Financial Fiddling at Fidelis?

Originally posted at Talk to Action.

The Catholic Right, Part Sixty-one

A little more than a year ago Fidelis, an umbrella advocacy group consisting of various not-for-profit entities, sought to derail the presidential prospects of pro-choice Republican (and Catholic) Rudy Giuliani. It is now going after presumptive Democratic presidential nominee Barack Obama (the junior senator from Illinois is also pro-choice, pro-embryonic stem cell research, and perhaps what truly horrifies these folks, he favors contemporary liberal economics).

However, my question of May 2007 still stands: Is Fidelis violating the Internal Revenue Code's provisions regarding not-for-profits?

If you visit the Fidelis web site, you will be confronted with a cornucopia of Catholic Right causes. Under "Issues" the only subsections we find are Abortion, Education (focusing exclusively on school vouchers) and Traditional Marriage ("Marriage is the union of one man and one woman"). A November 14, 2007 press release congratulates the U.S. Conference of Catholic Bishops "...for asserting the primacy of opposing abortion."

The site makes no mention of deeply established Catholic Social Justice issues such as distributive justice economics, immigration or poverty. Fidelis quickly reveals a Catholicism that is dark, exclusionary and joyless. At the top of the home page there is a banner that reads "Headlines," under which parades an endless stream of angry storylines often with hard-line conservative overtones (and having precious little relevance to Catholic social teachings).

Also revealed is Fidelis's dislike of Senator Barack Obama's candidacy for president. The Media Center's Press Section links to pronouncements such as Obama Slams Door on Education 'Change' as well as Jindal Record of Reform Making Strong Case for VP.

The piece on Obama and vouchers contains the very political exhortation "Despite the rhetoric, Barack Obama is not the candidate of change in education" while the one on Jindal contains similar-sounding electioneering content such as:

"A strong record of ethics and education reform is just what the doctor ordered to combat the perceptions of a lethargic, corrupt GOP that voters ousted from Congress in 2006," said Brian Burch, President of Fidelis.

"With his ethics bill and education plan, Governor Jindal is blazing a trail for Republican reform in the Bayou," said Burch.

"Adding Bobby Jindal to the ticket would reinforce John McCain's strong message of reform and would convince independents that the GOP learned the lessons from 2006."

There are other excellent reasons for selecting the Louisiana governor, Burch said.

In Part Thirteen of this series, I questioned the financial dealings of the Catholic Right group Fidelis. What drew my attention was this observation from a flyer the fervently anti-abortion organization was handing out against then-presidential candidate Rudy Giuliani:

...this brings us to a possible legal problem for the Fidelis family, as the activities of one family member may get another in trouble. ...At the bottom of both of the Giuliani-targeted Fidelis press releases is a statement very much worth noting:

Paid for by Fidelis America PAC_P.O. Box 277 Chelsea, MI 48118_Joseph J. Cella, Treasurer Not Authorized by Any Candidate or Committee

These releases-very clearly designed to influence the 2008 presidential election--are posted on what appears to be the joint web site for several related organizations, Fidelis, Fidelis America, Fidelis Media Fund, and Fidelis Center for Law and Policy, respectively, a political lobby, a PAC, a 527 political committee. On donation page the organization describes itself as a 501 (c)(4) tax-exempt organization, but has no separate donation capability for its PAC.

Still, at the writing of this piece, the About" page describes Fidelis in this manner:

Fidelis consists of four organizations:

The universal name Fidelis is our flagship 501(c)(4) membership organization engaged in lobbying, public education, and the advancement of issues related to life, faith, and family.

Under its universal designation, Fidelis works to shape public debate and formulates public policy that promotes religious freedom, values human life and upholds the institutions of marriage and the family.

Fidelis Political Action is a federal Political Action Committee (PAC). Members of Fidelis can contribute to this PAC to help elect candidates who support a culture of life, traditional marriage and family friendly policies.

Fidelis Center for Law and Policy is our 501(c)3 legal and educational arm established to organize, coordinate, and engage in strategic litigation designed to defend religious liberty, the traditional family, and a culture of life. The Center works with expert attorneys across the country to initiate, fund, and coordinate legal efforts.

Fidelis Media Fund is a public-education entity set up as an IRS Section 527 organization. The Media Fund participates in public education campaigns to champion religious freedom, a culture of life and marriage and the family by engaging voters and concerned citizens on important policy issues and judicial nominations. The media fund develops compelling and sharply-focused mailings, print, radio and television advertising to reinforce grassroots initiatives on these same fronts. Our team is reinforced by media experts who have a wealth of experience in political and corporate media projects.

There is still no separate donation capability for its PAC.

Internal Revenue Code; 501(c)(3) not-for-profit charities or foundations are described as:

organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation (except as otherwise provided in subsection (h)), and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office. (italics added)

The activities Fidelis's various entities raise a few troubling questions. Do the pro-Jindal and anti-Obama pronouncements constitute what the IRS describes as behavior designed to "intervene in a political campaign" -- activities from which non-profit tax exempt organizations are prohibited?

The IRS was very clear about this kind of thing in the run-up to the last federal elections:

"...all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office."

...further down stating in no uncertain terms:

Although section 501(c)(3) organizations may engage in some activities to promote voter registration, encourage voter participation, and provide voter education, they will violate the prohibition on political campaign intervention if they engage in an activity that favors or opposes any candidate for public office.

While a visit to the Fidelis web site reveals many things, its finances remain murky and suggests a possible -- and possibly illegal -- co-mingling of its efforts, and its contributions to both its PAC and 527 Media Fund.

The question still stands: Is Fidelis violating the Internal Revenue Code's provisions regarding not-for-profits?

The Catholic Right: A Series, by Frank L. Cocozzelli