September 10, 2016; Washington Post
NPQ readers are aware of the controversy surrounding Donald Trump and his philanthropic activities. David Fahrenthold of the Washington Post deserves credit for following the story for months. His most recent article summarizes extensive research of 17 years of IRS Form 990 of the Donald J. Trump Foundation and contacts to at least 250 charities with a connection to, or history with, the 2016 presidential candidate and his foundation.
In short, the most recent report confirms what was reported earlier this year: If Donald Trump has given personal funds to charity since 2008, there is no record of it on his foundation’s federal returns. The Donald J. Trump Foundation was founded in 1987, and Trump was either the sole donor or the overwhelming donor until 2007. He made small gifts to the foundation in 2007 and 2008, and no gifts from 2009 through 2014, the latest year for which records are publicly available.
The foundation acts as a conduit, receiving gifts from individuals and other wealthy people’s foundations and then distributing those gifts to charities under the Donald J. Trump Foundation name, typically with no credit given to the donor or donors funding the Trump Foundation gift. One example Fahrenthold cites is $150,000 in gifts made in 2009 and 2010 to the Palm Beach Police Foundation in Florida. The gifts originated with the Charles Evans Foundation, which gave the $150,000 to Trump’s foundation. Trump was honored for his foundation’s “selfless support” at a 2010 gala held at Trump’s own Mar-a-Lago Club. Not only didn’t his foundation’s gifts come from Trump’s own resources, he may have profited from his relationship with the Palm Beach Police Foundation. As the Post notes, it’s not known what the Palm Beach Police Foundation paid the Mar-a-Lago Club for hosting the 2010 gala, but in 2014, the foundation paid the club $276,463.
This pattern of repackaging other people’s money with the Trump Foundation name included his gifts to veterans’ charities earlier this year. As NPQ reported in June, Liberty House received a $100,000 gift as part of the $5.6 million raised by Trump when he skipped one of the televised Republican primary debates. The gift was one of 41 by Trump—or, more often, by people associated with Trump—in a list distributed in May. The actual check received by Liberty House, however, came from the Stuart J. Rahr Foundation. Liberty House’s gift arranged by Trump was noteworthy because the organization’s executive director, on advice of counsel, refused to participate in an awards presentation with Trump during a campaign event, fearing that doing so might jeopardize its tax-exempt status.
Looking at the foundation’s most recent IRS filing is intriguing. First, the foundation files a Form 990-PF as a private foundation rather than a Form 990 as a public charity. Its outgoing gifts totaled about $600,000, about $100,000 more than its incoming gifts received. Incoming gifts came from only two sources—$477,400 from Richard Ebers of Inside Sports and Entertainment Group, an event ticket reseller, and $20,000 from Prestige Mills, a carpet store on Long Island. The asset value of Trump’s foundation is about $1.3 million, a very modest amount when compared with the billionaire’s reported net worth. The foundation has no employees and no one is paid directly by the foundation. Its five directors are Donald Trump, his children Donald Jr., Ivanka, and Eric, and Allen Weisselberg, the chief financial officer of the Trump Organization, each of whom reports spending 30 minutes a week (26 hours a year) on Trump Foundation business. The foundation’s only reported administrative and operating expenses are $5,000 to fill out the Form 990-PF and $250 to file the form.
The Trump Foundation’s small size, its lack of employees, and its board composed four-fifths of family members (and one hundred percent Trump Organization employees) may explain—but does not at all excuse—its seat-of-the-pants operating style. This style has included slow, rare, and incomplete handling of media inquiries and public scrutiny, with no identified foundation spokesperson other than Trump himself. This creates problems—for example, when donations to sound-alike organizations dogged Trump’s veterans giving—and is the excuse the Trump Foundation offers for the foundation’s giving $25,000 to a campaign group associated with Florida Attorney General Pam Biondi, who was at the time considering whether or not to throw in with an investigation of Trump University. The foundation recently recovered the gift and paid a $2,500 penalty.
The Trump Foundation’s directors share the same duties of care, loyalty, and obedience that any nonprofit’s directors do. Trump’s “philanthropy” on other people’s dimes is conducted with an apparent carelessness that exhibits a disrespect of the sector.—Michael Wyland