Non-profit

The Hub Project

Website:

thehubproject.org

Location:

Washington, DC

Tax-Exempt Status:

501(c)(4)

Type:

Left-Wing Coalition

Project of:

Sixteen Thirty Fund

The Hub Project is a left-of-center advocacy and research organization established by former Obama administration officials in 2017 that works with other groups to promote left-of-center policy. The group spent millions of dollars in the 2018 election, advocating for policies through television advertisements, polling, and social media campaigns. It is a project of the Sixteen Thirty Fund, a 501(c)(4) pass-through and fiscal sponsorship nonprofit that’s part of a $731 million “dark money” nonprofit network managed by Arabella Advisors, a consultancy in Washington, D.C. [1]

The Hub Education and Engagement Fund is the group’s 501(c)(3) research arm, and a project of the New Venture Fund, another organization managed by Arabella Advisors.

Background

The Hub Project is a project of the Sixteen Thirty Fund, a 501(c)(4) funding and fiscal sponsorship nonprofit in Washington, D.C., that is managed by Arabella Advisors, a top consultancy for left-of-center advocacy nonprofit projects.[2]

The Hub Project was established in 2017 as a coalition-building group that works on media strategies for national and local advocacy campaigns. It has also worked with national and local nonprofit advocacy groups, foundations, and for-profit businesses and social entrepreneurs as clients and partners. [3]

The group also conducts research and polling as part of the broader media strategy. It manages digital campaigns with email, social-media and video content. The group says it draws press attention through earned and paid media, writing op-eds, and trying to frame the issue as a story.[4]

The Hub Project spent at least $30 million by late 2018 to pressure Republican members of Congress in their districts on issues such as the budget and health care, according to the New York Times. Most of the funding was through “dark money” sources, or donors who are not legally obligated to reveal their names. [5]

The project is an initiative run by former Obama administration officials and others. Top team members include former Obama White House health care official Leslie Dach and former Center for American Progress political strategist Arkadi Gerney, the group’s executive director. Jessica Floyd, a former staffer for the Democratic Congressional Campaign Committee, oversees advertising for the organization. [6]

Election Activities

The Hub Project is a project of the Sixteen Thirty Fund, a nonprofit that spent $141 million on more than 100 left-wing causes during the 2018 midterm elections, ranging from trying to defeat the nomination of Supreme Court Justice Brett Kavanaugh and other Trump administration judicial nominees, increasing the minimum wage and pushing laws on voting and redistricting. The Sixteen Thirty Fund played a major role in helping Democrats recapture the House of Representatives in the 2018 midterm elections. [7]

As a fiscally sponsored project, the Hub Project does not disclose its own budgets, donors, or other financial details, and it does not file IRS Form 990 reports. According to the New York Times, the Hub Project controlled the money flowing from the Sixteen Thirty Fund into its various state branches, though how it does this remains unclear. [8]

The Hub Project set up various state affiliates with vague names, including Keep Iowa Healthy, New Jersey for a Better Future and North Carolinians for a Fair Economy, all of which are fronts for the Sixteen Thirty Fund and do not publicly reveal their finances. The group used these local affiliates to recruit volunteers and run advertising against Republican members of Congress in the 2018 midterm elections. [9]

Arkadi Gerney, the group’s executive director, said in 2018 that the Hub Project is a “test case” for a larger Democratic political strategy to focus on GOP members of Congress instead of targeting President Donald Trump in the 2020 election. [10] The group began by targeting five GOP House members in the summer of 2017. It then expanded to 19 members in 2018. [11]

The Hub Project is also affiliated with a super PAC called Change Now, which bankrolled negative ads against several House Republicans in 2018. Change Now reported getting $1.75 million from the League of Conservation Voters, an environmental lobby group. [12]

Controversies and Criticism

Illegal Election Intervention Complaint (2021)

On May 15, 2021, the right-leaning watchdog Americans for Public Trust (APT) filed a complaint (archived here) with the Federal Election Commission (FEC), which oversees political groups’ spending, alleging violations of the Federal Election Campaign Act by Hansjorg Wyss, the Wyss Foundation, the Berger Action Fund, the New Venture Fund (in its capacity as the parent of the Hub Project), and Sixteen Thirty Fund. [13] According to APT, “Mr. Wyss indirectly funded federal electoral advocacy through his nonprofit organizations,” failing to set them up as political action committees (PACs), and “the intended recipient of these funds was ultimately a variety of organizations whose primary purpose is to engage in electoral advocacy.”

