Alliance may lose tax-exempt status over political ads

Alliance may have violated tax law with commercials to stop Cape Wind
May lose tax exempt status, Mihos, two others paid for ad

Alliance President/CEO Audra Parker and Development Director Buffy Pennick standing on left with Baker during a Main Street Hyannis campaign stop this Fall.

The Boston Globe reports today that the anti-Cape Wind group the Alliance to Protect Nantucket Sound appears to have broken federal tax law by running and paying for $32,500 worth of radio commercials critical of Governor Deval Patrick in the final days of the governor's race last month.

Yarmouth resident Christy Mihos, a co-chairman of the Alliance, is named as one of three who gave $32,500 to run the ads.

When contacted today he said, "For years I have been fighting special interest, sweetheart deals for big money insiders at the Big Dig. Cape Wind and National Grid is no different."

While his answer does not answer why he paid for apparently illegal ads, Mr. Mihos, who owns two homes on Great Island in Yarmouth overlooking Lewis Bay and The Sound,  has never made any bones about his opposition to Cape Wind.

We’ve been very careful to live within the letter of the law as a 501(c)(3).’’ - Audra Parker.

This is ironic given the history of both Mr. Mihos and his nemesis Cape Wind President Jim Gordon. Both men are about the same age and grew up stocking the shelves of their father's small food markets. They each built large enterprises from scratch about decades of hard work.

Members of the Alliance are alleged to have said that its backers will keep suing until Cape Wind is forced to "throw in the towel".  Alliance backers include many Osterville area waterfront homeowners and members with direct ties to the oil or coal industry. Mr. Mihos even comments below saying, "We'll be at this for years to come," just in case anyone doubts what tactics the Alliance plans to use to stop America's first offshore energy project.

"We'll be at this for years for
  years to come
         - Christy Mihos. 

When contacted by the Globe Audra Parker, president of the Alliance, said the organization's radio ad did not violate the IRS tax code's prohibition on political activity by nonprofit groups because it did not specifically tell listeners to vote for or against a candidate. A reading of the law below contradicts that opinion.

IRS guidelines are available on the agency's website and clearly state:

"501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office." The Alliance is a 501 organization.

The guidelines also say that "even if a statement does not expressly tell an audience to vote for or against a specific candidate, an organization delivering the statement is at risk of violating the political campaign intervention prohibition if there is any message favoring or opposing a candidate."

Read the Globe story here. welcomes thoughtful comments and the varied opinions of our readers. We are in no way obligated to post or allow comments that our moderators deem inappropriate. We reserve the right to delete comments we perceive as profane, vulgar, threatening, offensive, racially-biased, homophobic, slanderous, hateful or just plain rude. Commenters may not attack or insult other commenters, readers or writers. Commenters who persist in posting inappropriate comments will be banned from commenting on