Is “engaged philanthropy” a backdoor way of injecting special interest money into the political process?
ST. PAUL, MN— Global warming has been called by some the single greatest threat to mankind. While the rest of us await a climate Armageddon, Minnesota environmental advocacy groups have quietly reaped a financial windfall from well-endowed, largely out-of-state foundations, which have bestowed tens of millions of dollars to lobby, legislate and litigate around the issue.
Minnesota finds itself at the center of a larger, national phenomenon. A recent opinion piece in the Washington Post (“The Hidden Costs of Million Dollar Donations”, Dec. 30, 2011) documents how wealthy philanthropists are “setting policy priorities” through their tax-deductible giving. Politico reported on a White House meeting last year between the administration and friendly foundations. In that article, their reporter claimed that “green-minded charities were told by their advisors in 2007 to give about $600 million per year to deal with climate change in the United States and abroad.”
A Freedom Foundation of Minnesota (FFM) investigation reveals that nine national foundations have steered $48 million in funding to more than 40 non-profits and local governments since 2003 in an aggressive campaign to radically rewrite Minnesota environmental policy. Based on an examination of foundation records, tax filings, other public data and conversations with key foundations and advocacy groups, FFM found that Minnesota-focused non-profits received at least 285 grants in the last eight years. It is likely that the total amount of grants distributed in Minnesota is much higher, because of “re-granting” between foundations and other practices that serve to obscure the money flow.
The staggering amounts of foundation money flowing into the state were disbursed at a critical time, as state policymakers were engaged in a dramatic reorientation of Minnesota’s environmental and energy policy. The timing and ties to the legislative process may raise concerns about whether so-called “engaged philanthropy” amounts to a backdoor channel for injecting special interest money into politics.
Beyond setting policy priorities, these foundations have been extraordinarily successful in placing key staff in positions of political power in matters concerning energy and the environment. In 2011, Governor Mark Dayton appointed two alumni of these green nonprofits to head the Pollution Control Agency and the state’s Energy Resources Division. Others were appointed to the Metropolitan Council and advisory boards.
Bill Glahn, former Director of the Minnesota Office of Energy Security during the Pawlenty Administration, sees the on-the-ground influence of this network. “When you show up to a committee hearing at the State Capitol, you see a room full of former nonprofit political appointees, nonprofit spokespeople at the witness table, and nonprofit media members broadcasting the event live on Twitter and the Internet,” Glahn said.
Of the five foundations pumping the most money into and through Minnesota, all but one has headquarters out of state. The following foundations disbursed the largest amoung of grant funding in Minnesota from 2003-2011. (See a complete list of participating foundations and grant amounts below.)
- McKnight Foundation- Minnesota $16,991,727
- Energy Foundation of San Francisco- California $12,515,709
- Joyce Foundation- Illinois $ 5,236,723
- Kendeda Fund – Pennsylvania $ 5,100,000
- Garfield Foundation- Massachusetts $ 3,614,050
Their largesse supports the projects of a few activists familiar to Minnesotans such as explorer Will Steger and the Sierra Club. However, most of the recipients are not household names. Yet in the words of a comprehensive recent Monitor Institute report, “it’s working.”
How did this wealthy, largely out-of-state special interest group network gain such a powerful foothold in Minnesota, coming to dominate the public discourse on critical energy and environmental issues?
As foundation giving to green nonprofits started ramping up in 2003, the Massachusetts-based Garfield Foundation began exploring ways to more effectively push its environmentalist agenda by influencing policymakers and public opinion.
“We looked across the whole country. We have a national focus and we were incredibly impressed with the character, capacity and accomplishments of Minnesota nonprofits before we got into the picture,” Rick Reed, a Garfield Foundation energy program expert told FFM.
Garfield gathered a core group of like-minded wealthy philanthropies to team up under the banner of the RE-AMP Energy Network. The plan was to build a network of environmentally-centered foundations from across the country to target the Midwest with the hope of steering state policy in a manner that would benefit their objectives.
“For nonprofits and funders that want to go deeper on the tactics of how to build an effective network, it is useful to understand how RE-AMP has done it,” according to the Monitor Institute report.
The entrepreneurs who originally endowed the involved foundations would likely recoil at how their legacy is capitalized on today. The Rockefeller Family Fund, a RE-AMP member, traces its roots to the fossil fuel industry the foundation now endeavors to eliminate. The Garfield Foundation doles out millions of dollars generated in part from machines that spewed out the CO2 the philanthropy today labels cataclysmic. McKnight Foundation distributes Minnesota Mining and Manufacturing (3M) money to groups working to limit the expansion of mining in Minnesota and neighboring states, including a $100 million fund for “catastrophic global climate change” projects.
