Kochonomics in Wisconsin and North Carolina

Home , David Koch, Invista, Koch family, Koch Industries, Stephen Moore (writer)

By Anna Chu September 2014

WWW.AMERICANPROGRESSACTION.ORG Kochonomics in Wisconsin and North Carolina

By Anna Chu September 2014 Contents 1 Introduction and summary

5 The effect of Kochonomics in Wisconsin and North Carolina 5 Kochonomics: The Wisconsin experience 9 Kochonomics: The North Carolina experience

12 Conclusion

13 Appendix

16 Endnotes Introduction and summary

As heads of Koch Industries, Inc., America’s second-largest privately held company, a business empire heavily invested in oil and gas, chemicals, transportation, and manufacturing, the brothers Charles and David Koch are the fifth- and sixth- richest individuals in the world, worth an estimated $52 billion each.1 Much has been written about how the Koch brothers have used their immense wealth and influence to build a network of influence and how they are working to create an economic and political system at the national level that is rigged for the wealthy regardless of everyone else—or as we call it, “Kochonomics.” However, Kochonomics is not just being pushed at the federal level. Indeed, Kochonomics has gone spread beyond that and is being practiced by its foot soldiers at the state and local levels as well.

This report focuses on how Kochonomics is playing out in two states: Wisconsin and North Carolina. We chose these states for several reasons. First, the Koch brothers have a direct financial interest in these states, given that they own several subsidiaries operating in both North Carolina and Wisconsin. Second, conservative leaders have assumed much of the elected political leadership in these states and have put in place policies that have benefited a wealthy few with little to no regard for the effects on average taxpayers. Lastly, we chose Wisconsin and North Carolina because the Koch network selected them as targets for their conservative philoso- phy. In 2012, David Koch admitted that, “We’ve spent a lot of money in Wisconsin. We’re going to spend more.”2 Tim Phillips, the head of the Koch-backed issue advocacy group Americans for Prosperity, or AFP, called North Carolina a “model state” for its activities.3 “A few years ago, the idea we had was to create model states,” said Phillips. “North Carolina was a great opportunity to do that—more so than any other state in the region. If you could turn around a state like that, you could get real reform.”4 Indeed, Phillips admitted that North Carolina “was one of the states we were most active” in pushing its conservative agenda.5

We divide this report into three sections. The first lays out the financial stake Koch Industries has in Wisconsin and North Carolina and how public policies in these two states would affect the Koch’s bottom line.

1 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina The second section looks at how the Koch network has funded state leaders in Wisconsin and North Carolina who can and have put in place policies that benefit the wealthy few, including the Koch brothers, regardless of the effect such policies have on everyone else. We focus on two ardent followers of Kochonomics— Wisconsin Gov. Scott Walker (R) and North Carolina Speaker of the House Thom Tillis (R). Both Walker and Tillis have received large campaign contributions from Koch Industries in their respective states. The Koch network is also helping Walker and Tillis in their 2014 election campaigns: Walker is running for re- election as governor and Tillis is vying for a U.S. Senate seat representing North Carolina in one of the most competitive races in the country.6

The third and final section of the report looks at the various effects that Kochonomics has had on both Wisconsin and North Carolina. In general, we show that the conservative policies put into place by Koch-supported lawmakers have benefited the wealthy few. Specifically, we focus on the issue of tax and find that:

• In Wisconsin, the Koch network aggressively pushed for tax cuts that heavily favor millionaires, billionaires, and big corporations. One of the resulting benefits to the Kochs is that they could see their income tax rate on the manufacturing activities of Koch Industries subsidiaries in Wisconsin drop to as low as 0.15 percent.7 Conversely, over the past four years, Wisconsin’s working and low-income families have had to pay $170 million more in additional taxes.8

• In North Carolina, the Koch-backed Americans for Prosperity advocated for— and state lawmakers passed—tax cuts for the wealthiest 1 percent by an average of more than $10,000 annually, while working families making between $52,000 and $84,000 per year would actually have to pay an average of $74 more in taxes.9 Moreover, state lawmakers eliminated local business taxes, further reducing the taxes of Koch subsidiaries in North Carolina.

Koch Industries stake in Wisconsin and North Carolina

The Kochs have numerous business interests in Wisconsin, including at least six wholly owned subsidiaries in the state—Georgia-Pacific, Flint Hills Resources, Koch Pipeline Company, L.P., C. Reiss Coal Company, Koch Carbon LLC, and Koch Business Solutions—and at least two wholly owned subsidiaries in North Carolina—INVISTA and Georgia-Pacific Wood Products LLC. Because of these businesses, the Koch brothers have a financial stake in reducing the tax liability and regulatory obligations of their companies in these states.

2 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina Koch businesses in Wisconsin and North Carolina

• Georgia-Pacific, which is incorporated as a limited liability com- a subsidiary of Koch Minerals, LLC.19 Koch Minerals and its subsidiar- pany, or LLC, and has six locations in Wisconsin and eight in North ies are “among the world’s largest dry-bulk commodity handlers, Carolina, produces paper products.10 marketing and trading more than 40 million tons of product annually.”20 Koch Carbon has a registered office in Madison, Wisconsin.21 • Flint Hills Resources, a limited partnership, or LP, is a refining and chemical company with four locations in Wisconsin.11 Among • Koch Business Solutions, LP provides consulting and transac- other things, the company offers a wide variety of petroleum-based tional services, such as human resources, informational technology, products, including asphalt, gasoline, jet fuel, and heating oils.12 and finance, for subsidiaries of Koch Industries.22 Koch Business Solutions has an office in Green Bay, Wisconsin,23 and is organized as • Koch Pipeline Company, L.P., which is organized as a foreign lim- a foreign limited partnership.24 ited partnership,13 owns or operates pipelines that transport crude oil, refined petroleum, and other chemicals.14 • INVISTA is a “wholly owned subsidiary of Koch Industries, Inc.”25 and operates a chemical plant in Wilmington, North Carolina, as • C. Reiss Coal Company is a coal supplier with four locations in well as a polyester fiber plant in Salisbury, North Carolina.26 Among Wisconsin.15 It is organized as a corporation.16 other products, it produces synthetic fibers used in everything from clothing to seatbelts and chemicals used in agricultural products, • Koch Carbon LLC is registered in the state as a foreign LLC,17 and hand cleaners, and more.27 Although INVISTA is incorporated as an according to its website, “specializes in the global sourcing, supply, LLC in North Carolina, its country of incorporation is Luxembourg,28 handling and transportation of bulk commodities.”18 The company is a well-known tax haven.29

Meet the foot soldiers of Kochonomics

Wisconsin Gov. Scott Walker

Gov. Walker is no stranger to Koch largesse. Over the past 19 years, the Wisconsin governor has been one of the top recipients of Koch Industries political action committee, or PAC, donations in state political races, according to the National Institute on Money in State Politics.30 During Walker’s 2010 gubernatorial race, the Koch network donated $43,000 to his campaign, the second-largest donation that Walker received in his campaign.31

