THE SECRET G.O.P. CAMPAIGN

By VIVECA NOVAK AND MICHAEL WEISSKOPF/WASHINGTON

Two weeks before the 1996 election, Democrat Bill Yellowtail was in a neck-and-neck race for Montana's only House seat when a TV ad swooped out of the Big Sky. "Who is Bill Yellowtail?" it opened. "He preaches family values, but he took a swing at his wife." Yellowtail lost. A year later he's still trying to figure out who really took a swing at him. The ad's sponsor was a nonprofit group with a do-gooder name, Citizens for Reform. But the deeper mystery was how the organization knew to air a domestic incident more than 20 years old. Republican documents obtained by TIME help piece together this puzzle. What they point to is the possibility that G.O.P. candidates and groups that purport to be independent may have broken election law by coordinating their strategy.

Citizens for Reform was really a shell for Triad Management Services, a firm based in Washington that matches conservative donors with candidates and causes. In late September, a Triad agent huddled with the campaign of Yellowtail's opponent, Rick Hill, and figured out how to help. According to a Triad memo, Hill needed a "3rd party to expose Yellowtail" on "wife-beating." Citizens for Reform launched its ad a couple of weeks later, sparing Hill the indignity of playing the mudslinger. It was a turning point in the race, and it appears to be a prime example of the new dirty word in the financing of elections: coordination.

The term is shorthand for a kind of collaboration forbidden under the law: a party and its candidates are not allowed to direct outside groups to take action on their behalf--and that includes making ads. In addition, any ads paid for by these groups cannot explicitly advocate the election or defeat of a candidate, even if they praise or trash the candidate in other ways. As long as organizations obey these technicalities, they don't have to disclose their activities publicly and can spend an unlimited amount of money on campaigns.

The G.O.P. has long charged that the Democrats and the AFL-CIO must have coordinated their efforts in 1996 as the union shaped its $35 million campaign attacking individual Republican candidates. But the G.O.P. has never had much proof. Instead, new material in the hands of Senator Fred Thompson's investigating committee raises questions about whether groups friendly to his party knew where to target their ads and what message to use.

In the last weeks of the '96 race, Americans for Tax Reform, a nonprofit group headed by Grover Norquist, paid for a campaign burnishing the Republican image on the Medicare issue as well as an ad attacking New Jersey Democratic Senator Bob Torricelli. About the same time, Norquist's group received $4.6 million from the G.O.P. Norquist and party officials have denied coordinating their efforts. But bank records reviewed by TIME show that four days after a $2 million G.O.P. infusion, Americans for Tax Reform paid $280,000 to buy time for the anti-Torricelli ad, an expense the group could not cover otherwise. An additional $600,000 was paid out for phone banks and direct mail less than two hours after the same amount came in from the R.N.C.

Other documents turned over to the Senate Governmental Affairs Committee by Bob Dole's presidential campaign further erode Norquist's protestations of independence. R.N.C. deputy finance director and close Dole adviser Jo-Anne Coe directed a $100,000 contribution to Norquist's group from banana baron Carl Lindner two weeks before the election. "Keep up the good work," she wrote Norquist. Norquist did not return a telephone call seeking comment. An R.N.C. spokesman said the party never dictated the use of money given to Norquist's group; Dole, meanwhile, has volunteered to answer questions from Thompson's committee this week.

Of all the groups in the G.O.P. universe, Triad was one of the most effective at helping the party's cause behind the scenes. Citizens for Reform and another Triad shell group ran ads affecting more than two dozen congressional campaigns after a Triad consultant surveyed each one to determine how best to make a difference. Triad attorney Mark Braden denies there was collaboration, but if there was in the Hill-Yellowtail contest, it did make all the difference.