Monday, September 25, 2023

Did Liberal Nonprofits Make Illegal Contributions to a Wisconsin School Board Race?


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Multiple nonprofits may have made illegal campaign contributions to support “progressive” candidates

In the countless battles for control of local school boards, small organizations often get carried away with how far they can bend IRS campaign finance rules. That appears to be the case with a set of tax-exempt nonprofits in the small town of Kiel in eastern Wisconsin, which appear to have funneled money illegally to a committee supporting leftists in the town’s school board race last year.

In 2022, conservatives won control of the school board after teachers unions began pushing Critical Race Theory and other far-left topics on schoolchildren. Their reforms prompted “progressives” to push back hard.

In May, the school district filed a Title IX complaint accusing three middle school boys of “sexual harassment” for using incorrect gender pronouns on a fellow student. The school board, with help from the Wisconsin Institute for Law and Liberty, got the lawsuit dropped.

Activists turned to boycotting local businesses owned by conservative school board members with help of left-wing media outlets, which harried the board members as “far-right” for attempting to remove the district’s leftist superintendent. Two of the conservative board members ultimately resigned in February 2023.

Three seats are up for election on April 4th. A state committee—Best for Kids in the KASD (Kiel Area School District)—run by a local resident, Shane Konen, is pushing residents to vote for the left-wing candidates Dan Meyer, Tony Johannes, and Jim Bajczyk. But there’s reason to believe the group is funded by illegal campaign contributions.

Questionable Expenditures

The IRS prohibits 501(c)(3) public charities from directly intervening in elections. That includes independent expenditures, funds used to advocate for or against a candidate without his authorization, and direct contributions to committees.

The idea is to restrict campaign work to political action committees (PACs)—both federal and state—and 501(c)(4) groups, a type of nonprofit allowed to engage in limited electioneering, since donors’ contributions to (c)(3)s are tax-deductible.

In March 2022, three Kiel-based 501(c)(3) nonprofits made financial transactions with Best for Kids in the KASD. We’ve traced $400 from Friends of Kiel Performing Arts, $400 from the Kiel Booster Club, and $2,000 from the Wisconsin Alliance for Excellent Schools (through its project Wisconsin Public Education Network).

Source: Wisconsin Campaign Finance Information System

Best for Kids reported that it had made independent expenditures ahead of the April 2023 election in support of Johannes, Meyer, and Bajczyk. It appears likely that these expenditures were made using 501(c)(3) funds, which, if true, would be illegal and could result in revocation of tax exemption and a hefty IRS fine.

Were these grants illegal? The IRS’ clear prohibition on (c)(3)-PAC contributions suggests they are, but we won’t know until someone takes them to court.

This was originally published at Restoration of America'
Hayden Ludwig
Hayden Ludwig is director of policy research for Restoration of America and an expert on the Left’s ‘dark money’ networks.

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