Democratic Governors Association Accused of Union Dues Laundering Scheme Tied to Josh Shapiro’s 2022 Campaign
The Democratic Governors Association (DGA), chaired by Minnesota Governor Tim Walz, is under scrutiny following allegations of a $1.5 million union money laundering scheme involving the Pennsylvania State Education Association (PSEA) and the 2022 gubernatorial campaign of Governor Josh Shapiro.
According to a report by the Freedom Foundation, a conservative watchdog group, the DGA allegedly collaborated with the PSEA to funnel union dues through a shadow political fund and back into the Shapiro campaign — a move that may have violated Pennsylvania campaign finance laws and sections of the Internal Revenue Code.
Allegations of Illegal Campaign Contributions
The complaints, which were filed with both state and federal authorities, allege that the PSEA made two six-figure contributions from its general treasury funds to the Fund for Student Success (FSS) — a political action entity operated by the union. The FSS then transferred these funds to the DGA, which ultimately contributed significantly to Governor Josh Shapiro’s successful 2022 campaign.
Pennsylvania law prohibits unions from contributing general treasury funds directly to political candidates. However, federal rulings allow unions to independently purchase ads supporting or opposing candidates — a distinction the Freedom Foundation claims was deliberately ignored in this case.
“PSEA’s scheme to secretly launder nearly $1.5 million in members’ dues through the Democratic Governors Association to support Josh Shapiro’s 2022 candidacy appears to have violated both an array of Pennsylvania laws and the Internal Revenue Code,” said Maxford Nelsen, Director of Research and Government Affairs at the Freedom Foundation.
Union Leadership Accused of Deceiving Members
Nelsen further criticized union leadership, stating that PSEA executives knowingly circumvented legal restrictions while deceiving their own membership base — Pennsylvania public school teachers — about how their dues were being spent.
“Pennsylvania teachers deserve to know that their union’s assurances — that dues deducted from their hard-earned paychecks aren’t used for political purposes — are worth no more than a politician’s campaign promises,” Nelsen said.
The Freedom Foundation called the alleged actions “willful violations” of the law, citing internal knowledge among union officers about legal boundaries they purportedly chose to ignore.
Political Implications for the DGA and Governor Walz
The investigation also raises political concerns for Governor Tim Walz, who chairs the Democratic Governors Association and previously served as Kamala Harris’s running mate during her 2024 presidential campaign. The timing of the alleged misconduct, during a high-stakes election cycle, has intensified scrutiny of the DGA’s political financing practices.
Ongoing Legal and Political Fallout
While no formal charges have been filed yet, the case could have significant implications for campaign finance law enforcement in Pennsylvania and beyond. Legal experts expect that state and federal investigations could follow if the allegations prove substantiated.
Leave a Comment