Foundation Watch

Noting “A Note for Foundation Representatives” from the Democracy Alliance

In mid-November, the Democracy Alliance held its invitation-only Fall Investment Conference at the luxurious La Costa Resort & Spa in Carlsbad, California.  The Alliance is a consortium of liberal and progressive donors that has been active, financially and otherwise, in orchestrating the activities of a permanent infrastructure for the left since 2004, as reported by InfluenceWatch.  It has conservative analogues.  Its members offer support to, among other organizations, political campaigns and committees directly, Super PACs for influence on politics “independently,” and groups exempt from taxation under the Internal Revenue Code’s 501 §§ 501(c)(3) and (c)(4).

Groups with (c)(3) status are considered by the Internal Revenue Service (IRS) to be charities and cannot participate in politics, but they are allowed to engage in public education about policy.  Philanthropic foundations are (c)(3)s, as are their grant recipients.  Groups with (c)(4) status are considered by the IRS to be “social-welfare” groups — which can participate in politics, as long as politics does not become their primary focus.

A version of the conference agenda was obtained and published by The Washington Free Beacon.  On its first page of full text, entitled “Participation Guidelines,” there is a “Note for Foundation Representatives.”  The note says (c)(3) “Foundation Representatives should review the agenda and decide whether there are any sessions which they believe would not be appropriate for them to attend, or prefer to attend in their personal capacities.  Democracy Alliance staff and counsel are available to discuss any questions about the content of the sessions.”

Hmmm, curious.  Why the note?  It sure seems plausible to conclude that someone — if even only the agenda preparer — was justifiably a little worried about (c)(3) foundation-representative attendees becoming involved with only (c)(4)-permissible or in actual outright politics if they went to certain sessions.

Peruse the full conference schedule, maybe even just in your personal capacity.  Or, for fun, read it like an IRS official, maybe one who used to work for Lois Lerner.

Michael E. Hartmann

Michael E. Hartmann is CRC’s senior fellow and director of the Center for Strategic Giving, providing analysis of and commentary about philanthropy and giving. He…
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