Illegal Campaign Activity Suspected at Mira Costa Foundation


December 19, 2012:  (Carlsbad, CA)  The MiraCosta College Foundation appears  to have violated the law and jeopardized its 501(c)(3) tax-exempt status by making a large political contribution to the Yes on EE campaign.   An individual who identifies herself as a Foundation representative, denies our suspicions.  Stop Taxing Us successfully defended the taxpayers from this $1.5 billion tax hike in the November 2012 election. 


The MiraCosta College Foundation was established as a nonprofit tax-exempt 501(c) 3 in 1967 to receive and administer gifts and grants benefiting the college.  Contributions to the Foundation qualify for state and federal income tax deductions -- and for estate tax savings. 


Campaign filings for Yes on EE (link) show a $100,000 contribution from the MiraCosta College Foundation.  As a tax-exempt 501(c)(3) (link), the Foundation is restricted in contributing to political activities.  According to the IRS (link), a 501(c)(3) "may not attempt to influence legislation as a substant ial part of its activities."  


$100,000 would seem "substantial" on its face, but in the context of the size and scope of the Foundation's activities, the contribution is even more clearly substantial.  The most recent audited financials (link) show total annual program expenses of just $550,358, meaning this one political contribution amounted to more than 18% of the total prior year's services.  


According to Stop Taxing Us co-founder Dr. Gary Gonsalves, “Our research raises the question as to whether or not the use of College Foundation money for campaigning constitutes an inappropriate and perhaps illegal use of deductible charity dollars.  This may be more than simply a misallocation -- we wonder if it might be a crime and we are asking the proper state and federal authorities to investigate our findings.  If the average Joe taxpayer attempted to tax deduct their political contributions, it would not be long before the IRS came knocking on their door.”

Gonsalves further notes, “It's possible that this act could invalidate the foundation, and retroactively eliminate deductions for contributions -- even though they were made prior to the disbursement.  Only duly constituted authorities can make such determinations.”

The Proposition EE campaign would have instituted a $1.5 billion dollar tax hike on homeowners in North County. and it would have hit working families and renters in the form of higher rents. MiraCosta's $100,000 donation was the single largest contribution to the campaign that raised $350,000. In spite of this substantial war chest, the proposition failed.


What did you think of this article?

  • No trackbacks exist for this post.

  • 12/20/2012 12:50 PM Linda Fogerson wrote:
    A $100,000 contribution made by the MiraCosta College Foundation to the Yes on EE campaign in support of the college’s facility bond campaign was well within legal guidelines and, importantly, the right thing to do. According to the formula established by section 501 (h) election, a charity agrees to be evaluated by a mathematical limit that is imposed upon a percentage of its “exempt purpose expenditures”. The college Foundation’s exempt purpose expenditures totaled $885,000 last year, which sets the total allowable campaign donation amount at $157,750. The donation made from the college foundation to the campaign was $100,000.

    Had the bond passed, it would have been a tremendous benefit to students at the college by helping us to improve facilities and reduce the wait-lists for heavily impacted science and nursing classes. The Foundation Board voted unanimously to make this expenditure because the bond would have had such a far-reaching positive impact on our students and, by extension, our community.

    If you have any questions, please call Linda Fogerson, executive director of the MiraCosta College Foundation, at 760-795-6775.
    Reply to this
  • 12/25/2012 7:20 PM Thomas Burke wrote:
    I am ecstatic the bond did not pass. Taxes are already extremely high. Why should the people be forced to pay the college to benefit the students, improve facilities and reduce the wait list while the college continues the status quo of wasteful programs,lavish pensions and over paying the staff? One with common sense would see a wait list means high demand and/or low supply, so the price of tuition should rise or resources should be diverted to correct the imbalance. Since the college is obviously unwilling to divert resources, the students who choose to take the course can pay the college more benefit the themselves, improve facilities and reduce their own wait list while leaving tax payers off the hook.
    Government again shows its ignorance for markets (markets they should not be in to begin with). So voting yes to perpetuate this distortion and theft was the right thing to do? I disagree. Force is never the right thing to do.
    Reply to this
  • 12/27/2012 9:25 AM Richard Rider wrote:
    California, a destitute state, still gives away community college education at fire sale prices. Our CC tuition is the lowest in the nation.

    How low? Nationwide, the average community college tuition more than double our California CC’s.

    This ridiculously low tuition devalues education to students – often resulting in a 25+% drop rate for class completion. In addition, up to 2/3 of California CC students pay no net tuition at all – either filling out a simple unverified “hardship” form that exempts them from any tuition payment, or receiving grants and tax credits for their full tuition. http://tinyurlcom/ygqz9ls

    On top of that, California offers thousands of absolutely free adult continuing education classes – a sop to the upper middle class. In San Diego, about 1,000 classes for everything from baking pastries to ballroom dancing are offered mostly if not totally at taxpayer expense.
    Reply to this
Leave a comment

Submitted comments are subject to moderation before being displayed.


 Email (will not be published)

Your comment is 0 characters limited to 3000 characters.