Moreover, Americans for Prosperity strongly supported Walker. AFP President Tim Phillips estimates that from 2011 to 2012, the group spent $10 million promoting Walker’s conservative policies,32 which included dismantling collective bargaining for public sector unions, rolling back environmental regulations, cutting taxes,33 and helping the governor withstand a recall attempt.34 AFP actions included

3 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina transporting Wisconsin residents to the state capitol to support Walker’s propos- als35 and spending more than $48,000 on television ads for state Senate races in 2011.36 AFP also sent absentee ballot applications to Wisconsin voters, though the ballots were printed with the wrong date and erroneously told voters to return their ballots before August 11, 2011, despite the fact that Election Day was two days earlier on August 9.37 AFP claimed this was a mistake of the printer and that it contacted individuals on its mailing list to clarify the date of the elections.38

When Walker’s aggressive push of conservative policies raised voter ire, AFP helped the governor successfully fight a recall attempt.39 The group spent $1.5 million in the state’s biggest media markets during the recall election.40 Just days before the recall election, AFP organized a multi-city bus tour promoting Walker’s policies.41 As one reporter pointed out, “[g]iven the tour’s timing and billing, any reasonable person would view it as a statewide drive to get out the vote for Walker and his GOP allies in the June 5 election.”42

Additionally, AFP has dedicated nearly $1 million thus far in 2014 to support Walker’s re-election bid in November.43 As of the publication of this report, Walker is under investigation for improperly coordinating between his political campaign and independent groups.44 Records show he solicited millions of dollars for independent groups such as Wisconsin Club for Growth during the 2011 and 2012 recall elections in Wisconsin.45

North Carolina Speaker of the House Thom Tillis

As speaker of the North Carolina House of Representatives, Thom Tillis has tre- mendous influence over the direction of public policy in the state. He is also one of the biggest recipients of Koch Industries campaign contributions. According to the National Institute on Money in State Politics, from 2010 to 2012, Tillis received $11,000 from Koch Industries, making him second-highest recipient of Koch Industries campaign contributions in the Tar Heel state.46

The Koch network is also heavily supporting Tillis in his current race for the U.S. Senate. Charles Koch, his wife, son, and daughter-in-law each gave the maximum $2,600 campaign contribution to Tillis’ Senate campaign, for a combined total of $10,400.47 Koch Industries PAC also gave $5,000 to the Tillis campaign.48

Additionally, AFP has already spent nearly $9 million attacking Tillis’ opponent, the incumbent Sen. Kay Hagan (D).49 Another Koch-backed group, Freedom Partners, plans to spend at least $2.8 million in the North Carolina Senate race as well.50

4 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina The effect of Kochonomics in Wisconsin and North Carolina

Kochonomics: The Wisconsin experience

Once a Democratic-leaning state, Wisconsin now has a Republican governor, a Republican-dominated state legislature, and a Republican in one of its two U.S. Senate seats.51 Wisconsin’s new conservative political leaders have wasted little time in passing right-wing policies, including a host of carefully crafted and very specific tax changes that, if left unchanged, would increase the size of the Kochs’ pocketbooks.

As governor, Scott Walker has fought for a wish list of conservative policies, including dismantling the collective bargaining rights of public sector unions,52 preventing Wisconsin cities and counties from passing minimum-wage require- ments for local government workers and contractors,53 and allowing concealed weapons in public parks, bars, and near schools.54

Key among the policies passed are tax changes that could increase the Koch brothers’ financial bottom line but have harmed Wisconsin families.

How Koch Industries subsidiaries benefit from tax cuts

The first step in understanding how the Koch brothers benefit from state tax cuts is to know how Koch subsidiaries are organized. The Koch subsidiaries in Wisconsin and North Carolina are organized as limited partnerships or limited liability companies. Limited liability companies are known as “pass-through” entities and are generally not taxed as a corporate entity, but are instead taxed at the member level. This means that the profits or losses of the corporation are passed through to each member—or owner—who then reports the profits or losses on his or her personal federal tax return. There is no separate taxation at the corporate entity level.

5 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina Meanwhile, regular corporations, or “C” corporations, pay corporate income tax on their profits. Their after-tax profits are then either re-invested in the company or passed through to the shareholders in the form of dividends, which in turn are subject to individual income tax on each shareholder’s tax return. Under certain circumstances, either by law or at the election of the entity, a limited partnership may be treated like a C corporation for tax purposes.

In both Wisconsin and North Carolina, for limited partnerships and limited liability companies that are treated as pass-through entities, their nonresident owners must pay state income taxes for income earned in the state.55 Thus, if the Koch subsidiaries in those states are treated as pass-through entities, then their owner, Koch Industries, could stand to gain substantially from a reduction in state income taxes. Meanwhile, businesses set up or treated as C corporations are subject to state corporate taxes. This means that a reduction of corporate income taxes would benefit the shareholders of corporations. These issues become impor- tant again when assessing how much the Kochs benefit from tax cuts passed in Wisconsin and North Carolina.

Tax cuts for millionaires, billionaires, and big corporations but tax increases for working families

Gov. Walker has aggressively pushed to slash taxes for millionaires, billionaires, and big corporations during his time in office. Among the tax changes under Walker is the Manufacturing and Agriculture Tax Credit, which was signed into law as part of Walker’s 2011–2013 state budget and revised in his 2013–2015 budget.56 Walker then oversaw the passage of a $541 million tax-cut bill in 2014 that would undercut the alternative minimum tax—a measure originally meant to ensure that the wealthy earners who receive many tax deductions would still pay taxes—and allow the wealthy in Wisconsin to receive a big tax break from the Manufacturing and Agriculture Tax Credit.57

The Manufacturing and Agriculture Tax Credit gives manufacturers and agricultural businesses “a dollar-for-dollar credit of 1.875% on all income from manufacturing or agricultural production on their 2013 tax bill. The credit would rise to 3.75% in 2014, 5.526% in 2015 and 7.5% in 2016.”58 This manufacturing tax credit could effectively “zero out all income taxes for manufacturers in the state.”59

6 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina The Koch network threw its full support behind Walker’s conservative budgets. In 2011, AFP launched a four-day bus tour under the banner, “Stand Against Spending. Stand with Walker.” During the tour, the group asked activists to contact their legislators and urge them to “put an end to Wisconsin’s out-of-control state spending and to stand with Walker on commonsense spending reforms.”60 Then, after passage of the 2011 budget and tax cuts, AFP partnered with the John K. MacIver Institute for Public Policy, a Wisconsin-based conservative think tank, to air television ads touting the fact that “taxpayers are now back in control, and those savings helped Wisconsin avoid massive tax hikes.”61 AFP also launched a 10-city bus tour throughout Wisconsin to promote the various budget reforms passed in 2011, and to push for even more reforms.62 In total, AFP President Tim Phillips estimated that the group spent $10 million in 2011 and 2012 promoting Walker’s policies.63