Organizations which receive contributions in excess of $1,000 or makes contributions in excess of $1,000 in a calendar year is considered a PAC for the major purpose of influencing elections. PACs are subject to strict financial reporting requirements that 501(c)(3) and (c)(4) nonprofits are not. [14] The complaint points out that the Wyss Foundation, Berger Action Fund, and New Venture Fund, which are all 501(c) nonprofits, have failed to file a statement of organization with the FEC, despite Wyss contributing at least $56.5 million from the Wyss Foundation to the New Venture Fund and another $135 from the Berger Action Fund to the Sixteen Thirty Fund. The 501(c)(4) Sixteen Thirty Fund spent $30 million influencing the 2018 midterm elections in order to favor Democratic candidates, “thereby triggering classification as a political committee,” according to APT.

U.S. law strictly prohibits foreign nationals from making direct or indirect contributions to political action committees. [15] Wyss, who was born in Switzerland, resides in the U.S. under an “E-2 VISA” (which is intended for foreign investors who live and work in the country) and “is not a permanent resident of the U.S. under a ‘green card,'” according to his attorney. [16] The complaint cites $41,000 in illegal federal campaign contributions Wyss paid between 1998 and 2003, claiming that, “Since that time, [Wyss] has made indirect contributions and expenditures by means of an intricate network of organizations in a scheme to obscure his role as the source of these funds.” [17]

APT alleges that Wyss established the Hub Project, a front for the “dark money” funder New Venture Fund and the recipient of significant funding from the Wyss Foundation, in order “to avoid any connection with the sizeable election activities carried out by the Hub Project and Change Now,” a super PAC associated with the Hub Project. “Operating since 2015
without the requisite FEC filing,” APT writes, “the Hub Project has been immune to any oversight and accountability despite significant spending in federal election.” It adds:

The Hub Project has served as a vehicle for the political spending of Mr. Wyss. This is demonstrated by the fact that Mr. Wyss has not publicly disclosed his role in founding the Hub Project. Neither his influence nor his financial support can be found anywhere on the group’s website. Rather, information regarding his involvement with the Hub Project was the result of “interviews with five people with knowledge of The Hub Project, an internal memo from another liberal group that was obtained by The New York Times.”

Funding

Financial Overview

As the Hub Project is a fiscally sponsored project of the Sixteen Thirty Fund, little of its finances are publicly available and it isn’t required to disclose its budget or donors. Its sponsor, however, is a major pass-through funder of left-of-center causes and spent $98.6 million in 2019, or $334 million between 2009 and 2019. [18]

Wyss Foundation Connections

Also see the Wyss Foundation (Nonprofit), Hansjorg Wyss

The Hub Project may have originated as a proposal by the Wyss Foundation, a major left-of-center grantmaking foundation funded by Swiss billionaire Hansjorg Wyss.

According to a 2015 proposal entitled “A Plan for the Development of a Communications Hub Supporting The Wyss Foundation’s Core Issue Areas” prepared for the Wyss Foundation by Civitas Public Affairs Group, a liberal consulting firm, the foundation envisioned the creation of a “communications hub” meant to be established as an “independent organization with a fiscal sponsor” with the “flexibility to work across the spectrum of 501(c)(3), (h) election, and 501(c)(4) activities.” That sponsor needed to have “(c)(4) capacity” and the ability to set aside “15 to 25 percent of the budget for (c)(4) work funded by The Wyss Action Fund.” The Wyss Action Fund (renamed the “Berger Action Fund” in 2016) is the 501(c)(4) advocacy nonprofit arm of the Wyss Foundation, and responsible for funding the hub’s fiscal sponsor, another 501(c)(4) nonprofit. [19]

