Single-Payer, Inc.: How a Montpelier Lobbying Firm Plans to Cash in on Health Care Reform | Fair Game | Seven Days | Vermont's Independent Voice

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Single-Payer, Inc.: How a Montpelier Lobbying Firm Plans to Cash in on Health Care Reform

A former Bernie aide starts a pro-Sanders super PAC.

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Left to right: Vermont Leads executive director Peter Sterling, KSE Partners lobbyist Todd Bailey and Vermont's CURE executive director Tess Taylor. - PAUL HEINTZ
  • Paul Heintz
  • Left to right: Vermont Leads executive director Peter Sterling, KSE Partners lobbyist Todd Bailey and Vermont's CURE executive director Tess Taylor.

It was big news last week when a new single-payer advocacy group emerged — as if from the ether.

Big because the organization, Vermont's Coalition for Universal Reform, immediately attracted: a $100,000 contribution from the American Federation of Teachers; the leadership of House Majority Whip Tess Taylor (D-Barre), who resigned her seat Friday to become its executive director; and the services of the top-flight Montpelier lobbying firm KSE Partners.

Called Vermont's CURE for short, the nonprofit "was established by Vermonters" to push Gov. Peter Shumlin's single-payer health care agenda, according to KSE's Todd Bailey. To that end, it's planning a fundraising, lobbying and advertising campaign to make sure Montpelier — and the rest of the state — sticks with single-payer, and with Shumlin.

But wait. Did I say Vermont's CURE hired KSE Partners? I might've gotten that backward.

The way Bailey puts it, the new outfit "was a collective idea" hatched by the five-member board of Vermont's CURE, in consultation with KSE staff.

But according to board president Bram Kleppner, "It was sort of their idea," referring to the lobby shop. Both Kleppner and Vermont AFT president Ben Johnson say Bailey recruited them to the board, which also includes Bailey's wife, Lauren, a nurse practitioner at Fletcher Allen Health Care.

According to Bob Sherman, a veteran lobbyist and cofounder of KSE Partners, it was he who came up with the concept of Vermont's CURE, back in 2011, when the legislature first signed off on the concept of single-payer. As with legalizing gay marriage, for which the firm served as paid lobbyists, Sherman saw a chance to push a cause he supports — and make some money.

"We're creating a client. Ultimately, I hope I'm going to get paid," he says. "If you build it, they will come. Or, if you come, they will build it."

Who knew lobbying firms created their own clients out of whole cloth!

Then again, health care advocacy is big business. Kleppner says he "wouldn't be surprised if we were able to raise into the seven-digits," while Bailey thinks Vermont's pro-single-payer groups could collectively wind up spending "a few million dollars."

For now, KSE isn't earning a dime from Vermont's CURE. But Sherman and Bailey both say that as soon as the "nonprofit" they founded raises some cash, they hope it will hire their company for its consulting, lobbying and advertising services.

"Speaking realistically, it seems very unlikely that the board would choose to hire a different firm," Kleppner hints.

Vermont's CURE isn't the only game in town. Last month, another labor-funded nonprofit, Vermont Leads, announced it had raised $80,000 from the National Education Association to fight for single- payer. And while leaders of both groups speak diplomatically about one another, it's clear they're competing for the same donors.

"I think KSE saw an opportunity to raise money for their firm and work an issue that, at some level, they care about," says Vermont Leads executive director Peter Sterling. "But let's just be honest: KSE recognized that this would be a way to raise their profile on what's likely to be a critical issue in the next two years."

And it's not a bad way to curry favor with Shumlin, on whose administration KSE counts for access and favors. According to the governor, Sherman recently briefed him on the Vermont's Cure plan.

"He talked about the mission, the board, the structure and what they were up to," Shumlin says. "And I said, 'Hey, sounds good to me. We need all the help we can get.'"

Bailey says it's possible Vermont's CURE will form a political action committee to push its cause — and the candidates who support it — in this fall's elections. Such a group could be a real help to Shumlin's reelection campaign, providing his out-of-state donors with an anonymous destination for their cash.

That's because Kleppner says the board has tentatively decided not to disclose its donors to the public or the press — just like the anti-single-payer Vermonters for Health Care Freedom, which also refuses to name its funders.

"The main motivation is to protect donors to the organization from attacks," Kleppner explains. "On the other hand, I think everyone has an instinct to transparency."

Bailey sure does. At least, he used to.

Last time the lobbyist founded a political advocacy group — a super PAC called Vermont Priorities — back in July 2012, its purported mission was to put a stop to super PACs themselves and require political organizations to reveal their donors. Bailey even appeared in a 60-second TV ad the group produced in November 2012, pledging "to be transparent" and "to end super PACs, including this one."

But asked last week who funded Vermont's CURE, Bailey initially said, "We are not going to disclose our donors." He eventually caved, outing the AFT as its $100,000 friend.

Has Bailey's stance on transparency changed in the past two years?

"Our work with Vermont Priorities was different than the work with Vermont's CURE," he explains. "The mission of that organization we were consulting for was to disclose donors to a super PAC."

"That organization we were consulting for?!"

The reality is, as Sherman readily admits, that Vermont Priorities was another creature hatched in the offices of KSE — a creature that went on to raise money from wealthy Vermonters and hire KSE as its consultant.

Sounds like last time around, Bailey's transparency push was just a cynical ploy to make a buck. Wonder if the same is true this time with single-payer.

Recuse Me?