In 2013, after Walker unveiled his 2013 budget, which contained slight revisions to the manufacturing tax credit, AFP went on the road again to drum up support for additional tax cuts. It hosted at least five town hall gatherings around Wisconsin, asking people to attend to “learn about proposed tax cuts and tax reform and what you can do to help push through tax reform in Wisconsin.”64 AFP openly called on its members to support tax cuts.65

Walker then signed into law his 2014 tax bill that contained a measure that would eliminate the alternative minimum tax for recipients of the Manufacturing and Agriculture Tax Credit, along with the recipients of two other manufacturing- related tax credits.66 This move would give away $36.8 million from now through June 2015.67 As Jon Peacock, research director for Wisconsin Council on Children and Families, pointed out, this was a “no-strings-attached” giveaway to business owners, without any promise that they would grow their business and not layoff their workers.68 “The state is forfeiting a large and growing chunk of revenue without any assurance we’re getting anything from it,” said Peacock. 69

In fact, the Manufacturing and Agriculture Tax Credit benefits the already-wealthy in Wisconsin, including the Kochs, tremendously. As Jack Norman from the Institute for Wisconsin’s Future described it, the tax credit is ‘’a total giveaway to the wealthy. You’ve got a guy working at the factory making $35,000, paying his share of taxes. Meanwhile, the guy who owns the factory won’t pay any state taxes.’’70

7 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina This is how it works: The Manufacturing and Agriculture Tax Credit took effect in 2013 and is phased in through 2016. By the time it is fully phased in, it will give manufacturers a 7.5 percent tax credit.71 This is a dollar-for-dollar reduction of taxes on all income from manufacturing or agriculture.72 Businesses are eligible for this tax credit if they own or rent property in Wisconsin that is “assessed as manufacturing or agricultural property and used by the claimant to manufacture or grow, produce, or extract tangible personal property.”73 The amount of the reduction depends on how the manufacturer is incorporated and the amount of the manufacturer’s income:

• If the manufacturer is a corporation, it is subject to the Wisconsin corporate income tax rate of as high as 7.9 percent.74 After taking the 7.5 percent credit in 2016, that entity’s tax rate on manufacturing income could be reduced to as low as 0.40 percent.75

• If the manufacturer is a pass-through entity, then the manufacturer does not pay the Wisconsin manufacturing income tax rate of 7.9 percent. Instead, the top tax rate of the owners of the pass-through entity would be the Wisconsin individual income tax rate of 7.65 percent.76 After taking the credit, the tax rate on manufacturing income for the owners of the pass-through entity could be reduced to 0.15 percent.77

Many of the Koch subsidiaries in Wisconsin would benefit from the Manufacturing and Agriculture Tax Credit. More than a third of the Koch subsidiaries’ locations are considered manufacturing property.78 And as discussed above, because these subsidiaries are organized as pass-through companies, they are not subject to the state corporate tax rate, but are subject to the state income tax rate. Thus, they would able to use this tax credit to reduce the tax rate on their manufacturing income to as low as 0.15 percent.

This would be a massive savings for big manufacturers. For example, a company organized as a pass-through entity that qualifies for the tax cuts and makes $20 million a year from manufacturing income in Wisconsin, would have its tax liability for its Wisconsin manufacturing income reduced from 7.65 percent—or $1.53 million—to 0.15 percent—or $30,000, for a savings of $1.5 million.

8 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina While the Kochs would enjoy the manufacturing tax credit included in the past two Walker budgets, Wisconsin’s low-income families and children suffer. As noted by the Wisconsin Budget Project, at the same time the governor and legislature cut taxes for some in Wisconsin, they also “raised taxes on working families and low-income seniors.”79 Specifically, while Walker’s 2011–2013 budget includes a massive tax break for manufacturers, including the Kochs, it would also slash two credits for working families and low-income people—the Earned Income Tax Credit and the Homestead Credit.80 “Combined, these tax increases resulted in $170 million in additional taxes paid over the last four years by working families and people with low incomes.”81

Kochonomics: The North Carolina experience

Over the past few years, conservative forces backed by moneyed interests swooped into North Carolina, turning the once fairly moderate Southern state into a bastion of right-wing policies.82 The Koch network’s investment in North Carolina helped deliver the Koch brothers a Republican-controlled state legislature and governor’s mansion.83 With a statehouse controlled by right-wing lawmakers and a conservative Republican governor, the Kochs were able to secure an anti-government regime that boosted their financial bottom line regardless of North Carolina families.

Tax cuts for the wealthy, tax hikes for working and middle-class families

The Republican leadership in North Carolina, including Speaker Thom Tillis and the Koch-backed AFP, played major roles in passing personal and corporate tax cuts in North Carolina and allowing the state Earned Income Tax Credit, or EITC, to lapse. In particular, Tillis helped shepherd a tax plan through the North Carolina House that would cut the state’s corporate and personal income tax rates.84 Meanwhile, AFP launched a half-million-dollar campaign—“Back in the Game”—to champion tax cuts.85 AFP’s $500,000 push entailed hosting several tax rallies around the state,86 as well as events done in conjunction with the Civitas Institute, a conservative think tank,87 and Grover Norquist, president of Americans for Tax Reform88 and originator of the Taxpayer Protection Pledge, which opposes all tax increases, including those on millionaires and billionaires.89 AFP also released a poll showing that North Carolinians supported tax reform along the lines of the proposed state Senate plan,90 and even pushed its agenda at the North Carolina GOP party convention held in Charlotte in 2013.91

9 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina The combined result of the tax changes advocated by AFP and passed by Koch- backed North Carolina politicians—personal and corporate tax cuts, elimination of estate taxes, and lapse of EITC—is to hand millionaires, billionaires, and big corporations, including the Kochs, big tax cuts, while working and middle-class families pay more. The tax changes together will cost the state $2.4 billion over five years92 and is paid for, according to the North Carolina Budget and Tax Center, “by shifting the tax load onto middle- and low- income taxpayers.”93 The North Carolina Budget and Tax Center states that the tax bill “consists largely of cutting tax rates for personal and corporate income, in a way that will overwhelmingly benefit the wealthy.”94 The report went on to say that even proponents of the plan “acknowledge that taxpayers who make less than $84,000 per year will end up paying more in taxes once the tax code goes into effect.”95

Specifically, the poorest North Carolina taxpayers—those making $19,000 or less—would have to pay an average of $23 more in annual taxes.96 Taxpayers making between $52,000 and $84,000 would have to pay an average of $74 more per year.97 Meanwhile, the top 1 percent of North Carolina taxpayers—those making $393,000 or more—would actually get an average tax cut of $10,574 each.98

TABLE 1 Impact of recent North Carolina tax changes

2013 income level Lowest 20% Second 20% Middle 20% Fourth 20% Next 15% Next 4% Top 1% Less than $19,000 to $32,000 to $52,000 to $84,000 to $169,000 to $393,000 Income range $19,000 $32,000 $52,000 $84,000 $169,000 $393,000 or more Average tax +23 +47 +59 +74 -$98 -$1,059 -$10,574 change

Source: Cedric Johnson, “BTC Brief: Who Pays in 2014 – Tax Plan Creates Winners and Losers in North Carolina” (Raleigh, NC: North Carolina Budget and Tax Center, 2014), available at http://www.ncjustice.org/?q=budget-and-tax/btc-brief-who-pays-2014-tax-plan-creates-winners-and-losers-north-carolina.

