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Paul accused of misrepresenting antitax group status

From NBC’s Ali Weinberg
The Wall Street Journal reported yesterday evening that an anti-tax organization founded by Kentucky Republican Senate candidate Rand Paul, which he has referred to as an active group as recently as this week, was legally dissolved in 2000 after failing to file basic annual reports with the state, and ceased most activity in 2002.

The campaign for Paul's Democratic opponent, Attorney General Jack Conway, said Paul was "simply misleading voters" for playing up his affiliation with the group, Kentucky Taxpayers United, long after it suspended most of its activities, besides occasional public appearances by Paul or an associate who also did work for the group.

Paul has also previously indicated that the group collected money from members, which conflicts with statements his campaign press secretary made to the Wall Street Journal that the group had "thousands of supporters, but never collected dues."

In an April 12, 2000 article from the Associated Press State and Local Wire, Paul is quoted as saying that the group has "about 1,000 dues-paying members."

During a conference call with reporters, a spokesman for Paul's Democratic opponent Jack Conway said that Paul has been "simply misleading voters" for characterizing the group as an active organization, and that Paul would have further questions to answer about what he did with the money if, in fact, the group had collected dues.

"For the last ten years it appears that Rand Paul has been misleading Kentucky voters about the very issue that is at the core of his political argument. That's troubling," Conway spokesman John Collins said.

Paul's campaign manager Jesse Benton sent a written statement in response to the report: "Kentucky Taxpayers United was a vibrant and effective grassroots organization since Dr. Paul founded it in 1994. KTU issued ratings of the Kentucky legislature for 5 election cycles through 2002 and continued afterward to work with candidates at all levels to sign the Taxpayer Protection Pledge as well as to provide a platform for Dr. Paul and others to speak about the issues of Taxpayers Rights. KTU is a testament to the power of grassroots citizens overcoming big money and special interests, something Rand has continued in his campaign for Senate."

From the Wall Street Journal:

Brett Gaspard, who helped Paul prepare some of the legislative scorecards, said Kentucky Taxpayers United never had a formal membership but circulated its reports in the media and to allies, encouraged candidates to sign a no-tax-increase pledge, and gave awards to officials who resisted new taxes. Gaspard said the work had a major impact on political campaigns and proposed laws but after 2002 the group’s only significant activity came in public appearances by Paul and occasionally himself.

“You kind of give yourself a group,” he said. “You can’t just say, ‘I’m Brett Gaspard.’ ”

Paul declined to be interviewed. In a series of emails with The Wall Street Journal, Jesse Benton, his campaign manager, said Paul founded Kentucky Taxpayers United in 1994 and that it was an all-volunteer effort with “thousands of supporters, but never collected dues.” He described the group as “currently inactive” but wouldn’t specify when it became dormant. “There is no story here,” Benton wrote. “KTU was a recognized force in KY politics.”

State records indicate Paul formally incorporated Kentucky Taxpayers United in 1999 as a tax-exempt group. The organization was dissolved by the Kentucky secretary of state a year later for failing to file yearly corporate-registration documents. It never obtained federal tax-exempt status. Paul’s campaign spokesman said the organization didn’t raise enough money to trigger that requirement.