When the Congressional Black Caucus wanted to pay off the mortgage on its foundation’s stately 1930s redbrick headquarters on Embassy Row, it turned to a familiar roster of friends: corporate backers like Wal-Mart, AT&T, General Motors, Coca-Cola and Altria, the nation’s largest tobacco company.
Congressional Black Caucus members at a gospel event at the September 2007 conference.
Caucus members accepting a donation to the foundation from Eli Lilly, the pharmaceutical giant and a major contributor.
Soon enough, in 2008, a jazz band was playing at what amounted to a mortgage-burning party for the $4 million town house.
Most political groups in Washington would have been barred by law from accepting that kind of direct aid from corporations. But by taking advantage of political finance laws, the caucus has built a fund-raising juggernaut unlike anything else in town.
It has a traditional political fund-raising arm subject to federal rules. But it also has a network of nonprofit groups and charities that allow it to collect unlimited amounts of money from corporations and labor unions.
From 2004 to 2008, the Congressional Black Caucus’s political and charitable wings took in at least $55 million in corporate and union contributions, according to an analysis by The New York Times, an impressive amount even by the standards of a Washington awash in cash. Only $1 million of that went to the caucus’s political action committee; the rest poured into the largely unregulated nonprofit network. (Data for 2009 is not available.)
The caucus says its nonprofit groups are intended to help disadvantaged African-Americans by providing scholarships and internships to students, researching policy and holding seminars on topics like healthy living.
But the bulk of the money has been spent on elaborate conventions that have become a high point of the Washington social season, as well as the headquarters building, golf outings by members of Congress and an annual visit to a Mississippi casino resort.
In 2008, the Congressional Black Caucus Foundation spent more on the caterer for its signature legislative dinner and conference — nearly $700,000 for an event one organizer called “Hollywood on the Potomac” — than it gave out in scholarships, federal tax records show.
At the galas, lobbyists and executives who give to caucus charities get to mingle with lawmakers. They also get seats on committees the caucus has set up to help members of Congress decide what positions to take on the issues of the day. Indeed, the nonprofit groups and the political wing are so deeply connected it is sometimes hard to tell where one ends and the other begins.
Even as it has used its status as a civil rights organization to become a fund-raising power in Washington, the caucus has had to fend off criticism of ties to companies whose business is seen by some as detrimental to its black constituents.
These include cigarette companies, Internet poker operators, beer brewers and the rent-to-own industry, which has become a particular focus of consumer advocates for its practice of charging high monthly fees for appliances, televisions and computers.
Caucus leaders said the giving had not influenced them.
“We’re unbossed and unbought,” said Representative Barbara Lee, Democrat of California and chairwoman of the caucus. “Historically, we’ve been known as the conscience of the Congress, and we’re the ones bringing up issues that often go unnoticed or just aren’t on the table.”
But many campaign finance experts question the unusual structure.
“The claim that this is a truly philanthropic motive is bogus — it’s beyond credulity,” said Meredith McGehee, policy director at the Campaign Legal Center in Washington, a nonpartisan group that monitors campaign finance and ethics issues. “Members of Congress should not be allowed to have these links. They provide another pocket, and a very deep pocket, for special-interest money that is intended to benefit and influence officeholders.”
Not all caucus members support the donors’ goals, and some issues, like a debate last year over whether to ban menthol cigarettes, have produced divisions.
But caucus members have attracted increasing scrutiny from ethics investigators. All eight open House investigations involve caucus members, and most center on accusations of improper ties to private businesses.
And an examination by The Times shows what can happen when companies offer financial support to caucus members.
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