Two left-wing organizations dedicated to opposing President Donald Trump’s cabinet nominations are using a tax loophole to hide their finances from public scrutiny.
The “Trump Transparency Project,” an advocacy arm of the organization Allied Progress, is “dedicated to holding President-elect Donald Trump’s transition and eventual administration accountable for its economic appointments and policies that betray hardworking Americans.”
Allied Progress took credit for forcing Andy Puzder to withdraw from consideration as Trump’s nominee for Secretary of Labor. It has also publicly attacked Wilbur Ross, Trump’s nominee to lead the Department of Commerce, and now-Secretary of the Treasury Steven Mnuchin.
The micro-site targeted Puzder, OpposePuzder, now redirects to a page opposing his replacement, Alexander Acosta.
The organization suggests Acosta is a “controversial figure whose mismanagement of the Department of Justice’s Civil Rights Division led to scandal and a years-long investigation.”
While most organizations are required to disclose information on their donors, dark money organizations such as Allied Progress and the “Trump Transparency Project” use a tax loophole to hide their financial information.
Allied Progress is organized under the auspices of the New Venture Fund, a left-wing “fiscal sponsor” categorized as a tax-exempt 501 (c)(3) that handles legal compliance and logistics for Allied Progress and over 100 other organizations.
Allied Progress Action, the organization’s advocacy arm is part of a similar organization, the Sixteen Thirty Fund, that supports 501(c)(4) “social welfare” advocacy groups.
Charitable foundations and labor unions are normally required to disclose grants and contributions to groups such as Allied Progress; however, as Allied Progress is only a “project of the New Venture Fund,” donors are only required to list the financial sponsor on their disclosures – in this case, the New Venture Fund or the Sixteen Thirty Fund.
Under the terms of a fiscal sponsorship agreement, the sponsor is subject to federal restrictions on how much money nonprofits can spend on advocacy and lobbying activities, not the specific groups that it houses.
Labor Unions donated $860,000 to the Sixteen Thirty Fund and $134,000 to the New Venture Fund from 2015-2016, and are not required to disclose what organizations they were directly funding with their contribution to those fiscal sponsors.
Allied Progress is governed by a Board of Directors chaired by Eric Kessler, who served in the Clinton administration and as a senior manager for the National Democratic Institute for International Affairs (currently chaired by former Secretary of State Madeline Albright).