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Watchdog group calls out Klingenschmitt on nonprofit fundraising

click to enlarge Rep. Gordon Klingenschmitt claims no wrongdoing. - FILE PHOTO
  • File photo
  • Rep. Gordon Klingenschmitt claims no wrongdoing.

Gordon Klingenschmitt, the highly controversial Republican state representative from Colorado Springs, again is under fire — not for outlandish remarks about gays and lesbians as in the past, but for allegedly using his for-profit business to drum up money for his nonprofit, even as it was under suspension by the Secretary of State's Office.

Klingenschmitt, who represents House District 15 in El Paso County, allegedly used for-profit GJK Inc. to solicit funds for his nonprofit Persuade the World/Pray in Jesus Name during the nonprofit's suspension from Oct. 15, 2014, to Jan. 28, 2015, as previously reported by The Colorado Independent, a news website.

Klingenschmitt dismisses the issue, saying via email the suspension stemmed from "one block" on the nonprofit renewal form being left blank, which was remedied by paying a $60 late fee and completing the form. He also denied that funds were co-mingled, and lashed out at his accusers for "obsessing" on the late fee and supporting his opponent, Robert Gardner, for the 2016 GOP nomination in Senate District 12.

Klingenschmitt has been denounced by members of his own party for likening Democratic U.S. Rep. Jared Polis to ISIS in beheading Christians, predicting the Boy Scouts' new policy of allowing gay scout leaders will lead to kids being molested, and for demonizing gays and lesbians. Last year, he said on his TV show that LGBT activists "want your soul ... so that you go to hell with them."

But this time, the narrative isn't ideological. Colorado Government Watch, formerly Colorado Springs Government Watch, headed by DeDe Laugesen, has filed a complaint with the Secretary of State's Office alleging there may be "blurred lines, if any boundaries at all, between Klingenschmitt's charity and a for-profit enterprise."

"It is unclear whether the funds raised by the nonprofit were ultimately collected by the nonprofit or just raised in its name but retained by the for-profit," the complaint continues. "Either way, the ambiguous relationship between Klingenschmitt's for-profit and his nonprofit raises yet another set of ethical concerns and potential legal issues."

In an interview, Laugesen, wife of Gazette editorial page editor Wayne Laugesen, says Klingenschmitt is the only "answerable person" connected to both entities.

"We are not going after Rep. Klingenschmitt because of any kind of political controversies he's been involved in," she says. "We're not motivated by ideology. We really are looking for whether he's being accountable to his constituents and the taxpayers who are subsidizing his effort" through laws that allow nonprofits to not pay taxes.

"There's just a lot of holes here that we think he needs to answer to or clarify for the taxpayers," she says. "These considerations reflect on what kind of public servant he is, because it reflects on his character."

In mid-September, CGW submitted an open-records request to Klingenschmitt for records from his nonprofit and for-profit, which triggered a response letter from the Office of Legislative Legal Services saying those documents aren't subject to disclosure.

"The mere fact that a document is made during one's tenure as a public official does not render it a public record," the office wrote. "Any records or writings responsive to your request that Representative Klingenschmitt may have in his custody were not made, maintained, or kept in connection with the exercise of his official functions as a member of the General Assembly, and do not involve the receipt or expenditure of public funds."

So Laugesen turned to the Secretary of State's Office.

The Sept. 21 complaint cites The Colorado Independent report posted in January about the former Navy chaplain's use of GJK to solicit donations for Persuade the World Ministries when the latter was suspended due to failure to complete the registration process.

The news website reported that an email sent Dec. 30 sought donations to Pray in Jesus Name Ministries, part of Persuade the World. The message said the ministry is a 501(c)3 nonprofit to which donations are "100% tax-deductible, used for religious education and charity to help the poor..."

The news website also said when readers click on the link to donate, GJK Inc. is never mentioned. The link goes to the Pray in Jesus Name website donations page for Pray in Jesus Name Project, which solicits support for "non-profit defense of religious liberty and freedom of Christian expression ... to help [Klingenschmitt] protect our right to pray publicly 'in Jesus' name,' and mobilize tens of thousands of people to petition God and government."

Two days later, on Jan. 1, the text had been changed to say donations were "non-tax-deductible," The Colorado Independent reported.

It's worth noting that in 2010, Citizens for Responsibility and Ethics in Washington (CREW) filed a complaint with the IRS against Klingenschmitt, saying his "Shock and Awe Free Voter Guide" for each state was "overtly partisan." Nonprofits that engage in partisan politics risk losing their tax-exempt status.

Reached by phone, Jordan Libowitz, CREW's communications director, says CREW doesn't know what became of its complaint, because the IRS is prohibited by statute from discussing investigations or even saying whether it is investigating.

Luis Toro, director of Colorado Ethics Watch, reviewed Laugesen's complaint and said she might be on to something. "Our parent organization, CREW, was blowing the whistle on Rep. Klingenschmitt's group as early as 2010 and it looks like little, if anything, has changed," Toro says in an email. "We expect the Secretary of State to take this complaint very seriously."

Secretary of State spokeswoman Lynn Bartels says the office reviews all complaints, "and if an investigation is warranted we'll open one." But the office doesn't comment on pending investigations and follows the philosophy of being an "educator" in helping people understand and follow the rules, not a punitive "hammer," she says.

Klingenschmitt, who calls himself "Dr. Chaps," said the suspension resulted from an inadvertent mistake made by his "team of lawyers" that keeps charitable registrations current in all states.

His for-profit "political-activism/journalistic blog" The Pray in Jesus Name Project doesn't receive funds from his charity, but does donate web space to the nonprofit and sends an annual email blast seeking donations for it, he says. "Funds are not co-mingled and separate tax filings are filed by each entity," he says. (The nonprofit reports raising about $39,041 in 2013 and $853,679 in 2014, according to IRS records.)

He adds that a search indicated two Colorado donors gave money to the charity online during the suspension. "Yet both are happy and declined our offer to refund their money," he says.

Klingenschmitt then went on the offensive, accusing Laugesen of declining his request to investigate a $10,000 fine levied by the Secretary of State against his opponent Gardner.

Gardner served as the attorney and registered agent for a campaign group involved in a special district election in 2014; the group was fined for failing to file as a political committee and disclose contributions and spending as required by campaign finance laws, according to campaignintegritywatchdog.org, all of which Gardner has denied.

Klingenschmitt also accuses CGW of spending money to influence elections without disclosing donors, which he calls a violation of "state laws on election transparency."

Laugesen says Colorado Government Watch, donations to which are not tax-exempt, is a "nonpartisan, nonpolitical public-accountability watchdog" with no interest in his political races. The law doesn't require CGW to disclose contributions or spending.

"Nice try at a diversion," she says.

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