Black Drops

CD Productions has raked in more than $150,000 in campaign payments—but does it exist?

CD Productions has had a banner year. Between May 2011 and May 2012, the company has been paid a total of more than $150,000 to provide a variety of services ("advertising," "printing & mailing," "demographic research," "professional services" and so on) for Susana PAC, Gov. Susana Martinez' political action committee. Since last October, CD Productions has raked in a bigger share of Susana PAC's cash than any other business, with one exception—McCleskey Media Strategies, the company run by Martinez adviser Jay McCleskey—and received $28,000 on May 21 alone, just two weeks before the primary election.

The catch? CD Productions doesn't exist—at least not in the traditional sense.

CD Productions' only identifying features are its name and an Albuquerque PO box located less than two miles from McCleskey's office. Most of the various state and local agencies charged with registering businesses, nonprofits or other organizations have no record of it—including the Secretary of State's office, where the Susana PAC forms were filed.

"The public needs to know where the money comes from and what it's being spent on," Common Cause New Mexico Executive Director Viki Harrison says. "That's a huge concern."

In the aftermath of the US Supreme Court's 2010 decision in Citizens United v. Federal Election Commission, an influx of money has characterized the elections process. Much of that money is funneled through now-infamous "super PACs," or political action committees that operate independently of campaigns but are free to spend money advocating for or against political candidates.

Much attention has been paid to donors—the wealthy individuals or powerful corporations that fund the super PACs, sometimes anonymously. How those PACs then spend their money has elicited considerably less scrutiny, but is arguably just as important.

New Mexico law requires that all candidates and PACs report not only where their contributions come from, but also how they spend them. But the rules are loose enough to allow CD Productions to be listed as nothing more than a name and a PO box, and the Secretary of State's office isn't required to verify that Susana PAC pays out its campaign money to real companies.

"There's no oversight of that reporting," Harrison says. "Even if you have the laws in place that say you have to fill these things out, there's nobody overseeing it."

According to Ken Ortiz, the chief of staff for the Secretary of State's office, state law does require a 10 percent random audit of all campaign reports, but not until after the general election in November.

"Between the first report and the general election, there's nothing that requires us to audit or review [campaign finance reports]," Ortiz tells SFR. However, "We will audit or review if we have a complaint."

In addition to the Secretary of State's office, SFR contacted the New Mexico Public Regulation Commission, which registers corporations (nonprofit, for-profit and limited liability); Bernalillo County, which registers all "doing business as" names; and the City of Albuquerque. None had a listing for CD Productions.

The PRC does list a small, Corrales-based video company called C/D Productions, but a representative of the company assured SFR that it has never done any campaign work. New Mexico Taxation & Revenue Department spokesman SU Mahesh also confirms that either C/D or CD Productions is registered with TRD but won't say which. McCleskey, whose firm's address is listed for Susana PAC's treasurer, did not respond to SFR's requests for more information about CD Productions.

This leaves the public—and even Susana PAC donors—in the dark about where a large chunk of the PAC's money goes.

"That's a huge problem, when we have these payments going out to people and we don't know who they are," Harrison says.

State Sen. Peter Wirth, D-Santa Fe, who during the 2012 legislative session introduced a bill requiring additional disclosure for independent committees such as Susana PAC, agrees.

"In the post-Citizens United world of unlimited money coming into the political system, full disclosure of the source of money and the purpose of the expenditure is critical to give voters the information they need at the voting booth," Wirth says. His bill, SB 11—which passed the Senate unanimously but died in the House—focused on regulating campaign contributions rather than expenditures.

"But the thinking is the same: The voters have a right to know where the money's coming from and what it's being used for," Wirth says. He adds that he'll "definitely" introduce SB 11 again next year.

For now, though, CD Productions can continue to enjoy a steady influx of campaign cash—while New Mexicans continue to wonder where it's actually going.

"This is critically important for the citizens of New Mexico," Harrison says. "We have to have this information; otherwise, we lose all faith in our legislative system."

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