WASHINGTON - January 30 - The National Committee for Responsive Philanthropy
(NCRP) today decries the exclusion of Abramoff-type abuse of
foundations and nonprofits from the gamut of lobbying reform
legislation being debated on Capitol Hill.
"These legislative efforts ignore largely untraceable loopholes,
which if neglected in this round of lobbying reform, would leave the
charitable sector, Congress, and K Street ripe for more abuse and
illegal behavior," said Rick Cohen, executive director of NCRP. "The
Abramoff affair should be a clarion call to prevent politicians,
their campaign staff, and their K Street cronies from cloaking dirty
dealings behind charity and philanthropy," he continued.
The political abuse of charities’ tax-exempt status erodes the
public’s trust in government as well as in the charitable sector,
two entities that have been charged to be fiscally responsible and
straightforward with public dollars. NCRP urges Congress to ensure
that comprehensive lobbying reform includes regulation and
disclosure of lobbyists’ and politicians’ charitable activities.
Immediate steps must be taken to expose the political misuse of
foundations, to improve the ethical workings of the lawmaking
process and restore trust in Congress, and to prevent future abuse
and mitigate the growing public distrust of the nation’s nonprofit
Based on NCRP’s monitoring of the Abramoff case (and others), we
call on lawmakers to incorporate into any and all legislation that
deals with lobbying reform the following:
- Full disclosure of donors and grants. Any foundation or
charity established by or connected to members of Congress should
be required to disclose the source of its donations as well as a
detailed account of expenditures. Under federal law, the names of
donors to charities are protected from the public, but that rule
should not apply to tax-exempt groups founded by or affiliated
with lawmakers. Members of the House and Senate, even after
leaving public office, make and influence policy decisions that
affect every citizen; therefore, the public has a right to know
fully the interactions of politicians with lobbyists, especially
under the cover of nonprofits.
- Tighter ethics rules to govern lawmakers. The growth in
the number of charities that operate as political fronts stems
from the 2003 repeal of a rule that barred House of
Representatives members from accepting reimbursement for travel
and lodging expenses in connection with charity events. Under the
current standards, lawmakers and their families can participate in
charity fundraising events without disclosing how much money they
or their charity receive. These standards allow for lobbyists to
buy face time and access to these lawmakers.
- Increased dollars for Internal Revenue Service oversight
and enforcement. Many nonprofit leaders have urged state and
federal governments to step up enforcement of tax-exempt law, but
too few have done anything to press for more money to be channeled
to regulators. Now more than ever, the foundation excise tax needs
to be used for its original purpose: funding government oversight
of the tax-exempt sector.
- Better disclosure of financial transactions and donor
records among different types of nonprofit organizations (c3s,
Cohen’s article in Responsive Philanthropy’s Fall 2004
issue, "Abramoff: Well- Connected to the Well-Heeled of the Right,"
was one of the first to bring to light to Jack Abramoff’s abuse of
his Capital Athletic Foundation as a tool to funnel money from
various interest groups, including Native American tribes, to
himself, his colleagues and business partners, and prominently
ranked lawmakers on Capitol Hill.