Rob
Levine
July 15, 2000
AN INVESTIGATION INTO THE PHILANTHROPIC GIVING of the Milwaukee-based
Lynde
and Harry Bradley Foundation by Media
Transparency (MT) has revealed a $13 million omission in the philanthropy's
required 1997 Form 990 report to the Internal Revenue Service, and forced the
three-quarters of a billion dollar organization Lion House: Home of the Lynde
and Harry Bradley Foundationto re-file with the agency or face large financial
penalties. According to Bradley’s Chief Financial Officer Robert Berkopec, the
foundation has since filed an amended return with the IRS.
Among the largest mistakes made in the report is an under-reporting of $581,000 given to the ultra-conservative Heritage Foundation, out of a total of $853,000 given to the organization. The largest single omission is the $1.7 million not reported that was given to the Milwaukee based Partners Advancing Values in Education (PAVE), an organization created primarily by the Bradley foundation to generate support for school voucher programs.
Also omitted were a number of grants made to the Center for The Study of Popular Culture, which received $568,000 from the Bradley foundation in 1997, only $221,000 of which was reported. The CSPC and its founder, David Horowitz, run, among other things, the website called "Political War", which purports to give ongoing strategic advice specifically to Republicans running for national office, and who is said to be a major advisor to Republican Presidential candidate George W. Bush. (This wouldn't be the first time that Bradley money has been used to create the underlying political strategy for the Republicans -- see Marvin Olasky: Godfather of "Compassionate Conservatism".)
Media Transparency purchased the Form 990 reports of the Bradley Foundation for the years 1985-1998. By Federal law, philanthropies can charge citizens up to 15 cents per page for copies of their Form 990 IRS reports. The Bradley foundation, which makes grants of over $30 million per year, and has assets of over $750 million, charged MT researchers more than $200 for the reports.
After entering the philanthropy's 1997 grants (all 828), we performed a routine validity test to see if the data had been entered correctly. To our surprise, our total added up to some $13 million less than the total granted shown at the end of the foundation's 990 report.
Upon analyzing our grants database we determined that the error was either in the Bradley foundation's grant list, or in the amount they had reported as given.
Following repeated attempts to contact Bradley CFO Berkopec, we were finally able to speak with him. Berkopec had been unaware of the error, and reported back to us that our find had sent he and his staff into a flurry of activity to isolate how the error had occurred, indicating that MT was the first to find the error -- even though it was more than two years after the IRS report had been filed.
Berkopec stated that the false report stemmed from a computer software printing error that omitted some grants from the printed report. The error turned out to be especially difficult to catch, because the grants omitted were usually the second, third or fourth grants to a recipient in that particular year, and didn't appear uniformly, i.e. in some cases the second and third grants were printed, and for other recipients they were not.
A check with the foundation's 1997 Annual Report seemed to confirm Berkopec's description of the error, because all the grants were listed in it. Nevertheless, the Bradley foundation’s 1997 IRS Form 990 report was grossly in error, underreporting its grant making by over 40 percent.
IRS regulations specify steep penalties for filing false tax returns, especially for 501(c)(3) organizations such as the Bradley foundation. However, the same regulations make exceptions for honest mistakes, which, giving them the benefit of the doubt seems to have been what happened in 1997.
In June of this year, MT again contacted the Bradley foundation, this time looking for its 990 report for 1999. Berkopec informed us that the foundation had filed for an extension in filing the report, which is its right, and that it wouldn't be available until the middle of August 2000. Media Transparency then requested that the report be sent to us at that time. Berkopec requested that MT put the request in writing, which we agreed to. He then reminded us that the Bradley foundation, worth three quarters of a billion dollars, and a public charity, required us to send $40 to cover the copying cost.
Given that MT had already paid the Bradley foundation $200 for previous grant reports, and had found an enormous reporting error that no one else had found, including Berkopec (despite his $125,000 annual salary for his part-time work for the foundation), it didn't seem right that Bradley should want this fee. "That's our policy," answered Berkopec.
