Hamilton Center, a nine-county behavioral health system, may have violated federal tax law by making political contributions to Terre Haute mayoral candidates Kevin Burke and Duke Bennett.Hamilton Center Inc. donated $1,000 to Burke’s campaign in the Democratic party primary for Terre Haute mayor in February 2007.
After the May primaries, the mental health corporation made a pair of $500 donations to the general election campaign fund of Republican Duke Bennett.
Burke and Bennett reported these contributions in campaign finance reports filed with the Vigo County Clerk’s Office earlier this year. All the contributions are marked as “direct” as opposed to “in-kind” donations.
“They are just not allowed to do that,” said Steve Weissman, associate director for policy at the Campaign Finance Institute in Washington, D.C. The CFI is a nonpartisan, not-for-profit research and education institute associated with George Washington University.
Hamilton Center Inc., based in Terre Haute, is designated as a 501(c)(3) organization under the federal tax code. Such organizations can accept tax-deductible contributions but are prohibited from “directly or indirectly participating in, or intervening in, any political campaign … for elective office,” according to information provided by the IRS in Washington.
“There is an absolute prohibition against any political campaign intervention [by 501(c)(3) organizations],” Weissman said. “It’s in the tax code. It’s in the law and it’s in regulations. So that’s illegal.”
According to the Indiana Election Division, between 1998 and 2006, Hamilton Center has donated $19,200 to candidates for state offices. Recipients of that money include area Democrats Rep. Dale Grubb, Rep. Clyde Kersey, Rep. Vern Tincher, Rep. Alan Chowning, Sen. Mark Blade and Sen. Tim Skinner, as well as Lt. Gov. Katherine Davis, Gov. Joe Kernan and Gov. Frank O’Bannon. Republican recipients of Hamilton Center contributions include Gov. Mitch Daniels, Auditor Connie Kay Nass and the Vigo County Republican Central Committee.
What is shocking is the Hamilton Center's claim that its attorneys and accountants told it the contributions were permissible. "Galen Goode, Hamilton Center’s CEO, said that he has asked the mental health system’s attorneys and accountants in the past whether such activity is permitted." “Their response has always been that the dinners and golf events and things of that sort have typically been public events that we take the position of marketing,” Goode said. “By the time you subtract the cost of these events, etc., the remainder is not material.” The organizations attorney didn't have much to say to the Tribune-Star reporter. "An attorney for Hamilton Center, Richard Shagley Sr. of Terre Haute, said he was not authorized to comment on behalf of Hamilton Center," the story reports.
I simply can't believe a nonprofit could be making political contributions to all these different campaigns this many years and nobody has raised any questions about their legality. Suffice it to say, the Hamilton Center's problems have only just begun. And all of these campaign committees listed in today's story better get busy writing out checks to the Hamilton Center returning all of these illegal campaign contributions.