While the document does not name Arabella Advisors or its associated 501(c)(4) Sixteen Thirty Fund and 501(c)(3) New Venture Fund—the respective sponsors of the current Hub Project and Hub Education and Engagement Fund—few fiscal sponsorship structures of such scope existed in 2015 to support such a project. [20]

This “hub” was designed to “drive measurable change” and achieve “significant wins.” Its “core objective” was “to dramatically shift the public debate and policy positions of core decision makers” by developing “research-based message frames,” ultimately “leading to implementation of policy solutions at the local, state, and federal level.” As a hub, these goals would be largely driven by allied left-wing organizations in coalition with the Hub Project, which would provide campaign aid, research, and political advertising. [21]

Overseeing this was intended to be an advisory board “initially comprised of members of the The Wyss Foundation senior team and a representative from the fiscal sponsor.” The document also stresses the importance of distancing the “hub” from the Wyss Foundation, as “the hub’s independence will give the foundation appropriate separation from the hub’s work” (thereby avoiding scrutiny and the loss of its tax-exempt status) and “allow the hub to engage in a more robust way than it could if it was based within the foundation.” However, the hub would provide “quarterly updates for The Wyss Foundation identifying benchmarks that have been reached, challenges faced, and recommendations necessary” for achieving its annual objectives. [22]

The initial budget for this hub was $2,212,760 in 2015, rising to $4,122,175 in 2016, and $4,347,196 in 2017. In 2017, $800,000 of this budget was to be set aside for “original news content” and “earned media,” another $786,500 for research and “digital data management,” and $865,000 for “paid media and “creative design” work. [23] Whether these goals were met is unclear, as the Hub Project does not publicly release its internal budgets.

References

  1. “About.” The Hub Project. Accessed April 12, 2021. Original URL: https://thehubproject.org/jobs/. Archived: https://www.influencewatch.org/app/uploads/2021/04/hub-project-sixteen-thirty-fund-project.pdf ^
  2. “About.” The Hub Project. Accessed April 12, 2021. Original URL: https://thehubproject.org/jobs/. Archived: https://www.influencewatch.org/app/uploads/2021/04/hub-project-sixteen-thirty-fund-project.pdf ^
  3. We Build Movements. Accessed December 5, 2019. https://thehubproject.org/about/ ^
  4. We Build Movements. Accessed December 5, 2019. https://thehubproject.org/about/ ^
  5. Burns, Alexander. “With $30 Million, Obscure Democratic Group Floods the Zone in House Races.” The New York Times. October 31, 2018. Accessed December 5, 2019. https://www.nytimes.com/2018/10/31/us/politics/democrats-dark-money-midterms.html ^
  6. Burns, Alexander. “With $30 Million, Obscure Democratic Group Floods the Zone in House Races.” The New York Times. October 31, 2018. Accessed December 5, 2019. https://www.nytimes.com/2018/10/31/us/politics/democrats-dark-money-midterms.html ^
  7. Bland, Scott and Severns, Maggie. “Documents Reveal Massive ‘Dark Money’ Group Boosted Democrats in 2018.” Politico. November 19, 2019. Accessed December 5, 2019. https://www.politico.com/news/2019/11/19/dark-money-democrats-midterm-071725 ^
  8. Burns, Alexander. “With $30 Million, Obscure Democratic Group Floods the Zone in House Races.” The New York Times. October 31, 2018. Accessed December 5, 2019. https://www.nytimes.com/2018/10/31/us/politics/democrats-dark-money-midterms.html ^
  9. Burns, Alexander. “With $30 Million, Obscure Democratic Group Floods the Zone in House Races.” The New York Times. October 31, 2018. Accessed December 5, 2019. https://www.nytimes.com/2018/10/31/us/politics/democrats-dark-money-midterms.html ^
  10. Burns, Alexander. “With $30 Million, Obscure Democratic Group Floods the Zone in House Races.” The New York Times. October 31, 2018. Accessed December 5, 2019. https://www.nytimes.com/2018/10/31/us/politics/democrats-dark-money-midterms.html