The Koch brothers stand to gain tremendously from these tax cuts. As owners of limited liability companies operating in North Carolina, Koch Industries and its owners are subject to North Carolina taxes for profits made in the state and are likely huge beneficiaries of North Carolina’s recent tax changes.

An exact estimate of the tax benefits to the Koch subsidiaries in North Carolina is unavailable because the Kochs have chosen to keep their companies private, even as they spend millions of dollars to influence the political and economic system and even though Koch Industries is the second-largest privately held company in the United States, with an estimated $115 billion in revenue.99

10 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina However, the information that is publicly available suggests the tax benefits to the Kochs may be substantial. For instance, on its website, Georgia-Pacific boasts that it has eight facilities in North Carolina and pays $152 million in wages and benefits to its North Carolina employees.100 Its size, wages, and benefits suggest it is a company that is at the top of the income ladder in North Carolina. Thus, it could be a huge beneficiary of the North Carolina tax cuts.

In addition to benefitting from a cut in personal and corporate income taxes, the Kochs and the Koch subsidiaries could also benefit from the elimination of local business taxes. These local business taxes were called “privilege taxes,” as they were taxes placed on businesses for the privilege of doing business in a city.101 At least three Koch subsidiaries are located in cities that had privilege taxes— Wilmington,102 Creedmoor,103 and Asheboro104—and thus an elimination of these taxes could reduce the North Carolina Koch subsidiaries’ tax liabilities.

But while the Kochs could benefit from the elimination of local privilege taxes, cities would lose much-needed revenue. According to an Associated Press story looking at the effect of capping or eliminating the privilege tax, “The cities are wor- ried the lost revenue will require them to raise property taxes, cut services or both. … While a $100 cap could mean cities could cumulatively lose $11 million to $25 million during the 2015-16 fiscal year, a complete prohibition would mean a loss of $62.2 million, according to estimates from legislative staff analyzing both bills.”105

In sum, the Koch network in North Carolina passed key tax changes that would hand the rich, including the Koch brothers, massive tax cuts—a bill footed by making working and middle-class families pay more in taxes.

11 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina Conclusion

Over the years, the billionaire Koch brothers have spent large sums of money to build a vast network of think tanks, political action groups, issue advocacy organizations, and elected officials to help achieve their ideological vision of a small government with an anti-tax and anti-regulation regime. They employed this Kochonomics model in Wisconsin and North Carolina and helped usher in a conservative political apparatus in these states, with the help of Kochonomic adherents such as Wisconsin Gov. Scott Walker and North Carolina Speaker of the House Thom Tillis.

While the Koch brothers may claim that they are motivated by ideology,106 the impact of the policies they promoted in Wisconsin and North Carolina benefit the wealthy—including the Koch’s business interests in the two states—but in most cases hurt working families.

This report raises serious questions about how the Koch brothers and their affili- ated businesses directly benefit by aggressively advancing their right-wing agenda, not just at the federal level but also at the state and local level, regardless of the harm done to America’s working and middle-class families.

As the Koch influence continues to grow, the true agenda of Kochonomics becomes clearer: using the network’s vast resources to take power away from officials at all levels of government and give it to a pair of billionaire brothers and those who agree and profit with them.

12 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina Appendix

TABLE 1 Koch properties in Wisconsin

Assessed as Name of subsidiary Address manufacturing property

Georgia-Pacific 115 Depot Road, Phillips, WI Yes

Georgia-Pacific 1927 Erie Ave., Sheboygan, WI Yes

Georgia-Pacific 411 E. Murdock Ave., Oshkosh, WI Yes

Georgia-Pacific 413 E. Murdock Ave., Oshkosh, WI No

Georgia-Pacific 1915 Marathon Ave., Neenah, WI Yes

Georgia-Pacific 1919 S. Broadway, Green Bay, WI Yes

Georgia-Pacific 500 Day St., Green Bay, WI Yes

Georgia-Pacific 1100 W. Mason St., Green Bay, WI Yes

Exempt Waste Treatment Facility, North Quincy St., Georgia-Pacific Yes Green Bay, WI

Flint Hills Resources 2267 County Highway 34 North, Junction City, WI No

Flint Hills Resources 4405 Terminal Drive, McFarland, WI No

Flint Hills Resources N4240 Wisconsin Highway 26, Waupun, WI No

Flint Hills Resources 9343 N. 107th St., Milwaukee, WI No

Koch Minerals LLC 703 N. Eighth St., Suite 301, Sheboygan, WI No

Koch Minerals LLC 115 W. Mason St., Green Bay, WI No

Koch Pipeline Company LP E3660 Spruce Road, Eleva, WI No

Georgia-Pacific 1436 State St., Green Bay, WI Yes

Georgia-Pacific 1611 State St., Green Bay, WI Yes

Georgia-Pacific 603 Liberty St., Green Bay, WI Yes

Georgia-Pacific 1749 S. Broadway St., Green Bay, WI Yes

Georgia-Pacific 1001 Rear S. Broadway, Green Bay, WI Yes

13 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina Assessed as Name of subsidiary Address manufacturing property

Georgia-Pacific Lease Dock, Rear S. Broadway, Green Bay, WI No

Georgia-Pacific Taxable Site, North Road, Lot 20, Green Bay, WI No

Exempt Waste Treatment Site, North Road, Parcel Georgia-Pacific No Number 6H-1271, Green Bay, WI

Exempt Waste Treatment Site, Haven Place, Lot 12, Georgia-Pacific No Green Bay, WI

Exempt Waste Treatment Site, Haven Place, Lot 13, Georgia-Pacific No Green Bay, WI

Exempt Waste Treatment Site, North Road, Lot 14, Georgia-Pacific No Green Bay, WI

Exempt Waste Treatment Site, North Road, Parcel Georgia-Pacific No Number 6H-837-1, Green Bay, WI

Georgia-Pacific 727 Smith St., Green Bay, WI No

Georgia-Pacific 830 N. Quincy Road, Green Bay, WI No

Georgia-Pacific 708 Smith St., Green Bay, WI No

Georgia-Pacific 725 Smith St., Green Bay, WI No

Georgia-Pacific 1010 N. Quincy St., Green Bay, WI No

Source: Author’s subsidiary ownership and address based on data collected from property-assessment value records in counties across Wisconsin; author’s manufacturing site classifications collected from the Wisconsin Department of Revenue, “Manufacturing Assessment Rolls,” available at https://ww2.revenue.wi.gov/RETRWebRolls/ application?previousPageRollsVRHP=previousPageRollsVRHP (last accessed July 2014).

