THE BLOG
06/06/2012 03:11 pm ET | Updated Aug 06, 2012

Flattered to Be Accused of Violating IRS Rules?

The right-leaning Colorado Observer reported last week that Jessica Peck was "outraged, stunned -- and strangely flattered" when her organization was named in a recent Colorado Ethics Watch complaint to the IRS.

The Observer piece didn't explain why Peck was "outraged and stunned," but it did say that Peck was flattered because her organization is considered important and powerful enough to be taken seriously by Colorado Ethics Watch.

If I'm a reporter, and someone tells me they're flattered to be accused of violating IRS rules, I'd present an itsy bitsy bit of detail about the alleged violations.

But the Observer's reporter, Valerie Richardson, didn't offer any information about the substance of Colorado Ethics Watch's complaint against Peck's organization, the Open Government Institute.

Richardson deep-sixed the details and wrote:

Whatever the merits of the complaint, Peck's biggest crime may have been her Republican registration, according to CEW's legion of conservative critics.

I'm glad to know what the legion of conservative critics think, but why not present more information about this case, since it frames the entire Observer story about Colorado Ethics Watch?

"I seriously pondered doing that," Richardson told me. "But the story was getting too long, and I thought, at this point, that's a separate story. One of the things I am going to do next is write a story about the details of that complaint. It was already getting so long that I was afraid no one would read it."

I'll provide a few details here, to fill in the gap until Richardson writes what I hope will be a longer analysis.

Colorado Ethics Watch wrote a letter to the IRS after coloradopols.com posted a video on its website showing Peck, the Open Government Institute's Executive Director, stating:

"Congressman Coffman, we're working on some things that may, in a very non-partisan way, benefit you in your endeavors in November, so I'll talk a little about that. So, I come here as a partisan Republican..."

On its website, Colorado Ethics Watch writes that this "can be interpreted as stating that OGI [which bills itelf as nonpartisan] has already taken specific actions to 'benefit' U.S. Rep. Coffman's 'endeavors' in November, i.e. his reelection. Ms. Peck's remarks also allude to future activities that will be conducted by OGI between now and Rep. Coffman's November election."

In its complaint to the IRS, Colorado Ethics Watch wrote:

As set forth more fully below, it appears that this organization is currently involved in activities, and planning for future actions, which constitute political campaign intervention in violation of federal tax law governing 501(c)(3) organizations. Accordingly, Ethics Watch requests that the IRS closely examine the activities of OGI before determining of OGI's pending application for 501(c)(3) status.

This is a serious accusation, raising questions about the legitimacy of OGI's claim of nonpartisanship and non-profit status, allowing for tax-deductible donations.

In a telephone interview, Peck dismissed the charge, saying:

"We have not heard back from the IRS. We believe we're in complete compliance with laws governing nonprofits. Anyone can file a complaint."

She added that Colorado Ethics Watch "does a lot of great work." But not this time, she said.

One of the critics of Colorado Ethics Watch, cited in the Observer article, was Mario Nicolais, an attorney at the Hackstaff Law Group.

I asked him if he'd advise a client to say the things Peck said about Coffman.

"The Open Government Institute was a client of mine, prior to any of this happening, so I'm not going to be able to comment," Nicolais told me, adding that he represented them for "about a month when they first were opening up."

"Anyone who's been a client, I'm not going to comment without their direction."

In Richardson's upcoming article about Colorado Ethics Watch's complaint, I hope she asks the aforementioned "legion of conservative critics" the same question I asked Nicolais, as she lays out more detail about the IRS complaint against the Open Government Institute.