Test Case Could Slash Donations to Radical Environmental Groups; Frontiers Of Freedom Institute Files Complaint Against RAN
Copyright 2001 U.S. Newswire, Inc
June 22, 2001
WASHINGTON, June 22 - In what will be a test case of whether many environmental groups are violating tax laws, the Frontiers of Freedom announced today that it has filed a complaint with the Internal Revenue Service against the Rainforest Action Network (RAN) to effectively deny the group its tax-exempt status.
RAN, a nonprofit corporation established as a Section 501(c)(3) "educational" organization, has clearly violated tax laws by engaging in pressure campaigns, boycotts, and what it calls "direct action," Frontiers says. These activities clearly aren't "educational" -- but instead constitute "advocacy" activities. That would require RAN to file as a Section 501(c)(4) organization -- and forgo tax-exempt status.
"It's obvious that RAN wants to have it both ways," said George Landrith, Frontiers of Freedom's executive director. "It wants to operate as an advocacy group but enjoy tax-exempt status so it can rake in tax-deductible contributions.
"The end result is that taxpayers subsidize protests, boycotts and pressure campaigns. The law was designed to ensure that these types of activities would not be tax exempt."
RAN's own materials say: "Rainforest Action Network is not your typical band of tree-huggers." A small sample of RAN's strategies include:
-- On October 16, 1996, RAN coordinated protest actions in five cities resulting in six arrests. In one city, a police SWAT team was called upon to remove climbers from a building where they hung a 900-square-foot banner.
-- On May 25, 1999, RAN orchestrated a day of "ethical shoplifting," in which lumber was stolen from a Home Depot store and delivered to an FBI office.
-- On September 19, 2000, RAN activists occupied or blocked presidential candidate Al Gore's campaign offices in three cities.
-- On March 29, 2001, RAN activists broke into and rappelled from a building in Boise, Idaho, to hang a banner attacking Boise-Cascade. The incident forced the closure of a downtown Boise street and resulted in the arrest of three people, including senior RAN staff member Jennifer Krill.
Landrith said that many non-profits, such as the conservative Frontiers of Freedom organization and environmental organizations such as the Sierra Club, set up separate educational and advocacy organizations to comply with tax laws.
In the complaint to the IRS, Frontiers says: "While people have every right to form groups and forcefully express their opinions, RAN's founders chose to organize RAN as a non-profit dedicated solely to educational purposes in order to have access to tax-deductible contributions....
"...(F)or taxpayers who are footing the bill for advocacy activities they may not support, this is an unacceptable arrangement. It is also clearly prohibited by law."
"Losing its tax-exempt status could seriously jeopardize RAN's funding," Landrith said. "But that's the price you pay for advocacy.
"Other radical groups could eventually lose their tax-exempt status as well," Landrith noted. "This could have a profound impact on radical environmentalist groups that are skirting our nation's tax laws. This will force them to find legitimate ways to raise money -- and that won't be easy."
The complaint can be read online at http://www.ff.org