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'An easy sell': Inman texts point to PAC dominance in Michigan politics

Jonathan Oosting
The Detroit News

Lansing — Republican state Rep. Larry Inman was planning to vote against a controversial initiative to repeal Michigan's prevailing wage law when a top House GOP aide shared a dire prediction.

Democratic voters won't "come to your side" and "you will shut down any incentive for the big donors to give" to your reelection campaign, Dan Pero, chief of staff to then-House Speaker Tom Leonard, told Inman in a June 2018 text on the morning of the afternoon vote.

“You’re on the edge, pal,” Pero continued, warning Inman he already risked losing financial support from business community donors and political action committees because of his positions on other bills. 

State Rep. Larry Inman arrives at federal court in Grand Rapids on May 28, 2019.

“You’ve been a no vote on the income tax and no fault; you support fee increases; and if you become a no vote on PW, there’s zero incentive for the big PACs to write you a check,” Pero texted. “You vote yes on PW, my friend, you will get a pass on the other votes.”

The text messages, disclosed by federal prosecutors as Inman heads toward trial for allegedly trying to sell his vote to a union group opposed to the repeal, highlight the outsized influence interest group donors have on Michigan politics and how PAC contributions can influence legislative votes.

Inman flipped his position later that day and voted to repeal the 1965 law that had guaranteed union wages and benefits on government-funded construction projects. 

Prosecutors have not accused any other officials of criminal activity or wrongdoing. But the texts provide a rare glimpse at communications within the Michigan Legislature, which is completely exempt from public records requests under the state's Freedom of Information Act.

“The suspicion is that these are the types of conversations that are happening behind the scenes on a lot of major subjects, but we don’t get to hear,” said Craig Mauger, executive director of the nonprofit Michigan Campaign Finance Network.

“We get very little insight into the conversations that are happening among paid, taxpayer-funded employees who are supposed to be in Lansing to do the will of the people."

While several Democratic presidential candidates are preaching political purity by eschewing PAC contributions, records show state lawmakers and leaders from both major political parties heavily rely on donations from corporate and union PACs seeking to affect public policy decisions.

Michigan’s top 150 PACs have raised a combined $13.9 million for the year through July 20, according to a Michigan Campaign Finance Network analysis. That’s up 14% even though no state-level candidates are up for reelection this year.

The uptick is largely attributable to large fundraising hauls by Republican and Democratic caucus committees and a growing number of personal PACs that individual lawmakers are using to raise large sums of money beyond limits that govern their actual campaign committees.

Since the 2018 election, Republican House Speaker Lee Chatfield of Levering, Democratic House Minority Leader Christine Greig of Farmington Hills, Republican Senate Majority Leader Mike Shirkey of Clarklake and Democratic Senate Minority Leader Jim Ananich of Flint have each used various committees to raise more than $100,000 from interest group PACs.

Michigan law allows PACs to give candidates 10 times more than individuals can. Under limits the GOP-led Legislature increased in 2013, an individual can give up to $1,050 to a state House candidate while a PAC can give $10,500. Leadership PACs linked to individual lawmakers can accept unlimited amounts of money and redirect them to other candidates. 

For lawmakers across the sprawling state, “most of their money — their largest donors — come from political action committees that are based in Lansing,” Mauger said.

Cash considerations

The morning of the prevailing wage vote, Inman told Pero he planned to oppose the repeal initiative, which would have sent it to the statewide ballot. The Traverse City-area Republican explained he was "low on cash" and feared upsetting a large local contractor and swing voters in a district he said was getting more Democratic each year.

Inman had won reelection by 8 percentage points in 2016, but he was expecting a much tougher fight that fall, a prediction proven true when he won a third term by less than one point over Democrat Dan O'Neil.  

Pero briefly touted repeal on policy grounds, calling it a form of “worker freedom" that could reduce the cost of school building construction, but he also disputed Inman's forecast that voting against the initiative would help his reelection chances.

“My gut tells me your analysis will see you lose in November because you won’t have enough lettuce to feed the rabbits,” Pero told Inman.

Pero, a veteran GOP strategist who cut his teeth working with Republican former Gov. John Engler, declined comment for this story, citing Inman’s upcoming criminal trial and the possibility he may be called to testify as a witness.

Inman is facing bribery and extortion charges related to the vote and separate texts exchanged with the Michigan Regional Council of Carpenters and Millwrights, which opposed repealing the 1965 prevailing wage law that had guaranteed union wages and benefits on government-funded construction projects.

Federal prosecutors last week disclosed other messages Inman sent to an official at a second union group, the International Brotherhood of Electrical Workers, suggesting he would need “a ton of campaign money” if he voted against repeal because his own “R Party will be all over my ass.”

IBEW Local 58 electrical workers walk the parade route in 2018 along Michigan Ave. to Hart Plaza. Federal prosecutors have released text messages between an IBEW official and state Rep. Larry Inman about his vote on an initiative to repeal Michigan's prevailing wage law.

Inman has denied wrongdoing and pleaded not guilty to all charges. His attorney Chris Cooke said Friday that “the whole story has not been told” and argued that Inman did not violate any federal laws by trying to communicate with groups that had contributed to his campaigns in the past.