In hindsight it shouldn't have surprised us that besides being the number one funder of conservative policy, action and advocacy organizations in the country, besides being poor accountants of their own activities, the folks at the Bradley foundation are not eager to have the public, in whose tax-exempt benefit they operate, closely examine how it carries on its business.
| Recipient/description | #unreported grants | Total unreported amount |
| American Council of Trustees and Alumni | 2 | 100,000 |
| American Enterprise Institute | 2 | 405,000 |
| American Foreign Policy Council | 1 | 18,750 |
| American Jewish Committee (Commentary fund) |
1 | 37,500 |
| American Spectator Education Foundation ("special projects" ) |
1 | 42,500 |
| American Studies Center | 1 | 25,000 |
| Argus Project | 1 | 56,250 |
| Association of Literary Scholars and Critics | 1 | 12,500 |
| Becket Fund, Inc. | 2 | 84,000 |
| University of Wisconsin (evaluation of Wisconsin Works welfare reform) |
3 | 206,250 |
| Boston College | 5 | 144,296 |
| Boston University | 1 | 50,000 |
| Boys & Girls Club of Greater Milwaukee, Inc. | 1 | 25,000 |
| Capital Research Center | 1 | 28,375 |
| Carnegie Mellon University | 4 | 170,000 |
| Catholic University of America | 1 | 49,505 |
| Cato Institute | 1 | 37,500 |
| Center for Individual Rights | 2 | 70,000 |
| Center for Parental Freedom in Education | 2 | 50,000 |
| Center for Strategic and Budgetary Assessments | 1 | 25,000 |
| Center for the Study of Popular Culture | 3 | 337,500 |
| CESA Foundation, Inc. | 1 | 1,000 |
| Children's Hospital of Wisconsin, Inc. | 1 | 25,000 |
| Christian Methodist Episcopal Church | 1 | 50,000 |
| Citizens for a Sound Economy Foundation |
1 |
12,500 |
| Claremont Graduate University | 1 | 15,000 |
| Claremont Institute for the Study of Statesmanship. | 4 | 187,500 |
| Claremont McKenna College | 1 | 15,000 |
| Collegiate Network | 1 | 80,000 |
| Columbia University | 1 | 15,000 |
| Community Enterprises of Greater Milwaukee, Inc. | 4 | 133,000 |
| Competitive Enterprise Institute | 1 | 20,000 |
| Corporation for the Advancement of Policy Evaluation | 1 | 25,000 |
| Discovery World: James Lovell | 2 | 50,000 |
| Empire Foundation for Policy Research | 1 | 25,000 |
| Environmental Defense Fund | 2 | 77,000 |
| Esperanza Unida, Inc. | 1 | 37,500 |
| Ethics and Public Policy Center, Inc. | 3 | 243,750 |
| Family House Incorporated | 1 | 36,250 |
| Family Service of Milwaukee | 3 | 150,000 |
| Federalist Society for Law and Public Policy Studies | 2 | 90,000 |
| First Stage Milwaukee | 2 | 22,500 |
| Florentine Opera Company, Inc. | 1 | 50,000 |
| Fordham University | 1 | 25,000 |
| Foundation for Cultural Review | 3 | 115,000 |
| Foundation Saint-Simon (Paris) | 1 | 15,000 |
| Free Congress Research and Education Foundation | 2 | 284,000 |
| Freedom House, Inc. | 2 | 100,000 |
| Fund for American Studies | 1 | 25,000 |
| George C. Marshall Institute |
2 |
107,000 |
| George Mason University Foundation | 3 | 45,000 |
| Georgetown University | 2 | 30,000 |
| Harvard University | 5 | 107,500 |
| Heritage Foundation | 4 | 581,250 |
| Houghton College | 1 | 31,786 |
| Hudson Institute | 7 | 319,213 |
| Indiana University | 2 | 50,000 |
| Institut Fur Die Wissenschaften Vom Menschen | 1 | 40,000 |
| Institute for American Values | 1 | 50,000 |
| Institute for Contemporary Studies | 3 | 158,500 |
| Institute for International Economics | 1 | 25,000 |
| Institute for International Studies | 2 | 134,000 |
| Institute for Justice | 1 | 60,000 |
| Institute for Policy Innovation | 1 | 37,500 |
| Institute on Religion and Democracy, Inc. | 1 | 25,000 |
| Institute on Religion and Public Life | 4 | 296,250 |
| Intercollegiate Studies Institute | 1 | 45,000 |
| International Center for Economic Growth | 1 | 50,000 |
| International Republican Institute | 1 | 25,000 |
| Johns Hopkins University | 10 | 410,275 |
| Kenyon College | 1 | 15,000 |
| Libro Libre | 1 | 20,000 |