14 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina About the author

Anna Chu is the Policy Director for the Center for American Progress Action Fund. She brings experience serving as the policy director for the Democratic Senatorial Campaign Committee during the successful 2012 cycle that saw Democrats adding two seats to their majority in the Senate. As policy director, she oversaw and managed all policy issues for the committee and Democratic Senate candidates. Prior to working at the Democratic Senatorial Campaign Committee, she served as the policy advisor for the House Democratic Caucus. She previously served as a federal law clerk and worked as an associate at Paul Hastings. Chu graduated from the University of California, Berkeley, and has a J.D. from the University of Southern California.

Acknowledgements

The author would like to thank Tony Carrk, Tiffany Germain, Jeff Barrera, Rob Cohen, Nicholas Ahamed, Christa Chiao, and Leah Hughes for their assistance.

15 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina Endnotes

1 Bloomberg, “Bloomberg Billionaires, Today’s ranking 11 Tony Carrk, “The Koch Brothers: What You Need to of the world’s richest people,” available at http://www. Know About the Financiers of the Radical Right” bloomberg.com/billionaires/latest (last accessed July (Washington: Center for American Progress Action 2014). Fund, 2011), available at http://www.americanprogressaction.org/issues/regulation/report/2011/04/04/9399/ 2 Stacey Singer, “David Koch intends to cure cancer in his the-koch-brothers/; Wisconsin Department of Financial lifetime and remake American politics,” The Palm Beach Institutions, “Flint Hills Resources, Limited Partnership,” Post, February 20, 2012, available at http://www.palm- available at https://www.wdfi.org/apps/CorpSearch/ beachpost.com/news/business/david-koch-intends-to- Details.aspx?entityID=K025584&hash=1374122908&s cure-cancer-in-his-lifetime-/nL4Fb/. earchFunctionID=6bca2392-23a0-47af-87be-fb523c6 ef4c3&type=Simple&q=Flint+Hills (last accessed June 3 Tarini Parti, “GOP, Koch brothers find there’s nothing 2014). finer than Carolina,” Politico, May 11, 2013, available at http://www.politico.com/story/2013/05/koch-brothers- 12 Flint Hills Resources, Flint Hills available at http://www. republicans-north-carolina-91200.html?hp=t1. fhr.com/about/default.aspx?AspxAutoDetectCookieSu pport=1 (last accessed August 2014). 4 Ibid. 13 Wisconsin Department of Financial Institutions, “Koch 5 Ibid. Pipeline Company, LP,” available at https://www.wdfi. org/apps/CorpSearch/Details.aspx?entityID=K0258- 6 Daniel Strauss, “Conservative Americans For Prosperity 71&hash=2119123584&searchFunctionID=3e0db6 Pours Major Cash Into Walker Race,” Talking Points 2e-73e5-4608-84e5-e7f5e184fe38&type=Simple&q=Ko Memo, May 27, 2014, available at http://talkingpoints- ch+Pipeline (last accessed July 2014). memo.com/livewire/scott-walker-americans-for- prosperity-re-election; John Frank, “Koch family maxes 14 Koch Pipeline Company, L.P., out for Thom Tillis campaign,” News & Observer Under lt.aspx?AspxAutoDetectCookie, available at http:// the Dome Blog, July 23, 2014, available at http://www. kochpipeline.com/about-us/kpl-facts/ (last accessed newsobserver.com/2014/07/23/4025187/koch-family- August 2014). maxes-out-for-thom.html#storylink=cpy. 15 Koch Industries, nd.com/files/wisconsinfactse at 7 When the Manufacturing and Agriculture Tax Credit https://www.kochind.com/files/wisconsinfacts.pdf (last was first passed in 2011, the Milwaukee Journal Sentinel accessed June 2014). reported that alturing and Agriculture Tax Credit was first passed i—whose shareholders pay the firm’s tax 16 Wisconsin Department of Financial Institutions, “The C. as personal income tax—would be able to reduce Reiss Coal Company,” available at https://www.wdfi.org/ their rate from as much as 7.75% to 0.25% or less.1, the apps/CorpSearch/Details.aspx?entityID=1R00259&ha is-lifetime-/nL“Business production tax break added sh=1365327135&searchFunctionID=e3e77a04-8d94- to state budget,” Milwaukee Journal Sentinel, June 43b8-b77d-e97c2d14718f&type=Simple&q=C.+Reiss+ 6, 2011. However, this was before the top personal Coal (last accessed July 2014). income tax rate was lowered to 7.65 percent. Citizens for Tax Justice Staff, “Bad budgets become law in Ohio 17 Wisconsin Department of Financial Institutions, “Koch and Wisconsin,” Citizens for Tax Justice Blog, July 1, Carbon, LLC,” available at https://www.wdfi.org/apps/ 2013, available at http://www.ctj.org/taxjusticedigest/ CorpSearch/Details.aspx?entityID=K030409&hash archive/2013/07/bad_budgets_become_law_in_ohio. =1978086230&searchFunctionID=e61de334-3db3- php#.U6sXYrH266-. The tax credit applied against the 4072-ba60-d7af312a0e89&type=Simple&q=Koch (last current personal income tax rate of 7.65 percent would accessed June 2014). yield a maximum tax rate of 0.15 percent of applicable income derived from manufacturing or agriculture 18 Koch Industries, “Koch Minerals, LLC,” available at http:// property in Wisconsin. www.kochind.com/companies/koch_minerals.aspx (last accessed June 2014). 8 Tamarine Cornelius, “Breaking with Tradition: How Wisconsin lawmakers have shortchanged a legacy of 19 Ibid. investment in the state’s future” (Madison, WI: Wiscon- sin Budget Project, 2014), available at http://www. 20 Ibid. wisconsinbudgetproject.org/breaking-with-tradition- how-wisconsin-lawmakers-have-shortchanged-a- 21 Wisconsin Department of Financial Institutions, “Koch legacy-of-investment-in-the-states-future. Carbon, LLC..

9 Cedric Johnson, “BTC Brief: Who Pays in 2014 – Tax Plan 22 “Koch Business Solutions, LP,” available at http://www. Creates Winners and Losers in North Carolina” (Raleigh, kbslp.com/ (last accessed June 2014). NC: North Carolina Budget and Tax Center, 2014), available at http://www.ncjustice.org/?q=budget-and-tax/ 23 Koch Industries, “Global Presence,” available at http:// btc-brief-who-pays-2014-tax-plan-creates-winners- www.kochind.com/About_Koch/Global_Presence.aspx and-losers-north-carolina. (last accessed June 2014).

