Campaign finance groups: Lerner didn't target Crossroads

A pair of campaign finance reform groups is pushing back against Republicans who insisted this week that former IRS official Lois Lerner had targeted Crossroads GPS, a prominent GOP group.

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Democracy 21 and the Campaign Legal Center said Thursday that the IRS’s examination of Crossroads GPS, which was co-founded by Karl Rove and has for years sought tax-exempt 501(c)(4) status, “was not only proper, but essential to the agency’s fulfillment of its law enforcement responsibilities.”

“Far from being too aggressive, the IRS’s efforts with respect to Crossroads GPS were too slow,” Fred Wertheimer, Democracy 21’s president, and Gerald Hebert, the executive director of the Campaign Legal Center, said in a statement.

Both groups were mentioned in a criminal referral that the House Ways and Means Committee sent on Wednesday to Attorney General Eric Holder, in which Republicans say that Lerner pushed to deny Crossroads’s application and wanted the group audited.

Lerner, who headed an IRS division dealing with tax-exempt organizations and has since retired, was the first agency official to apologize in May 2013 for the IRS’s improper scrutiny of Tea Party groups. In addition to the Ways and Means referral Wednesday, the House Oversight Committee also voted to hold her in contempt of Congress on Thursday.

The referral letter adds that Lerner showed increased interest in Crossroads after meeting with Democracy 21 and the Campaign Legal Center in January 2013.

The two groups have long said that they don’t believe Crossroads GPS, which has spent tens of millions of dollars in both the 2010 and 2012 cycles, qualifies as a 501(c)(4) social welfare group.

Ways and Means Committee Chairman Dave Camp (R-Mich.) and other GOP lawmakers said that those groups had similar concerns about liberal-leaning groups like Priorities USA. But according to the referral, Lerner showed much more interest in Crossroads than she did liberal organizations.

According to current IRS regulations, 501(c)(4)s are supposed to primarily engage in social welfare work, which is widely interpreted to mean more than half of their activities. The law says social welfare should be those organizations’ exclusive purpose.

The Ways and Means referral also suggests that Lerner tried to influence the appeals process for groups who saw their tax-exempt applications denied.