| Manhattan Institute for Public Policy | 2 | 100,000 |
| Marquette University | 2 | 120,000 |
| Medical College of Wisconsin | 1 | 20,000 |
| MHS., Inc. Messmer High School | 3 | 150,000 |
| Michigan State University | 2 | 30,000 |
| Middle East Forum | 1 | 22,500 |
| Milwaukee Area Technical College Foundation, Inc. | 3 | 150,000 |
| Milwaukee Art Museum | 1 | 25,000 |
| Milwaukee Ballet Company | 1 | 50,000 |
| Milwaukee Brewers Student Achievers Account | 1 | 48,251 |
| Milwaukee County War Memorial Center, Inc. | 4 | 350,000 |
| Milwaukee Foundation | 1 | 25,000 |
| Milwaukee Kickers Soccer Club Foundation, Inc. | 1 | 12,500 |
| Milwaukee Public Museum | 1 | 50,000 |
| Milwaukee Public Schools | 1 | 30,000 |
| Milwaukee Repertory Theater, Inc. | 2 | 60,000 |
| Milwaukee Rescue Mission | 1 | 12,500 |
| Milwaukee School of Engineering | 3 | 225,000 |
| Milwaukee Youth Symphony Orchestra | 1 | 12,500 |
| MMAC Community Support Foundation | 1 | 32,475 |
| Morley Institute | 1 | 62,500 |
| National Affairs> (Public Interest, National Interest) |
2 | 175,000 |
| National Association of Scholars | 1 | 75,000 |
| National Bureau of Economic Research | 3 | 150,000 |
| National Center for Neighborhood Enterprise | 13 | 282,000 |
| National Center for Policy Analysis | 1 | 50,000 |
| National Council for History Education, Inc. | 2 | 64,448 |
| National Endowment for Democracy | 3 | 115,000 |
| National Fatherhood Initiative | 2 | 90,000 |
| National Forum Foundation | 1 | 37,500 |
| National Strategy Information Center | 2 | 117,500 |
| New Citizenship Project, Inc. | 1 | 25,000 |
| New York University | 3 | 65,000 |
| Next Door Foundation | 1 | 25,000 |
| Nixon Center | 1 | 37,500 |
| Our Lady of the Lakes Catholic School | 1 | 3,000 |
| Pacific Research Institute for Public Policy | 1 | 37,500 |
| Partners Advancing Values in Education (PAVE) | 3 | 1,700,000 |
| Penfield Children's Center | 1 | 20,000 |
| Peterhouse College | 1 | 10,000 |
| Progressive Foundation | 1 | 25,000 |
| Puebla Institute | 1 | 35,000 |
| Reason Foundation | 1 | 37,500 |
| Roper Center for Public Opinion Research | 2 | 123,000 |
| St Camillus Ministries, Inc. | 1 | 50,000 |
| St. Francis Children's Center | 1 | 20,000 |
| St. Mary's and St. Nicholas Joint Education... | 1 | 3,000 |
| Salvation Army Wisconsin & Upper Michigan | 1 | 17,500 |
| Sand County Foundation | 1 | 55,000 |
| Skylight Opera Theatre Corp | 1 | 30,000 |
| Social Philosophy and Policy Foundation | 2 | 84,000 |
| St. Leo School, Inc. | 1 | 10,000 |
| State of Wisconsin "legal fees in defense of const. of the amended Milwaukee School Choice program" |
1 | 50,000 |
| Taliesin Preservation Commission, Inc. | 1 | 25,000 |
| Texas A & M University | 2 | 82,500 |
| Thomas Aquinas College | 1 | 50,000 |
| Thoreau Institute | 1 | 22,500 |
| TransCenter for Youth, Inc. | 1 | 50,000 |
| United Negro College Fund, Inc. | 1 | 25,000 |
| University of California-Irvine | 1 | 33,903 |
| University of California-Malibu | 1 | 17,500 |
| University of California-Berkely | 1 | 15,000 |
| University of Chicago | 7 | 105,000 |
| University of Maryland Foundation | 2 | 78,000 |
| University of Notre Dame | 1 | 15,000 |
| University of Oklahoma | 1 | 15,000 |
| University of Toronto | 2 | 30,000 |
| University of Virginia | 3 | 45,000 |
| University of Wisconsin-Milwaukee | 1 | 75,000 |
| UWM Foundation | 2 | 97,900 |
| Washington University | 1 | 15,000 |
| Wisconsin Center for Academically Talented Youth | 2 | 92,500 |
| Wisconsin Conservatory of Music | 1 | 17,500 |
| Wisconsin Correctional Service | 1 | 25,000 |
| Wisconsin Foundation for Independent Colleges, Inc. | 1 | 12,500 |
| Wisconsin Policy Research Institute, Inc. | 1 | 200,000 |
| Wisconsin Public Radio | 1 | 1,500 |
| Woodrow Wilson International Center for Scholars | 1 | 31,500 |
| Yale University | 2 | 50,000 |
| Youth Leadership Academy | 3 | 60,000 |
| Total unreported grants | 13,058,677 |