A non-profit organization which has affiliates providing campaign-related services for political candidates has received hundreds of thousands of dollars in taxpayer money in recent years, allocated in many cases by some of the same lawmakers on whose campaigns the group worked.
The earmarks have been directed to the New York Agency for Community Affairs (NYACA), which is located at the same office as ACORN and its various political arms.
NYACA received $175,000 from eight state senators this year, $240,500 from 10 Assembly members and $85,000 from four Council members.
Several of those legislators received backing from ACORN in current or previous political campaigns in the form of canvassing and other field work when facing contested races.
According to a mission statement provided on request, NYACA was founded “to provide a vehicle for grassroots community organizations to increase their capacity to meet the needs of low- and moderate-income communities.” Officially, the money was allocated to deal with foreclosures and other housing issues.
On tax records filed with the Internal Revenue Service, NYACA states more simply that the money is “utilized to promote the social welfare of poor citizens.” According to those records and those filed with the state attorney general’s office, NYACA declared no relationships with any outside organizations through common employees or officers.
But a review of those same tax records, city and state lobbying records, contracts, campaign finance reports and interviews reveals several layers of overlap between NYACA and ACORN.
“The organizations share staff and office space,” said Mariana Davenport, the executive director of NYACA, in an email, adding that, “Although many of the NYACA board members are also members of ACORN, ACORN has no authority to direct NYACA.”
Davenport, herself an ACORN employee, wrote that the organization she heads has no independent payroll and acts simply as a “fiscal sponsor” for taxpayer funding meant for ACORN’s foreclosure prevention efforts and homebuyers' assistance programs, among other initiatives.
NYACA has transferred most of the government money it has received through grants and contracts in recent years to ACORN. In 2006, for example, NYACA reported a little over $1.3 million in income-producing activities, almost all of which was allocated from the government. That same year, the organization paid close to $1.2 million for “contractual services” to ACORN and donated another $67,000 in direct grants also to ACORN, according to tax records. In 2007, NYACA reported just over $730,000 in government contracts and public support, and gave $711,152 of that money to ACORN.
One of the principals of the organization, according to city records, is Bertha Lewis, the executive director of ACORN’s New York affiliate.
It is not uncommon for non-profit organizations to establish political action committees, but those organizations must clearly delineate between the funds they receive from taxpayers and those that they channel from private citizens into their political work.
In the case of the New York Agency for Community Affairs, the group has transferred most of its money to ACORN, an organization that engages in political activity and provides social services under one roof, and, in many cases, by employing the same people.
Nonetheless, Davenport explained, “when NYACA receives a grant, it enters into a contract/grant agreement with ACORN which sets out the parameters of all work and strictly requires that all work complies with section 501(c)3 of the Internal Revenue code,” adding that, “the fiscal sponsor and its board serve to provide independent oversight to ensure contractors or sub-grantees use funding strictly for permissible purposes.”
NYACA is registered as a “public charity,” meaning that the organization receives most of its funding from the general public or the government. That classification exempts NYACA from certain state and federal taxes, but prohibits the group from engaging in or supporting political activity.
ACORN, however, is registered as a “social welfare organization,” which allows the organization to perform campaign-related work. According to city and state records, ACORN has provided paid political services to candidates for city and state office over the years, and has received large sums of money from sources including labor unions and the Working Families Party. Some of those payments from campaigns were made to organizations listed as “ACORN Associates” or “NY Citizens’ Services,” organizations for which no public records could be located, though they are listed as located at the same address.
The Senate Democratic Campaign Committee, for example, has paid both Data and Field Services, the for-profit arm of the Working Families Party, and “ACORN Associates” tens of thousands of dollars for campaign-related services as recently as last year.
“There seems to be some sort of relationship between these different organizations,” said Jill Manny, a professor of non-profit law at New York University and the executive director of the National Center on Philanthropy and the Law, after reviewing NYACA’s tax records.
Members of the State Senate who funded NYACA this year said they trust the organization to be scrupulous in its use of taxpayer money.
State Sen. Bill Perkins,
who allocated $10,000 this year for
NYACA, said he believed the group was most likely a “conduit” set up by
ACORN
to receive government funding for its counseling programs, since ACORN
engages in political work and lawmakers cannot fund it directly.
“That’s obviously the reason why,” Perkins said, after reviewing his office’s records on NYACA. “They want to do this type of work, and they obviously can’t do it through ACORN.”
Annabel Palma, a member of the City Council who allocated $20,000 to NYACA this year, said her grant was intended for general community organizing in her district and not for her political activity and said it was up to city agencies and the comptroller’s office to audit the contracts.
“I don’t have a hands-on role in how the money is spent," she said. "That’s not my role."
In interviews, several members of the State Legislature who funded NYACA said they would rely on the state comptroller’s office to review the organization’s contracts and ensure that the money was being spent appropriately.
William Reynolds, a spokesperson for the state comptroller’s office, said the office had not reviewed any of NYACA’s past member-item contracts, and did not have any immediate plans to do so.
Several critics beyond New York have lobbed allegations of unlawful coordination between ACORN’s tax-exempt affiliates and its non-profit political organs on a national level. A report issued in July by Rep. Darrell Issa, the ranking Republican on the House Oversight and Government Reform Committee, alleged that ACORN had, among other things, used taxpayer money to fund political activity, and that the organization has failed to erect sufficient firewalls between its tax-exempt, non-political work and its campaign activity.
“ACORN and its affiliates cannot delineate their 501(c)(3) work from their non-501(c)(3) work,” the report said.
In an interview, State Sen. Liz Krueger, who allocated $10,000 for NYACA’s tax counseling programs, said she doubted the money was being used for political activity, but that she would ask the organization for more information about its relationship with ACORN.
“That will actually then trigger me to have my staff go do some homework,” Krueger said. “Obviously we live in a world where people don’t always do what they say they’re going to do with the money.”
List | Elected Officials Who Funded NYACA:
In addition Perkins and Krueger, the state senators who have funded NYACA are: Eric Schneiderman, Velmanette Montgomery, Ruth Hassell-Thompson, Hiram Monserrate, Kevin Parker, Diane Savino, Eric Adams and John Sampson.
In addition to Palma, the Council members who have funded NYACA are: Bill de Blasio, Melissa Mark-Viverito and James Sanders.
The Assembly members who have funded NYACA are: Sheldon Silver, William Boyland, Adam Clayton Powell IV, Hakeem Jeffries, Vivian Cook, Audrey Pheffer, Annette Robinson, Richard Gottfried, Nick Perry and Darryl Towns. Aurelia Greene, now the deputy Bronx borough president, also funded the group while in the Assembly.