Tag Archives: Franchise Tax Board

Central City East Association, Municipal Ethics

The Story Of How The Central City East Association Evidently Violated City Ethics Laws Restricting Campaign Contributions, Gave Illegally To Mitch O’Farrell and Marqueece Harris-Dawson In 2015, Lied About It On Their Tax Form, And I Turned Them In To The IRS And The Ethics Commission

March 9, 2017 Mike Leave a comment

CCEA: The truth may be out there but it’s not out there on our tax forms.

This story begins with the fact that the Central City East Association, which runs the infamous Downtown Industrial District BID, contributed $700 each to two City Council candidate campaigns in 2015. The money was given to Mitch O’Farrell of CD13 and Marqueece Harris-Dawson of CD8. You can see the record at the City Ethics Commission and also if it’s more convenient, here is a PDF of the same information.

This turns out to be a huge problem for a number of unrelated reasons. First and most simply, the CCEA is a nonprofit 501(c)(6) organization. Unlike the more famous 501(c)(3) organizations, 501(c)(6) groups are allowed to engage in lobbying, but it’s unclear whether they’re allowed to support candidates for office.¹ However, irrespective of any restrictions on donations, there are very clear reporting requirements.

Take a look at the CCEA’s 2015 tax form. In particular, take a look at question 3 of part IV, found on page 3 of the form. It asks unambiguously:

Did the organization engage in direct or indirect political campaign activities on behalf of or in opposition to candidates for public office?

And, as you can see in the image that appears somewhere near this paragraph, the CCEA unambiguously stated that they did not. It’s hard to imagine a less ambiguous form of direct political campaign activities than giving actual money, amirite? Hence I turned them in to the IRS and also to the Franchise Tax Board for this lacuna. Stay tuned in case anything happens!

And it turns out that there are some more subtle, but potentially equally serious, problems with these two donations involving various municipal laws. Turn the page for the highly sordid but highly technical details!² Continue reading The Story Of How The Central City East Association Evidently Violated City Ethics Laws Restricting Campaign Contributions, Gave Illegally To Mitch O’Farrell and Marqueece Harris-Dawson In 2015, Lied About It On Their Tax Form, And I Turned Them In To The IRS And The Ethics Commission →

Hollywood Property Owners Alliance

Central Hollywood Coalition Cleared by Franchise Tax Board of All Fiscal Wrongdoing, Tax Exempt Status Reinstated After Months of Struggle, and it Wasn’t an Audit After All!!

April 9, 2016 Mike Leave a comment

Proof that the SVBID is all good once again with the Franchise Tax Board.

Yesterday the gracious-seemingly-in-spite-of-herself Kerry Morrison sent me a bunch of documents pertaining to the months-long struggle between the HPOA and the Franchise Tax Board over the tax-exempt status of the Central Hollywood Coalition, the shell corporation which exists, seemingly, mostly to hire the HPOA to manage the Sunset & Vine BID. And there are two salient points. First, everything is finally all settled and the CHC is good to go on wreaking havoc in its little corner of Hollywood without having to pay any of those pesky taxes. Second, as Kerry informed me in the email missive that accompanied the documents, “Please also note this that was not an audit – even though I mistakenly used this label at the board meeting where you were present.”

Hollywood Property Owners Alliance

Central Hollywood Coalition’s Tax-Exempt Status Under Audit by Franchise Tax Board; Kerry Morrison Stamps Little Foot, Shakes Little Fist, Loudly Exclaims “NO FAIR!!”

February 14, 2016 kohlhaas Leave a comment

Kerry Morrison at the February 9, 2015 meeting of the Central Hollywood Coalition's Board of Directors, in the midst of a characteristically inarticulate expression of disgust with government bureaucracy and the general unfairness of it all. — Kerry Morrison at the February 9, 2015 meeting of the Central Hollywood Coalition’s Board of Directors, in the midst of a characteristically inarticulate expression of disgust with government bureaucracy and the general unfairness of it all.

Kerry Morrison, speaking at the February 9, 2016 meeting of the Central Hollywood Coalition’s Board of Directors, filled the boss-guys and boss-gals in on the California Franchise Tax Board’s like, TOTALLY UNFAIR, ongoing audit of the tax-exempt status of the CHC. The upshot seems to be that some guy a while ago forgot to pay some fee, and things escalated through no fault of Kerry’s, to the point where, because bureaucrats are dumb and mail letters to the wrong place, the FTB is auditing the CHC but a lot of records are missing because 12 years ago is a long time and how can they expect that we would still have them?!? There’s also a looming problem, unmentioned here by Kerry, in that the CHC, like all BID management companies, signed a pledge to the City of Los Angeles that they would “…notify the awarding authority [the Los Angeles City Clerk] within 30 calendar days after receiving notification that any governmental agency has initiated an investigation which may result in a finding that the contractor did not comply with any federal, state, or local law in the performance of the contract…” Kerry didn’t mention anything about this clause, and we don’t (yet) know whether the CHC is complying with it. Stay tuned for info on that.

Meanwhile, if you have five minutes to spare, watch and listen here for a master-class lesson in white privilege, zillionaire privilege, power-broker privilege, and generalized contempt for the mundane reality that most of us inhabit, all expressed with the liberal use of hand-waving, hair-flipping, eyebrow-waggling, and uvular ejective plosives. If you don’t have time, we understand. There’s a transcript after the break, and we’ll provide commentary on selected juicy bits as well.
Continue reading Central Hollywood Coalition’s Tax-Exempt Status Under Audit by Franchise Tax Board; Kerry Morrison Stamps Little Foot, Shakes Little Fist, Loudly Exclaims “NO FAIR!!” →