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December 17, 2005

Misgiving

For Frist, charity begins at home:

WASHINGTON (AP) - Senate Majority Leader Bill Frist’s AIDS charity paid nearly a half-million dollars in consulting fees to members of his political inner circle, according to tax returns providing the first financial accounting of the presidential hopeful’s nonprofit.
The returns for World of Hope Inc., obtained by The Associated Press, also show the charity raised the lion’s share of its $4.4 million from just 18 sources. They gave between $97,950 and $267,735 each to help fund Frist’s efforts to fight AIDS.
… Frist’s lawyer, Alex Vogel, said Friday that he would not give their names because tax law does not require their public disclosure. Frist’s office provided a list of 96 donors who were supportive of the charity, but it did not say how much each contributed.
The donors included several corporations with frequent business before Congress, such as insurer Blue Cross/Blue Shield, manufacturer 3M, drug maker Eli Lilly and the Goldman Sachs investment firm.
World of Hope gave $3 million it raised to charitable AIDS causes, such as Africare and evangelical Christian groups with ties to Republicans Franklin Graham’s Samaritan Purse and the Rev. Luis Cortes’ Esperanza USA, for example.
The rest of the money went to overhead. That included $456,125 in consulting fees to two firms run by Frist’s longtime political fundraiser, Linus Catignani. One is jointly run by Linda Bond, the wife of Sen. Christopher “Kit” Bond, R-Mo. The charity also hired the law firm of Vogel’s wife, Jill Holtzman Vogel, and Frist’s Tennessee accountant, Deborah Kolarich.
… Vogel told the AP that Frist was proud that World of Hope’s overhead costs amounted to less than $1 of every $5 raised. “It’s leaner than the average charity,” Vogel said.

Um, no, it’s not. Forbes magazine calculates that the average “commitment” of U.S. charities—i.e., what’s left after management, overhead and fundraising costs—is 84%. But most reputable charities perform far better, with commitment percentages above 90%. In fact, many well-known charities fall into this category: for example, America’s Second Harvest (98%), Food for the Poor (96%), the Mayo Foundation (95%), Project Hope (94%), and Save the Children (91%)—among numerous others. (Forbes doesn’t include Frist’s charity in its survey.)

Moreover, the expenses of a minuscule charity with only a small number of contributors and beneficiaries should be significantly lower than those of a larger charity—it’s hard to imagine what half a million dollars in consulting fees could legitimately have been spent on at World of Hope. As Kent Cooper, the Federal Election Commission’s former public disclosure chief, told the AP:

[T]he consulting fees were “excessively high” and the fact that they were “paid to primarily political consultants also raises questions about the long-range strategic benefits for the 2008 presidential race.”

Cooper also wonders what World of Hope’s donors thought they were buying:

“These tax deductible gifts were earmarked through Senator Frist,” Cooper said. “They were raised in the political arena at the 2004 Republican Convention and the natural question is were they given to the Senate majority leader to gain favor or were they given for true charitable purposes?”

But what could be more charitable than the gift of influence?

Posted by Stephen at 4:11 PM in Politics | Permalink | TrackBack (2)

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» Frist's AIDS Charity Funds Were Used To Pay Consultants from The Moderate Voice
Yet ANOTHER new question is being raised about Senate Majority Bill Frist: were consultants paid out of funds from his AIDS charity? According to the AP, the answer is yes:[Read More]

Tracked on December 18, 2005 4:43 AM

» Frist's AIDS Charity Funds Were Used To Pay Consultants from The Moderate Voice
Yet ANOTHER new question is being raised about Senate Majority Bill Frist: were consultants paid out of funds from his AIDS charity? According to the AP, the answer is yes:[Read More]

Tracked on December 18, 2005 4:43 AM