered by then ALGOP Executive Director John Ross. Mike Hubbard who was then ALGOP Chairman has since tried to distance himself from the 136 Year PAC but the domain name for the website was registered in the name of the Alabama Republican Party. See document.  It was also administered by Megan Eldridge using a algop.org email account. 

In September 2010, the RSLC contributes $50,000 to NETPAC, another Hubbard-controlled PAC.

In October, NETPAC contributes $50,000 to the 136 Year PAC. This makes available $420,000 for the 136 Year PAC. 

Starting in October 2010, $421,585.23 was disbursed from the 136 Year PAC to the Alabama Republican Party, Montgomery ($89,000); SRM Media & Advertising, Montgomery ($303,067.39); Majority Strategies, Ponte Vedra Beach, FL ($29,517.84). 

Document 1, Document 2, Document 3, Document 4

The over $300,000 in payments to SRM Media & Advertising were classified as media placement. 

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According to Bizpedia, SRM Media & Advertising’s registered agent is The Howe Group, LLC. According to the Secretary of State’s records, The Howe Group LLC is owned by Tim Howe who was the founding member of Swatek, Azbell, Howe & Ross (SAHR).

Dax Swatek, is a trusted aid to Hubbard, David Azbell helped write Hubbard’s book  and Ross was Executive Director of the ALGOP under Hubbard.  

According to Howe’s bio he served as, “Executive Director of the Alabama Republican Party from 2005-2007.” He has also, “For the past three years,…served as a paid strategic consultant to the Alabama House Republican Caucus and as, ‘Chairman of State Legislative Candidate Recruitment for the Alabama Republican Party during the 2010 election.’”

SRM Media & Advertising was established in 2010 and has seemed to go dark after that election cycle. 

Majority Strategies received $29,517.84 for mailings and were were listed in the explanation as pertaining to races in House Districts 14, 22, 91, 2, 81 and Senate District 29.

Majority Strategies, subcontracted around $800,000 to Craftmaster Printing, a company in which Mike Hubbard is a director and partner. 

In those districts, GOP candidates defeated Democrats with the aid of money from Big Tobacco. They are District  2- Lynn Greer, District 14 – Richard Baughn, District 22 -Wayne Johnson, District 91-Barry Moore, District 81 -Mark Tuggle, District 29 -Becky Nordgren. 

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A contribution to the Alabama Republican Party on 10/18/10 in the amount of $83,000 closely matches expenditures to the campaigns of then candidate for Lt. Governor Kay Ivey for ($75,000) and Becky Nordgren for State House ($10,000) on the same date. According to the PACs records, they were the only expenditures made on that date.

This flow of money from an big corporate donors to the RSLC, which then funnels laundered money to GOP-controlled PACs is a pattern used to disguise and deceive.

The fact that once again these PACs were controlled by then ALGOP Chairman Mike Hubbard, who used the money to not only fund candidates but to also pay known associates and companies that he conducted business with on a regular basis, sets up a pattern and practice that would seem to be beyond the ethical bounds of the ALGOP Chairman. 

This coupled with to the Grover Norquest no-tax-pledge—that was given legs by money from Big Tobacco—and the GOP lawmakers adherence to such a pledge, give big tobacco companies a reason to invest in Alabama political campaigns. On the contrary, those who want to see tobacco taxes raised and control and prevention expanded would seem to have little hope. 

Bill Britt
Written By

Bill Britt is editor-in-chief at the Alabama Political Reporter and host of The Voice of Alabama Politics. You can email him at [email protected] or follow him on Twitter.

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