“The McKnight Foundation supports policy efforts to reduce greenhouse gas emissions and accelerate the transition to a low-carbon future, helping the Upper Midwest provide a significant portion of the nation’s renewable energy supply,” Tim Hanrahan of the McKnight Foundation said in a statement. “In this, McKnight is pleased to provide funding for the RE-AMP network’s efforts across eight Upper Midwest states to improve state-level policies and reduce carbon.”
From the outset of the agreement, the foundations agreed to collectively direct their millions in annual grants toward “one audacious goal”: Drastically reducing carbon emissions to check global warming. The Midwest was deemed ripe for greater environmental impact due to the region’s concentration of manufacturing and coal power—prime producers of C02 emissions—and moderate politics.
“This ambitious project is aimed at transforming the upper Midwest energy sector into a model of clean, efficient and safe energy use, while reducing global warming pollution economy-wide 80% by 2050. RE-AMP brings environmental, labor, faith, youth, energy, conservation and other groups together to develop common priorities to achieve our goals in the areas of Clean Energy, Coal, Energy Efficiency, Global Warming Solutions and Transportation,” according to the RE-AMP website.
Operating behind the scenes, often with limited transparency, RE-AMP’s network has grown to include 14 foundations and about 135 nonprofits in eight Midwest states: Minnesota, North and South Dakota, Illinois, Iowa, Wisconsin, Michigan and Ohio. In Minnesota alone RE-AMP’s roster lists 33 nonprofits and funders, more than any other state.
With an annual budget of $700,000 for core operations, RE-AMP’s unorthodox organizational structure assures a low profile. By design the network remains unincorporated with no official office or headquarters. Decentralized, RE-AMP has less than a dozen staff members dispersed at member organizations like Fresh Energy in St. Paul. Teams from five key issue working groups meet monthly to track and coordinate action regionally and by state, strategizing on policy, tactics and messaging.
While thinking regionally, RE-AMP has acted locally, focusing much of its financial firepower first and foremost in Minnesota. The “blank check” strategy has paid off with a checklist of significant legislative and regulatory victories.
In Minnesota, RE-AMP-supported nonprofits have registered dozens of lobbyists to become a major force at the Minnesota Capitol, according to state records. The group’s legislative muscle helped pass a series of far-reaching environmental laws capped by the 2007 Minnesota Next Generation Act, which included the Midwest’s most stringent mandates on carbon emissions, renewable energy and efficiency.
“We’re incredibly proud of what Minnesotans are doing for themselves and they’ve inspired us. Rather than dictating to them, we’re inspired by their vision of a clean, modern, safe, efficient and affordable energy system,” said Rick Reed, one of Garfield Foundation’s key RE-AMP architects. “We think all Americans deserve that and if Minnesotans want to lead the way, we’d love to use some of our philanthropic grant dollars to help achieve that.”
Regionally, the deep-pocketed philanthropists claim credit for accomplishments from thwarting 30 coal-fired power plants to generating harsh new energy and environmental regulations and ramming through the nation’s most rigorous cap-and-trade program at the Midwest Governor’s Association. Allied foundations wrote checks for $2.8 million to the Council of State Governments to bankroll and promote passage in individual states of theMidwestern Greenhouse Gas Reduction Accord (MGGRA). To build further momentum, RE-AMP created the Global Warming Strategic Action Fund, dispersing more than $10.8 million to 144 groups in all eight member states since 2007.
“I work with climate groups all over the country. While RE-AMP may not be perfect, there’s nothing like it anywhere else in the country. Climate advocates outside the Midwest know this,” said Larry Shapiro of the Rockefeller Family Fund in a RE-AMP document.
From the beginning, RE-AMP also directed millions of dollars to communications and training for grant recipients to disseminate its message in the media. The network has also launched its own environmental news service called Midwest Energy News. Although funded by RE-AMP through the Minnesota-based environmental group Fresh Energy, Midwest Energy Newsstories have been published by mainstream news outlets without any disclaimer or notification to readers. Moreover, one Minnesota-based news organization has received more than $5 million from a RE-AMP funder to provide comprehensive coverage of environmental issues.
Leading up to the critical 2012 elections, RE-AMP has been working on a massive voter identification database. The green group aims to assign potential voters in Minnesota, Michigan, Ohio and Wisconsin a score based on their projected environmental leanings. Dubbed the Catalist Project, the tool predicts how likely voters are to support RE-AMP policies and like-minded candidates. RE-AMP media director Tom Elko was checking on the progress of the Catalist initiative at the time this report was posted. If successful, the Catalist Project positions RE-AMP to be a major player in voter turnout throughout the upper Midwest.
Part 2: The money trail in Minnesota as unheard of sums of special interest money funds a campaign to influence policy makers, media coverage and public opinion. Read here.