    ^

  11. Burns, Alexander. “With $30 Million, Obscure Democratic Group Floods the Zone in House Races.” The New York Times. October 31, 2018. Accessed December 5, 2019. https://www.nytimes.com/2018/10/31/us/politics/democrats-dark-money-midterms.html ^
  12. Burns, Alexander. “With $30 Million, Obscure Democratic Group Floods the Zone in House Races.” The New York Times. October 31, 2018. Accessed December 5, 2019. https://www.nytimes.com/2018/10/31/us/politics/democrats-dark-money-midterms.html ^
  13. Americans for Public Trust: Complaint to Federal Elections Commission regarding Wyss Foundation. Filed May 15, 2021. Original URL: https://americansforpublictrust.org/document/wyss-complaint/. Archived URL: https://www.influencewatch.org/app/uploads/2021/05/Wyss-Foundation-FEC-Complaint-Americans-for-Public-Trust.-05.15.21.pdf ^
  14. 52 USC 30101: Definitions. From Title 52-VOTING AND ELECTIONS. U.S. House of Representatives. Accessed May 17, 2021. https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title52-section30101&num=0&edition=prelim ^
  15. “Foreign nationals.” Federal Election Commission. June 23, 2017. Accessed May 17, 2021. https://www.fec.gov/updates/foreign-nationals/ ^
  16. “E-2 Treaty Investors.” U.S. Citizenship and Immigration Services. Accessed May 17, 2021. https://www.uscis.gov/working-in-the-united-states/temporary-workers/e-2-treaty-investors ^
  17. Richard Pollock. “EXCLUSIVE: Foreign Clinton Donor Made Donations To US Campaigns.” The Daily Caller. Feb. 28, 2016. Accessed May 17, 2021. https://dailycaller.com/2016/02/28/exclusive-clintons-swiss-ally-gave-big-bucks-to-u-s-campaigns/ ^
  18. Return of Organization Exempt from Income Tax (Form 990). Sixteen Thirty Fund. 2009-2019. Part I: Line 12. ^
  19. “A Plan for the Development of a Communications Hub Supporting The Wyss Foundation’s Core Issue Areas.” Civitas, prepared for the Wyss Foundation. February 2015. Accessed April 13, 2021. Archived: https://www.influencewatch.org/app/uploads/2021/04/Wyss-Foundation-Communications-Hub.pdf ^
  20. “A Plan for the Development of a Communications Hub Supporting The Wyss Foundation’s Core Issue Areas.” Civitas, prepared for the Wyss Foundation. February 2015. Accessed April 13, 2021. Archived: https://www.influencewatch.org/app/uploads/2021/04/Wyss-Foundation-Communications-Hub.pdf ^
  21. “A Plan for the Development of a Communications Hub Supporting The Wyss Foundation’s Core Issue Areas.” Civitas, prepared for the Wyss Foundation. February 2015. Accessed April 13, 2021. Archived: https://www.influencewatch.org/app/uploads/2021/04/Wyss-Foundation-Communications-Hub.pdf ^
  22. “A Plan for the Development of a Communications Hub Supporting The Wyss Foundation’s Core Issue Areas.” Civitas, prepared for the Wyss Foundation. February 2015. Accessed April 13, 2021. Archived: https://www.influencewatch.org/app/uploads/2021/04/Wyss-Foundation-Communications-Hub.pdf ^
  23. “A Plan for the Development of a Communications Hub Supporting The Wyss Foundation’s Core Issue Areas.” Civitas, prepared for the Wyss Foundation. February 2015. Accessed April 13, 2021. Archived: https://www.influencewatch.org/app/uploads/2021/04/Wyss-Foundation-Communications-Hub.pdf ^

Directors, Employees & Supporters

  1. Gwen Snyder
    Former Consultant
  2. Michael Linden
    Policy and Research Director
  3. Nicole Gill
    Campaign Director
  4. Arkadi Gerney
    Executive Director
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The Hub Project

1601 Connecticut Ave. NW
Washington, DC