“That’s a consistent need that every politician has going into a campaign,” Cooke said. “It’s not improper for someone to request support for a campaign.”

The flip

Inman and Pero exchanged messages throughout the day as House leadership worked to secure the votes for the prevailing wage repeal initiative.

The effort had been spearheaded by the Associated Builders and Contractors of Michigan, a non-union contractor group that spent millions of dollars on petition drives to get around a promised veto by GOP then-Gov. Rick Snyder.

“People in my district don’t write large political checks," Inman told Pero around noon. And lawmakers like Inman who sit on the powerful House Appropriations Committee “don’t get big checks either,” he continued, “it’s the reps on Policy that get the big Lansing checks , :)”

Pero replied succinctly: “The big money is the PAC community and the independent groups who keep the score cards.”

Inman ended up voting for repeal later that day. In a text sent less than an hour before the 56-53 House vote, he told Pero he flipped to protect two GOP colleagues from political ramifications in their own districts while still ensuring House Republican leadership had enough votes for passage. 

“I had to protect our people over my principal (sic), now I am going to have a s--- storm,” Inman said, foreshadowing a difficult reelection campaign. “I need some help.”

Pero told Inman he’d talk to “the groups around town” over the summer. “This vote was the big deal for groups with dough,” he texted. “Makes your yes vote an easy sell for me.”

Inman sent similar texts to Chatfield, who at the time was head of the House Republican Campaign Committee and the presumptive favorite to become speaker this term if the GOP maintained its majority.

“My seat is now at high risk, with no Dem votes I normally get to save my butt,” Inman said. “Now I need hugh (sic) help with Door help and s---load of money… this vote put me in a s---hole.”

Michigan House Speaker Lee Chatfield, R-Levering, speaks with reporters following the House's approval of a bill that would cut auto insurance premiums on Thursday, May 9, 2019, in the Capitol in Lansing, Mich. Democratic Gov. Gretchen Whitmer threatened to veto the legislation if it gets to her desk without changes.

Chatfield was diplomatic in response.

“Like any core Republican principle, Larry… the Dems will oppose what we do and attack us for it," Chatfield replied. "When we all go to war this November, we’ll be on the side of our base. We’ll fight them off.”

Inman also sent at least one text to a Democratic leader roughly two weeks before the vote, suggesting there may be as many as 12 Republicans preparing to vote against the repeal measure backed by GOP leadership.

“I asked the trade multi clients , you better start cutting big checks to the new dirty dozen, big checks , to lock them in,” Inman said in a May 24 text to then-House Minority Leader Sam Singh of East Lansing, who did not respond to voicemails seeking comment on this story and is a potential witness in the trial.

Chatfield's spokesman declined comment on the Inman texts and questions over political donor influence on the Michigan Legislature. The speaker has pressured Inman to resign in the wake of his May indictment.

Leadership PACs

Inman ended up raising $69,775 in additional campaign cash before the Nov. 6 general election, and the House Republican Campaign Committee spent more than $253,000 on ads to support him in the race. 

His top campaign donors include the Chatfield Majority Fund PAC, which gave Inman $10,000, and Senate Majority Leader Mike Shirkey’s Compete Michigan PAC, which donated $5,000.

So-called leadership PACs can raise unlimited funds that lawmakers can use to “support like-minded candidates, like-minded causes and their own political party,” Mauger said.

In Michigan, they are "effectively operating under the same laws as a PAC connected to a business or another interest group,” he said, “but they’re much different because they are connected to a state officeholder.”

State records show Chatfield — who is in his third term and cannot seek reelection to the House next year — has raised more than $455,000 for his campaign committee and three separate leadership PACs since the 2018 election.

Of the 250 contributions reported to the state, 157 came from PACs that contributed a combined $189,450 to various Chatfield committees. Top donors this cycle include PACs associated with Consumers Energy, Michigan Beer and Wine Wholesalers, the Michigan Chamber of Commerce and the Auto Dealers of Michigan.

Greig, the Democratic leader who is also in her third term, has raised a combined $111,379 for her campaign committee and two leadership PACs since the 2018 elections. More than $76,000 came from PACs, including Consumers Energy, Blue Cross Blue Shield, the Michigan Laborers Political League and the Michigan Regional Council of Carpenters.

Greig said she uses one leadership PAC to promote female candidates and another to “just help the Democratic cause.” They allow her to redistribute contributions from donors who may not know who the top candidates or key races are, she told The Detroit News. 

State representative Christine Greig rallies nursing home workers to demand accountability and fair wages.

“It’s a way to not have to go out to thousands and thousands of individual donors,” Greig said. “For me, especially my Women in Leadership PAC, it works out really well.”

Greig said she would support reforms to the system, however, including a cap on the amount donors can give leadership PACs, along with additional disclosure and accountability tools.

Inman’s texts are “further evidence” he’s not serving his constituents and should step down, the House minority leader said, expressing hope that most lawmakers are not basing their votes on campaign contributions.

“You have different constituent groups talking to you, and evidently some people are influenced by it,” Greig said. “I would hope that our caucus members are not — that they’re talking about issues. But clearly with Inman, he felt there was influence there.”