Charity pork a top dish at Capitol

In early 2005, state Rep. Ken Kennedy asked the state Department of Health and Environmental Control to send $18,000 to Vital Aging of Williamsburg County, a nonprofit that serves the elderly.

The day Vital Aging got its $18,000 check, the nonprofit donated $10,000 to a high school scholarship fund controlled by Kennedy's family.

At commencement exercises three weeks later, Kennedy's niece was awarded money from the scholarship fund.

Kennedy, D-Greeleyville, is far from alone when it comes to doling out grants and other state tax dollars to charities. Lawmakers at all levels of government have been doing this for years, often to score points with voters in their districts or advance their own political agendas.

But a Post and Courier examination of state grants and earmarks shows that some elected officials quietly pump money into charities with which they have close family or professional ties.

In a few cases, lawmakers requested money for charities they direct.

In other cases, lawmakers funnel money to charities with controversial programs, prompting some to question why state government is playing rainmaker to nonprofits in the first place.

Many of these requests are buried in the budget and involve relatively small sums of money.

"That allows them to fly under the radar," said John Crangle, director of Common Cause of South Carolina, a government watchdog group. "It seems like there's a custom where you're allowed to have a certain amount of slush money you can divvy in your district."

Special delivery

Last year, Rep. Gilda Cobb-Hunter, D-Orangeburg, asked DHEC to send $8,256 to CASA Family Systems, according to a letter dated June 8, 2006.

CASA Family Systems helps victims of domestic violence, and Cobb-Hunter is the organization's executive director. She receives a $73,000 salary from the group, federal tax records show.

In an interview, Cobb-Hunter said DHEC began giving the agency small sums in the late 1980s, years before she became a member of the General Assembly.

That practice continued after she became a lawmaker. She said that after Earl Hunter became DHEC commissioner in 2001, agency officials asked her to write a letter formally requesting the money. She's not sure why, "and I didn't give it a second thought. I just wrote the letter."

Is there anything wrong with a lawmaker asking a state agency to send money to an organization where she works? "I don't have any heartburn over that as long as the money is used for a legitimate purpose," Cobb-Hunter said.

In some cases, lawmakers ask agencies to send them checks made out to the nonprofits so they can hand deliver the money. Several lawmakers said this is simply good politics.

For instance, in one letter to DHEC last year, Rep. Joe Mahaffey, R-Spartanburg, asked the agency to send him a check for $24,000 made out to the Middle Tyger Community Center, a free clinic in a rural area Upstate. Mahaffey is on the nonprofit's board.

In an interview, Mahaffey said DHEC told him to explain his request for the money, "and they send it to me so I can deliver it. Earl Hunter (the DHEC chairman) knows about it all. It's all very worthwhile."

Mahaffey and several other lawmakers said these funding efforts were vital to keep some charities running.

In an e-mail to DHEC earlier this year, state Sen. Larry Martin, R-Pickens, asked the agency to send $20,000 to Pickens County Health Partners. The e-mail said the group needed the money, "to get them through the next year as they raise money to sustain the program into the future." The organization promotes wellness programs that discourage teen drinking, smoking and other negative lifestyle choices.

In an interview, Martin said one of the charity's grants had run out and its leaders needed money to buy time before other grant money came through. He said he knew and respected the people involved in the group. "We're talking about $20,000, and we would get a pretty good return on our investment," by keeping it afloat, he said, adding that some state agencies spend that much just to print a brochure. He said nonprofits and agencies are constantly asking for money, and it's his role as a legislator to help them get as much money as he can.

Lack of accountability

Politicians have long steered money to nonprofits and other groups that supported their political agendas, even when some of these groups have controversial programs.

That happened here recently when a Charleston County Council member proposed giving $1,000 to a group that favors drug law reforms. Less than two weeks ago, council members divvied up $203,500 to about 40 nonprofits and other groups.

On the federal level, recent scandals about congressional earmarks also have triggered cries for reform. Groups such as Citizens Against Government Waste have railed for years about earmarks — special spending measures that lawmakers slip into legislation — and nonprofits that rely on government money.

