As the 2012 campaign revs up, nonprofit corporations that engage in political advocacy are becoming prominent once again.
And once again, voters will know nothing about their finances until long after they cast their ballots, and will never know the identities of the donors who fund them.
Take a look at two politically active nonprofit entities, Americans for Tax Reform, presided over by anti-tax zealot Grover Norquist, and one called Taxpayer Network.
Both claim to protect taxpayers' interests. Both sought to influence politics in 2010. Here we are in October 2011, and neither has released any information about its 2010 finances.
Granted, public disclosure by nonprofit corporations is not the world's most pressing issue. But here's a reason to care: these entities seek to sway policymakers, and benefit mightily from the tax code.
You'd think they could bestir themselves to meet a few basic requirements, like filing their public tax returns, more or less by the April 15 deadline that most of us meet.
From his base in Washington, D.C., Norquist has attained prominence on tax issues, having cajoled most Republican members of Congress and state legislators to sign pledges promising to never raise taxes. Republicans know they risk their careers if they cross Norquist.
Taxpayer Network is obscure, operating little more than a website in which it describes itself as a "nonprofit public benefit corporation" whose goal "is to educate the public about the policies and policy-makers involved in issues of taxation, spending and regulation of the economy."
Its lofty stated goals notwithstanding, Taxpayer Network was a shell until the end of the 2010 campaign, when it received an infusion of money and aired a vicious television ad attacking Sen. Barbara Boxer, claiming she had voted against injured war veterans and in favor of giving Viagra to pedophiles.
After leveling its over-the-top attack, Taxpayer Network sought to slink back into anonymity. And it would be forgotten, except that having written about Taxpayer Network and its sleazy ad last year, I feel a certain obligation to keep track of it.
Although little about Taxpayer Network is public, this we know: Its address was in a strip mall mail drop in Rocklin, and Republican consultant Dave Gilliard of Sacramento created the spot.
Gilliard's clients include Rep. Darrell Issa, the San Diego-area Republican who heads the House oversight committee and is perhaps Congress' wealthiest member, and who often spends his own money on campaigns. Gilliard declines to say who paid for the Taxpayer Network's 2010 commercial.
Far be it from me to suggest that Taxpayer Network skirted the law governing tax-exempt corporations. But the law is fuzzy on fundamental questions related to such corporations. They cannot spend all their time working on campaigns, but the amount of time is in dispute. Some attorneys say they are permitted to spend up to 49 percent of their time engaged in campaigns. Paul Ryan, attorney for the Campaign Legal Center in Washington, believes the allowable level is far lower, 20 percent or less.
Ryan's nonprofit sent a letter to the Internal Revenue Service last week challenging the tax-exempt status of several high-profile nonprofits, including Priorities USA, recently co-founded by former Obama administration spokesman Bill Burton; Crossroads GPS, inspired by George W. Bush's adviser, Karl Rove; and Americans Elect, which seeks to draft a centrist candidate to run in the 2012 presidential election.
"My hopes are high. My expectations are low," Ryan told me. "I don't know whether there is the political will at the IRS to tackle this issue in a presidential election year." Nonprofit corporations get the sweetest of all tax breaks. They don't have to pay taxes. In exchange, they have a few obligations, one of which is that they are supposed to release parts of their tax returns to anyone who asks.
I've been asking Americans for Tax Reform and Taxpayer Network for their returns since early in the summer. Not that I'll learn much once I receive them.
Such returns show revenue, expenses and a few other details such as salaries of top officers. Back in 2009, Norquist's compensation was $222,419, according to the tax return covering that year. Not bad.
Norquist press secretary John Kartch sent me a note Aug. 17, saying the tax return for Americans for Tax Reform and the related Americans for Tax Reform Foundation "would available shortly." On Aug. 29, he told me that "we anticipate having them ready this week."
When I checked back on Thursday, a month later, I got this note: "I'm sorry but it is not available." At least Kartch had the courtesy to answer.
Taxpayer Network has been ignoring me since Aug. 29, when I received this note from its lawyer, Paul Sullivan of Washington, D.C.:
"As you are aware, the organization has 30 days during which to comply with the written request for a copy of the return. That having been said, I will work to expedite getting the return to you since I presume you are on a deadline."
I sent him another note asking for the return last week, 30 days after he promised it to me. Sullivan did not get back to me until Friday afternoon when he apologized for the oversight and promised to deliver the tax return Monday.
No doubt, I'll get the tax returns. Taxpayer Network and Americans for Tax Reform are, after all, operating in the public interest. I'll let you know what they say.