City park board returns $200K levy campaign donation

The Cincinnati Board of Park Commissioners gave $200,000 to the park levy initiative in July, but decided Thursday morning to reverse the action and the money was returned to them by the end of the day.

The money went to a nonprofit organization, Great Parks Great Neighborhoods. The group is organized under U.S. tax code in a manner that allows it to accept donations without disclosing the sources, a manner called “dark money” by campaign finance experts.

The donation by the Park Board came to light on Monday, after The Enquirer uncovered the donation in a review of the board's meeting minutes.

Under Ohio law, a donation to a political campaign would be illegal if the donation were made with public funds. However, park department and board officials have insisted the donation is legal because it was taken from a private endowment given to the Park Board and does not constitute public money.

Charlie Luken, who incorporated Great Parks Great Neighborhoods, issued the following statement Thursday morning:

"We are not tone deaf."

“Our number one priority is to support Cincinnati Parks and the passage of Issue 22, the Cincinnati Parks Levy. In recent days, a particular contribution to our organization has come in dispute.

Though we strongly believe that contribution from the private Meyer Fund held by the Cincinnati Park Board was, and is, above board, it has no doubt become a distraction to our goal of supporting the parks and passing Issue 22. That is why we plan to return the contribution to the Meyer Fund.

Our parks are one of Cincinnati’s greatest assets, and the passage of Issue 22 will guarantee that they are maintained and enhanced for our children and all future issues. I hope that now this matter is behind us that the public dialogue can return to where it ought to be: the merits and importance of this policy.”

Great Parks Great Neighborhoods is a nonprofit 501(c)(4) organization was created earlier this year. It was formed "to promote the common good and general welfare of the people of the Cincinnati community by bringing civic betterments and social improvements in the community's parks and neighborhoods," according to documents filed with the Ohio Secretary of State's office.

After Thursday's board meeting, which began 15 minutes before the earlier released meeting agenda, Park Board President Otto Budig did not say the board made the wrong move. But he said the board did not want the action to negatively affect the levy campaign. The announcement of the board's rescission of the donation was made before the published start time of the meeting.

"We feel as if, as a board, that we acted in a transparent way. What we did not want to do is create something that would cloud the purpose of the levy," Budig said. "Whether or not the citizens are interested in improving the park system, they will have that right (to decide) on Nov. 3."

When asked why the money went to Great Parks Great Neighborhoods instead of directly to the levy campaign, Budig said "I can't speak to that, not that I don't want to speak to it. It may be tax issues, it may be some other issues. I'm not certain." He continued that the board decided to give money to Great Parks Great Neighborhoods because the funds from that entity were for advocacy and the board wished to advocate for the parks.

"This was a means through which we were instructed to do it," Budig said.

Vice President Merri Gaither Smith was absent from the meeting but the remaining four members agreed to ask for the money back. It was back in the Park Board's hands by the end of the day.

Tim Mara, a lawyer who has led the anti-levy movement, thanked the board for rescinding the $200,000. "We weren't questioning your integrity but your judgment," he said during a comment period.

The board said it rescinded the donation after questions raised by Mara and Tom Brinkman Jr., a state representative from Mount Lookout, who Wednesday threatened a lawsuit if the money was not returned.

ABOUT GREAT PARKS, GREAT NEIGHBORHOODS

The group was incorporated on June 4 at the law firm of Manley Burke, a block away from City Hall, documents filed with the Ohio Secretary of State's office show.

The nonprofit does not have 501(c)(3) tax-exempt status, which would preclude it from any political activity. A 501(c)(4) can make political contributions and endorse candidates. It also may "educate" voters about issues; in this case, extolling the virtues of the proposed tax levy, as long as it doesn't advocate a yes for the levy also called Issue 22.

Donations to 501(c)(4)s are not tax-deductible, but the names of contributors to such groups are not disclosed. Campaign finance experts say that confidentially allows unlimited amounts of "dark money" to be funneled to candidates and causes without disclosure of the donors.

The anonymous nature of donations to 501(c)(4)s differs from those made to traditional political action committees (PACs) or even campaign committees. Donations to political action committees and directly to candidates or campaigns must be disclosed to both state and in some cases federal elections officials.

But 501(c)(4) groups do not need to register with state or federal election commissions. The groups can donate to particular candidates or campaigns, and only the group and not individual donors are listed as contributors to those campaigns in campaign finance records. The only limitations on the nonprofit groups is that they can’t spend the “majority” of their time or resources on direct political activity such as donations or endorsements for specific campaigns. Those rules are under review by the IRS to become more specific after this issue was at the core of the IRS scandal two years ago involving conservative nonprofits.

One study found that donations from such organizations skyrocketed in the 2014 election cycle, when it was nearly five times the previous major congressional election cycle.

Following the IRS scandal involving scrutiny of right-leaning 501(c)(4) organizations two years ago at the IRS' Downtown Cincinnati offices, the agency said that any group applying for nonprofit status is provisionally approved pending review. The Great Parks Great Neighborhoods group formed in June, although it is not yet on the IRS's official list of approved nonprofits