Common Cause asks state probes of ALEC | Arkansas Blog

Friday, May 11, 2012

Common Cause asks state probes of ALEC

Posted By on Fri, May 11, 2012 at 10:14 AM

With the American Legislative Exchange Council currently meeting in Charlotte with legislative stooges on plotting new corporate-agenda state legislation, Common Cause has called on state attorney generals to investigate ALEC for its compliance with tax and lobbying laws.

“ALEC, the ‘charity’ that’s not a charity and the lobby that claims it doesn’t lobby, is at it again,” said Common Cause president and CEO Bob Edgar. “The ‘task forces’ it is convening in Charlotte this weekend are about to be spoon-fed another helping of legislation written by corporate executives and lobbyists and designed to advance private interests at public expense.”

Contributions to ALEC are tax deductible, Common Cause notes, but it is no charity. It exists to work for anti-tax, anti-regulation, anti-health care reform and other conservative agenda items with the help of like-thinking state legislators, nearly all of them Republican.

Common Cause had earlier complained to the IRS about ALEC's blatant political activities as a tax-favored "charity."

Attorney General Dustin McDaniel was on the list of 29 to whom Common Cause mailed letters. I've asked the office for comment on reviewing political advocacy (so blatant that Sen. Missy Irving used an ALEC employee to support her effort to torpedo health care reform legislation) by a nonprofit.

UPDATE: McDaniel's office said he'd not yet received the letter, but a spokesman said: "Regardless, he believes that non-profits should all play by the same rules and those rules should be enforced uniformly and vigorously at the state and federal level." Not exactly a yes or no on an examination.

COMMON CAUSE RELEASE

WASHINGTON, DC – As state legislators and corporate leaders gathered in Charlotte, N.C. to draft a new series of “model” bills for the American Legislative Exchange Council (ALEC), Common Cause announced Friday that it has asked state attorneys general from coast-to-coast to examine the business lobby’s compliance with tax and lobbying laws.

“ALEC, the ‘charity’ that’s not a charity and the lobby that claims it doesn’t lobby, is at it again,” said Common Cause president and CEO Bob Edgar. “The ‘task forces’ it is convening in Charlotte this weekend are about to be spoon-fed another helping of legislation written by corporate executives and lobbyists and designed to advance private interests at public expense.”

Common Cause has sent letters to 29 state attorneys general requesting that they investigate whether ALEC’s lobbying violates its tax-exempt status. “ALEC calls itself a charity and the corporations that support it get a federal tax deduction for their contributions. But it’s clear that ALEC’s lobbying is anything but charitable,” Edgar said. “It’s critical that state authorities examine ALEC’s activities and determine whether it’s following appropriate tax and lobbying laws.”

The Common Cause letters come on the heels of an Internal Revenue Service “whistleblower” complaint the non-partisan government watchdog organization filed against ALEC last month,

“This weekend’s meetings in Charlotte are ALEC’s first get-togethers since thousands of pages of ALEC documents obtained and released by Common Cause gave Americans a clear picture of the breadth of ALEC’s agenda and the extent of its lobbying,” Edgar observed. “States should take a hard look at both.”

Common Cause’s formal submission to the Internal Revenue Service Tax Whistleblower Office charges that ALEC’s primary purpose is to serve as a vehicle for corporations to do taxpayer-subsidized lobbying. The ALEC emails, “issue alerts,” position papers and other materials filed with it show extensive ALEC efforts to lobby state lawmakers and influence a wide range of legislation, clearly violating the terms of its tax-exempt status.

The prominent whistleblower law firm Phillips & Cohen LLP is representing Common Cause pro bono on the IRS complaint. Phillips & Cohen has recovered more than $7 billion in fines and settlements for governments as a result of its whistleblower cases. The complaint seeks an IRS audit of ALEC and the payment of back taxes and penalties.

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