Posted on 10/19/2004 10:07:07 PM PDT by calif_reaganite
The Internal Revenue Service has begun an investigation of ASUCD after it was discovered that the association was in violation of an IRS regulation regarding nonprofit organizations at the beginning of this month.
The investigation was announced in a letter sent to ASUCD from the IRS agent assigned to the case that claimed the association -which currently has tax-exempt status - had been "intervening in a political campaign."
ASUCD Controller Cameron Menezes said the investigation was spurred by an informal investigation carried out by former UC Davis student Igor Birman. Menezes said Birman "disagreed with many of the political stances that ASUCD has taken in the past," and that he decided to pursue the case in the form of a formal complaint to the IRS.
According to Menezes, ASUCD is prohibited from endorsing candidates for public office because of its nonprofit status. Although the ASUCD Senate has passed several resolutions in support of various candidates and California state ballot measures, Menezes said the senate maintains it did not have full knowledge of the law when the resolutions were passed.
Menezes said ASUCD has made contact with the IRS to "establish our good faith in making sure this never happens again."
As a preemptive barrier to further IRS action against the association, ASUCD Vice President Paloma Perez had authored a senate bill - which was recently withdrawn - to add language to the senate standing rules "to prevent ASUCD from losing its tax-exempt status."
ASUCD President Kalen Gallagher said the bill was pulled because the IRS agent assigned to the case will soon be coming out to talk to members of the association. Associate Campus Counsel Deborah Allison said the group should wait to hear from the agent before they take any further action on the matter, according to Gallagher.
Gallagher said that the bill - or one similar to it - will definitely be re-introduced sometime during the next two academic quarters.
In the formal complaint he filed with the IRS Exempt Organizations Examination Division in March 2004, Birman cited five instances in which ASUCD passed resolutions in support of candidates and 10 in which they passed resolutions in support of California state ballot measures.
Among the candidates that ASUCD passed resolutions in support of were Lois Wolk, who ran as a representative for the 8th district, and Lamar Heystek, a UCD graduate student who ran for Davis City Council.
The resolution in support of Wolk was authored by former Internal Affairs Commission Chair Anthony Volkar, and was passed unanimously by the senate in November 2002. The resolution stated that Wolk had "actively been involved with ASUCD and its student leaders through numerous meetings, potlucks, and various speaking engagements."
As to the ban on ASUCD's intervening in political campaigns, Menezes said he had "never really thought about it before, but it makes sense."
"Birman prosecuted this case well, so we're taking action on it," he said.
At a recent senate meeting, Perez asked ASUCD Senator Donald Cohen-Cutler to remove a placard in support of the Kerry/Edwards presidential campaign that he had fastened in front of his place at the senate table. Menezes said that Perez was right to make the request.
"Right now, we're being cautious about everything, and it seems like the senators are very understanding of that," he said.
AIMEE THERON can be reached at campus@californiaaggie.com.
Igor Birman, complainant in Birman v. ASUCD, upon the determination of the case by the Internal Revenue Service, released the following statement:
"In April of this year, I filed a formal complaint with the IRS, contending that ASUCD has wilfully, knowingly, and repeatedly engaged in violations of Section 501(c)(3) of the United States Internal Revenue Code by endorsing candidates for political office and attempting to influence statewide legislation.
I did so, fully realizing the grave implications of this approach, but at the same time guided by a desire to stop the reprehensible practice of ASUCD spending student and taxpayer funds on candidate and legislative endorsements -- practices strictly prohibited by the Internal Revenue Code to non-profit charities, such as ASUCD.
ASUCD was informed of the nature of their obligations as a registered charity and the relevant restrictions on political activity both by me and by Professor Daniel Simmons of the UC Davis Law School in a California Aggie article. Since this advice fell on deaf ears and was met with arrogance and contempt by ASUCD, I had a responsibility to the students of my alma mater as well as to taxpayers of California to request the involvement of the Federal Government to forever end this abusive and illegal practice.
The investigation begun by the IRS is an enormous victory for the students of UC Davis and the taxpayers of California, as it will lead to a permanent cessation of these activites that have made a mockery of federal law.
I call on ASUCD to issue a formal apology to the students of UC Davis for engaging in illegal activities on their behalf and also to establish a mechanism for these students to seek refunds of the fees that ASUCD collected from them over the years when the unlawful endorsements took place. Those ASUCD officials and advisors who brought about this needless and unfortunate sequence of events need to be held accountable by the student body. They have utterly failed in their responsibilites and deserve appropriate consequences."
You are the man. This is exactly what this type of group needs. A wakeup call. Too often they think because they are exempt from paying taxes, they are also exempt from following the law.
Good for you. The law doesn’t exempt sniveling leftists.
If you filed this complaint, God bless you. This is very encouraging when the IRS for a change, doesn't look the other way at institutions and goes after them. They never have a problem going after Joe Taxpayer. Now the "other side" will know what it feels like to get one's a** reamed.
BTW- Here is an unrelated article on what is wrong with student government,..... Deliver us from Student Government
Good for you. I am a resident of the People's Republic of Davis. My hat is off to those who keep the radical institutions in line.
They just figured they are above the law, and if past trends continue, they would get away with it anyway, just like all other liberal subversive 501(c)3's have.
I know. I imagine they probably lied. They have a full time agent investigating them now.
Excellent. Time for students all across the nation to rise
and act!
Leftists student politics aside. I've always wondered about the wisdom of giving tax-exempt status in exchange for the constitutional right of free speech. I think a lot of our freedoms are being bought up this way.
Why did you have to point this out to the IRS? Can't they see the forest through the trees?
Thanks! I have a history with UCD -- I got fired from their campus newspaper for being too conservative back when I was still a student. Ended up suing them and winning.
Here's a really old thread: http://www.freerepublic.com/focus/f-news/827007/posts
Taxman Bravo Zulu!
According to Menezes, ASUCD is prohibited from endorsing candidates for public office because of its nonprofit status. Although the ASUCD Senate has passed several resolutions in support of various candidates and California state ballot measures, Menezes said the senate maintains it did not have full knowledge of the law when the resolutions were passed. Nonsense.
My daughter graduated from UC Davis in June of 2003. The political correctness was a thorn in her side. It is good to know there are some Aggies with good sense. Keep up the good work!!
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