10 Georgia-Pacific, “Georgia-Pacific Locations,” available 24 Wisconsin Department of Financial Institutions, “Koch at http://www.gp.com/Company/Company-Overview/ Business Solutions, LP,” available at https://www.wdfi. Locations (last accessed June 2014). org/apps/CorpSearch/Details.aspx?entityID=K037- 731&hash=132094918&searchFunctionID=e61de334- 3db3-4072-ba60-d7af312a0e89&type=Simple&q=Koch (last accessed June 2014).

16 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina 25 INVISTA, “About INVISTA,” available at http://invistaca- 36 Kantar Media/CMAG with analysis by the Center for reers.com/about-history.php (last accessed June 2014). American Progress Action Fund.

26 Daniel McCoy, “Koch’s Invista unit to lay off 100 in 37 David Catanese, “Americans for Prosperity: Wrong date North Carolina,” Wichita Business Journal, November 6, a n Progress Action F” Politico, August 2, 2011, available 2013, available at http://www.bizjournals.com/wichita/ at http://www.politico.com/news/stories/0811/60515. news/2013/11/06/kochs-invista-unit-to-lay-off-100-in. html. html; Scott Jenkins and Mark Wineka, “Former employees file suit against Invista,” Salisbury Post, September 38 Greg Sargent, “Americans for Prosperity sent mislead- 16, 2005, available at http://archive.salisburypost.com/ ing absentee ballot far more widely than previously archive_detail.php?archiveFile=2005/September/16/ known,” The Washington Post, August 5, 2011, available Area/29283.xml&start=420&numPer=20&keyword=tou at http://www.washingtonpost.com/blogs/plum-line/ ts§ionSearch=&begindate=1%2F1%2F1983&endd post/americans-for-prosperity-sent-misleading- ate=12%2F31%2F2009&authorSearch=&IncludeStories absentee-ballot-far-more-widely-than-previously- =1&pubsection=&page=&IncludePages=1&IncludeIma known/2011/03/03/gIQAxhcywI_blog.html. ges=1&mode=allwords&archive_pubname=Salisbury+ Post%0A%09%09%09.l. 39 Roarty, “The Long Game.”

27 INVISTA, “It’s Not Our Name, It’s Our Products,” available 40 Kathy Kiely, “Americans for Prosperity campaigns at http://invistacareers.com/products.php (last ac- without leaving a paper trail in Wisconsin,” Sunlight cessed August 2014). Foundation Blog, June 7, 2012, available at http:// sunlightfoundation.com/blog/2012/06/07/americans- 28 North Carolina Department of the Secretary of State, prosperity-campaigns-without-leaving-paper-trail- “Corporations,” available at http://www.secretary.state. wisco/. nc.us/corporations/Corp.aspx?PitemId=4882055 (last accessed June 2014). 41 Andy Kroll, “Americans for Prosperity: Our Pro-Walker bus tour has nothing to do with recall,” Mother Jones, 29 The issue of whether the Kochs are able to evade May 28, 2012, available at http://www.motherjones. certain U.S. taxes through INVISTA’s location in a well- com/mojo/2012/05/americans-for-prosperity-wiscon- known tax haven is outside the scope of this report. sin-bus-tour-walker-recall. Neil Maclucas, “Tax havens (other than Switzerland) feeling the heat from tax collectors,” The Wall Street 42 Ibid. Journal, May 19, 2014, available at http://blogs.wsj. com/law/2014/05/19/tax-havens-other-than-switzer- 43 Strauss, “Conservative Americans For Prosperity Pours land-feeling-the-heat-from-tax-collectors/. Major Cash Into Walker Race.”

30 National Institute on Money in State Politics, “Koch 44 Matthew DeFour, “Scott Walker solicited money for Industries: Non-Individual,” available at http://beta. conservative groups, records show,” Wisconsin State followthemoney.org/entity-details?eid=1457 (last ac- Journal, August 23, 2014, available at http://host.madi- cessed August 2014). son.com/news/local/govt-and-politics/scott-walker- solicited-money-for-conservative-group-records-show/ 31 Andy Kroll, “Wisconsin Gov. Scott Walker: Funded by article_e17d6f2a-f423-5a1f-9b2e-464c4f18b174.html. the Koch Bros.,” Mother Jones, February 18, 2011, available at http://www.motherjones.com/mojo/2011/02/ 45 Ibid. wisconsin-scott-walker-koch-brothers. 46 National Institute on Money in State Politics, “Showing 32 Jack Craver, “Dark money: How Wisconsin14).g/entity- Koch Industries contributions to Candidates and Com- details?eid=1457rals.aspx” vailable at =1” “ 7rals.aspx” mittees on reports filed in North Carolina,” available vailab” The Capital Times, January 15, 2014, available at http://beta.followthemoney.org/show-me?d- at http://host.madison.com/news/local/writers/jack_ eid=1457&f-s=NC#[{1|gro=f-eid (last accessed August craver/dark-money-how-wisconsin-s-most-politically- 2014). influential-organizations-avoid/article_8ddf078f-1112- 5f44-9268-cb9e5f2d3fd2.html. 47 Frank, “Koch family maxes out for Thom Tillis campaign.”

33 Office of Gov. Scott Walker, “Governor Walker Intro- 48 Ibid. duces Budget Repair,”overnor Walker February 11, 2011, available at http://walker.wi.gov/newsroom/press-re- 49 Renee Schoof, “Tillis raises $1.6 million in second lease/governor-walker-introduces-budget-repair; Politi- quarter,” News & Observer, July 11, 2014, available at Fact, “Wisconsin Gov. Scott Walker says his budget-re- http://www.newsobserver.com/2014/07/11/4000323/ pair bill would leave collective bargaining ‘fully intact,’” tillis-raises-16-million-in-second.html. February 18, 2011, available at http://www.politifact. com/wisconsin/statements/2011/feb/18/scott-walker/ 50 Alexis Levinson, “Freedom Partners Dives Into North wisconsin-gov-scott-walker-says-his-budget-repair-/; Carolina Senate Race,” CQ Roll Call, July 22, 2014, A. G. Sulzberg, “Union bill is law, but debate is far from available at http://atr.rollcall.com/kay-hagan-freedom- over,”nThe New York Times, March 12, 2011, available at partners-thom-tillis-north-carolina-senate/. http://www.nytimes.com/2011/03/12/us/12wisconsin. html?_r=0&gwh=93625004FAB97E2E7F6072E3A0C421 51 Craig Gilbert, “River of red buries the blue,” Milwaukee C0&gwt=pay. Journal Sentinel, November 3, 2010, available at http:// www.jsonline.com/news/statepolitics/106589258.html. 34 Alex Roarty, “The Long Game: Americans for Prosperity is just getting started,” National Journal, June 12, 2014, 52 Office of Gov. Scott Walker, “Governor Walker Intro- available at http://www.nationaljournal.com/maga- duces Budget Repair”; PolitiFact, “Wisconsin Gov. Scott zine/the-long-game-20140612. Walker says his budget-repair bill would leave collective bargaining ‘fully intact,’”; Sulzberg, “Union bill is law, but 35 Eric Lipton, “Billionaire brothers/law/2014/05/19/ debate is far from over.” tarsn Wisconsin dispute,”iThe New York Times, February 22, 2011, available at http://www.nytimes. com/2011/02/22/us/22koch.html?pagewanted=all&_r= 0&gwh=0B626AC8B2B366653BA253150202019C&gwt =pay.

