Attack on tax status of environment group

Conservatives ask IRS for new ruling

Glen Martin, Chronicle Environment Writer

Thursday, June 21, 2001





In a move that could hobble environmental protests, a conservative lobbying organization has petitioned the Internal Revenue Service to rescind nonprofit status for a San Francisco environmental group.

Environmentalists say a positive ruling by the IRS would have a chilling effect on nonprofit organizations that sometimes engage in lobbying or protests.

The unusual action by the Frontiers of Freedom Institute in Arlington, Va., against Rainforest Action Network (RAN) could represent a new strategy by conservative groups alarmed by recent large-scale protests against world trade and multinational corporations.

Rainforest Action Network specializes in public campaigns against companies the group believes are involved in the destructive logging of old-growth forests or selling products from such forests.

The Frontiers of Freedom Institute has requested that the IRS revoke the 501(c)(3) status of Rainforest Action. Such status means that an organization is tax-exempt and that all contributions made to it are tax deductible.

"They basically contend that because some members of Rainforest Action have participated in misdemeanor trespass (during protests), they are engaged in criminal behavior, and that (RAN) therefore deserves to be stripped of nonprofit status," said Michael Shellenberger, a spokesman for the environmental group.

The IRS can revoke 501(c)(3) status if it determines an organization spends too much money on lobbying -- generally, more than 20 percent of revenues -- or if members engage in criminal activity.

"It's a canard," Shellenberger said of the institute's contentions. "The kind of activity that would require revocation of 501(c)(3) is felonious activity -- embezzlement and the like."

Jason Wright, a spokesman for the institute, confirmed that his organization had made the request to the IRS but declined to comment further to The Chronicle, saying the story had been promised exclusively to another publication.

In March, the Frontiers of Freedom Institute issued a press release condemning Rainforest Action Network for protests held at the headquarters of Boise Cascade, a forest products company based in Boise, Idaho.

George Landrith, the institute's executive director, called Rainforest Action Network "fundamentally radical, anti-capitalist and lawless."

"American companies are the most responsible forest resource developers in the world," Landrith said. "In contrast, RAN's approach to forest resource development would cost thousands of jobs, reduce choices for consumers and achieve little environmental good."

Boise Cascade has been a primary target of Rainforest Action because of its logging activities in old-growth coniferous forests in British Columbia.

Boise Cascade spokeswoman Susan Walton said her company was not affiliated with Frontiers of Freedom.

"But we are certainly aware that some organizations are beginning to question the status of groups like RAN as charitable institutions due to their lawless activities," Walton said. "We have found (RAN) to be a group of reckless, lawless and radical activists."

Walton said three RAN members had been arrested in Boise in April for rappeling off a building during protests against the company.

"And three others were arrested in October of last year when they illegally entered our building," she said. "We're just thankful no one was hurt."

Walton said Boise Cascade had met several times with RAN staff members to discuss logging issues and would do so again, "but the first item on the agenda will have to be a correction of the mistruths they have spread on this company."

Shellenberger said Rainforest Action would survive no matter what the IRS decided. "(Frontiers of Freedom) is trying to scare our supporters, but they won't be scared," he said. "Ultimately, this will help us raise money."

But other environmental leaders deplore the development. "It's outrageous," said Carl Pope, director of the Sierra Club. "By the standard Frontiers of Freedom is trying to apply, the NAACP and other civil rights groups would have lost their tax exemptions because members participated in protests.

"I think this could have a very chilling effect on many organizations. If it goes through, we'll have very strong evidence that the Bush administration has politicized the IRS."

E-mail Glen Martin at glenmartin@sfchronicle.com.