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, 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.
The tax forms,
filed nine months after they were first due, do not
identify the 18 major donors by name.
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 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,
drugmaker 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
Reverend Luis Cortes's 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 fund-raiser, Linus Catignani. One is jointly
run by Linda Bond, the wife of Sen. Christopher "Kit"
Bond, a Missouri Republican. The charity also hired
the law firm of Vogel's wife, Jill Holtzman Vogel, and
Frist's Tennessee accountant, Deborah Kolarich.
Kolarich's name
recently surfaced in an e-mail involving Frist's
controversial sale of stock in his family-founded health
care company. That transaction is now under federal
investigation.
Jill Holtzman
Vogel, who is raising money for a run for the state senate
in Virginia in 2007, has received thousands in contributions
this year from Catignani & Bond and from her
husband, among numerous other sources, according to
data released by the Virginia Public Access Project.
Alex Vogel said
Frist picked people to work on his charity whom he
trusted and knew, such as Vogel's wife, and was proud that
overhead costs amounted to less than $1 of every $5
raised. "It's leaner than the average charity," Vogel
said. Frist is listed as the charity's president, and
his wife was listed as secretary. Neither was compensated.
Political experts
said both the size of charity's big donations and its
consulting fees raise questions about whether the tax-exempt
group benefited Frist's political ambitions.
"One of the
things people who are running for president try to do is
keep their fund-raising staff and political people close at
hand. And one of the ways you can do that is by
putting them in some sort of organization you run,"
said Larry Noble, the government's former chief
election lawyer who now runs the nonpartisan Center for
Responsive Politics that studies fund-raising.
Kent Cooper, the
Federal Election Commission's former public disclosure
chief, said the big donors' motives are also suspect.
"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?"
Cooper said the
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."
A charity could
lose its tax-exempt status if it is found to be involved
with political activity, said Marcus S. Owens, a former
director of the Internal Revenue Service's Exempt
Organizations Division. "If the IRS were to conduct an
examination, what they would look for would be the
relationship between the organization and any incumbent
politician or candidate," Owens said. "They'd be
particularly interested in transactions of money or
assistance of any kind being provided."
Frist formed the
charity in 2003. It drew attention in August 2004 when
it held a benefit concert in New York during the Republican
National Convention at which President Bush was
nominated for reelection.
The group's 2004
tax return was due April 15, 2005, but it filed for two
extensions and only reported its activity to the IRS last
month. The tax forms show at least 11 of the charity's
18 biggest donors gave $97,950 each, that one gave
$100,000, and that the rest gave more than $245,000
each.
Vogel said
Catignani was paid the fees because he helped arrange the
New York concert that featured country stars Brooks
and Dunn, handling both the event arrangements and
fund-raising.
The tax forms
show Catignani's fund-raising firm, Catignani & Bond,
was paid a total of $276,125 and his event-planning arm,
Consulting Services Group, was paid $180,000. The
amount Catignani was paid by Frist's charity in 2004
is roughly the same as what his firms received over
the past three years for work for Frist's political action
committee, Volunteer PAC. The firm collected $523,666 in
fees from the PAC since 2003, FEC records show.
World of Hope's
beneficiaries include evangelical Christian groups with
Republican connections.
Cortes, Esperanza
USA's president, is an influential evangelical leader
who hosted Bush at this year's National Hispanic Prayer
Breakfast. Frist has worked and traveled extensively
with Samaritan's Purse, in Africa as well as during
the immediate aftermath of Hurricane Katrina. Franklin
Graham is the son of the Reverend Billy Graham.
Weeks before
Frist's convention fund-raiser, the Senate leader traveled
to Africa, visiting Chad, Sudan, and Kenya, on a trip
underwritten by Samaritan's Purse, Senate records
show.
Samaritan's Purse
spokesman Jeremy Blume said the $490,000 that World of
Hope donated to Samaritan's Purse in 2004 was spent on AIDS
programs in sub-Saharan Africa. The recipients of the
charity's money were Africare, Samaritan's Purse,
Esperanza USA, Nashville's Meharry Medical College,
Taso-Uganda, and Save the Children. (AP)