17 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina 53 Wisconsin State Legislature, “Assembly Bill 750,” avail- 64 Americans for Prosperity-Wisconsin, “AFP-WI Tax able at https://docs.legis.wisconsin.gov/2013/propos- Reform Town Hall-Oshkosh,” available at http:// als/ab750 (last accessed June 2014); Wisconsin State americansforprosperity.org/wisconsin/event/afp- Legislature, “Wisconsin Assembly: AB 750 Preemption wi-tax-reform-town-hall-oshkosh/ (last accessed of Local Living Wage Ordinances,” available at https:// August 2014); Americans for Prosperity-Wisconsin, docs.legis.wisconsin.gov/2013/related/votes/assembly/ “AFP WI-Tax Reform Town Hall-Green Bay,” available at av0370 (last accessed August 2014). http://americansforprosperity.org/wisconsin/event/ afp-wi-tax-reform-town-hall-green-bay/ (last accessed 54 Patrick Marley and Bill Glauber, “Wisconsin Senate August 2014); Americans for Prosperity-Wisconsin, passes concealed-carry bill,” Milwaukee Journal Sentinel, “AFP WI-Tax Reform Town Hall-Appleton,” available at June 14, 2011, available at http://www.jsonline.com/ http://americansforprosperity.org/wisconsin/event/ news/statepolitics/123826279.html. afp-wi-tax-reform-town-hall-appleton/ (last accessed August 2014); Americans for Prosperity-Wisconsin, 55 Wisconsin Department of Revenue, “Limited Liability “AFP WI-Tax Reform Town Hall-Green Lake,” available Companies (LLCs)”(L2014), available at http://www.rev- at http://americansforprosperity.org/wisconsin/event/ enue.wi.gov/pubs/pb119.pdf; North Carolina General afp-wi-tax-reform-town-hall-green-lake/ (last accessed Assembly, “Enacted Legislation North Carolina taxable August 2014); Americans for Prosperity-Wisconsin, income defined,” available at http://www.ncga.state. “AFP WI-Tax Reform Town Hall-Sheboygan,” available nc.us/EnactedLegislation/Statutes/HTML/BySection/ at http://americansforprosperity.org/wisconsin/event/ Chapter_105/GS_105-134.5.html (last accessed June afp-wi-tax-reform-town-hall-sheboygan/ (last accessed 2014); North Carolina Legislature, “Enacted Legislation, August 2014). Chapter 105,” available at www.ncleg.net/EnactedLeg- islation/Statutes/PDF/BySection/Chapter_105/GS_105- 65 Americans for Prosperity-Wisconsin, “Support the Tax 134.pdf (last accessed June 2014). Cut,” May 1, 2013, available at http://americansforprosperity.org/wisconsin/legislativealerts/support-the-tax- 56 Gallagher, “Business production tax break added to cut/. state budget”; Wisconsin Manufacturers & Commerce, “Phase-In of the Manufacturing & Agriculture Credit,” 66 Stein, “Some factory, farm owners would get an extra June 14, 2013, available at https://www.wmc.org/ tax break under Walker plan.” issues/issues-policy/phase-in-of-the-manufacturing- agriculture-credit/; Jason Stein, “Some factory, farm 67 Ibid. owners would get an extra tax break under Walker plan,” Milwaukee Journal Sentinel, March 1, 2014, avail- 68 Ibid. able at http://www.jsonline.com/news/statepolitics/ some-factory-farm-owners-would-get-extra-tax-break- 69 Ibid. under-walker-plan-b99215578z1-248046631.html. 70 Mike Ivey, “Windfall? Rich will get richer from new 57 Stein, “Some factory, farm owners would get an extra tax credit,” The Capital Times, May 23, 2012, available tax break under Walker plan.” at http://host.madison.com/business/biz_beat/ windfall-rich-will-get-richer-from-new-tax-credit/ar- 58 Gallagher, “Business production tax break added to ticle_bfe745dc-a44a-11e1-a1b6-001a4bcf887a.html. state budget.t 71 Gallagher, “Business production tax break added to 59 Patrick Marley and Jason Stein, “Scott Walker signs state budget. $541 million tax legislation,” Milwaukee Journal Sentinel, March 24, 2014, available at http://www.jsonline.com/ 72 Ibid. news/statepolitics/scott-walker-set-to-sign-tax-cut- legislation-b99231851z1-251936261.html. 73 Wisconsin Manufacturers & Commerce, “Phase-In of the Manufacturing & Agriculture Credit,” June 14, 2013, 60 Stand Against Spending. Stand with Walker, Americans available at https://www.wmc.org/issues/issues-policy/ for Prosperity Facebook, March 3, 2011-March 6, 2011, phase-in-of-the-manufacturing-agriculture-credit/. accessed on June 29, 2014, available at https://www. facebook.com/events/114184561992796/. 74 Tamarine Cornelius and Jon Peacock, “New Year Brings New Tax Cuts to Wisconsin” (Madison, WI: Wisconsin 61 Americans for Prosperity Foundation-Wisconsin, “AFP Budget Project, 2013), available at http://www.wiscon- Foundation-Wisconsin and the John K. Maciver Insti- sinbudgetproject.org/new-year-brings-new-tax-cuts- tute Air ‘Did it Right’ Commercial,” Press release, January to-wisconsin-previously-passed-cuts-and-credits-will- 3, 2013, available at http://americansforprosperityfoun- reduce-revenue-by-262-million-in-2013-15. dation.com/newsroom/afp-foundation-wisconsin-and- the-john-k-maciver-institute-air-did-it-right-commer- 75 Wisconsin Manufacturers & Commerce, “Phase-in of the cial. Manufacturing & Agriculture Credit.t

62 Americans for Prosperity Foundation, “A Better Wiscon- 76 Wisconsin Department of Revenue, “Tax Rates,” avail- sin Bus Tour,” available at http://americansforprosperity- able at http://www.revenue.wi.gov/faqs/pcs/taxrates. foundation.com/abetterwisconsin-2 (last accessed June html#tx1a (last accessed June 2014). 2014). 77 See endnote 8. 63 Craver, “Dark money. 78 See Appendix.

