Late yesterday, Common Cause dropped a bombshell. It intends to file a complaint with the IRS alleging that the American Legislative Exchange Council is abusing its nonprofit status. Specifically, Common Cause claims that ALEC is a lobbying organization masquerading as a charity.
ALEC is formed as a nonprofit that brings together lawmakers and private sector organizations to develop legislation and policy.The complaint is due to be released later today.
ALEC says its work is not lobbying.
Common Cause disagrees. "It tells the IRS in its tax returns that it does no lobbying, yet it exists to pass profit-driven legislation in statehouses all over the country that benefits its corporate members," said Bob Edgar, president of Common Cause, in a statement. "ALEC is not entitled to abuse its charitable tax status to lobby for private corporate interests, and stick the bill to the American taxpayer."
Common Cause wants an IRS audit of ALEC's work, penalties and the payment of back taxes.
According to extensive pieces that ran in yesterday's NYT and on this morning on Morning Edition, ALEC claims it does no lobbying. However, Common Cause claims that ALEC spends two-thirds of its budget on lobbying. Additionally, corporate lobbyists and state legislators work together on ALEC panels to draft legislation.
The complaint is based on 4,000 pages that Common Cause has obtained over the last year. They include spreadsheets for ALEC-crafted bills, as well as talking points.
This is easily the biggest salvo yet against ALEC. From my layman's perspective, it's going to be awfully hard for ALEC to reconcile its claim that it doesn't lobby with all this documentation that shows how it works to get its bills passed.
7:09 AM PT: Since this made the rec list, I thought I'd note just how dumb this sounds on ALEC's part. Practically all of the major pressure groups that immediately come to mind--PFAW and the NRA, for starters--have separate organizations that are devoted exclusively to lobbying. And they all do it legally. Surely with the millions in ALEC's warchest, it could have done the same.