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Catholic Campaign for Human Development 2011: Part 5
Taxing Issues – Funding DuPage Sponsors and Lake County Sponsors
Stephanie Block
“IAF [Industrial Areas Foundation] is not a political organization; however, its efforts are definitely political. IAF doesn’t endorse candidates; rather, it asks government officials, politicians, and business leaders to endorse IAF positions.” 1
The above bit of doublespeak is at the crux of much frustration critics have over the Alinskyian organizing that occurs inside of religious congregations. Political efforts on the part of organizations that are “not” political, to find candidates that endorse their positions rather than endorsing candidates (is there really a difference?) is wordplay.
In this installment of the CCHD 2011 series, consider two of the 2010 CCHD grantees, namely DuPage Sponsors, awarded $45,000, and Lake County Sponsors, awarded $40,000. Both these organizations are affiliates of the Industrial Areas Foundation (IAF), the oldest of the Alinskyian organizing networks.
What’s interesting about these two organizations is that both are 501c-3. That is, these are non-profit organizations that, as such, may not work to influence legislation as a substantial part of their activities or participate in political campaign activity. In exchange for this status, charitable donations to 501c-3 organizations are tax-exempt, encouraging greater generosity.
However, the IAF and every other Alinskyian organization’s raison d'être isto influence legislation and political campaigns (see above quote) so being a 501c-3 is only useful during its early, organizational stage. Once the local is established, it needs to get down to the work it was designed to do. But political “efforts” cost money.
The solution to this has been to create parallel 501c-4 organizations. DuPage Sponsors’ 501c-4 is DuPage United 2; Lake County Sponsors’ 50c-4 is Lake County United.3
The 501c-3 raises capital for the 501c-4. “Having both types in an affiliated structure, in conjunction with ‘carefully managing the flow of money and staff between the two organizations,’ allows groups to ‘receive tax-deductible donations and foundation gifts and continue to lobby extensively without violating the law’.” 4
Affiliated 501c-3/501c-4 organizations “may share employees, facilities, equipment and other overhead items,” even a joint website, “provided that each organization pays its share of salary, rent and other shared expenses.” Most interestingly, the “501(c)(3) organization may make grants to its affiliated 501(c)(4) organization ("Grants"); provided, however, that the Grants are used exclusively to further the 501(c)(3) organization's exempt purposes.” 5
It’s quite legal.
And extremely fascinating from the perspective of the citizen pew-sitter who discovers his philanthropic donations areused for political purposes, often with the effect of electing pro-abortion politicians…though, of course, the organization is “not” political and is only looking for candidates that endorse its political positions, which have nothing to do with abortion (abortion being “too controversial” an issue, they explain).
Think about that, when the CCHD collection comes around.
1 Informational material about local IAF affiliate, People Acting Together in Howard (PATH), Columbia United Christian Church website: www.cucc-md.org/index.php?option=com_content&task=view&id=57&Itemid=132
2 DuPage United, “How to Contribute:” www.dupageunited.org/howtocontrib.html
3 Donations to Lake County Sponsors - Lake County United: www.lakecountyunited.org/donations.htm
4 Emily Chan, “Affiliated 501(c)(3) and 501(c)(4) Organizations,” Nonprofit Law Blog, 8-10-08: www.nonprofitlawblog.com/home/2008/08/affiliated-501c.html Quoting then deputy director of the National Committee of Responsive Philanthropy (NCRP), Jeff Krehely, “Maximizing Nonprofit Voices and Mobilizing the Public,” Winter 2005.
5 Gene Takagi, “Formation and Control of a 501(c)(3) Affiliate,” Nonprofit Law Blog, 7-29-06: www.nonprofitlawblog.com/home/2006/07/formation_and_c.html