LANDMARK CALLS ON IRS TO STRIP TAX STATUS OF DC, FLORIDA TEACHERS' UNIONS

Foundation Cites Financial Misdeeds by Union Leaders as Cause

FOR IMMEDIATE RELEASE

September 5, 2003

CONTACT: Eric Christensen

(703) 689-2370

(703) 689-2373 (fax)

info@landmarklegal.org

www.landmarklegal.org

(HERNDON, VA) Landmark Legal Foundation, America's leading authority on the political operations of the nation's teachers' unions, today called on the Internal Revenue Service to strip the tax-exempt status of the United Teachers of Dade County (UTDC), Florida, and the Washington Teachers Union (WTU) in the District of Columbia for financial misdeeds by the heads of the two affiliates of the American Federation of Teachers (AFT). Landmark's complaint was also filed with the Tax Division of the U.S. Department of Justice.

Numerous media reports indicate that former WTU President Barbara Bullock and other former WTU officers diverted millions in union funds for personal use over a several year period. Former UTDC President Pat Tornillo also recently entered into a plea agreement with federal prosecutors in Miami to serve two years for fraudulently charging more than $650,000 in personal expenses to the union.

Landmark's complaint documents the financial dealings of the two union heads and also includes a detailed review of relevant federal tax requirements. Nonprofits, like the WTU and the UTDC that are 501(c)(5) groups, are proscribed by IRS regulations from paying unreasonable compensation to individuals who have substantial influence over that organization. Such a practice is called inurement, and is grounds for revoking the group's nonprofit tax status.

"The leadership of these two unions allowed their former presidents to run roughshod over them for years before their misconduct became so egregious that they had to be stopped," commented Landmark President Mark R. Levin. "The unions themselves are guilty of inurement and the IRS should follow its own rules and hold them accountable."

Landmark has previously filed complaints with the IRS, the Justice Department, the Department of Labor and the Federal Election Commission documenting unreported political expenditures and activities on the part of the National Education Association and its state affiliates in violation of federal reporting requirements. The Foundation's latest complaint, which was filed with the IRS and the Justice Department this week, calls for investigations and, where appropriate, criminal prosecution of the union and its leaders.

"America's teachers have placed their faith, their futures and their profession's good name in the hands of organizations and individuals who have horribly abused that trust," Levin concluded. "The government needs to take steps to rectify those abuses."

Founded in 1976, Landmark Legal Foundation is a nonprofit, public interest law firm with offices in Kansas City, Missouri and Herndon, Virginia.