Keeping Palin on rally roster was risky, groups were told
A former top IRS official warned Jewish groups that they would likely face a financial penalty and expensive audit process if they went through with plans to have the Republican vice-presidential candidate speak at an anti-Iran rally.
The warning came from Marcus Owens, a 25-year veteran of the Internal Revenue Service and the former director of its tax-exempt unit. According to the general counsel of the UJA-Federation of New York, it echoed the advice of several other lawyers.
“For this to be legal, an invitation would have had to be issued to both vice-presidential candidates at the same time so they would have an equal opportunity to speak at the rally,” Ellen Zimmerman told JTA.
Zimmerman said she consulted with at least five lawyers specializing in this field, including Owens, who said Palin’s appearance would be problematic.
Zimmerman’s version of events, confirmed by Owens, would appear to poke a major hole in the claim by right-wing critics that organizers of the rally were motivated primarily by partisan politics in deciding to disinvite Palin and other American elected officials.
Jewish groups triggered an uproar, first by inviting Palin to and then disinviting her from the Sept. 22 rally to protest Iranian President Mahmoud Ahmadinejad’s appearance at the United Nations General Assembly.
The Palin invitation prompted U.S. Sen. Hillary Rodham Clinton (D-N.Y.) to renege on an earlier commitment to appear and led to accusations that organizers — in particular the Conference of Presidents of Major American Jewish Organizations — had blundered, allowing election year politicking to overshadow a bipartisan display of opposition to Iran’s nuclear program.
In response, the Presidents Conference issued an invitation to the Democratic running mate, Sen. Joe Biden (D-Del.); but he had a prior engagement, so the Obama campaign agreed to send U.S. Rep. Robert Wexler (D-Fla.), one of its most active Jewish surrogates.
In the end, Jewish groups decided to rescind all the invitations to American politicians. But instead of quelling the controversy, the move triggered a slew of right-wing claims that Jewish liberals inside and outside the Presidents Conference were more interested in sabotaging Palin than confronting Iran.
“It was Democratic partisans that made this political,” said Morton Klein, the president of the Zionist Organization of America. “The real issue was giving visibility to Sarah Palin. Liberal Democratic interests trumped concern about Iran.”
The McCain campaign trumpeted the same line, lamenting that Palin was barred under pressure from “Democratic partisans.”
The International Fellowship of Christians and Jews accused “organizers” of politicizing the event and invited Palin to address its upcoming banquet. And columnist Caroline Glick, writing in the Jerusalem Post, took aim at two organizational leaders involved in the rally planning — Rabbi Steve Gutow of the Jewish Council for Public Affairs and John Ruskay of UJA-Federation of New York — suggesting that associations with left-wing groups earlier in their careers is evidence of their partisan machinations.
Both Gutow and Ruskay adamantly deny the charges. The issue, insiders say, was concern that hosting Palin without a comparable representative from the Obama campaign constituted a violation of the laws governing tax-exempt organizations.
“IRS rules are quite clear,” said Zimmerman, the New York federation’s lawyer. “Given what was potentially a threat to UJA-Federation and the other tax-exempt organizations’ exempt status, that was just too much of a risk to take.”
Owens, the former IRS unit director, told JTA that agency rules require that the terms and conditions need to be the same for political invitations by nonprofits. That would include giving both sides equal amounts of time to respond, he said.
Had the rally gone forward with Palin’s appearance as planned, Owens said it was likely the IRS would have pursued action against the organizers, though he doubted their exempt status would be revoked. Instead, the agency likely would have levied an excise tax and begun an audit, a costly endeavor that sometimes leads to further tax problems.