Given all the attention this legislative session on Montpelier's revolving door, Rep. Taylor's hiring last week by Vermont's CURE was a little awkward.

Last week, she was busy counting votes as the third-ranking member of the House Democratic leadership. This week, she's toiling away in the offices of KSE, whose clients include companies ranging from Green Mountain Power to VISA to AT&T.

But to her credit, Taylor didn't attempt to cling to her legislative job after Vermont's CURE formally offered her the executive director position Thursday night.

"Once that offer was actually made, I felt that it was really incumbent upon me to step down, so there wouldn't be any conflict," she says.

The same can't be said of Rep. Chris Pearson (P-Burlington), who has worked as a social media consultant for Vermont Leads — that other pro-single-payer group — since May 2012. Throughout that time, he's served as a member of the House Committee on Health Care, which will play a major role in the single-payer debate.

Pearson says he's been careful to avoid conflicts — and might recuse himself down the road.

"If we're at a time when there's a [single-payer] financing package in the House and Vermont Leads is active, I'll have to pick one or the other," he says.

Of course, that's not the only potential conflict. Vermont Leads was originally founded and funded by the Service Employees International Union — back when it was hoping to unionize Vermont homecare workers. It spent $100,000 on issue ads and another $50,000 supporting political candidates during the 2012 election. Now it's funded by the Vermont-NEA.

Did Pearson recuse himself from the homecare unionization vote — or, for that matter, any other legislation pushed by Vermont Leads' donors?

"I definitely did vote for that. I was proud to vote for that," he says. "I have a 100 percent labor voting record for the entire time I've been down there."

Pearson says that while his professional and political worlds occasionally overlap, there's never any question why he votes the way he does.

"My internal test has been: Is there anything that corrupts my values or influences my values?" he says. "In all these cases, my legislative record is longer than these short contracts or temporary work that I take on for a client."

Big Bernie

Have you heard the one about the Progressive state rep who started a super PAC to promote the presidential ambitions of an anti-super PAC U.S. senator?

Seriously, folks. You can't make this stuff up.

Turns out that when Rep. Pearson is not legislating or Vermont Leads-ing, he's running a volunteer outfit called Draft Bernie. Founded in January, the group is dedicated to talking Sen. Bernie Sanders (I-Vt.) into running for president. And if its 20,000 Facebook "likes" are any indication, that message has some resonance.

"For many months, Bernie has been making noise about running for president," Pearson explains. "I think that would be excellent for our country, for the national debate. And so I wanted to see if I could help."

But here's the thing: Draft Bernie ain't just a website. It's a political action committee. And in a letter Pearson sent to the Federal Election Commission in January establishing its existence, he wrote that it "intends to make independent expenditures" and "intends to raise funds in unlimited amounts."

In other words, it's a super PAC.

"There's no other choice," Pearson 'splains. "If you want to be independent of the candidate, you're in super PAC world. That's what the FEC offers."

Pearson says he finds it "somewhat upsetting" to find himself at the helm of a super PAC and maintains that Draft Bernie "is not an effort to raise big money from a few individuals." Thus far, it's only raised a few thousand dollars, he says, and that includes money Pearson himself has donated.

So if a major labor union wanted to drop $300,000 into the group's coffers tomorrow, what would Pearson the Prog say?

"That's a fun hypothetical to think about," he says. "What would I say? I don't know. It's just so far ahead of where my capacity is right now."

Surely Sanders, who regularly rails against Citizens United and super PACs, wouldn't want one started in his name, right?

Actually, back in February 2012, he told my predecessor, Andy Bromage, that a pro-Sanders super PAC is "something we would look at" if he faced a super PAC-financed opponent, adding, "But I hope we're not going to have to."

Asked about Draft Bernie, Sanders operative Phil Fiermonte said that while the senator is "very fond" of Pearson, a former staffer, the two have not discussed the super PAC. He added that it would be "absurd" for "opponents of right-wing Republicans" to "unilaterally disarm and not use the tools available to them."

"To suggest that there is any comparison between a small, grassroots organization in Vermont and the multi-billion-dollar political machine bankrolled by the Koch brothers is preposterous," Fiermonte said.

Got it. Their super PAC bad. My super PAC good.

Mystery Woman

Could the Vermont GOP's "mystery man" gubernatorial candidate turn out to be a mystery woman?

Rep. Heidi Scheuermann (R-Stowe) sure seems to think so.

The four-term state rep and former Jim Jeffords aide says she's seriously considering challenging Shumlin for governor.

"It would be a difficult race, but I believe that he is vulnerable — that Vermonters are frustrated with the direction in which the state is going at this point," Scheuermann says.

A member of the House commerce committee and the owner of a property management and development company, Scheuermann has distinguished herself as a business-friendly moderate. She worked closely with Lt. Gov. Phil Scott last year as he sought to rebrand the ailing Vermont Republican Party.

"Heidi's very bright and knows the issues — and she'd be a great candidate from that standpoint," Scott says. "But I'd hate to lose her in Stowe as a rep, because I think she offers a lot and gives a lot, in terms of the debate."

Scheuermann says she's not blind to the challenges she'd face — from a lack of name recognition to, as she puts it, "the fact that the governor has an unlimited checkbook." But she says that by focusing on "our relatively stagnant economy," health-care financing and rising property taxes, she could make her case to voters.

"I believe — and the people I've spoken with believe — the governor is absolutely beatable," she says.

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