I know it is Friday and the last thing you want is homework. BUT...these are the guys we are up against all the time in Congress and especially when it is time to vote. -- Tax Filings Hint at Extent of Koch Brothers’ Reach By NICHOLAS CONFESSORE Published: September 12, 2013 A single nonprofit group with ties to Charles G. and David H. Koch provided grants of $236 million to conservative organizations before the 2012 election, according to tax returns the group is expected to file Monday, underscoring the broad reach of the political movement the two business executives and their advisers have built in recent years. Charles G. Koch, above, and David H. Koch, the billionaire industrialists, seek to stay in line with tax laws as they use their wealth to support libertarian causes in elections nationwide. Freedom Partners gave $32.3 million to Americans for Prosperity, a conservative political organization co-founded by David H. Koch. Freedom Partners, as the group is now known, is playing a bigger role for the Kochs as the brothers seek a tighter rein over the advocacy groups and political organizations that their donor network finances and expand their involvement in Republican political causes. The group, formerly known as the Association for American Innovation, functions as a clearinghouse for money and message strategy. Like other such groups on the right and left, Freedom Partners raises money from donors and then distributes it to other groups — most of them other nonprofits that mix issue advocacy and election advertising — to spend. The arrangement gives the donors an extra layer of anonymity and blurs the original source of money that fuels controversial campaigns. The scale of Freedom Partners’ fund-raising is striking: It raised $256 million between November 2011 and last year’s election, according to the returns, details of which were reported on Thursday by Politico. That rivals or exceeds the annual budgets of the largest advocacy groups in the nation, like the National Rifle Association and the U.S. Chamber of Commerce. But the returns also reflect a significant shift in the tax strategies the Koch operation deploys to avoid challenge from the Internal Revenue Service, which limits how much nonprofit groups can spend to aid or defeat candidates. Other donor clearinghouses, along with nearly all of the political groups they support, register with the I.R.S. as “social welfare” groups under Section 501(c)4 of the tax code. That has let such groups spend money on elections while keeping their donors secret — drawing increasing regulatory and legislative scrutiny from critics who assert that some of the groups are violating campaign laws. But Freedom Partners established itself in November 2011 as a 501(c)6 “business league,” typically a trade association of corporations, like the Chamber of Commerce, organized to promote a common business interest. Instead of donors, it has more than 200 “members,” each making a minimum $100,000 contribution, which Freedom Partners classifies as member dues. The approach gives it many of the same advantages social welfare groups have, with one significant addition: Some contributions to the group may be tax deductible as business expenses. A spokesman for Freedom Partners declined to comment. But according to the group’s Web site, “Freedom Partners’ principal goal is to educate the public about the critical role played by free markets in achieving economic prosperity, societal well-being, and personal happiness.” A majority of the Freedom Partners board consists of longtime Koch employees, like Richard Fink, an executive vice president of Koch Industries who supervises the brothers’ public relations, lobbying and political operations. The organization primarily finances activism in four areas: health care overhaul, federal spending, energy policy, and what its Web site calls “cronyism” between government and business. Freedom Partners grants went to groups that included the American Future Fund, an Iowa-based conservative group active in the 2012 elections, and an array of smaller, Tea Party-affiliated organizations, such as Tea Party Patriots. In some cases, the money went to other clearinghouses, like the Arizona-based Center to Protect Patient Rights, a group that received $115 million from Freedom Partners (the most of any recipient) and that has helped finance opposition to President Obama’s health care law. The center faces an inquiry by California election officials over allegations that it broke disclosure rules in funneling millions of dollars into state ballot initiatives in 2012. Koch strategists indicated this year that the center would play a smaller role in the brothers’ political operation in the future. Freedom Partners also gave $32.3 million to Americans for Prosperity, a conservative political organization co-founded by David Koch. “We are grateful for all the support from groups like Freedom Partners and the many others that help us in our fight for economic freedom,” said Levi Russell, a spokesman for Americans for Prosperity. A version of this article appears in print on September 13, 2013, on page A14 of the New York edition with the headline: Tax Filings Hint at Extent Of Koch Brothers’ Reach. Get Home DeliveryTry unlimited access to NYTimes for just 99¢.
Posted on: Fri, 13 Sep 2013 18:58:45 +0000
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