Bill Hogan stories from The Center for Public Integrity

Three Big Donors Bankrolled Americans For Limited Government In 2005

2012-05-30T16:07:49-04:00

Americans for Limited Government, the tax-exempt organization that bankrolled a series of controversial ballot initiatives this year, raised 99 percent of its $5.4 million in total contributions in 2005 from just three donors, the Center for Public Integrity has learned.

The number of ALG’s major donors in 2005, but not their identities, was disclosed in financial statements obtained by the Center.

New York political activist Howard Rich, the organization’s high-profile chairman, did not respond to the Center’s requests for information about ALG’s financial affairs, including a question about how much of his own money, if any, he has given to the group. Rich has repeatedly declined to disclose the identities of donors to ALG and eight other tax-exempt organizations that share common management.

Rich was recently described by The Wall Street Journal as “a publicity-shy, libertarian-leaning businessman who has become the go-to man for supporters of conservative ballot initiatives.”

The reliance of Americans for Limited Government on such a small number of big donors is at sharp variance with how the organization bills itself to journalists and to the public.

“Americans for Limited Government is funded by thousands of individuals from across the country,” the organization’s Web site says. “Grassroots volunteers and donors make up the heart and soul of our organization.”

It’s a theme that Rich and his lieutenants have sounded again and again.

Months before the November elections, for example, Rich told a reporter for the San Francisco Chronicle that his network of organizations — chief among them Americans for Limited Government — is funded by thousands of individual donors.

And in an October 24 e-mail to the Center, John Tillman, ALG’s president, said that the organization’s “funding comes from thousands of Americans all over the country.” Tillman went on to say that “we are also proud of the fact that our support is broad and deep.”

The Center previously reported that Americans for Limited Government was apparently forced last month to move out of Illinois, its longtime base of operations, because it could not comply with the state’s charity laws. Just after the November 7 elections the organization changed the address listed on its Web site to the Virginia residence of one of its officers.

Organization That Bankrolled ‘Takings’ Initiatives Forced Out Of Illinois By Attorney General

Illinois,United States — 2012-05-30T15:27:30-04:00

Americans for Limited Government, the Chicago-based tax-exempt organization that bankrolled a series of controversial ballot initiatives this year, has apparently been forced to move out of Illinois because it could not comply with the state’s charity laws, the Center for Public Integrity has learned.

Americans for Limited Government had operated from offices in Illinois since 2002, but just after the November 7 elections it quietly changed its address to the Virginia residence of one of its officers. At the same time, ALG created two new tax-exempt groups, the Sam Adams Alliance and the Sam Adams Foundation, which occupy its former Chicago address.

The chairman of Americans for Limited Government, New York political activist Howard Rich, was recently described by The Wall Street Journal as “a publicity-shy, libertarian-leaning businessman who has become the go-to man for supporters of conservative ballot initiatives.” Rich did not respond to the Center’s requests for information about the organization’s financial affairs.

In all, Americans for Limited Government spent at least $8 million in 2006 pushing takings initiatives and other ballot measures. The organization has repeatedly refused to disclose the sources of its funds.

Although charitable organizations that operate in Illinois are required to furnish state regulators with annual financial statements audited by a certified public accountant, Americans for Limited Government never did so, the Center has learned.

On September 15, Illinois Attorney General Lisa Madigan notified Americans for Limited Government that its registration under the state’s charitable solicitation laws was “delinquent and not in good standing” and that its registration would be cancelled on October 15 if it failed to file a complete annual report, including the audit.

“Upon cancellation,” Madigan’s letter said, “the file will be reviewed to determine if further action, including dissolution, appointment of new trustees, and/or court-imposed remedies and fines, are appropriate.”

Madigan sent identical warnings to ALG’s affiliate, Americans for Limited Government Foundation.

Neither organization responded to the warnings, and on October 15 the Illinois Attorney General’s office canceled their registrations as charitable organizations.

The Center previously reported that both organizations ran afoul of a different state law last year by continuing to operate in Illinois even after Secretary of State Jesse White had revoked their authority to do business there.

Financial statements filed with Illinois authorities say that Americans for Limited Government Foundation shares “common management” with more than a half-dozen of Rich’s organizations, including ALG; Legislative Education Action Drive (LEAD); Parents In Charge Foundation (formerly LEAD Foundation); U.S. Term Limits; U.S. Term Limits Foundation; Social Security Choice.org (SSC.org), and SSC.org Foundation.

Although Rich’s two new organizations, the Sam Adams Alliance and the Sam Adams Foundation, solicit contributions on their shared Internet site (which was set up by Americans for Limited Government), neither has registered with the Illinois Charitable Trust Bureau, as is required by Illinois law.

Driving Without A License

Illinois,United States — 2012-05-30T17:54:29-04:00

A Chicago-based tax-exempt organization that has been bankrolling takings initiatives in more than a half-dozen Western states — including all five with measures on the ballot this November 7 — continued to dispense millions of dollars even after its authority to do business had been revoked by Illinois authorities.

The tax-exempt organization, Americans for Limited Government, Inc., has given at least $2.5 million this year to groups pushing the ballot initiatives. But much of this activity came during a period when it had no legal standing to operate from Illinois, the Center for Public Integrity has learned.

Illinois Secretary of State Jesse White revoked the nonprofit’s certificate of authority to do business in the state on February 1, 2006, citing its failure to file an annual report as required by law. The organization’s authority to do business in the state was not reinstated until September 22.

“Upon the issuance of the certificate of revocation,” Illinois law says, “the authority of the corporation to conduct affairs in this state shall cease and such revoked corporation shall not thereafter conduct any affairs in this state.”

In the eight months that Americans for Limited Government operated illegally in Illinois:

It was the largest donor ($892,000) to the Arizona HomeOwners Protection Effort, which is backing Proposition 207.
It was the largest donor ($168,778) to People’s Initiative to Stop the Taking of Our Land (PISTOL), which is backing Question 2 in Nevada.
It was the largest donor ($260,000) to the Property Fairness Coalition, which is backing Initiative 933 in Washington state.

It was the largest donor (more than $2 million) to America at its Best, a tax-exempt organization in Virginia that was the second-largest donor to both This House Is MY Home, the chief proponent of Proposition 2 in Idaho, and Missourians in Charge, which backed a failed takings in that state.

In August, Americans for Limited Government also hosted the “ALG Action Conference” in Chicago, a three-day event that featured, among others, U.S. Senator Tom Coburn, a Republican from Oklahoma; political activist Howard Rich, the organization’s chairman; and John Tillman, its president.

On the same day that it revoked the license of Americans for Limited Government, the Illinois Secretary of State also revoked the certificate of its affiliate, Americans for Limited Government Foundation, Inc.

“These were clerical oversights that have been taken care of,” Tillman told the Center in an e-mail. “The reinstatements have been processed.”

The Illinois Secretary of State’s office, however, told the Center that, as of October 24, it had not reinstated the foundation’s certificate of authority.

Financial statements filed with Illinois authorities say that the foundation shares “common management” with more than a half-dozen of Rich’s organizations, including Americans for Limited Government; Legislative Education Action Drive (LEAD); LEAD Foundation; U.S. Term Limits; U.S. Term Limits Foundation; Social Security Choice.org, Inc. (SSC.org), and SSC.org Foundation, Inc.