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OutSource New Mexico: Dark Money Funds ‘Left-of-Center’ SourceNM to ‘Change the Political Debate’

Dark money rears its head in New Mexico politics.

Originally published at The Conservative New Mexican on August 22, 2022.

Earlier this year, “scrappy” “independent” press organization Source New Mexico had one of their reporters ejected from a campaign event in Carlsbad for Mark Ronchetti, headlined by Florida Gov. Ron DeSantis. 

Reporters Ryan Lowery, Marisa Demarco, and Shaun Griswold seem to have recently launched a politically-charged vendetta against New Mexico gubernatorial candidate Mark Ronchetti. There’s a clear political slant with articles like, “Ronchetti campaign receives donation from fake NM elector” and “Ronchetti fails to denounce violent extremist groups.” Despite record murders, last-in-the-nation unemployment, job-killing COVID lockdown policies, and a last-place rank in childhood well-being, SourceNM hasn’t published any articles that reflected poorly on Democrat incumbent Gov. Michelle Lujan Grisham.

One could easily argue–and write a headline at their newspaper–that Lujan Grisham has failed to denounce Nazis, Black Lives Matter, or Antifa. Is it factually accurate? Sure. It’s arguably more poignant than the “violent extremist groups” SourceNM cited, considering that more people have died at BLM/Antifa riots than Oath Keepers or Three Percenters’ rallies. But it’s cheap, and the fact that SourceNM didn’t counter their attack on Ronchetti with Lujan Grisham’s failed denunciations showcases the organization’s bias. (For the record, Ronchetti has made his position on “violent extremist groups” of all kinds–regardless of political affiliation–quite clear.)

As a “charitable nonprofit” that claims to be “an independent, nonprofit news organization,” where should we draw the line with organizations like SourceNM that are clearly partisan?

The IRS expressly prohibits 501(c)(3) organizations from engaging in political activity on behalf of campaigns:

“Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Violating this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.”

The Restriction of Political Campaign Intervention by Section 501(c)(3) Tax-Exempt Organizations

With headlines like “Ronchetti fails to denounce” and “Governor [Michelle Lujan Grisham] praises…,” it’s difficult to differentiate between “reporting” and prohibited political activity with clearly established bias.

SourceNM is a relatively young organization, having joined Twitter in August of 2021. They appeared out of nowhere and now boast five reporters covering New Mexico, according to their webpage. How was it that they were able to rapidly deploy the funding and infrastructure to support the initiative?

SourceNM is part of States Newsroom, which openly acknowledges itself as the backbone of dozens of “left-of-center media outlets” funded by anonymous donors in an effort to “change the political debate.” States Newsroom is registered in the District of Columbia and has filed as a foreign nonprofit corporation with the New Mexico Secretary of State.

Even the liberal Washington Post published a fact-check in February 2020 from the nonpartisan fact-checking group NewsGuard that criticized States Newsroom as being “launched with the backing of the Hopewell Fund, another liberal dark-money group.”

When State Newsroom responded, NewsGuard had this to say about the organization’s claim of “delivering hard-hitting reporting and commentary to shine a spotlight on state government”: 

“We love local journalism, especially ‘hard hitting’ journalism. We love philanthropic journalism. What we don’t love is politically-funded organizations with an undisclosed agenda and undisclosed funders posing as journalism” (emphasis added).

Response to NewsGuard ratings of States Newsroom websites, Jan. 29, 2020

A search on August 16, 2022 found that States Newsroom was “Not in Good Standing” with the New Mexico Secretary of State. A certificate of revocation was issued in March 2022 for “failure to file initial report,” a status which itself prompted more questions than answers.

More was revealing from States Newsroom’s 990 form. All charitable organizations are required to file some form of 990, the tax return for tax-exempt organizations. These forms are public record and contain important disclosures about the charities that file them, part of a process that is intended to prevent abuse of the coveted charitable status.

States Newsroom’s 2020 990 includes a section listing the organization’s fictitious names. These are essentially pseudonyms under which the corporation operates, notably Colorado Newsline, and Arizona Mirror. Notably absent? SourceNM. The 2021 990 return was not available as States Newsroom had requested a filing extension.

Dan McKay of The Albuquerque Journal covered more of the inception:

“A 2019 story published on reported that the States Newsroom network was launched as a sponsored project of the Hopewell Fund, which it described as a left-leaning nonprofit group focused on ‘social change’ projects.”

NM reporter’s rally ejection ignites controversy over press access,” The Albuquerque Journal, Aug. 19, 2022

The situation came to a head when Ronchetti’s press secretary, Enrique Knell, denied access to SourceNM’s Griswold at the Carlsbad campaign event on the basis that SourceNM is “a left-wing advocacy group, not a legitimate news organization.”

Even the supposedly “nonpartisan” New Mexico Foundation for Open Government weighed in:

“This could be setting a dangerous precedent — letting any prospective public servant decide who is and is not a ‘legitimate’ reporter. Reporters are the public’s eyes and ears. If they can be silenced by being denied access, the members of the public are the ultimate victims.”

Freedom of the Press — Key to Democracy,” NMFOG, Aug. 16, 2022

NMFOG is also a 501(c)(3) and is thus prohibited from interfering in political campaigns. Of note, Ronchetti is not a public servant, yet, and thus not subject to any government transparency obligations.

The board of the Rio Grande chapter of the Society of Professional Journalists also chimed in:

“Singling out and excluding reporters from simply watching you speak during quasi-public events — before even gaining office — is a troubling new low.”

SPJ-RG Denounces Actions of Ronchetti Campaign,” RGSPJ, Aug. 15, 2022

Heading the board of the Society of Professional Journalists Rio Grande chapter is none other than SourceNM’s own Ryan Lowery, whose article accusing Ronchetti of not adequately denouncing rightwing groups was the impetus for the campaign denying SourceNM access to the Carlsbad campaign event. Quite the incestuous circle of “ethical journalism” in New Mexico.

Trustworthy journalism is more important than ever, but these political operatives are using millions of “dark money” dollars to fund ads and digital content masquerading as news coverage. SourceNM is a fictitious entity, the reporters above likely draw their salaries from States Newsroom, an organization with over $9 million of dark money coming from across the country, standard operating procedure for a similar George Soros effort launched in advance of the 2020 election cycle.

According to Marisa Demarco, “No one has ever told me what to publish in Source New Mexico.”

In the end, SourceNM is outsourced journalism funded by States Newsroom, which “supports state-level media operations that use hard-hitting reporting and commentary to change the political debate.” You read that right: they are changing the political debate, bordering on political campaign interference contrary to IRS prohibitions and Source New Mexico’s own ethics policy.

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