Two years ago, Gov. Mark Sanford told agencies under his umbrella to stop doling out money to charities through earmarks and other budget machinations. Now, agencies under his control are required to go through a competitive grant process. But the governor said even that system is being abused.

"In a general sense," said Joel Sawyer, the governor's spokesman, we think the way (competitive grant program is) has the appearance of a slush fund for legislators who want to fund pet projects without going through the legislative process."

While some grants are relatively small, such as the $10,000 boost to the Belton Tennis Association to resurface tennis courts, a few nonprofits have grown dramatically by dining on government pork.

In 1995, for instance, Heritage Community Services, a group that teaches abstinence in schools, worked out of a small office at the old Charleston Navy base and had a budget of about $50,000. In 1999, George W. Bush visited one of Heritage's workshops during his first presidential campaign stop in South Carolina. The group remains well-connected, with Cyndi Mosteller, sister of Sen. Chip Campsen, R-Charleston, sitting on the group's board. Over the years, Charleston-area lawmakers, such as state House Speaker Bobby Harrell and state Sen. Larry Grooms, R-Bonneau, have sponsored grant applications for the group.

In all, during the past decade, Heritage received more than $8 million in state and federal money. This year, the state's budget included $1.4 million for Heritage Community Services. In its most recent tax filing, the group said its annual revenues exceeded $3 million. All but $50,806 came from government sources.

The charity nabbed these state dollars even as local and national educators questioned the group's materials and programs. A federally funded study by Mathematica Policy Research, Inc. recently found that a component of Heritage's program had "no impact on sexual abstinence, sexual activity, or most other risk behaviors examined."

'Best intentions'

The Vital Aging of Williamsburg County case is an intriguing example of how state agencies and nonprofits can be used as funnels.

Vital Aging operates three centers for seniors in Kingstree, Greeleyville and Hemingway, and Kennedy has been one of its staunchest supporters. In several interviews, he said he's obtained hundreds of thousands of dollars in state money for the agency over the years. One center is named after the Kennedy family.

Kennedy said he asked DHEC in early 2005 to send him a check for $18,000 made out to Vital Aging. He said a Vital Aging board member asked if their group could make a donation to him, and he told them to send it to the family scholarship fund. He said he was flattered with the agency's contribution and saw nothing unusual in a group that helps senior citizens contributing to a high school scholarship fund.

In an interview earlier this year, Tom Mahoney, Vital Aging's former financial officer, said that the same day the agency deposited the $18,000 check from DHEC, the group's executive director at the time, Judy Elder, told him to cut a $10,000 check for the Kennedy family scholarship fund.

(Last week, a grand jury indicted Elder on a charge that she embezzled more than $1,000 from a federal foster grandparent program. The indictment does not involve the DHEC money.)

"Judy Elder had informed me long before we got the check that Ken Kennedy would be getting some money because of a favor he had done for someone else, and that he wanted to deposit money in our account, but he would get half and we would get half," Mahoney told the newspaper.

Kennedy's niece received an award from the scholarship a month later at CE Murray's commencement exercises, school records show. Kennedy said his niece received between $500 and $1,000.

He said that he wasn't involved in the decision to award the scholarship, and that as soon as DHEC made its contribution to Vital Aging, he told school officials that his family would turn over control of the fund to the school. "The money my niece got was money my family had put in" before the $10,000 Vital Aging donation, he said.

School officials said they first learned about Vital Aging's $10,000 donation to the scholarship fund at least a month after Kennedy's niece received the award. The school now controls the fund, according to school records obtained under the state Freedom of Information Act.

"If you're trying to find out if a member of my family got a piece of that $10,000, that didn't happen," Kennedy said. "Everything was done with the best of intentions."

Reach Tony Bartelme at 937-5554 or tbartelme@postandcourier.com. Reach Yvonne Wenger at 803 799-9051 or ywenger@postandcourier.com.