18 Center for American Progress Action Fund | Kochonomics in Wisconsin and North Carolina 79 Cornelius, “Breaking with Tradition.” 92 Fiscal Research Division, “Impact of House Bill 998, Session Law 2013-316” (2013), available at http:// 80 Ibid.; Wisconsin Budget Project, “Top 10 Reasons to www.ncleg.net/fiscalresearch/budget_legislation/ Increase Tax Credits for Low-income Households,” budget_legislation_pdfs/2013/conference/2013%20 February 6, 2014, available at http://www.wisconsin- Finance%20Charts%20for%20Web.pdf; Fiscal Research budgetproject.org/top-10-reasons-to-increase-tax- Division, “Impact of House Bill 82 (version 1), Session credits-for-low-income-households. Law 2013-10” (2013), available at http://kayhagan. us8.list-manage.com/track/click?u=b7ca917a5da8 81 Cornelius, “Breaking with Tradition.” 73f38b73941e5&id=5bed37d83d&e=27c0604ac9; Cedric Johnson, “Final tax pan falls far short of true 82 Bridge Project, “How Conservatives Took Over North tax reform” (Raleigh, NC: North Carolina Budget and Carolina” (2014), available at http://www.bridgeproject. Tax Center, 2013), available at http://www.ncjustice. com/research/how-conservatives-took-over-north- org/?q=budget-and-tax/btc-reports-final-tax-plan-falls- carolina/. far-short-true-tax-reform.

83 Parti, “GOP, Koch brothers find there’s nothing finer 93 Johnson, “BTC Brief: Who Pays in 2014 – Tax Plan Cre- than Carolina.” ates Winners and Losers in North Carolina.”

84 John Frank, “House, Senate differ on how to pay for NC 94 Johnson, “Final tax plan falls far short of true tax tax cuts,” News & Observer, May 16, 2013, available at reform.” http://www.newsobserver.com/2013/05/16/2897852/ house-senate-differ-on-how-to.html. 95 Mark Binker, “Breaking down the 2013 tax package,” WRAL, July 19, 2013, available at http://www.wral.com/ 85 Parti, “GOP, Koch brothers find there’s nothing finer breaking-down-the-2013-tax-package/12678653/. than Carolina”; Americans for Prosperity-North Carolina, “AFP Praises Tax Relief and Reform Compromise, Urges 96 Johnson, “BTC Brief: Who Pays in 2014 – Tax Plan Cre- Lawmakers to Support,” Press release, July 15, 2013, ates Winners and Losers in North Carolina.” available at http://americansforprosperity.org/north- carolina/newsroom/afp-praises-tax-relief-and-reform- 97 Ibid. compromise-urges-lawmakers-to-support/. 98 Ibid. 86 Americans for Prosperity-North Carolina, “Coastal Carolinas Taxpayers Association Tax Day Tea Party Rally,” 99 Forbes, “America’s Largest Private Companies: Koch available at http://americansforprosperity.org/north- Industries,” available at http://www.forbes.com/compa- carolina/event/coastal-carolina-taxpayers-association- nies/koch-industries/ (last accessed August 2014). tax-day-tea-party-rally/ (last accessed August 2014); Americans for Prosperity-North Carolina, “Moore 100 Georgia-Pacific, “North Carolina” (2013), available at County Tax Day Rally,” available at http://americansfor- http://www.gp.com/~/media/Corporate/GPCOM/Files/ prosperity.org/north-carolina/event/moore-county- State-Fact-Sheets/northcarolina.ashx. tax-day-rally-afp-foundation/ (last accessed August 2014); Americans for Prosperity-North Carolina, “NC 101 Liz Emanuel, “North Carolina Builds on Tax Reform, Back in the Game Tax Reform Rally,” available at http:// Repealing Burdensome Local Privilege Taxes,” Tax Foun- americansforprosperity.org/north-carolina/event/ dation, June 5, 2014, available at http://taxfoundation. nc-back-in-the-game-tax-reform-rally/ (last accessed org/blog/north-carolina-builds-tax-reform-repealing- August 2014); Americans for Prosperity-North Carolina, burdensome-local-privilege-taxes. “Rally in Raleigh!,” available at http://americansforprosperity.org/north-carolina/event/rally-in-raleigh/ (last 102 City of Wilmington, “Privilege License Fees” (2014), accessed August 2014). available at http://www.wilmingtonnc.gov/Portals/0/ documents/Finance/Budget/City%20of%20Wilming- 87 Americans for Prosperity-North Carolina, “Civitas Tax ton%20Fee%20Schedule.pdf. Reform Reception with WSJ’s Stephen Moore,” available at http://americansforprosperity.org/north-carolina/ 103 City of Creedmoor, “Fee and Rate Schedule 2014-2015” event/civitas-tax-reform-reception-with-wsjs-stephen- (2014), available at http://www.cityofcreedmoor.org/ moore/ (last accessed August 2014). modules/showdocument.aspx?documentid=121.

88 Americans for Prosperity-North Carolina, “RSVP Now 104 American Legal Publishing Corporation, “Section 110.35 for Grover Norquist Events,” Press release, May 8, 2013, Supplemental Schedule of Privilege Taxes, Asheboro, available at http://americansforprosperity.org/north- NC Code of Ordinances,” available at http://www.amle- carolina/newsroom/rsvp-now-for-grover-norquist- gal.com/nxt/gateway.dll/North%20Carolina/asheboro/ events/. cityofasheboronorthcarolinacodeofordinan?f=templat es$fn=default.htm$3.0$vid=amlegal:asheboro_nc (last 89 Brett Logiurato, “The incredible life of Grover Norquist, accessed July 2014). the man behind the GOP’s famous tax pledge,” Business Insider, December 1, 2012, available at http://www. 105 Gary D. Robertson, “NC Senate Committee backs omni- businessinsider.com/who-is-grover-norquist-pledge- bus tax bill,” Associated Press, May 27, 2014, available at signers-list-fiscal-cliff-republicans-tax-2012-11?op=1. http://www.washingtontimes.com/news/2014/may/27/ nc-senate-committee-backs-omnibus-tax-bill/. 90 Americans for Prosperity-North Carolina, “AFP-NC: New poll shows strong support for massive tax reform,” Press 106 Charles G. Koch, “Charles Koch: I’m fighting to restore a release, May 8, 2013, available at http://americansfor- free society,” The Wall Street Journal, April 2, 2014, avail- prosperity.org/north-carolina/newsroom/afp-nc-new- able at http://online.wsj.com/news/articles/SB1000142 poll-shows-strong-support-for-massive-tax-reform-2/. 4052702303978304579475860515021286.

91 Americans for Prosperity-North Carolina, “AFP-NC at the NC GOP Convention in Charlotte,” available at http:// americansforprosperity.org/north-carolina/event/ afp-nc-at-the-nc-gop-convention-in-charlotte/ (last accessed August 2014).

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